Donahue v. Tokyo Electron Am., Inc.

• Decision Date: 27 August 2014
• Docket Number: Case No. A–14–CA–563–SS.
• Citation: 42 F.Supp.3d 829
• Parties: Timothy DONAHUE, Plaintiff, v. TOKYO ELECTRON AMERICA, INC. and Tokyo Electron U.S. Holdings, Inc., Defendants.
• Court: U.S. District Court — Western District of Texas

42 F.Supp.3d 829

Timothy DONAHUE, Plaintiff
v.
TOKYO ELECTRON AMERICA, INC. and Tokyo Electron U.S. Holdings, Inc., Defendants.

Case No. A–14–CA–563–SS.

United States District Court, W.D. Texas, Austin Division.

Signed Aug. 27, 2014.

42 F.Supp.3d 831

John F. Melton, Melton & Kumler, LLP, Austin, TX, for Plaintiff.

Daniel Anthony Verrett, Michael W. Fox, Ogletree Deakins Nash Smoak & Stewart, PC, Austin, TX, for Defendants.

ORDER

SAM SPARKS, District Judge.

BE IT REMEMBERED on this day the Court reviewed the file in the above-styled cause, and specifically Plaintiff Timothy Donahue's Motion to Remand [# 5], Defendants Tokyo Electron America, Inc. and Tokyo Electron U.S. Holdings, Inc.'s Response [# 6], Plaintiff Donahue's Reply [# 9], and Defendants' Sur–Reply [# 12]; Counter Defendant Donahue's Motion for Partial Summary Judgment [# 13]; Counter Defendant Donahue's Motion to Dismiss [# 14], and Counter Plaintiffs Tokyo Electron America, Inc. and Tokyo Electron U.S. Holdings, Inc.'s Response [# 17]; and Counter Plaintiffs Tokyo Electron America, Inc. and Tokyo Electron U.S. Holdings, Inc.'s Rule 56(d) Motion to Deny Counter Defendant Donahue's Motion for Partial Summary Judgment [# 15], and Counter Defendant Donahue's Response [# 16].¹ Having considered the documents,

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the file as a whole, and the governing law, the Court enters the following opinion and orders GRANTING IN PART and DENYING IN PART the motion to remand, DENYING the motion for partial summary judgment, and DENYING the motion to dismiss.

Background

Plaintiff Timothy Donahue worked as a Media Producer for Defendant Tokyo Electron America, Inc. (Tokyo Electron) for seventeen years helping the company make videos and advertisements. In June 2013, Tokyo Electron fired Donahue. Donahue believes he was fired due to his age. Tokyo Electron denies the firing had anything to do with age and rather contends it was due to performance. Tokyo Electron claims to have placed Donahue on a Performance Improvement Plan (PIP) in April 2013, and when his work did not improve during the PIP period, Tokyo Electron elected to terminate his employment.

Based on this series of events, Donahue filed an age discrimination claim with the Texas Work Force Commission and the Equal Employment Opportunity Commission. Ultimately, after receipt of a right-to-sue letter, Donahue filed a lawsuit in Texas state court against Defendants Tokyo Electron America, Inc. and Tokyo Electron U.S. Holdings, Inc., asserting age discrimination under the Texas Labor Code, and claiming all individual officers of Tokyo Electron were liable for Donahue's damages under the Texas Tax Code. See Notice of Removal [# 1–2], Ex. 2 (Orig. Pet.), ¶¶ 5.1–.4. The lawsuit was served on Defendants on April 28, 2014. See id. [# 1], ¶ 1. All parties in this case are citizens of Texas for purposes of diversity jurisdiction. See Orig. Pet., ¶¶ 2.1–.3.

After Donahue's termination, another series of events unfolded, which ultimately formed the basis for counterclaims asserted by Defendants. Apparently, after Donahue left Tokyo Electron, he hosted certain videos he had made during his employment with Tokyo Electron on his personal website, which is accessible by the general public. On January 6, 2014, general counsel for Tokyo Electron sent Donahue a cease-and-desist letter, indicating the posting of these videos, which contained Tokyo Electron's confidential and proprietary information, was in violation of the Agreement for Confidential Information and Intellectual Property executed on September 9, 1996 (Confidentiality Agreement). See Mot. Remand [# 5–1], Ex. 1. Tokyo Electron further reminded Donahue he had signed the Employee Termination Certification (ETC) on June 3, 2013, making clear the confidentiality obligations were to be honored post-termination. Id. In addition, Tokyo Electron told Donahue that, under the ETC, Donahue certified he had returned, and no longer had in his possession, any of Tokyo Electron's confidential information, and the posting of the videos reflected a violation of this certification. Id. Finally, Tokyo Electron asserted Donahue's behavior violated its intellectual property rights and demanded Donahue remove the videos immediately. Id.

On January 21, 2014, Donahue's counsel responded via letter indicating, while there was disagreement as to the intellectual property rights asserted, he had removed the videos from his website. Donahue claims to have used the videos merely as a portfolio with which to obtain a new job. See id. [# 5–2], Ex. 2. On April 4, 2014,

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outside counsel for Tokyo Electron, John Melton, sent Donahue a letter regarding Donahue's potential age discrimination lawsuit. See id. [# 5–3], Ex. 3. Melton rejected this lawsuit as baseless, and also stated his understanding Donahue had been in contact with Tokyo Electron's general counsel in a separate series of communications regarding potential violations by Donahue of “trade secret, copyright infringement, and confidentiality obligations.” Id. Melton further stated if a lawsuit were filed by Donahue for age discrimination, a counterclaim would be filed against him for the alleged post-termination activity.Id.

After Defendants were served with Donahue's age discrimination lawsuit on April 28, 2014, they timely filed their Original Answer on May 16, 2014, and did not include any counterclaims. See Notice of Removal [# 1–2], Ex. 2 (Orig. Answer). On June 10, 2014, Tokyo Electron officially registered its copyrights in the videos at issue with the U.S. Copyright Office. See id. [# 1–1], Ex. 1 (Am. Answer and Countercls.), ¶ 18. On June 16, 2014, Defendants filed an Amended Answer and Counterclaims, in which Tokyo Electron asserted a copyright infringement and a breach of contract counterclaim premised on Donahue's alleged breach of the Confidentiality Agreement. Both Defendants asserted counterclaims for computer fraud under the Computer Fraud and Abuse Act (CFAA), breach-of-computer-security crimes under the Texas Civil Practice and Remedies Code (TCPR), and misappropriation under the Texas Uniform Trade Secrets Act (TUTSA). See id., ¶¶ 20–45. On this same day, Defendants filed their notice of removal, and removed the case to this Court. See id. [# 1] (Notice of Removal).

Three days later, Donahue filed a Motion to Remand [# 5], arguing the removal was untimely, and, in the alternative, the Court should not exercise supplemental jurisdiction over his age discrimination claim. In addition, Donahue has since filed a Motion for Partial Summary Judgment [# 13], contending Tokyo Electron has no evidence of damages concerning its copyright claim, and a Motion to Dismiss [# 14] the Defendants' CFAA claim under Rule 12(b)(6). Finally, Tokyo Electron has a filed Motion to Deny Donahue's Motion for Partial Summary Judgment [# 15] because the discovery period in this case has yet to begin.

Analysis

I. Motion to Remand

Defendants removed this action pursuant to 28 U.S.C. §§ 1441, 1446, and 1454. See Notice of Removal, at 1. Any ambiguities are construed against removal and in favor of remand to state court. Manguno v. Prudential Prop. & Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir.2002) (citing Acuna v. Brown & Root, Inc., 200 F.3d 335, 339 (5th Cir.2000) ). The party seeking to remove bears the burden of showing that federal jurisdiction exists and that removal was proper. Id. (citations omitted). Section 1441 provides, “[e]xcept as otherwise expressly provided by Act of Congress,” a defendant can remove to federal court any civil action brought in state court over which the district court would also have had original jurisdiction. 28 U.S.C. § 1441(a). Section 1441(a) does not directly provide the basis for removal in this case because this Court does not have original jurisdiction over Donahue's state law age discrimination claim, but it does so indirectly as Congress has indeed “otherwise expressly provided” via 28 U.S.C. § 1454. Section 1454 provides: “A civil action in which any party asserts a claim for relief arising under any Act of Congress relating to patents ... or copyrights may be removed to [federal court].”

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28 U.S.C. § 1454(a). Accordingly, Defendants' basis for removal is § 1454 because they asserted a counterclaim for copyright infringement.

Section 1454 was recently enacted in September 2011 as part of the Leahy–Smith America Invents Act (AIA). See Pub.L. No. 112–29, § 19(c)(1), 125 Stat. 332 (codified as 28 U.S.C. § 1454 ). While perhaps not the most glamorous component of the AIA, § 1454 certainly marks a clear change in removal procedure. Traditionally, a plaintiff could not get into federal court simply because an anticipated defense to the plaintiff's state law claim would raise a federal question.See Louisville & Nashville R.R. Co. v. Mottley, 211 U.S. 149, 153–54, 29 S.Ct. 42, 53 L.Ed. 126 (1908). Generally, federal question jurisdiction is present “only when the plaintiff's statement of his own cause of action shows that it is based upon [federal law].” Id....