Modern Computer Corp. v. Ma
| Decision Date | 23 September 1994 |
| Docket Number | No. CV 93-794 (ADS).,CV 93-794 (ADS). |
| Parties | MODERN COMPUTER CORP., Midern Computer, Inc. and Microstar Computers, Inc., Plaintiffs, v. Hsi K. MA and Ralph Oman, as Registrar of Copyrights, Defendants. |
| Court | U.S. District Court — Eastern District of New York |
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Colucci & Umans by Kenneth R. Umans, Curtis, Mallet-Prevost, Colt & Mosle by Turner P. Smith, New York City, for plaintiffs.
Sidney N. Weiss, New York City, for defendant Hsi K. Ma.
Zachary W. Carter, U.S. Atty. E.D.N.Y. by Millicent Y. Clarke, Elliot M. Schachner, Asst. U.S. Attys., Brooklyn, NY, for defendant the Registrar of Copyrights.
In this action for a declaratory judgment of non-infringement and patent/copyright invalidity, the plaintiffs contend that their computer products do not infringe on the copyright and patent of the defendant Hsi K. Ma ("defendant" or "Ma"). According to the plaintiffs, Ma's copyright and patent are invalid because they were fraudulently obtained. The complaint further alleges pendent state law claims against Ma for tortious interference with the plaintiffs' contractual and business relations, and unfair competition.
Ma moves pursuant to Fed.R.Civ.P. 12(b) to dismiss this action on the grounds that (1) the Court lacks personal jurisdiction over him, (2) venue in the Eastern District of New York is improper, and (3) forum non conveniens. In the alternative, Ma moves pursuant to 28 U.S.C. § 1404(a) to transfer this case to another venue, or to stay the proceedings in this case until the resolution of an action involving similar claims between the parties that is pending in the Republic of China ("Taiwan"). The plaintiffs oppose the motion.
The plaintiff Modern Computer Corp. ("Modern"), is a corporation organized and existing under the laws of Taiwan, with its place of business in Taipei, Taiwan. Modern is in the business of designing, creating, manufacturing and selling computers, including "Notebook Computers" ("notebooks"). Through its distributors, Modern alleges it does business in the United States in interstate commerce, including in the Eastern District of New York.
The plaintiff MicroStar Computers, Inc. ("MicroStar"), is a corporation organized under the laws of New Jersey. MicroStar alleges it is engaged in the sale and distribution of Modern's notebooks in the United States, including within the Eastern District of New York.
The plaintiff Midern Computer Inc. ("Midern"), is a corporation organized under the laws of California. Allegedly, Midern is also engaged in the sale and distribution of Modern's notebooks in the United States, including within the Eastern District of New York.
The defendant Ma is an individual residing in Taipei, Taiwan. Ma is the founder of Modern, and from sometime in 1984 until August 1992 was the president and chief executive officer of that company. According to the plaintiff, Ma does business in the United States in interstate commerce, and has an agent/attorney who does business in the Eastern District of New York.
The defendant Ralph Oman was the Register of Copyrights, United States Copyright Office, Washington D.C. Currently, the acting Registrar of Copyrights is Barbara Ringer.
According to the plaintiffs, Ma was not only the President and CEO of Modern, but was also in charge of research and development for Modern. Among Ma's research and development duties was developing the design of Modern's NOTESTAR and SAGER notebooks. Essentially, the plaintiffs claim that while working for Modern in Taiwan, Ma misappropriated Modern's customer lists and unlawfully obtained technical drawings of the computer designs developed by Modern for its NOTESTAR and SAGER notebooks, in order to "infringe and usurp" Modern's rights to those computer designs.
The plaintiffs allege that on August 14, 1992 Ma filed a fraudulent application with the United States Copyright Office and wrongfully procured a Copyright Registration Certificate, VA 525,703 ("Certificate"), for the copyright of the notebook designs he unlawfully obtained from Modern.
The plaintiffs further allege that Ma then filed the Certificate with the United States Bureau of Customs ("Customs Bureau"), falsely representing himself to be the true owner of the Certificate and the work covered therein. By filing the Certificate with the Customs Bureau, Ma sought to prevent the importation into the United States of products bearing the same designs covered by the Certificate. According to the plaintiffs, Ma also misrepresented to the Customs Bureau that Modern's NOTESTAR and SAGER notebooks were infringing and pirated copies of the copyrighted designs covered by his Certificate.
Based on Ma's representations and filing, the Customs Bureau listed the plaintiff Modern as an exporter, and the plaintiffs Midern and MicroStar as importers, of infringing and pirated copies of Ma's copyright. The plaintiffs allege that Modern's notebooks were then seized by the Customs Bureau at ports of entry in the United States during November, 1992, including John F. Kennedy Airport in New York. Although the Customs Bureau later rescinded its order to seize Modern's notebooks, the plaintiffs contend that this was not until early 1993, and that in the interim Modern was unable to fulfill its notebook orders in the New York marketplace.
In addition to the above, the plaintiffs allege that Ma filed an application with the United States Patent and Trademark office on October 15, 1991 for a patent covering a "Battery and Expansion Slot Changeable Computer," and obtained Patent No. 5,058,045. Modern contends, however, that it is the owner of the patent on account of a valid assignment of the patent by Ma to Modern on June 12, 1991. According to Modern, this assignment was upheld by a civil judgment of the Taipai Shihlin District Court on October 27, 1992, and an appeal by Ma was denied by the Taiwan High Court on June 21, 1993.
The plaintiffs also allege that through the law firm of Bucknam and Archer located in Garden City, New York, Ma sent to MicroStar and certain of MicroStar's and Modern's customers in New York appearing on the lists allegedly misappropriated by Ma, a letter of infringement demanding that the plaintiff and their customers cease and desist from distributing or selling the notebooks. As a result of this cease and desist letter to MicroStar and the customers in New York, the plaintiffs allege that they lost sales of their notebooks in the New York market area.
Based on the controversy described above concerning the copyright and patent obtained by Ma, the plaintiffs commenced this action for a declaratory judgment on February 23, 1993. The complaint sets forth six causes of action. The first two causes of action concern the copyright Certificate, and seek (i) to have the Certificate cancelled, (ii) a declaration that the NOTESTAR and SAGER notebooks do not infringe any valid copyright in Ma's Certificate, and (iii) a declaration that Ma is not the owner of the copyright. The third and fourth causes of action concern Ma's patent, and seek a declaratory judgment that the sales and distribution of the plaintiffs' notebooks do not infringe on Ma's patent. The remaining two causes of action allege state law tort claims for deliberate interference by Ma in the contractual and business relations of the plaintiffs (count five), and misappropriation by Ma of Modern's trade secrets and customer lists resulting in unfair competition (count 6).
As a result of Ma's actions, the plaintiffs' contend that they have been irreparably harmed in their business and notebook sales, and have no adequate remedy at law. The plaintiffs seek the following relief:
MOTIONS BEFORE THE COURT.
Ma moves to dismiss, transfer or stay this case pursuant to a variety of Rules under Fed.R.Civ.P. 12(b). First, Ma moves pursuant to Rule 12(b)(2) to dismiss the complaint for lack of personal jurisdiction. Ma moreover contends that the action must be dismissed pursuant to Rule 12(b)(5), due to insufficiency of service. Second, Ma moves that the action should be dismissed pursuant to Rule 12(b)(3) because the action is improperly in the Eastern District. In addition, Ma contends that the action should be dismissed on the grounds of forum non conveniens.
If the Court does not dismiss the case, Ma moves in the alternative under 28 U.S.C. § 1404 to transfer the case to an appropriate venue. Ma also moves to stay this suit pending the outcome of an action in Taiwan involving the...
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