Beech Aircraft Corp. v. EDO CORP.

• Citation: 777 F. Supp. 884
• Decision Date: 01 November 1991
• Docket Number: Civ. A. No. 90-4185-S,91-4038-S.
• Parties: BEECH AIRCRAFT CORPORATION and Paul Jonas, Plaintiffs, v. EDO CORPORATION, Defendant. BEECH AIRCRAFT CORPORATION and Paul Jonas, Plaintiffs, v. EDO CORPORATION and Harry Manbeck, Commissioner of Patent and Trademarks, Defendants.
• Court: United States District Courts. 10th Circuit. United States District Courts. 10th Circuit. District of Kansas

777 F. Supp. 884

BEECH AIRCRAFT CORPORATION and Paul Jonas, Plaintiffs, v. EDO CORPORATION, Defendant.

BEECH AIRCRAFT CORPORATION and Paul Jonas, Plaintiffs, v. EDO CORPORATION and Harry Manbeck, Commissioner of Patent and Trademarks, Defendants.

Civ. A. Nos. 90-4185-S, 91-4038-S.

United States District Court, D. Kansas.

November 1, 1991.

Paul B. Swartz, Jeffrey L. Kennedy, Martin, Pringle, Oliver, Wallace & Swartz, Wichita, Kan., for plaintiffs.

Richard D. Greene, Morris, Laing, Evans, Brock & Kennedy, Chtd., Wichita, Kan., Marvin Genzer, College Point, N.Y., for defendant EDO Corp.

MEMORANDUM AND ORDER

SAFFELS, District Judge.

This case is before the court on cross-motions for summary judgment. Beech Aircraft Corporation ("Beech"), EDO Corporation ("EDO"), and the Commissioner of Patent and Trademarks each filed motions for partial summary judgment in Case No. 91-4038-S (Docs. 14, 17, 25). This case was originally filed in the United States District Court for the District of Columbia, but has since been transferred to this court. In their four-count complaint in that case, plaintiffs seek: (1) judicial review under 35 U.S.C. § 146 of an adverse decision rendered by the Board of Patent Appeals and Interferences in Interference No. 102,086 (Count I); (2) relief under 35 U.S.C. § 291 alleging that a patent applied for by, and a patent issued to, the assignor ("Abildskov") of EDO interferes with a patent issued to plaintiff Paul J. Jonas ("Jonas") and assigned to plaintiff Beech (Count II); (3) relief under 35 U.S.C. § 256, alleging that Jonas is the inventor or co-inventor of the invention claimed in the patent owned by EDO (Count III); and (4) assignment to Beech of the EDO patent pursuant to this court's previous ruling in Case No. 85-2204-S (Count IV).

Shortly after Beech filed suit in the United States District Court for the District of Columbia, it also filed in the District of Kansas, Case No. 90-4185-S, on substantially the same claims. These cases are now both before the court. Both Beech and EDO have filed motions for summary judgment on the claim for assignment to Beech of the EDO patent. This is Count I in Case No. 90-4185-S, and Count IV in Case No. 91-4038-S. Pursuant to a scheduling order filed June 20, 1991, this court will first address these latter motions based upon the requested assignment of the EDO patent, recognizing that this court's resolution on these motions may be dispositive of all remaining issues.

To the extent that the Commissioner's and EDO's respective requests for oral argument on their motions are still outstanding (having been filed in the District of Columbia originally), the court finds that oral argument will not be of material assistance to the court in its resolution of matters raised in the parties' motions, and thus, the request for oral argument will be denied. D.Kan. 206(d).

A moving party is entitled to summary judgment only when the evidence indicates that no genuine issue of material fact exists. Fed.R.Civ.P. 56(c); Maughan v. SW Servicing, Inc., 758 F.2d 1381, 1387 (10th Cir.1985). The requirement of a "genuine" issue of fact means that the evidence is such that a reasonable jury could return a verdict for the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). The moving party has the burden of showing the absence of a genuine issue of material fact. This burden "may be discharged by `showing' — that is, pointing out to the district court — that there is an absence of evidence to support the nonmoving party's case." Celotex Corp. v. Catrett, 477 U.S. 317, 325, 106 S.Ct. 2548, 2554, 91 L.Ed.2d 265 (1986). "A party opposing a properly supported motion for summary judgment may not rest on mere allegations or denials of his pleading, but must set forth specific facts showing that there is a genuine issue for trial." Anderson, 477 U.S. at 256, 106 S.Ct. at 2514. Thus, the mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment. Id. The court must consider factual inferences tending to show triable issues in the light most favorable to the existence of those issues. United States v. O'Block, 788 F.2d 1433, 1435 (10th Cir.1986). The court must also consider the record in the light most favorable to the party opposing the motion. Bee v. Greaves, 744 F.2d 1387, 1396 (10th Cir.1984), cert. denied, 469 U.S. 1214, 105 S.Ct. 1187, 84 L.Ed.2d 334 (1985).

FACTS

These parties were previously before this court for trial in case No. 85-2204-S, where the court made numerous findings of fact. EDO Corp. v. Beech Aircraft Corp., 715 F.Supp. 990 (D.Kan.1988). The pertinent facts are set forth below.

4. Beginning in September, 1982, Beech and EDO entered into a series of research and development contracts related to a new composite aircraft, the Starship. Beech chose EDO's Fiber Science Division as a subcontractor on the Starship research and development program because of FSD's experience with composite filament winding. Composite filament winding is a state of the art process for constructing non-metal aircraft. FSD was to design and construct the main wing for the Starship.

5. The first contract between FSD and Beech provided that FSD would conduct a design study for the wing structure and propose a design to Beech. The parties entered into this first contract in late 1982. The second, third and fourth contracts provided for further design, development and construction of the Starship wing.

....

8. The first contract between EDO and Beech also provided that all patent and inventive rights arising from the contract would become the property of Beech, except that `procedures, designs, processes and concepts which were unique to FSD and which were developed prior to this subcontract that FSD has documentation for shall be exempt. FSD will so indicate in the final report to Beech the procedures, designs, processes and concepts that are exempt.'

9. The second, third, and fourth contracts contained similar language to that stated above, except that FSD was not required to set out the exempt procedures, designs, processes and concepts in writing.

....

11. After the December 1982 contract, FSD developed its design concept for the Starship main wing and presented the design study to Beech in April 1983. That study included a proposal that an `H' section concept be employed to attach spars to the wing skins. 715 F.Supp. at 991-93.

The court found that subsequent to the receipt of the design study, Beech officials met and decided to order a restructuring of the Starship program based upon some concerns regarding the method by which the main wing was to be built. Beech then notified EDO it was terminating their contracts. This court further found that "Beech subsequently applied for and received a patent on the `H' joint technology. This concept is now being employed in the Starship." 715 F.Supp. at 993.

EDO's assignor filed a patent application, Serial No. 687,956, on December 31, 1984. The Jonas patent, No. 4,671,470, was issued June 9, 1987, and was based upon a patent application filed July 15, 1985. During the pendency of the previous case, on March 24, 1988, EDO's assignor filed a document entitled "Amendment for Purposes of Provoking an Interference", in which new claims Nos. 23 and 24 were added to the EDO parent patent application originally filed on December 31, 1984. New Claim No. 23 corresponded word-forword with Claim No. 7 in the Beech patent. New Claim No. 24 corresponded word-forword with Claim No. 10 of the Beech patent. (Hanes Affidavit, Exhibit "A," Paragraph 8).

Interference No. 102,086 was declared by the Patent and Trademark Office ("PTO") on March 8, 1989. The interference was subsequently "redeclared" with the final result designating the respective claims of the parties to correspond to the counts as follows:

                  Count      Jonas' claims      Abildskov claims
                    1              7                    9
                                                       13
                                                       23
                    2             10/7                 15
                                                       18
                                                       19
                                                       20
                                                       24
                

Judgment was finally entered against Jonas determining he was not entitled to a patent containing claims 7 and 10/7 of his application involved in the interference.¹ As a result of the PTO decision regarding the interference, the current lawsuits were filed.

Simply stated, Beech claims it is the owner of the technology in its patent and seeks an assignment of the EDO patent. EDO contends it is entitled to summary judgment on any one of three independent grounds. First, EDO argues the doctrine of res judicata prohibits Beech from seeking assignment of EDO's patent, since this court previously denied the request for assignment in EDO Corp. v. Beech Aircraft Corp., 755 F.Supp. 985 (D.Kan.1991). It further argues that, even if res judicata does not bar this court from considering Beech's claim for assignment, Beech should have brought its claim in case No. 85-2204-S, EDO Corp. v. Beech Aircraft Corp., 715 F.Supp. 990, as a compulsory counterclaim. Finally, EDO argues Beech is now barred by the statute of limitations from litigating its claim for assignment. EDO contends the statute began to run in 1984 when Beech became aware that EDO was claiming the rights to the technology in question and attempting to patent the invention.

PREVIOUS LITIGATION

Issues related to the current litigation have previously been before this court in two connected cases involving the same parties. In EDO Corp. v. Beech Aircraft Corp., 715 F.Supp. 990 (D.Kan.1988), the court made findings on the following claims after a trial to the court: (1) EDO's breach of contract claim based on Beech's alleged wrongful termination of the contracts...