Radioptics, Inc. v. United States

• Decision Date: 30 April 1980
• Docket Number: No. 369-75.,369-75.
• Citation: 621 F.2d 1113
• Parties: RADIOPTICS, INC. v. The UNITED STATES.
• Court: U.S. Claims Court

621 F.2d 1113

RADIOPTICS, INC. v. The UNITED STATES.

No. 369-75.

United States Court of Claims.

Decided April 30, 1980.

William F. Dudine, Jr., New York City, attorney of record, for plaintiff. Darby & Darby, New York City, of counsel.

Donald E. Townsend, Washington, D. C., with whom was Asst. Atty. Gen. Alice Daniel, Washington, D. C., for defendant. Richard J. Webber, Thomas J. Byrnes and Robert Marchick, Washington, D. C., of counsel.

Before COWEN, Senior Judge, and DAVIS and BENNETT, Judges.

OPINION

PER CURIAM:

This case comes before the court on the parties' exceptions to the recommended decision of Trial Judge Francis C. Browne, filed April 12, 1979, pursuant to Rule 134(h), having been submitted on the briefs and oral argument of counsel. Upon consideration thereof, since the court agrees with the trial judge's recommended opinion and conclusion, as hereinafter set forth,^* it hereby adopts the same as the basis for its decision in this case. It is therefore concluded as a matter of law that plaintiff is not entitled to recover and the petition is dismissed.

OPINION OF TRIAL JUDGE

BROWNE, Trial Judge:

Plaintiff, Radioptics, Inc. (Radioptics), seeks relief under 28 U.S.C. § 1491 for alleged taking by the United States of America (defendant) of certain proprietary information and trade secrets which Radioptics contends were disclosed to defendant in confidence but were used by or for defendant in breach of such confidence, without justly compensating Radioptics.

Radioptics bases its claim principally upon breach of a contract, implied in fact. Alternatively, it alleges a taking of its property rights in its proprietary information and trade secrets for public use without just compensation as required under the fifth amendment to the Constitution of the United States.

In brief, Radioptics contends that it disclosed to defendant in confidence the concept of using lasers in a process for separating isotopes of uranium, and that defendant used and disclosed that concept to others without Radioptics' consent and without compensating Radioptics for its rights in the property thus allegedly taken.

Defendant denies that it has taken or made unauthorized use or disclosure of any proprietary information or trade secrets disclosed by Radioptics to defendant. Defendant contends that, in any event, Radioptics had no protection-susceptible right in any proprietary or trade secret information which was disclosed to defendant by Radioptics. Moreover, defendant asserts that even if Radioptics had a protection-susceptible right, the present action is barred by the statute of limitations or by application of the doctrine of laches.

Radioptics has failed to establish by competent evidence that a contractual relationship existed, in fact, between Radioptics and defendant or that there was a taking by defendant of any property of Radioptics within the meaning of the fifth amendment to the Constitution of the United States. Accordingly, we hold for the defendant and dismiss the petition.

I. Summary of Facts

A. Disclosure to Defendant

In March 1963, Dr. Leonard R. Solon, an officer of Radioptics, and Dr. James G. Beckerley, his consultant, met with some of the officials of the Atomic Energy Commission (AEC) in Germantown, Maryland, to persuade the AEC to provide funds to enable Radioptics to conduct a research program relating to the separation of uranium isotopes by use of lasers.¹ Radioptics contends that the AEC representatives with whom they met requested or otherwise induced Radioptics to submit a solicited proposal. Defendant contends, however, that the AEC representatives did not request a proposal but, rather, left it up to Radioptics to decide whether or not to submit an unsolicited proposal. There is no evidence that the AEC representatives ever issued a written request for a proposal. On the other hand, the testimony is in conflict as to whether or not an oral request was made by the AEC personnel. The evidence does establish that the AEC representatives indicated that they would give consideration to a proposal (be it solicited or unsolicited) if submitted by Radioptics. As of the time Radioptics left the conference, there had been no mutual understanding that the AEC would fund the proposed research, but only that AEC would give consideration to a proposal, along with other proposals which were competing for the limited funds available to the AEC for research and development relating to isotope separation.

In April 1963, as a consequence of the March meeting, Radioptics submitted to Dr. Paul W. McDaniel, Director of the AEC Division of Research, Washington, D. C., six copies of a research proposal. The proposal was entitled "An Investigation into the Feasibility of Photochemical Isotope Separation Using Optical Maser Action (with Particular Application to the Separation of U-235 from Natural Uranium)." Radioptics identified the proposal by the symbol "P-103."

B. Contents of Proposal P-103

Radioptics set forth in its proposal P-103 an outline for an initial exploratory investigation into the feasibility of using lasers for the separation of uranium isotopes.² The proposal was not, however, intended to be a definitive procedure for separating uranium isotopes. Radioptics was cognizant of the fact that a number of difficult problems had to be overcome before the process could be used successfully.³ Thus, Radioptics had not, as of the time of submission of P-103 to the AEC, developed or tested a technically proven process for the separation of the U-235 and U-238 isotopes of uranium.

C. Notice of Proprietary Claim

On the page following the title page of the P-103 proposal, as submitted to the AEC in April 1963, the following legend appeared:

PROPRIETARY INFORMATION

This proposal contains information relating to novel proprietary processes and/or trade secrets and/or design data and/or proprietary data and/or apparatus which are the sole property of Radioptics, Inc. regardless of whether or not patents thereon have been or will be applied for. Such information is disclosed herein to the U.S. Atomic Energy Commission in confidence and upon the condition that none of such processes, trade secrets, designs, data, apparatus, or other information will be utilized or copies reproduced except for purposes of evaluating this proposal. If a contract is awarded to Radioptics, Inc. as a result of or in connection with the submission of such data, the Government will have the right to duplicate, use, or disclose this data to extent stipulated in the contract.

The information submitted herein also constitutes disclosure to the Government of a new method of manufacturing special nuclear material, such disclosure being required under the Atomic Energy Act of 1954.

D. Security Classification of Proposal P-103

Shortly after receiving the proposal, the AEC Division of Research forwarded one of the six copies for statutory security classification review⁴ to Dr. C. L. Marshall, Director of the AEC's Division of Classification. Another copy was sent to Mr. Roland Anderson, the AEC in-house Assistant General Counsel for Patents, for his files. The record does not indicate what disposition, if any, was made of the other four copies of the proposal at that time.

Dr. Marshall determined that the proposal contained information which came within the definition of "Restricted Data" under the Atomic Energy Act of 1954 and ordered it classified accordingly.⁵ The order of classification was transmitted by Marshall to the Division of Research and to Anderson with a cover memorandum. The memorandum included a specific request that Marshall be notified if the Division of Research decided not to sponsor the proposal.

Radioptics was promptly informed of the classification decision and was advised that it would have to provide prescribed storage facilities for copies of the proposal which it had retained to maintain security of the information. Additionally, Radioptics was told that it must obtain AEC permission prior to disclosing the contents of the proposal to anyone outside the company. However, Radioptics was not required to obtain permission if it merely wished to disclose the nature of the proposal in very general terms to outside investors or the like.

In accordance with its established practice, AEC affixed to each page of each copy of the submitted proposal the stamped notation "CLASSIFIED."

E. Evaluation of Proposal P-103

Having settled the matter of classification of the proposal, the AEC wrote Radioptics in June 1963 requesting permission to disclose the contents of P-103 to persons outside the AEC solely for the purpose of technical evaluation. Although such permission was implicit in the "Proprietary Information" legend appearing in the proposal, Radioptics expressly granted permission, in writing, repeating that such disclosure would be solely for the purpose of technical evaluation and stating that the permission was not intended to constitute a waiver of any proprietary or patent rights in P-103. After receipt of the written permission from Radioptics, the AEC forwarded one copy of P-103 to Professor John Dieke at Johns Hopkins University, Baltimore, Maryland, and another copy to Mound Laboratory, Miamisburg, Ohio (a laboratory operated by Monsanto Chemical Company under contract with AEC), for the purpose of obtaining their respective opinions as to the technical feasibility of the process proposed in P-103, since such feasibility was a prerequisite to funding of a contract for the work.

Dr. Dieke's review of P-103 indicated that a number of serious problems existed that would be likely to preclude successful application of the P-103 laser process to uranium isotope separation. He concluded by saying that he felt that the authors of the proposal had no detailed knowledge of the field beyond that which could be readily obtained from the general literature. Nevertheless, it was implicit from the...