Moore U.S.A. Inc. v. Standard Register Co.
| Decision Date | 13 August 1999 |
| Docket Number | No. 98-CV-485C(F).,98-CV-485C(F). |
| Citation | 60 F.Supp.2d 104 |
| Parties | MOORE U.S.A. INC., and Toppan Forms Co., Ltd., Plaintiffs, v. The STANDARD REGISTER COMPANY, Defendant. |
| Court | U.S. District Court — Western District of New York |
Nixon & Vanderhye P.C. (Robert A. Vanderhye, and James D. Berquist, of counsel), Arlington, VA, and Cohen Swados Wright Hanifin Bradford & Brett (Laurence B. Oppenheimer, of counsel), Buffalo, NY, for plaintiffs.
Oblon, Spivak, McClelland, Maier & Neustadt, P.C. (Charles L. Gholz, of counsel), Arlington, VA, and Gibson, McAskill & Crosby (Brian P. Crosby, of counsel), Buffalo, NY, for defendant.
DECISION and ORDER
Currently pending before the court are: (1) defendant Standard Register's motion to dismiss based on collateral estoppel (Item 16); (2) plaintiff Moore U.S.A.'s motion for summary judgment on the issue of standing (Item 30); and (3) defendant Standard Register's cross-motion for summary judgment based on lack of standing or, in the alternative, to add Toppan Forms Co., Ltd., as an indispensable party (Item 34). The court heard oral argument on these motions on April 6, 1999.
On August 3, 1998, plaintiffs Moore U.S.A., Inc. ("Moore U.S.A.") and Toppan Forms Co., Ltd. ("Toppan Forms"), filed a complaint in the United States District Court for the Western District of New York alleging that defendant Standard Register has been manufacturing, selling, and using a pressure-sensitive adhesive which infringes United States Patent Number 4,918,128 ("the '128 patent"). Item 1. On September 28, 1998, Moore U.S.A. filed a motion to remove Toppan Forms from the pleading and to amend/supplement the complaint with a September 14, 1998, License Agreement which reflected Moore U.S.A.'s ownership interest in the '128 patent. Item 9. On October 5, 1998, the court granted Moore U.S.A.'s motion, and Moore U.S.A. filed its amended complaint. Item 12. On October 14, 1998, Standard Register responded with an amended answer, an amended motion to dismiss based on collateral estoppel, and, in the alternative to the motion to dismiss, an amended motion to transfer to the Eastern District of Virginia. Items 15-17. The court decided that it was best to decide the motion to transfer first. On December 29, 1998, the court denied Standard Register's motion to transfer. Item 29.
On January 29, 1999, Moore U.S.A. filed a motion for summary judgment. Item 30. On March 1, 1999, Standard Register responded to Moore U.S.A.'s motion and filed a cross-motion for summary judgment. Items 33 and 34. On March 22, 1999, Moore U.S.A. filed a motion to amend its amended complaint. Item 38. Moore U.S.A. argues that while it believes that the September 1998 License Agreement (Item 21) confers standing, it filed this motion to amend its amended complaint to further establish its ownership of the '128 patent and to reflect its name change to Moore North America, Inc. Item 38, at 2.1
On April 6, 1999, the court heard oral argument on the cross-motions for summary judgment on the issue of standing and Standard Register's motion to dismiss. The court also granted Moore U.S.A.'s motion to amend the amended complaint (Item 38) to reflect Moore's name change to Moore North America, Inc. ("Moore North America").
On May 11, 1999, Moore North America filed another motion to amend its complaint. Item 51. Moore North America argues that it has uncovered additional acts of infringement by Standard Register. In addition to infringing the '128 patent, Moore North America alleges that Standard Register also infringes U.S.Patent No. 5,201,464 ("the '464 patent"). However, since Moore North America filed this motion after the court heard oral argument, this motion will be addressed at a later date. For now, it is better for the court to decide the initial motions filed — Items 16, 30, and 34.
In ruling, the court must decide whether collateral estoppel bars plaintiff Moore North America's claims. If it does not, then the court must decide whether plaintiff Moore North America has standing to sue on the '128 patent. If Moore North America has standing, then the court must decide whether Toppan Forms must be joined as an indispensable party.2
On April 17, 1990, United States Patent No. 4,918,128 (the '128 patent) was issued to Tsutomu Sakai of Japan and assigned to Toppan Moore Company, Ltd. ("Toppan Moore"), also of Japan. Item 13, Exh. A. On March 20, 1997, Toppan Printing Company, Ltd. ("Toppan Printing") bought out the remaining 10 percent of the shares of Toppan Moore from Moore Corporation Limited ("Moore Limited"), a Canadian Corporation, and Moore International B.V. ("Moore International"), a Dutch Corporation. Item 20. Pertinent to this agreement was the fact that Moore Limited could sue infringers, but only after first giving Toppan Printing or Toppan Moore the right to do so.
On October 22, 1997, Moore Limited assigned its "entire rights, title, and interest in United States Patent No. 4,918,128, entitled `Pressure-Sensitive Adhesive,' including the right to enforce that patent and to sue for infringement, both current and past, and to collect damages arising from any such infringement" to Moore U.S.A. Item 30, Exh. C. On March 30, 1998, Toppan Moore assigned the '128 patent to Toppan Forms. This assignment was recorded in the United States Patent office at Reel 9075, Frame 0385-394. Item 38, Exh. A. On April 1, 1998, an Agreement was signed between Toppan Forms, Moore Limited, Moore International, and Moore U.S.A. which stated:
The purpose of this Agreement is to put into writing that the agreement, dated March 20, 1997 ... was always intended by Toppan Forms to grant to Moore U.S.A. Inc. ("Moore") the sole and exclusive license in the United States to use and sell and offer for sale, except to make, anything within the scope of United States Patent No. 4,918,128.
The Agreement also went to state that:
Toppan Forms' intent also has always been to grant Moore [U.S.A.] the sole and exclusive right to sue for infringement of the '128 patent in Moore [U.S.A.]'s own name, and under Moore [U.S.A.]'s sole control and at Moore's sole expense, to collect damages for past, present, and future infringement of the '128 patent, and to obtain any other relief that is necessary or feasible, including the right to enjoin others from practicing invention of the '128 patent, to collect enhanced damages and/or attorney fees for willful infringement thereof, and without limitation to secure any other relief possible.
On September 14, 1998, an Agreement was signed between Toppan Forms and Moore Limited which stated:
1. Toppan Forms shall grant to Moore [Limited] the sole and exclusive license in the United States to use, sell, offer for sale, make and import anything within the scope of the '128 patent, with the right in Moore [Limited] to sublicense.
2. Toppan Forms shall grant to Moore [Limited] the sole and exclusive rights to sue for infringement of the '128 patent in Moore [Limited]'s own name, and under Moore [Limited]'s sole control and at Moore [Limited]'s sole expense, to collect damages for past, present and future infringement of the '128 patent, and to obtain any other relief that is necessary or feasible, including the right to enjoin others from practicing invention of the '128 patent, to collect enhanced damages and/or attorney fees for wilful infringement thereof, and without limitation to secure any other relief possible.
On February 23, 1999, Moore Limited sold and assigned its "entire right, title and interest in United States Patent No. 4,918,128, entitled `Pressure Sensitive Adhesive,' including the right to enforce that patent and to sue for infringement, both current and past, and to collect damages arising from any infringement" to Moore North America. Item 38, Exh. C. Standard Register did not oppose this motion, Item 44, at 10, but argued that the February 23, 1999, Assignment should not be considered by the court because it should have been submitted with Moore U.S.A.'s opening papers in this case. However, at oral argument, the court granted Moore U.S.A.'s motion.
Standard Register argues that the doctrine of collateral estoppel bars this action because on March 6, 1998, the United States District Court for the Eastern District of Virginia granted summary judgment against Moore U.S.A. and held that Moore U.S.A. lacked standing to sue for infringement of the '128 patent. Moore U.S.A., Inc. v. Standard Register, 97-CV-2054-A (E.D.Va. Mar. 6, 1998) (attached to Item 16 as Exh. B). Standard Register argues that the Eastern District of Virginia found that: (1) the '128 patent is owned by Toppan Forms; (2) Moore U.S.A. is a "bare" licensee (i.e., nonexclusive licensee under the '128 patent); and (3) that a "bare" licensee has no standing to bring an action for infringement of a patent, (a) even if the patentee is joined in the suit and (b) even if the agreement granting the non-exclusive license purports to give the non-exclusive licensee the right to sue in its own name. Item 16, at 1-2.
Moore U.S.A. replies that the doctrine of collateral estoppel does not apply because in contrast to the case before the Eastern District of Virginia, Moore U.S.A. is now relying on the September 14, 1998, license agreement which expands its rights as a licensee and eliminates the contract language that the Eastern District of Virginia relied on as the basis for its decision. Item 28, at 3. In addition, Moore U.S.A. argues that its additional submission of the February 23, 1999, License Agreement should clear up any confusion and establish that Moore North America is an exclusive licensee, having all substantial rights in the '128 patent.
The doctrine of collateral estoppel is designed to protect litigants "from the burden of relitigating an identical issue ... and [to promote] judicial economy by preventing...
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