Crosfield Hastech, Inc. v. Harris Corp.

• Decision Date: 10 November 1987
• Docket Number: Civ. No. 87-90-D.
• Citation: 672 F. Supp. 580
• Parties: CROSFIELD HASTECH, INC. v. HARRIS CORPORATION, Randolph W. Duerr.
• Court: U.S. District Court — District of New Hampshire

672 F. Supp. 580

CROSFIELD HASTECH, INC. v. HARRIS CORPORATION, Randolph W. Duerr.

Civ. No. 87-90-D.

United States District Court, D. New Hampshire.

November 10, 1987.

COPYRIGHT MATERIAL OMITTED

Michael Lenehan, Concord, N.H., and Lawrence F. Scinto, New York City, for plaintiff.

George R. Moore and Matthias J. Reynolds, Manchester, N.H., for defendants.

ORDER

DEVINE, Chief Judge.

By way of a seven-count amended complaint, plaintiff Crosfield Hastech, Inc. ("CHI"), a designer, developer, manufacturer, and marketer of computer hardware and software for the newspaper publishing industry, brings this action against a former employee, Randolph W. Duerr ("Duerr"), and Harris Corporation ("Harris"), Duerr's current employer and CHI's business competitor. Suit is brought for copyright infringement (Counts I and II), misappropriation and theft of trade secrets and unfair competition (Count III), breach of contractual and fiduciary obligations (Counts IV and V), inducing breach of such obligations and tortious interference with an employer/employee relationship (Count VI), and a declaratory judgment (Count VII).¹ CHI seeks, inter alia, injunctive relief, future inspection privileges of Harris's facilities under Court supervision to insure compliance with said injunctive relief, statutory damages, actual and enhanced compensatory damages, costs, attorneys' fees, and a declaratory judgment as to the invalidity and noninfringement of a Harris patent which Harris charges CHI with infringing.

At bar are nine motions.

In six motions, Harris and Duerr each move for: (1) dismissal of the original and the amended complaints and of subsequent document requests on the basis that the Court lacks personal jurisdiction "Jurisdiction Motions" (document nos. 14 and 17, respectively); (2) transfer of the action to the Middle District of Florida pursuant to federal venue provisions found at 28 U.S.C. § 1400(a) relating specifically to copyright actions "Copyright Venue Motions" (document nos. 16 and 19, respectively); and (3) transfer of the action to the Middle District of Florida based on the change of venue provisions found at 28 U.S.C. § 1404(a) and the doctrine of forum non conveniens ("Forum Motions") (document nos. 15 and 18, respectively). Attached to each of these motions are duplicate copies of two affidavits: one by Dale A. Normington, Harris's Senior Counsel, Litigation and Products Liability "Normington Affidavit"; the other by Duerr "Duerr Affidavit".

CHI objects separately to each motion, supporting its objections with one legal memorandum, Plaintiff's Combined Memorandum in Opposition to Defendants' Motions to Dismiss and to Transfer "Plaintiff's Combined Memo". In conjunction with its Combined Memo, CHI has submitted the affidavit of R. Bruce Wilson, Vice-President of CHI "Wilson Affidavit".

Harris and Duerr also jointly present the Court with three nonjurisdictional motions. First, they move the Court to strike the Wilson Affidavit or, alternatively, to order CHI to produce better documentation in support of Mr. Wilson's attestations "Motion to Strike" (document no. 28). Second, they move for permission to file a response memorandum to Plaintiff's Combined Memo, to be filed within ten days of either an adverse ruling on their Motion to Strike or CHI's submission of further documentation to support the Wilson Affidavit "Motion to File Response Memorandum" (document no. 29). And third, they move for the Court to order production of (1) Duerr's employment contract with CHI,² and (2) specific information as to which corporate entities within CHI's parent and subsidiary corporate structure have been damaged, and to what degree, by the events herein at issue "Production Motion" (document no. 32).

Factual Background

As stated previously, CHI is in the business of designing, developing, manufacturing, and marketing computer hardware and software for the newspaper publishing industry. CHI's principal place of business is located in Manchester, New Hampshire. Amended Complaint ¶ 1.

As part of its sales efforts, CHI manufactures and markets a computer publishing system called "PagePro", which consists of computer hardware, software, and related documentation such as the system's operating manual. CHI has allegedly achieved substantial sales of this system since its market introduction in 1981, and alleges that much of the company's success is due to the capability of PagePro to satisfy customer needs concerning the automatic pagination of advertisements and news. Id. ¶¶ 15-16. The PagePro software is integral to the PagePro system and was developed by CHI through the expenditure of "substantial time, effort, and expense." Id. ¶ 16.

CHI employed Duerr from April 1972 to March 1982. During this ten-year period, Duerr held the positions of Programmer Analyst and Senior Member of the Technical Staff; beginning in 1977 and until he resigned, he was the lead programmer for the project under which PagePro was developed. As lead programmer, Duerr had "principal" responsibility for designing and developing the PagePro software and allegedly had personal knowledge of or access to confidential and proprietary information relating to the software's design and implementation. Id. ¶ 17.

In connection with his employment, Duerr entered into proprietary information agreements with CHI. These agreements, entitled "Patent, Copyright, Disclosure and Conflict of Interest Agreements" "Agreements", provide in parts pertinent to this litigation that Duerr assigned to CHI all his interests and rights in discoveries made during the course of his employment, within the scope of CHI's business, or stemming from work undertaken on company behalf, and that Duerr

would not during his employment with CHI or thereafter at any time disclose to others or use for his own benefit any Company Private data, i.e. trade secrets or confidential information, pertaining to any of the businesses of CHI or any of its customers, representatives, agents, consultants, licensees, or affiliates, acquired by him during the period of his employment, except to such an extent as may be necessary in the ordinary course of performing his particular duties....

Id. ¶ 18.

In March 1982 Duerr resigned from his position at CHI and began employment with Harris, a company roughly one hundred times the size of CHI with thirty-six plants, approximately 325 offices in the United States, Canada, Europe, Latin America, and Asia, more than 26,000 employees, and 1986 revenues of approximately $2.2 billion. Combined Memo at 6; Wilson Affidavit ¶ 12; see also Combined Memo Exhibit B at 2 (1986 Harris Corporation SEC Form 10-K Annual Report). Approximately two years later, the Harris Information Systems group — the National Accounts Division of which is allegedly located in Nashua, New Hampshire, and Dallas, Texas, Wilson Affidavit ¶ 13 — began manufacturing and marketing a computer publishing system competitive to PagePro, called the "Harris 8300" system ("8300").

CHI alleges that Duerr was responsible for the design and implementation of the 8300 software and operating manuals and that his work on the 8300 improperly relied upon, utilized, and in large part copied confidential and proprietry information relating to PagePro. See, e.g., Amended Complaint ¶¶ 19, 26-27, 32-33. CHI further alleges that since Harris began shipping 8300 systems in 1984 the company has sold a substantial number of systems, id. ¶ 20, and that Harris's continued utilization of Duerr's knowledge of CHI's confidential information threatens CHI's preeminence in the newspaper publishing computer market, id. ¶ 36. Finally, CHI alleges that Harris's headhunting of Duerr was not serendipitous; that Harris hired Duerr, fully aware that he was subject to noncompetition and nondisclosure agreements, in order to obtain access to the confidential information he possessed. Id. ¶¶ 54-56.

Duerr is currently employed by Harris at its main office and headquarters in Melbourne, Florida, as Principal Engineeer-Software Systems. Duerr Affidavit ¶ 1. Duerr avers that his employment with Harris does not require him to travel to New Hampshire, that he has only been in New Hampshire twice for a total of four days since he departed CHI's employ, both times for reasons unrelated to the matters herein at issue, and that having to travel to New Hampshire to appear in court would place a substantial burden upon him personally and in regard to duties engendered by his employment. Id. ¶¶ 7-9.

Discussion

The first six of defendants' nine motions go to the question of whether the Court may properly assert jurisdiction over this action. In connection with said motions, the Court faces three issues: (1) whether the Court may assert personal jurisdiction over the defendants, (2) whether venue is proper in this district, and (3) whether, if jurisdiction may be asserted and venue is proper in this district, the action should nonetheless be transferred to another district under the doctrine of forum non conveniens. The Court addresses these issues in the order given, as "the question of personal jurisdiction, which goes to the court's power to exercise control over the parties, is typically decided in advance of venue, which is primarily a matter of choosing a convenient forum." Leroy v. Great W. United Corp., 443 U.S. 173, 180, 99 S.Ct. 2710, 2715, 61 L.Ed.2d 464 (1979) (citing C. Wright, A. Miller & E. Cooper, 15 Federal Practice and Procedure ¶ 3801, at 5-6 (1976)).

"When a court's personal jurisdiction over a defendant is contested, the plaintiff has the burden of showing that jurisdiction exists." Ealing Corp. v. Harrods, Ltd., 790 F.2d 978, 979 (1st Cir.1986) (citing McNutt v. GMAC, 298 U.S. 178, 189, 56 S.Ct. 780, 785, 80 L.Ed. 1135 (1936)). To meet this burden and thus avoid dismissal on jurisdictional grounds, a plaintiff need make only "a prima facie showing of jurisdiction supported by specific facts alleged in the...