Marley Co. v. Fe Petro Inc.
| Decision Date | 23 September 1998 |
| Docket Number | No. Civ. 3-97-70025.,Civ. 3-97-70025. |
| Citation | 38 F.Supp.2d 1070 |
| Parties | THE MARLEY COMPANY, Plaintiff, v. FE PETRO, INC. and Charles C. Franklin, Defendants. FE Petro, Inc., Plaintiff, v. The Marley Company, Defendant. |
| Court | U.S. District Court — Southern District of Iowa |
Thomas N. Kamp, Lane & Waterman, Davenport, IA, Neil B. Siegel, Robert M. Masters, Sughrue Mion Zinn MacPeak & Seas, Washington, DC, for Marley Company, plaintiff.
David J. Meloy, Stanley Lande & Hunter, Muscatine, IA, John C. Hendricks, Stanley Lande & Hunter, Davenport, IA, Timothy J. Vezeau, Martin T. Lefevour, Marshal O'Toole Gerstein, Murrary & Borun, Chicago, IL, for Fe Petro, Inc., Charles C. Franklin, defendants.
The Marley Company ("Marley") brings this action against Charles Franklin and FE Petro, Inc. ("FE Petro"),1 concerning submersible pump technology used in gasoline stations. Marley organizes its complaint into the following counts: (1) conversion by Franklin; (2) specific performance of technical employee agreements requiring assignment of patent rights from Franklin to Marley; (3) misappropriation of trade secrets by Franklin and FE Petro; (4) declaratory judgment for patent invalidity, unenforceability, and non-infringement; (5) unfair competition by Franklin and FE Petro; and (6) implied license under shop right. FE Petro originally filed its own action for patent infringement against Marley in the United States District Court for the Western District of Wisconsin. That case was transferred to this court and consolidated with the present case.2 Petro also filed an answer to Marley's complaint which contained the following counterclaims: (1) Lanham Act violation; (2) defamation of Franklin; (3) defamation of FE Petro; and (4) abuse of process. Petro moves for summary judgment on Marley's conversion, misappropriation, assignment, shop right, and unfair competition claims. Marley resists and moves for summary judgment on Petro's Lanham Act, defamation, and abuse of process claims. The motions are submitted.
Rule 56 of the Federal Rules of Civil Procedure provides that summary judgment
shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.
Fed.R.Civ.P. 56(c). To preclude the entry of summary judgment, the nonmovant must make a sufficient showing on every essential element of their case for which they have the burden of proof at trial. Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Continental Grain Co. v. Frank Seitzinger Storage, Inc., 837 F.2d 836, 838 (8th Cir. 1988). Rule 56(e) requires the nonmoving party to go beyond the pleadings and by affidavits, or by the depositions, answers to interrogatories, and admissions on file, designate "specific facts showing that there is a genuine issue for trial." Fed. R.Civ.P. 56(e); Celotex, 477 U.S. at 324, 106 S.Ct. 2548; Johnson v. Schopf, 669 F.Supp. 291, 295 (D.Minn.1987). The quantum of proof that the nonmoving party must produce is not precisely measurable, but it must be "enough evidence so that a reasonable jury could return a verdict for the nonmovant." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 257, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); Johnson, 669 F.Supp. at 295-96.
For the purposes of this motion, the following facts are undisputed. Franklin has worked in the petroleum pump business for over thirty years. Franklin spent a majority of this time working for Marley in a number of different capacities. Franklin progressed from working in Marley's engineering department, where he worked from 1967 until 1970, to Vice President of Sales and Marketing. While Vice President of Sales and Marketing at Marley, Franklin and his department would request the engineering department to consider certain design changes or new products, or to address certain problems uncovered in the field. In 1980, while Vice President of Sales and Marketing for Marley, Franklin requested the engineering department to consider performing a feasibility study into the concept of adjustable piping for the fuel pumps. Ronald E. Green, Marley's Manager of Engineering in 1980, approved Franklin's request for "Engineering Action" to determine the feasibility of providing four foot pumps with adjustable piping to fit tanks with various diameters and depths. In response to this request, the engineering department developed two technical drawings of the proposed piping dated February 15, 1980, one drawing dated May 7, 1980, and a working model of a telescoping pipe assembly.
The two technical drawings dated February 15, 1980, and the working model were created by Elmer Deters, a former engineer with Marley who was working as an independent consultant for the company in 1980. Deters and Marley entered into a technical employee agreement dated February 22, 1972, which provided that, in exchange for Deters' continued employment at Marley, Deters disclose and assign to Marley all inventions made by him during the period of his employment with Marley. Deters also agreed not to keep or retain any drawing, blue print or other reproduction or list, schedule, extract or other data as to any matter, concept, idea or other thing in or prepared from the records of Marley. Deters and Marley subsequently entered into a consulting agreement dated August 31, 1978, which did not include any obligation to transfer or assign any rights in his ideas, work product, or inventions to Marley. Marley hired Deters under this consulting agreement to do general work on Marley's products, including the modification of existing products to reduce cost or solve reliability problems; the development, design, and model preparation of new products; patent review; and other consultation. Although not required under the consulting agreement, Deters assigned patent applications to Marley while working as a consultant.
Richard Allender, an engineer at Marley, prepared the technical drawing of the telescoping pipe coupling dated 5-7-80. Allender based his drawing on the Deters' drawing dated 2-15-80. Allender has detailed recall of the telescoping pipe project and of the assembly design discussed at that time.
Marley also assembled a Value Analysis ("VA") team to study the telescoping pipe assembly and to determine the feasibility of implementing such a design in its commercial product line. The members of the team included: Betty Golden, Charles Ostert, Allender, and Curt Trondson. Golden, the recording secretary for the VA team, was also Franklin's secretary. Golden, Ostert, and Allender recall the telescoping pipe assembly project and their service on the VA team. Ostert specifically recalls the aforementioned drawings and model. Ostert saw the model only once when he received it for storage in the engineering laboratory. Trondson is now an employee of FE Petro.
Work on this variable length or telescoping pipe project initiated by Franklin apparently ended on December 3, 1980. At that time, Marley's engineering department decided to "[d]efer further work on this project at this time." The project cover sheet, denoting the termination of the project, was distributed to Franklin and others. The engineering file for this project, containing the aforementioned technical drawings, were maintained in the engineering department at Marley. The files were available to those who had a desire to review such information. Franklin, like other employees at Marley, had access to the engineering files. However, Marley's former and current employees do not have personal knowledge of whether Franklin received the results of this 1980 project — whether he saw the technical drawings dated February 15, 1980, and May 7, 1980, and the working model of a telescoping pipe assembly. Franklin asserts in his affidavit that he does not recall seeing and does not believe he saw any of the aforementioned technical drawings prior to this litigation. Franklin also asserts that he did not know that a model pipe assembly had been built at Marley in 1980.
Pursuant to a 1980 employment agreement with Marley, Franklin agreed, in exchange for continued employment at Marley, to disclose and assign all inventions made by him during the period of his employment. Franklin also agreed not to keep or retain any drawing, blue print or other reproduction or list, schedule, extract or other data as to any matter, concept, idea or other thing in or prepared from the records of Marley.
The United States Patent and Trademark Office issued U.S. Patent No. 5,577,895 ("'895 patent"), titled "Submerged Pump Unit Having a Variable Length Pipe Assembly," to FE Petro, Inc. on November 26, 1996. This patent discloses and claims a variable length pipe assembly for connecting a pump-motor unit to a manifold assembly. The named inventors on the '895 patent are Franklin, Donald P. Kenney, and Brian C. Green. All three are employees of FE Petro. Marley has manufactured and offered for sale a variable length pipe assembly designated as the "Red Jacket T-feature Telescoping Column Pipe." Marley's pipe assembly was publicly displayed at a trade show in Orlando, Florida in October 1996. Employees of FE Petro, including Franklin, were at the trade show and saw Marley' pipe assembly. Franklin further observed handouts distributed by Marley at the trade show which described the coupling mechanism of Marley' pipe assembly. Marley' promotional literature describes the Red Jacket T-feature Telescoping Column Pipe as a telescoping pipe assembly having a telescoping adapter with an "O" ring seal and a thread-locking design that provides a clamping force along the engagement surface. From the...
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...be read, as Cargill asserts, to mean that no claim of conversion can ever involve intellectual property. In Marley Co. v. FE Petro, Inc., 38 F.Supp.2d 1070 (S.D.Iowa 1998), a decision of this court's sister district upon which Cargill also relies, Judge Vietor likewise rejected a defendant'......
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...royalty-free right permitting the employer to use an invention developed by its employee on the job. Marley Co. v. FE Petro, Inc., 38 F. Supp. 2d 1070, 1083 (S.D. Iowa 1998). And shop rights attach only when there is no specific contractual provision providing for the assignment of intellec......
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...royalty-free right permitting the employer to use an invention developed by its employee on the job. Marley Co. v. FE Petro, Inc., 38 F.Supp.2d 1070, 1083 (S.D. Iowa 1998). And shop rights attach only when there is no specific contractual provision providing for the assignment of intellectu......
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