Trade-Secret Misappropriation (under Ohio State Law)
Leahy-Smith America Invents Act (“AIA”)
Motion to Amend a Judgment
Motion to Amend the Complaint
Motion to Dismiss
Motion for Summary Judgment
The complaint sought correction of inventorship in several Goodyear patents and alleged, among other things, that Goodyear misappropriated Coda’s trade secrets.
(…) We vacate the district court’s dismissal and remand for further proceedings consistent with this opinion.
(…) Before the meeting took place, the parties executed a nondisclosure agreement restricting use of disclosed information to cooperation between the parties regarding the development of SIT technology.
(…) At this meeting, and at Goodyear’s request, Coda shared novel, proprietary, and confidential information concerning its SIT technology, including the placement of the tire’s pump tube, the design of the pressure management system, the efficiency of the leakage compensation system, and the air passageway/interface between the exterior and interior of the tire.
(…) Also that month, and unbeknownst to Coda, Goodyear applied for a patent entitled “Self-Inflating Tire Assembly.” Goodyear’s application published on June 23, 2011, issued as U.S. Patent No. 8,042,586 (the “’586 patent”) on October 25, 2011, and named Messrs. Benedict and Losey as the inventors.
(…) According to the complaint, between 2012 and 2015, eleven other patents issued to Goodyear covering assemblies and methods for assembly of pumps and other devices used in self-inflating tires. The complaint alleges that these patents have claims with limitations covering the novel, proprietary, and confidential information Coda disclosed to Goodyear.
(…) Plaintiffs sued Defendants in the U.S. District Court for the Northern District of Ohio on August 9, 2015. The complaint included two correction-of-inventorship claims concerning the ’586 patent—one to add Mr. Hrabal as an inventor, the other to remove Messrs. Benedict and Losey as inventors. The complaint also included correction-of-inventorship claims to add Mr. Hrabal as an inventor on eleven other Goodyear patents (the “Alleged Jointly Invented Patents”) and a claim of trade-secret misappropriation under Ohio state law.
(…) We also review a district court’s denial of a Rule 59(e) motion to amend a judgment and a motion to amend the complaint under the regional circuit’s law. Alcon Research Ltd. v. Barr Labs., Inc., 745 F.3d 1180, 1192 (Fed. Cir. 2014) (Rule 59(e) motion to amend a judgment); Advanced Software Design Corp. v. Fiserv, Inc., 641 F.3d 1368, 1380 (Fed. Cir. 2011) (motion to amend the complaint). The Sixth Circuit reviews denial of such motions for abuse of discretion. Morse v. McWhorter, 290 F.3d 795, 799 (6th Cir. 2002).
(…) Plaintiffs’ complaint sets forth thirteen correction-of-inventorship claims under 35 U.S.C. § 256 (…) Section 256 addresses two types of inventorship errors—misjoinder and nonjoinder. Stark v. Advanced Magnetics, Inc., 119 F.3d 1551, 1553 (Fed. Cir. 1997). Misjoinder is the error of naming a person as an inventor who is not an inventor; nonjoinder is the error of omitting an inventor. See id. Through claims of misjoinder and nonjoinder together, § 256 “allows complete substitution of inventors.” Id. at 1556; see id. at 1553 (cf. Leahy-Smith America Invents Act (“AIA”), Pub. L. No. 112–29, 125 Stat. 284 (2011)).
(…) Assessment of the facial sufficiency of the complaint must ordinarily be undertaken without resort to matters outside the pleadings. If a court does consider material outside the pleadings, the motion to dismiss must be treated as a motion for summary judgment under Rule 56 and all parties must be given a reasonable opportunity to present all material pertinent to the motion.
(…) The district court also erred in dismissing Plaintiffs’ trade-secret-misappropriation claim as time-barred.
An Ohio trade-secret-misappropriation claim must be brought “within four years after the misappropriation is discovered or by the exercise of reasonable diligence should have been discovered.” Ohio Rev. Code § 1333.66; Adcor Indus., Inc. v. Bevcorp, LLC, 411 F. Supp. 2d 778, 784–85 (N.D. Ohio 2005) (observing that this provision incorporates the “discovery rule”). (…) These issues go more to the merits of De- fendants’ statute-of-limitations defense than the complaint’s sufficiency. Indeed, because “the statute of limitations is an affirmative defense, and a plaintiff generally need not plead the lack of affirmative defenses to state a valid claim,” a Rule 12(b)(6) motion, “which considers only the allegations in the complaint, is generally an inappropriate vehicle for dismissing a claim based upon the statute of limitations.” Cataldo v. U.S. Steel Corp., 676 F.3d 542, 547 (6th Cir. 2012); see Lutz v. Chesapeake Appalachia, L.L.C., 717 F.3d 459, 464 (6th Cir. 2013). Considering only the complaint, and drawing all reasonable inferences in Plaintiffs’ favor, we conclude that the district court erred in dismissing Plaintiffs’ trade-secret-misappropriation claim as time-barred.
For the foregoing reasons, we vacate the district court’s dismissal and remand for further proceedings consistent with this opinion.
Vacated and remanded.
Costs to Plaintiffs-appellants.
Secondary sources: Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1366 (3d ed. 2018).
(U.S. Court of Appeals for the Federal Circuit, February 22, 2019, Coda Development S.R.O., Coda innovations S.R.O., Frantisek Hrabal v. Goodyear Tire & Rubber Company, Robert Benedict, Robert Allen Losey, Docket No. 2018-1028)