Deichmann v. Boeing Co.

• Decision Date: 03 March 1999
• Docket Number: No. 4:97CV1913-SNL.,4:97CV1913-SNL.
• Citation: 36 F.Supp.2d 1166
• Parties: Ronald S. DEICHMANN and Usher's Waterworks, Inc., Plaintiffs, v. The BOEING COMPANY, Defendant.
• Court: U.S. District Court — Eastern District of Missouri

36 F.Supp.2d 1166

Ronald S. DEICHMANN and Usher's Waterworks, Inc., Plaintiffs, v. The BOEING COMPANY, Defendant.

No. 4:97CV1913-SNL.

United States District Court, E.D. Missouri, Eastern Division.

March 3, 1999.

Henry W. Cummings, Henry W. Cummings, St. Charles, MO, for plaintiffs.

Robert G. Lancaster, Associate, David A. Roodman, Associate, Daniel A. Crowe, Associate, Bryan Cave L.L.P., St. Louis, MO, for defendant.

MEMORANDUM AND ORDER

LIMBAUGH, District Judge.

This matter is before the Court on Defendant Boeing's Motion for Summary Judgment (# 81) filed February 10, 1999, as part of a Motion Package pursuant to Local Rule 4.05. This Court previously dismissed Counts II and IV of plaintiffs' Third Amended Complaint for failure to state a claim upon which relief could be granted. This motion seeks summary judgment on the remaining Counts I and III. Count I claims breach of an express contract. Count III states a federal statutory claim for correction of inventorship.

Summary Judgment Standard

Courts have repeatedly recognized that summary judgment, like dismissal, is a harsh remedy that should be granted only when the moving party has established his right to judgment with such clarity as not to give rise to controversy. New England Mut. Life Ins. Co. v. Null, 554 F.2d 896, 901 (8th Cir.1977). Summary judgment motions "can be a tool of great utility in removing factually insubstantial cases from crowded dockets, freeing courts' trial time for those that really do raise genuine issues of material fact." Mt. Pleasant v. Assoc. Elec. Coop., Inc., 838 F.2d 268, 273 (8th Cir.1988). But there must be absolutely "no genuine issue as to a material fact and the moving party [must be] entitled to judgment as a matter of law." Poller v. Columbia Broadcasting Sys., Inc., 368 U.S. 464, 467, 82 S.Ct. 486, 488, 7 L.Ed.2d 458 (1962).

The burden is on the moving party. Mt. Pleasant, 838 F.2d at 273. After the moving party discharges this burden, the nonmoving party must do more than show that there is some doubt as to the facts. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 1355-56, 89 L.Ed.2d 538 (1986). Instead, the nonmoving party bears the burden of setting forth specific facts showing that there is sufficient evidence in its favor to allow a jury to return a verdict for it. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 2510-11, 91 L.Ed.2d 202 (1986); Celotex Corp. v. Catrett, 477 U.S. 317, 324, 106 S.Ct. 2548, 2553, 91 L.Ed.2d 265 (1986).

In passing on a motion for summary judgment, the court must review the facts in a light most favorable to the party opposing the motion and give that party the benefit of any inferences that logically can be drawn from those facts. Buller v. Buechler, 706 F.2d 844, 846 (8th Cir.1983). The court is required to resolve all conflicts of evidence in favor of the nonmoving party. Robert Johnson Grain Co. v. Chem. Interchange Co., 541 F.2d 207, 210 (8th Cir.1976). With these principles in mind, the Court will now turn to the facts.

Undisputed Facts

As an initial matter, the Court deems admitted all the facts as outlined by defendant. Local Rule 4.01(E) states that the following:

Every memorandum in opposition shall include a statement of material facts as to which the party contends a genuine issue exists. Those matters in dispute shall be set forth with specific references to portions of the record, where available, upon which the opposing party relies. The opposing party also shall note for all disputed facts the paragraph number from movant's listing of facts. All matters set forth in the statement of the movant shall be deemed admitted for purposes of summary judgment unless specifically controverted by the opposing party.

Plaintiffs failed to identify the paragraph numbers from defendant's statement of The Uncontroverted Facts for any issues which they contend are in dispute. Rather, plaintiffs identify certain facts which they believe a jury could find which would result, they argue, in a verdict in their favor. However, "[a] district court is not required to speculate on which portion of the record the nonmoving party relies, nor is it obligated to wade through and search the entire record for some specific facts that might support the nonmoving party's claim." Barge v. Anheuser-Busch, Inc., 87 F.3d 256, 260 (8th Cir. 1996) (quoting White v. McDonnell Douglas Corp., 904 F.2d 456, 458 (8th Cir.1990)). Once defendant met its burden of demonstrating a lack of genuine issues of material fact, plaintiffs were required to designate specific facts creating a triable controversy. Plaintiffs' mere allegations that issues remain in dispute are insufficient to meet the requirements of Local Rule 4.01(E), and they are deemed to have admitted all facts which were not specifically controverted. See Ruby v. Springfield R-12 Pub. Sch. Dist., 76 F.3d 909, 911 n. 6 (8th Cir.1996). The Court will now outline the facts identified by defendant.

Since 1973, McDonnell Douglas Corporation (MDC)¹ has designed, manufactured and used Automated Ultrasonic Scanning Systems (AUSS) to non-destructively inspect airplane parts for structural flaws. Defense Exhibit 1. While this originally required submerging the entire part in a tank of water, the current state of the art involves emitting an ultrasonic wave through a stream of water which can be moved slowly over the surface of the part being tested. See Defense Exhibit 13, United States Patent 5,431,342 (the '342 patent). Prior to 1989, MDC used ordinary nozzles to produce the necessary stream of water. However, MDC found that a stream of water emitted from an ordinary nozzle quickly becomes non-laminar or diffused. Id. As a result, it was necessary to keep the testing device very close to the part being tested. Id. This posed difficulty in the testing of oddly-shaped parts. Id. For that reason MDC began contemplating the use of nozzles capable of producing a more laminar or coherent flow.

Sometime prior to 1989, designers of ornamental fountains began using laminar flow nozzles in their displays. On July 2, 1987, California fountain designer Mark Fuller applied for a patent on a laminar flow nozzle. Defense Exhibit 8, United States Patent 4,795,092 (the Fuller patent). That patent application described a nozzle utilizing a "cylindrical enclosure ... having ... a substantially sharp edge [outlet] orifice," and a "turbulence reducing means compris[ing] an open cell foam member...." Id.² On January 3, 1989, that patent numbered 4,795,092 issued. Id.

In July, 1989, MDC's AUSS engineers learned that plaintiff Usher's Waterworks, Inc. (Usher's), a St. Louis area fountain design firm, used laminar flow nozzles for ornamental fountains. Rich Lawson of MDC contacted Usher's to determine whether or not technology in the fountain nozzles would be adaptable for ultrasonic testing systems. Prior to this contact, no one connected with Usher's had any experience with ultrasonic testing applications or the use of laminar nozzles in such applications. Deichmann Deposition p. 69 ln. 16; Kuykendal Deposition pp. 127-28.

David Usher, who worked for Usher's at that time, claimed that they in fact possessed the technology to produce a long and extremely coherent stream of water. Usher Deposition p. 49 ln. 20. Plaintiffs agreed to demonstrate this technology for MDC representatives immediately. Id. at lns. 23-24. However, prior to this demonstration, plaintiffs insisted that MDC enter a non-disclosure agreement (the Non-Disclosure Agreement) to protect plaintiffs' assertedly confidential information. Defense Exhibit 3. The agreement defined confidential information as "all information both written, oral, and as represented by viewing the external and internal mechanisms of the nozzle(s), which [Usher's] deem[s] to be confidential and proprietary, relating to the coherent flow nozzle (including, but not limited to mechanical operation, data, know-how, technical and non-technical materials, parts, and specifications"). Id. The agreement required MDC to maintain such information in confidence and prevented MDC from engaging in any communication with any third parties regarding the information for five years. Id.

Representatives of both MDC and Usher's signed the Non-Disclosure Agreement, and Usher's demonstrated a laminar flow nozzle at their Fenton facility. Deichmann Deposition p. 137 ln. 16 — p. 139 ln. 18. Apparently MDC was impressed enough with plaintiffs' nozzle that it ordered production by plaintiffs of a prototype coherent flow ultrasonic nozzle. Defense Exhibit 9. In exchange for the prototype nozzle, MDC agreed to pay Usher's $18,500.00. Id.

In March or April, 1990, plaintiffs advised MDC that they had completed a prototype nozzle which was available for demonstration at MDC's facility. Unfortunately, MDC was unhappy with the results achieved at the testing of the prototype. Lawson Deposition p. 34 ln. 12. The prototype nozzle that plaintiffs brought to MDC for testing apparently produced a laminar stream without MDC's additional requirements applied. Lawson Deposition p. 37 lns. 8-9. However, when the transducer was installed and the device placed in motion, the results were not satisfactory. Lawson Deposition p. 35 lns. 6-7; Usher Deposition p. 137 lns. 10-19. MDC informed plaintiffs the prototype nozzle yielded unusable data. Deichmann Deposition p. 157 lns. 21-22; p. 159 24. When Usher's personnel left MDC that day, they took the prototype nozzle with them. Deichmann Deposition p. 160 ln. 9. As Usher's had never provided any drawings, blueprints or schematics, this effectively ended the working relationship between Usher's and MDC. Deichmann Deposition p. 161 lns. 2-8.

MDC's development of laminar flow nozzle technology for application in ultrasonic testing did not end with the failure of plaintiffs' prototype. In March of 1991, Rich Lawson contacted another MDC engineer, Kondala...