Pac. Coast Marine Windshields Ltd. v. Malibu Boats, LLC
| Decision Date | 22 August 2014 |
| Docket Number | Case No: 6:12-cv-33-Orl-28DAB |
| Parties | PACIFIC COAST MARINE WINDSHIELDS LIMITED, Plaintiff, v. MALIBU BOATS, LLC, MARINE HARDWARE, INC., TRESSMARK, INC., MH WINDOWS, LLC, and JOHN F. PUGH, Defendants. |
| Court | U.S. District Court — Middle District of Florida |
This case involves a dispute as to the origin of the design of a boat windshield for which the U.S. Patent and Trademark Office issued Patent Number D555,070 ("the '070 Patent") to Darren Bach, the owner of Plaintiff, Pacific Coast Marine Windshields Limited. As its name suggests, Pacific is in the business of manufacturing windshields for boats. Alleging infringement of the '070 Patent,1 Pacific sues Defendants Malibu Boats, LLC; Marine Hardware, Inc.; Tressmark, Inc.; MH Windows, LLC; and John F. Pugh. In its counterclaims, Malibu asserts conversion of the '070 Patent, unlawful business practices based on the '070 Patent, and entitlement to declaratory judgment as to non-infringementand invalidity of the '070 Patent.2 The parties filed cross-motions for summary judgment. (Defs.' Consolidated Mot. Partial Summ. J., Doc. 211; Pl.'s Mot. Summ. J., Doc. 176). This Order addresses only the issues of patent inventorship, Malibu's claim of shop right as a defense, and Malibu's argument that damages awarded to Pacific should be limited to the profits of the windshield. Because there is a genuine dispute of material fact regarding the claims of inventorship, Defendants' motion for summary judgment on Pacific's claim of patent infringement and Pacific's motion for summary judgment on Malibu's patent-related claims must be denied. Also, under the facts as alleged, the shop right defense does not extend to Malibu, and Defendants' motion for summary judgment on that basis must also be denied. Finally, because Defendants' reading of the damages statute is inconsistent with the statutory text and purpose, Defendants' motion for summary judgment on the issue of damages must be denied.
In the past, Pacific supplied Malibu with at least two types of windshields used in the manufacture of Malibu's boats. In 2005, Darren Bach, Chief Executive Officer and owner of Pacific, (Bach Decl., Doc. 177, ¶ 1),3 discussed with Malibu employees the possibility of a new windshield design. Development of the design proceeded and eventually included a tapered corner post, a hidden top rail, and four vent holes. . Bach applied for a design patent, and on November 13, 2007, the '070 Patent was issued designating Bach as the sole inventor. (Doc. 69 at 34-38).
Bach states that he conceived of the idea for the new boat windshield on his own and initially drew the details of his idea on the back of a poster in his house in the middle of the night in February 2005. (Bach Decl., Doc. 177, ¶¶ 3-4; Ex. 1(a) to Bach Decl., Doc. 177-1). Bach claims that he made more sketches of his idea between February and September 2005. (Id. ¶ 5; Exs. 2(a)-2(g) to Bach Decl., Doc. 177-2). Many of these sketches were dated after Bach completed them because it was policy at Pacific for office workers to periodically copy and date Bach's drawings and return them to his desk. (Bach Decl., Doc. 177, ¶ 7; Gourlay Decl., Doc. 178, ¶ 3; Collantes Decl., Doc. 179,¶ 3). Bach also attests that by September 2005 he was working with another Pacific employee to develop computer assisted drawings of his design. (Bach Decl., Doc. 177, ¶ 6; Ex. 3 to Bach Decl., Doc. 177-3). The electronic documents indicate that the same Pacific employee was working on these computer assisted drawings in May 2005.4 (Collantes Decl., Doc. 179, ¶ 5; Exs. D & E to Collantes Decl., Doc. 179-1, at 7-10).
On September 27, 2005, Bach joined Dan Gasper, the Manager of Research and Development for Malibu, on a car ride to Parker, Arizona. (Bach Dep., Doc. 212-12, at 99;Bach Decl., Doc. 177, ¶¶ 9-10; see also Gasper Decl., Doc. 207, ¶¶ 3, 5). Along the way, Bach showed Gasper his ideas for a new windshield design for Malibu boats. (Gasper Decl., Doc. 207, ¶ 5). Bach testified that Gasper liked one drawing in particular. (Bach Dep., Doc. 212-12, at 110 ()). According to Bach, Gasper was excited about Bach's ideas and stated that the design concepts would be used "as a basis for a new windshield for Malibu" and that the staff at Malibu would determine whether the vent holes should remain on the design. (See id. at 118).
Defendants dispute Bach's inventorship. Gasper maintains that he was the first to conceive of the corner post windshield, the hidden top rail, and other elements of the design patent. (Gasper Decl., Doc. 207, ¶ 12). According to Gasper, he came up with the idea for an automotive-style corner post after seeing a windshield on a concept car at a car show in November 2004. (Id. ¶ 4). Gasper maintains that he, not Bach, proposed the idea of an automotive-style corner post, and he states that Bach was "receptive to this idea." (Id. ¶ 6). Gasper also contends that he did not like any of the ideas suggested by Bach on the car ride. (Id. ¶ 5). As evidence of these contentions, Defendants submitted a picture of the concept car on which Gasper allegedly based his idea, ), and an email exchange between Gasper and Bach in which Gasper attached computer assisted drawings that he maintains are substantially similar to the design in the '070 Patent, (see Ex. 3 to Gasper Decl., Doc. 207-3; Gasper Decl., Doc. 207, ¶ 8).5
In addition to disputing with whom the corner-post idea originated, the parties also dispute how similar Bach's drawings are to the final patented design. (See, e.g., Bach Dep., Doc. 212-12, at 106-07; Bach Decl., Doc. 177, ¶ 10; Gasper Decl., Doc. 207, ¶ 5). Bach acknowledges that none of the drawings he showed Gasper were identical to the patented design, though he argues that one of the drawings was very similar. (Bach Dep., Doc. 212-12, at 119-20). In fact, Gasper testified that he thought he should be listed as an inventor on the eventual design patent but did not tell Bach his thoughts in that regard because he assumed Bach knew those thoughts. (Gasper Dep., Doc. 180-2, at 145-46). Indeed, according to one witness, Bach stated on March 20, 2008, that Gasper could have been considered an inventor of the windshield, although it is unclear whether Bach was referring to the design patent specifically. (Broy Dep., Doc. 209-3, at 32-35 ()). Bach also stated in an email to Gasper on January 30, 2006, that both men would "probably have to appear as inventors." (Bach Email, Doc. 212-13, at 2).
Bach eventually obtained the '070 Patent and was listed as the sole inventor. (Doc. 69 at 34). The '070 Patent was for "[t]he ornamental design for a marine windshield." (Id.). Malibu used the '070 windshield for a particular boat model and paid Pacific for eachwindshield it installed. By August 2007, however, the relationship between the two companies had soured. (See Alkema Email, Doc. 177-10). Malibu complained of defective windshields purchased from Pacific and eventually retained another company, Defendant Marine Hardware, Inc., to supply the patented windshield. (Gasper Decl., Doc. 207, ¶ 10; Alkema Dep., Doc. 146-1, at 108-10).
In 2010, Pacific sued Malibu, Marine Hardware, MH Windows, John F. Pugh, and Tressmark, claiming patent infringement, copyright infringement, and trade secret misappropriation. (Case No. 6:10-cv-1285, Am. Compl., Doc. 37; see also Second Am. Compl., Doc. 69). Malibu brought counterclaims for conversion of the 6 motion based on prosecution history estoppel only with respect to non-infringement of the '070 Patent. (Doc. 325 at 9). However, the United States Court of Appeals for the Federal Circuit reversed that grant of summary judgment, holding that Pacific's infringement claim was not barred by principles of prosecution history estoppel. (J. & Op., Doc. 354, at 17-18; Mandate, Doc. 355). The Federal Circuit remanded the case for further proceedings, including disposition of the remaining issues in the parties' motions for summary judgment.
In their motion, Defendants argue that Gasper contributed to the design and that Bach's patent is thus invalid. (Doc. 211). Defendants also argue that Malibu had an implied license in the form of a shop right to use the design and thus could not infringe the patent and that damages should be limited to the profits from the sale of the windshields, not the sale of the boats. (Id.). Pacific, on the other hand, contends in its motion for summary judgment that Bach was the sole inventor of the '070 Patent and that thus Defendants' claims of rights to the patent must fail.7 (Doc. 176).
Summary judgment shall be granted "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). In other words, '"summary judgment may be granted when no reasonable jury could return a verdict for the nonmoving party.'" Fina Oil & Chem. Co. v. Ewen, 123 F.3d 1466, 1472 (Fed. Cir. 1997) (quoting O.I. Corp. v. Tekmar Co., 115 F.3d 1576, 1580 (Fed. Cir. 1997)). The moving party bears the burden of demonstrating that no genuine issues of material fact remain. Celotex...
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