University of Wv, Bd. of Trustees v. Vanvoorhies

• Decision Date: 03 September 2003
• Docket Number: No. 02-1533.,02-1533.
• Citation: 342 F.3d 1290
• Parties: University of West Virginia, Board of Trustees, Plaintiff-Appellee, and West Virginia University Research Corporation, Third Party Defendant-Appellee, and James Earl Smith and Integral Concepts, Inc., Third Party Defendants, v. Kurt L. Vanvoorhies, Defendant/Third Party Plaintiff-Appellant.
• Court: U.S. Court of Appeals — Federal Circuit

342 F.3d 1290

University of West Virginia, Board of Trustees, Plaintiff-Appellee, and West Virginia University Research Corporation, Third Party Defendant-Appellee, and James Earl Smith and Integral Concepts, Inc., Third Party Defendants, v. Kurt L. Vanvoorhies, Defendant/Third Party Plaintiff-Appellant.

No. 02-1533.

United States Court of Appeals, Federal Circuit.

Decided: September 3, 2003.

David E. Tungate, Eckert Seamans Cherin & Mellott, LLC, of Pittsburgh, PN, argued for plaintiff-appellee and third party defendant-appellee, The University of West Virginia, Board of Trustees and West Virginia University Research Corporation. With him on the brief were Andrew G. Fusco and Jeffrey A. Ray, of Morgantown, WV.

Robert A. Dunn, Dinnin & Dunn, P.C., of Auburn Hills, MI, argued for third party defendant/third party plaintiff-appellant Kurt L. VanVoorhies. With him on the brief was Michael T. Raggio. Of counsel on the brief were Kenneth A. Martin, Martin & Associates, of Washington, DC; and William A. Kolibash, of Philips, Gardill, Kaiser & Altmayer, of Wheeling, WV.

Before LOURIE, CLEVENGER, and PROST, Circuit Judges.

CLEVENGER, Circuit Judge.

Kurt L. VanVoorhies ("VanVoorhies") appeals from the denial of his motion pursuant to Federal Rules of Civil Procedure 59 and 60 for relief from an order requiring the assignment of certain patents to the University of West Virginia Board of Trustees (the "University"). Because the district court abused its discretion in denying VanVoorhies's motion for relief, we reverse.

I

A

This appeal has its roots in an ownership dispute which was previously before this court. See Univ. of W.Va. v. Vanvoorhies, 278 F.3d 1288 (Fed.Cir.2002) ("UWV I"). That dispute originated in the early 1990s, when VanVoorhies was a graduate student at the University. Id. at 1292.

In 1991, VanVoorhies co-invented a contrawound toroidal helical antenna, which became embodied in U.S. Patent Application 07/992,970 (the "'970 Application") and later issued as U.S. Patent No. 5,442,369 (the "'369 Patent"). Id. As required by the applicable University patent policy, VanVoorhies and his co-inventor assigned their rights to the '369 patent to the University. Id.

In December of 1993, around the time he received his doctoral degree from the University, VanVoorhies invented a half-wave bifilar contrawound toroidal helical antenna (the "second invention"). Id. at 1293. Initially, VanVoorhies informed the University about the second invention and urged the University to obtain patent coverage for that new matter. Id. He subsequently changed his mind, and declined to respond when the University sent him a draft application for the second invention. Id. Despite VanVoorhies's lack of response, the University claimed coverage for the second invention through U.S. Patent Application 08/486,340 (the "'340 Application"), which listed VanVoorhies as the inventor and would ultimately issue as U.S. Patent No. 6,028,558 (the "'558 Patent"). While the University sought patent protection for the second invention, VanVoorhies independently submitted a number of patent applications directed to the same second invention: (1) U.S. Patent Application 08/514,609 (the "'609 Application"), which would issue as U.S. Patent No. 5,743,353 (the "'353 Patent"); (2) U.S. Patent Application 08/514,610 (the "'610 Application"), which was filed to provoke an interference with the '340 Application; and (3) a third patent application, which was a continuation of the '609 Application and which would issue as U.S. Patent No. 5,952,978 (the "'978 Patent"). Id.

Two years later, the University sued VanVoorhies, alleging that the inventor breached his duty to assign the second invention. Id. at 1294. VanVoorhies responded by filing extensive counterclaims and third-party complaints. Id. The district court disposed of numerous issues in the case on summary judgment and issued a final ruling in favor of the University on May 25, 2000 (the "May 25 Order").

On appeal from that summary judgment, we affirmed all of the district court's determinations. Id. at 1299-1305. Most relevant to this instant appeal, we "affirm[ed] the district court's grant of summary judgment that VanVoorhies breached his obligation to assign the '340 and '609 applications to WVU, and we affirm[ed] its order requiring him to execute an assignment of those applications and the issued patents based thereon." Id. at 1299.

B

In light of our ruling in UWV I, the University asserted its rights to VanVoorhies's patents and pending patent applications. This assertion of rights was the genesis of this second appeal.

In March of 2002, the University asked VanVoorhies to assign the '340, '609 and '610 Applications and to disclose any additional applications already filed (or intended to be filed). On April 29, 2002, VanVoorhies replied to the University's inquiry. In that reply, VanVoorhies refused to execute the University's proposed assignment forms, but instead enclosed three newly drafted assignments which only conveyed rights to the patent applications referenced in the May 25 Order and to their respective foreign counterparts. In that reply, VanVoorhies also requested the monetary incentive awards to which he believed he was entitled, and declined to make the requested disclosures. He further stated that, unless the University reimbursed him for the $33,907 in fees already incurred to prosecute the assigned applications and their foreign counterparts, he would abandon his pending applications. On May 10, 2002, the University responded that it would not pay the $33,907 in fees, intimated that VanVoorhies's demands constituted an improper attempt to modify the district court's final judgment, and demanded payment of court fees related to that court order. VanVoorhies retorted in a letter dated May 16, 2002, that he had fully complied with the district court's ruling in submitting the newly drafted assignments enclosed with the letter dated April 29, 2002, and that he refused to pay anything but $370 in court costs.

On June 4, 2002, the University sought relief from the district court by filing an ex parte motion for an order under Federal Rule of Civil Procedure 70¹ to enforce the May 25 Order. On that same day, the district court granted the University's motion and entered an order pursuant to Rule 70 (the "Rule 70 Order"), instructing VanVoorhies's attorney to execute the University's proposed assignment forms. The district court further issued a separate order on that same day setting a status conference for July 2, 2002.

On June 18, 2002, VanVoorhies moved pursuant to Federal Rules of Civil Procedure 59 and 60 for relief from the Rule 70 Order. The district court held a status hearing on July 2, 2002, and disposed of VanVoorhies's motion for relief by issuing a short order that same day (the "Order Denying Relief"). In that order, the district court denied VanVoorhies's motion for relief because the court "found that the three assignments at issue included patents that were part of the litigation in this matter.... [and] found that the patent assignments should be executed immediately by counsel for the defendant, Kenneth Martin, as ordered by the Court in its June 4, 2002 Order [the Rule 70 Order]." As directed by the Order Denying Relief, VanVoorhies's attorney executed on behalf of his client the assignments prepared by the University. The trial court also denied without prejudice VanVoorhies's oral motion for costs made during the status hearing.

On July 31, 2002, VanVoorhies appealed the Order Denying Relief. We have jurisdiction pursuant to 28 U.S.C. § 1295(a)(1).²

II

This appeal requires that we determine whether the district court properly denied VanVoorhies's motion for relief under Rules 59 and 60. Because the denial of such a motion is a purely procedural question not unique to patent law, we review that denial under the law of the regional circuit, in this case, the Fourth Circuit. Ajinomoto Co. v. Archer-Daniels-Midland Co., 228 F.3d 1338, 1350 (Fed.Cir. 2000) (applying Third Circuit law to review of Rule 59 motion); Marquip, Inc. v. Fosber Am., Inc., 198 F.3d 1363, 1369 (Fed. Cir.1999) (reviewing denial of a Rule 60(b) motion under Seventh Circuit law). The Fourth Circuit applies an abuse of discretion standard in reviewing the denial of a Rule 59(e) or 60(b) motion. NOW v. Operation Rescue, 47 F.3d 667, 669 (4th Cir. 1995) (applying abuse of discretion standard to the review of a Rule 60(b) motion); Temkin v. Frederick Co. Comm'rs, 945 F.2d 716, 724 (4th Cir.1991) (same in the context of Rule 59). In the Fourth Circuit, a district court abuses its discretion when the court refuses to exercise its discretion, fails to adequately take into account judicially recognized factors constraining its exercise of discretion, or when the court's exercise of discretion rests on an erroneous factual or legal premise. James v. Jacobson, 6 F.3d 233, 239 (4th Cir.1993).

In this appeal, VanVoorhies argues that the trial court incorrectly denied his motion for relief because it erred in determining that the Rule 70 Order was properly granted. If that is the case, then the court's denial would rest on an erroneous premise and would thus rise to the level of an abuse of discretion. See Collison v. Int'l Chem. Workers Union, Local 217, 34 F.3d 233, 238-40 (4th Cir.1994) (reversing denial of Rule 59 motion because the ruling challenged by the Rule 59 motion was legally erroneous). To decide if an abuse of discretion occurred in this case, we must therefore decide whether the district court correctly issued its Rule 70 Order.

Under Rule 70, the trial court may order the performance of specific acts by a third party on behalf of a disobedient party "[i]f a judgment directs a party ... to perform any other specific act and the party fails to comply within the time specified." Fed. R.Civ.P. 70. According to VanVoorhies, the district court improperly acted under Rule 70,...