Ali v. Carnegie Institution of Washington ( 2013 )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF OREGON
PORTLAND DIVISION
MUSSA ALI, Case No. 3:12-cv-01764-SI
Plaintiff, OPINION AND ORDER
v.
CARNEGIE INSTITUTION OF
WASHINGTON, and UNIVERSITY OF
MASSACHUSETTS,
Defendants.
Joseph W. Berenato III, and Steven v. Kelber, Berenato & White, LLC, 6550 Rock Spring Drive,
Suite 240, Bethesda, MD 20817. Joel P. Leonard, and John D. Ostrander, Elliott, Ostrander &
Preston, P.C., 707 SW Washington Street, Suite 1500, Portland, OR 97205. Attorneys for
Plaintiff.
Kurt G. Calia, Covington & Burling LLP, 333 Twin Dolphin Drive, Suite 700, Redwood Shores,
CA 94065. Alexa R. Hansen, and Nathan E. Shafroth, Covington & Burling, LLP, 1 Front Street,
Floor 35, San Francisco, CA 94111. Kelly M. Jaske, Jaske Law LLC, 521 SW Clay Street, Suite
209, Portland, OR 97201. Attorneys for Defendants.
Michael H. Simon, District Judge.
Plaintiff brings this lawsuit to correct the inventorship of five issued patents related to
gene silencing. For the reasons stated below, Defendants’ Motion to Dismiss (Dkt. 18) is
GRANTED IN PART AND DEFERRED IN PART, Plaintiff’s Motion for Jurisdictional
Discovery (Dkt. 30) is GRANTED IN PART AND DENIED IN PART AND STAYED, and
Plaintiff’s request for a Rule 16 conference (Dkt. 33) is GRANTED.
BACKGROUND
This case arises out of Plaintiff Mussa Ali’s claim that he was erroneously omitted as a
named inventor on five patents: U.S. Patent Nos. 6,506,559; 7,538,095; 7,560,438; 7,622,633
and 8,283,329. Am. Compl. ¶ 3, 25-26. Defendants Carnegie Institute of Washington
(“Carnegie”) and University of Massachusetts (“UMass”) are owners, by assignment, of the
patents at issue. Am. Compl. ¶ 3-4.
Defendants have filed a motion to dismiss or strike Plaintiff’s First Amended Complaint
(“FAC”). Dkt. 18. They argue that the Court lacks subject matter jurisdiction over the action
based on the sovereign immunity of Defendant UMass and its status as a “required party.” In the
alternative, Defendants contend that the Court lacks personal jurisdiction over all Defendants.
Before Plaintiff’s response was due, Plaintiff filed a motion seeking jurisdictional discovery on
both aspects of Defendants’ motion to dismiss. Dkt. 30. Simultaneously, Plaintiff filed a request
for a Rule 16 Conference to discuss and schedule any allowed jurisdictional discovery. Dkt. 33.
Defendants oppose Plaintiff’s request for a Rule 16 conference, urging the Court to decide their
motion to dismiss without permitting discovery. Dkt. 34.
On April 9, 2013, the Court issued a Minute Order stating that it was considering
ordering a stay of this litigation until the U.S. Court of Appeals for the Federal Circuit issued its
opinion in a pending case that appears to involve similar factual and legal issues. Dkt. 35
Page 2 – OPINION AND ORDER
referring to University of Utah v. Max-Planck, No. 12-1540 (Fed. Cir. 2013). The Court invited
any party wishing to be heard on that question to file a motion within 14 days. Id. All parties
objected to the Court’s contemplated stay, arguing that the cited case would not be dispositive or
the pending motion to dismiss could be decided on alternative grounds. Dkts. 39, 40. Since that
time, Defendants filed a memorandum arguing that Plaintiff’s failure substantively to respond to
Defendants’ motion to dismiss is sufficient grounds for the Court to grant that motion. Dkt. 37.
Defendants also filed their opposition to Plaintiff’s request for jurisdictional discovery. Dkt. 38.
STANDARDS
In patent cases, Federal Circuit law governs the relevance of a request for jurisdictional
discovery. See Commissariat A L'Energie Atomique v. Chi Mei Optoelectronics Corp., 395 F.3d
1315, 1323 (Fed. Cir. 2005); Beverly Hills Fan Co. v. Royal Sovereign Corp., 21 F.3d 1558,
1564 (Fed. Cir. 1994). Whether jurisdictional discovery is warranted, however, is a question
answered by the law of the regional circuit. See Chi Mei, 395 F.3d at 1323 (relying on regional
circuit law to determine whether the party seeking discovery “made a sufficient threshold
showing”); see also Autogenomics, Inc. v. Oxford Gene Tech. Ltd., 566 F.3d 1012, 1021 (Fed.
Cir. 2009) (“We review the district court's denial of discovery, an issue not unique to patent law,
for abuse of discretion, applying the law of the regional circuit.”).
Because there is no statutorily proscribed method for resolving jurisdictional disputes
before trial, the mode of resolution is left in the discretion of the trial court. See Data Disc, Inc.
v. Sys. Tech. Assocs., Inc., 557 F.2d 1280, 1285 (9th Cir. 1977) (citing Gibbs v. Buck, 307
U.S. 66, 71-72 (1939)). If a court limits the presentation of relevant evidence to “affidavits plus
discovery materials,” as opposed to holding an evidentiary hearing, then the plaintiff “must make
only a prima facie showing of jurisdictional facts through the submitted materials in order to
avoid a defendant's motion to dismiss.” Id. In considering whether to grant or deny jurisdictional
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discovery, a trial court has broad discretion. Id. Generally, discovery is appropriate “where
pertinent facts bearing on the question of jurisdiction are controverted or where a more
satisfactory showing of the facts is necessary.” Id. at 1285 n.1 (citing Wells Fargo & Co. v. Wells
Fargo Express Co., 556 F.2d 406, 430 n.24 (9th Cir. 1977)). A court may deny jurisdictional
discovery unless the denial “will result in ‘actual and substantial prejudice to the complaining
litigant’ (e.g., ‘a reasonable probability that the outcome would have been different had
discovery been allowed’).” Digeo, Inc. v. Audible, Inc., 505 F.3d 1362, 1370 (Fed. Cir. 2007)
(quoting Laub v. U.S. Dep't of Interior, 342 F.3d 1080, 1093 (9th Cir. 2003)).
DISCUSSION
Defendants assert two independent grounds for complete dismissal of this case. First,
Defendants argue that UMass is entitled to sovereign immunity and that UMass is a required
party that cannot be joined; thus, the case must be dismissed, Defendants argue, pursuant to
Federal Rule of Civil Procedure 12(b)(7). Second, Defendants argue that the Court cannot
properly exercise personal jurisdiction over them. In the alternative to these two arguments for
complete dismissal, Defendants contend that Plaintiff’s second count and alternative second
count must be dismissed for failure to state a claim pursuant to Federal Rule of Civil
Procedure 12(b)(6). In response to Defendants’ motion to dismiss, Plaintiff seeks discovery
related to Defendants’ motion and a Rule 16 conference. Except in part, Plaintiff has not yet
responded to the merits of Defendants’ motion.
A. UMass’s Sovereign Immunity
Defendants argue that UMass should be dismissed because it is immune from suit under
the Eleventh Amendment as an arm of the state of Massachusetts. Plaintiff opposes Defendants’
contention, arguing that discovery is necessary to determine whether UMass is entitled to
immunity or if it has waived its sovereign immunity.
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The Eleventh Amendment provides sovereign immunity to states from suits brought in
federal court.1 See Idaho v. Coeur d'Alene Tribe of Idaho, 521 U.S. 261, 268 (1997). “[A] federal
court has subject matter jurisdiction to hear cases involving federal law, but the Eleventh
Amendment gives the state ‘a sovereign immunity from suit.’” Tegic Commc'ns Corp. v. Bd. of
Regents of Univ. of Texas Sys., 458 F.3d 1335, 1340 (Fed. Cir. 2006) (quoting Coeur d’Alene
Tribe, 521 U.S. at 267). Sovereign immunity applies to actions brought under the patent laws of
the United States. See generally Fla. Prepaid Postsecondary Educ. Expense Bd. v. Coll. Sav.
Bank, 527 U.S. 627 (1999) (holding that Congress did not properly abrogate states’ Eleventh
Amendment immunity from suits under the Patent Act). A state, however, may waive its
immunity from suit under two circumstances: “when the state makes a ‘clear declaration’ that it
intends to waive immunity, such as by statute, or when the state voluntarily invokes federal
jurisdiction.” Tegic Commc’ns, 458 F.3d at 1340 (internal citations omitted) (citing Port Auth.
Trans-Hudson Corp. v. Feeney, 495 U.S. 299 (1990); Gunter v. Atl. Coast Line R.R. Co., 200
U.S. 273 (1906)).
The Eleventh Amendment only applies to states and state officials; it does not apply “to
counties and similar municipal corporations.” Mt. Healthy City Sch. Dist. Bd. of Educ. v. Doyle,
429 U.S. 274, 280 (1977). If a defendant is an “arm of the state,” then it is entitled to Eleventh
Amendment immunity from suit. See id. To determine whether a public entity is an arm of the
state, a court looks at five factors:
(1) whether a money judgment would be satisfied out of state funds, (2) whether the
entity performs central governmental functions, (3) whether the entity may sue or be
1
Because sovereign immunity is not unique to patent law, the Federal Circuit applies the
law of the regional circuit court. See Intel Corp. v. Commonwealth Scientific & Indus. Research
Org., 455 F.3d 1364, 1369 (Fed. Cir. 2006) (applying Ninth Circuit law to a claim of immunity
under the Foreign Sovereign Immunities Act).
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sued, (4) whether the entity has the power to take property in its own name or only the
name of the state, and (5) the corporate status of the entity.
Holz v. Nenana City Pub. Sch. Dist., 347 F.3d 1176, 1180 (9th Cir. 2003) (internal quotation
marks and citation omitted). “To determine these factors, the court looks to the way state law
treats the entity.” Durning v. Citibank, N.A., 950 F.2d 1419, 1423 (9th Cir. 1991) (quoting
Mitchell v. Los Angeles Cmty. Coll. Dist., 861 F.2d 198, 201 (9th Cir. 1988), cert. denied, 490
U.S. 1081 (1989)). The party asserting sovereign immunity has the “burden of proving the facts
that establish its immunity.” ITSI T.V. Prods., Inc. v. Agric. Assocs., 3 F.3d 1289, 1292 (9th Cir.
1993). The Ninth Circuit has noted, however, that immunity will be in serious dispute “only
where a relatively complex institutional arrangement makes it unclear whether a given entity
ought to be treated as an arm of the state.” Id.
Notwithstanding Plaintiff’s arguments to the contrary, the five factors identified generally
do not require the presentation of extraneous evidence. See, e.g., ITSI, 3 F.3d at 1292-94
(deciding the defendant was not an arm of the state with reference to various portions of the
California Code); Durning, 950 F.2d at 1424 (deciding the defendant was not an arm of the state
with reference to Wyoming statutes and case law). This issue can be decided solely with
reference to Massachusetts statutes and the consensus of Massachusetts courts, which conclude
that UMass is entitled to sovereign immunity.
The first factor—whether a monetary judgment for the plaintiff “would have to be
satisfied out of public funds from the state treasury”—is the most important. See Durning, 950
F.2d at 1424 (relying on Edelman v. Jordan, 415 U.S. 651, 663 (1974)). With limited exceptions
not relevant here, Massachusetts indemnifies members of UMass’s Board of Trustees “for any
claim arising out of any official judgment, decision, or conduct of said member.” Mass. Gen.
Laws ch. 75, § 1A; see also Hannigan v. New Gamma-Delta Chapter of Kappa Sigma
Page 6 – OPINION AND ORDER
Fraternity, Inc., 367 Mass. 658, 659, 327 N.E.2d 882, 883 (1975) (holding the trustees “are one
and the same party, namely the Commonwealth of Massachusetts”). Thus, the first factor favors
a finding sovereign immunity for UMass.
The second factor is whether the entity performs central government functions. The Ninth
Circuit has recognized that “public education is a central government function.” See Durning,
950 F.2d at 1426 (collecting cases). It is undisputed that UMass’s central function is public
education. See Mass. Gen. Laws ch. 75, § 1 (creating UMass “as a public institution of higher
learning”). Thus, the second factor favors sovereign immunity.
The third factor is whether the entity may sue or be sued. The Massachusetts Supreme
Judicial Court has recognized that “[f]or purposes of the Commonwealth's consent to be sued,
the University of Massachusetts and the Commonwealth are one and the same.” Wong v. Univ. of
Mass., 438 Mass. 29, 36, 777 N.E.2d 161, 167 (2002) (quotations and citation omitted). Thus,
the third factor favors sovereign immunity.
The fourth factor is whether the entity can take property in its own name. Generally,
UMass’s ability to manage its property is limited, doing so only “on behalf of the
commonwealth.” Mass. Gen. Laws ch. 75, § 12; see also Mass. Gen. Laws ch. 75, § 25 (granting
the trustees limited powers to convey land “in the name of and for the commonwealth”). Thus,
the fourth factors favors sovereign immunity.
The fifth and final factor is whether the entity has its own independent corporate identity.
As mentioned above, the Massachusetts courts consider UMass and the commonwealth to be
“one and the same.” See Wong, 438 Mass. at 36, 777 N.E.2d at 167. Indeed, Massachusetts
courts explicitly hold that UMass, as the alter ego of the commonwealth, is entitled to sovereign
immunity. See, e.g., Cameron Painting, Inc. v. Univ. of Mass., 83 Mass. App. Ct. 345, 347, 983
Page 7 – OPINION AND ORDER
N.E.2d 1210, 1213 (2013) (“[A]s a component of the Commonwealth, the University cannot be
sued unless the Commonwealth has consented to a waiver of its sovereign immunity.”) Because
all five factor point in the same direction, the Court concludes that UMass is an arm of the state
of Massachusetts and is entitled to sovereign immunity from suit. 2
Plaintiff also asserts the possibility of UMass’s waiver of sovereign immunity as a basis
for granting relevant discovery. As noted above, a state waives sovereign immunity in only two
instances: (1) a state’s voluntarily invocation of the jurisdiction of a federal court; or (2) a state’s
“clear declaration” that it intends to submit itself to the jurisdiction of a federal court. See Coll.
Sav. Bank, 527 U.S. at 675-76. “[A]ny waiver of sovereign immunity by a state must be express
and voluntary, and cannot be implied or constructive.” State Contracting & Eng'g Corp. v. State
of Fla., 258 F.3d 1329, 1336 (Fed. Cir. 2001) (citing Coll. Sav. Bank, 527 U.S. at 682).
Plaintiff cites Intel Corp. v. Commonwealth Scientific & Indus. Research Org., 455 F.3d
1364 (Fed. Cir. 2006), to support his argument that a state-patent owner may waive sovereign
immunity by licensing or threatening to enforce its patents. Pl.’s Disc. Br. at 5. Intel, however, is
inapposite because the immunity at issue in that case was conferred by the Foreign Sovereign
Immunities Act (“FSIA”), 28 U.S.C. §§ 1602-11, not by the Eleventh Amendment. Id. at 1366.
As the court noted, FSIA contains an immunity exception for foreign sovereigns engaged in
2
The cases cited by Plaintiff are inapplicable. In Comeau v. Volusia Cnty., 609-CV-
1907-ORL28KRS, 2010 WL 2293291 (M.D. Fla. June 7, 2010), the court, relying on a Florida
Supreme Court case, held that determining whether “a governmental action qualifies as a
discretionary governmental process,” which Florida exempted from a waiver of immunity, was a
“fact-intensive inquiry.” Id. at *2 (internal quotations omitted) (citing Commercial Carrier Corp.
v. Indian River Cnty., 371 So. 2d 1010, 1919 (Fla. 1979)). In Walker v. City of Waterbury, 228
F.R.D. 118 (D. Conn. 2005), the court declined to rule whether a non-party was entitled to
sovereign immunity because the non-party, not the plaintiff, would “be in a far better position . . .
to bring to the Court's attention all relevant facts.” Id. at 120-21. None of the unique
circumstances present in these cited cases apply here; instead, UMass falls squarely within the
definition of an “arm of the state” as elucidated by the five-factor test.
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“commercial activity carried on in the United States.” Id. at 1369 (quoting 28 U.S.C.
§ 1605(a)(2)). The FSIA’s legislative history emphasizes Congress’s attempt to “codify the
so-called ‘restrictive’ principle of sovereign immunity, . . . [wherein] the immunity of a foreign
state is ‘restricted’ to suits involving a foreign state's public acts . . . and does not extend to suits
based on its commercial or private acts . . . .” Id. (citing H.R.Rep. No. 94-1487, at 7 (1976),
reprinted in, 1976 U.S.C.C.A.N. 6604, 6605). As the Supreme Court has made clear, however,
Eleventh Amendment sovereign immunity cannot be characterized as “restrictive.” See, e.g.,
Coll. Sav. Bank v. Fla. Prepaid Postsecondary Educ. Expense Bd., 527 U.S. 666, 686 n.4
(“[S]tate sovereign immunity, unlike foreign sovereign immunity, is a constitutional doctrine
that is meant to be both immutable by Congress and resistant to trends.”). Except for the specific
methods of waiver previously identified, the Eleventh Amendment does not contain exceptions
for the commercial activity of states. As such, the information that Plaintiff seeks about UMass’s
use of the patents in suit would not support a waiver of sovereign immunity.
Even assuming that UMass litigates or licenses the patents in suit, UMass has not
“invoked” the jurisdiction of this federal court by engaging in “classic litigation tactics . . . [with]
the patents in suit” or by participating in an inter partes reexamination. See Pl.’s Disc. Br. at 6. A
state’s filing of a patent infringement suit does not effectuate a complete waiver of sovereign
immunity, even with respect to the infringed patents. See Tegic Commc'ns, 458 F.3d at 1341-43.
Any such waiver is limited to the complete adjudication of the state’s suit, including any
compulsory counterclaims, in the state’s chosen forum. See id. The state’s suit does not,
however, waive sovereign immunity from a suit on the same patent filed in a different court by a
different party. See id. (citing Lapides v. Bd. of Regents of the Univ. Sys. of Ga., 535 U.S. 613,
620 (2002)) (“While waiver in the litigation context focuses on the litigation act, the waiver must
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nonetheless be “clear.’”). Thus, no evidence of any litigation by UMass of the patents in suit,
assuming that such litigation exists, would effectuate any waiver of immunity sufficient to permit
Plaintiff’s suit in this district. Further, to the extent that UMass may have participated in the inter
partes reexamination of one of the relevant patents, that reexamination, at most, would have
waived UMass’s immunity to any review of that decision. See Vas-Cath, Inc. v. Curators of
Univ. of Mo., 473 F.3d 1376, 1384 (Fed. Cir. 2007) (“[W]hen the University initiated and
participated in the interference, its participation included the ensuing statutory review
procedures; the University cannot invoke Eleventh Amendment immunity, after it prevailed, to
shield the agency decision from review.”).
Because none of the theories advanced by Plaintiff can demonstrate that UMass is not
entitled to, or has waived, state sovereign immunity, Plaintiff’s proposed discovery is not
relevant. Accordingly, Plaintiff’s Motion for Jurisdictional Discovery is denied with respect to
any issues relating to sovereign immunity. Further, there does not appear to be any dispute in the
case law that UMass is an arm of the state of Massachusetts entitled to sovereign immunity; thus,
UMass is dismissed from this lawsuit.3
3
The Court recognizes that Plaintiff has not been heard on the legal issues surrounding
UMass’s status as an arm of the state. The Court has independently researched the issues in
granting this portion of Defendants’ motion and concludes the dictates of sovereign immunity
and efficiency counsel the immediate dismissal of UMass. If, however, Plaintiff believes the
Court’s conclusion on this point is in error, then Plaintiff is given leave to file a motion to
reconsider within 14 days stating the legal basis for his contrary conclusion.
Plaintiff also argues that discovery is necessary so he can determine the appropriate
UMass officers to sue pursuant to Ex Parte Young, 209 U.S. 123 (1908). Plaintiff’s citation to
Univ. of Utah v. Max-Planck-Gesellschaft zur Forderung der Wissenschaften E.V., 881 F. Supp.
2d 151 (D. Mass. 2012), appears to provide that information. In Univ. of Utah, instead of UMass,
the plaintiff filed suit against the “President of the University of Massachusetts . . . Executive
Vice President and Chief Operating Officer of the University of Massachusetts . . . Senior Vice
President for Administration, Finance, & Technology and University Treasurer of the University
of Massachusetts . . . and . . . Executive Director, Office of Technology Management of the
Page 10 – OPINION AND ORDER
B. Personal Jurisdiction
Defendants also argue that this case should be dismissed because they are not subject to
personal jurisdiction in this forum. Plaintiff responds that Defendants’ actions and use of the
patents in suit, primarily through licensing, are sufficient to confer personal jurisdiction. He
requests related discovery to support his contentions.
To assert personal jurisdiction over an out-of-state defendant in a patent-related dispute, a
court must resolve two inquiries: “whether a forum state’s long-arm statute permits service of
process and whether assertion of personal jurisdiction violates due process.” Genetic Implant
Sys., Inc. v. Core-Vent Corp., 123 F.3d 1455, 1458 (Fed. Cir. 1997). In this case, these inquiries
merge because Oregon’s long-arm statute extends jurisdiction “to the outer limits of due
process.” State ex rel. Hydraulic Servocontrols Corp. v. Dale, 294 Or. 381, 384 (1982); accord
Inamed Corp. v. Kuzmak, 249 F.3d 1356, 1360 (Fed. Cir. 2001) (“[B]ecause California’s long-
arm statute is coextensive with the limits of due process, the two inquiries collapse into a single
inquiry: whether jurisdiction comports with due process.”).
The Due Process Clause “protects an individual’s liberty interest in not being subject to
the binding judgments of a forum with which he has established no meaningful contacts, ties, or
relations.” 4 Burger King Corp. v. Rudzewicz, 471 U.S. 462, 471-72 (1985) (internal quotation
University of Massachusetts,” each in their official capacities. Id. at 151. If Plaintiff so chooses,
he is given leave to amend his complaint to include some or all of these officials. See Fed. R.
Civ. P. 15(a) (“The court should freely give leave [to amend] when justice so requires.”).
4
The Federal Circuit has noted that because a federal court’s subject matter jurisdiction
to hear patent disputes is based on federal question jurisdiction, 28 U.S.C. § 1331, rather than
diversity jurisdiction, 28 U.S.C. § 1332, the Due Process Clause of the Fifth Amendment, rather
than the Due Process Clause of the Fourteenth Amendment, governs the court’s assertion of
personal jurisdiction. Deprenyl Animal Health, Inc. v. Univ. of Toronto Innovations Found., 297
F.3d 1343, 1350 (Fed. Cir. 2002); see generally Honeywell, Inc. v. Metz Apparatewerke, 509
F.2d 1137, 1143 (7th Cir. 1975). Int’l Shoe Co. v. Washington, 326 U.S. 310 (1945), and its
Page 11 – OPINION AND ORDER
marks and citation omitted). To satisfy due process, the plaintiff must show that the defendant
has “certain minimum contacts with [the forum state] such that the maintenance of the suit does
not offend traditional notions of fair play and substantial justice.” Int’l Shoe Co. v. Washington,
326 U.S. 310, 316 (1945). Under the “minimum contacts” test, “a defendant may be subject to
either specific jurisdiction or general jurisdiction.” LSI Indus. Inc. v. Hubbell Lighting, Inc., 232
F.3d 1369, 1375 (Fed. Cir. 2000). A court has general personal jurisdiction over an out-of-state
defendant when that defendant has “continuous and systematic general business contacts” with
the forum state. Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 416 (1984). A
court has specific personal jurisdiction where “the defendant has purposefully directed his
activities at residents of the forum, and the litigation results from alleged injuries that arise out of
or relate to those activities.” Burger King Corp., 471 U.S. at 472 (internal quotation marks and
citations omitted). Thus, in “contrast to general, all-purpose jurisdiction, specific jurisdiction is
confined to adjudication of issues deriving from, or connected with, the very controversy that
establishes jurisdiction.” Goodyear Dunlop Tires Operations, S.A. v. Brown, 131 S. Ct. 2846,
2851 (2011) (internal quotation marks and citation omitted).
In this case, the parties disagree about the extent to which actions of related third-
parties—primarily licensees and co-inventors—can subject an entity to personal jurisdiction in a
forum. Plaintiff’s primary contentions are that Defendants’ use of the patents through licensing
and the actions of the patents’ listed inventors subject Defendants to personal jurisdiction in
progeny were decided under the Due Process Clause of the Fourteenth Amendment. See id.
at 311 (the question “for decision [is] whether, within the limitations of the due process clause of
the Fourteenth Amendment, appellant, a Delaware corporation, has by its activities in the State
of Washington rendered itself amenable to proceedings in the courts of that state”). Nonetheless,
the Federal Circuit applies the standards developed in Int’l Shoe and its progeny “to Fifth
Amendment due process cases arising under the federal patent laws.” Deprenyl Animal Health,
297 F.3d at 1350.
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Oregon. As a basis for general personal jurisdiction, Plaintiff asserts that Defendants support
research conducted in Oregon.
Personal jurisdiction cannot be based on “the ‘unilateral activity of another party or a
third person,’” Burger King Corp., 471 U.S. at 475 (quoting Helicopteros Nacionales, 466 U.S.
at 417). Jurisdiction may be appropriate, however, when a party’s contacts with a forum resident
create “continuing obligations” between the parties. See id. at 475-76. The mere existence of a
licensor-licensee relationship is insufficient, without more, to subject the licensor to personal
jurisdiction in a forum where its licensee has sufficient contacts. See Red Wing Shoe Co., Inc. v.
Hockerson-Halberstadt, Inc., 148 F.3d 1355, 1361 (Fed. Cir. 1998) (“[D]oing business with a
company that does business in Minnesota is not the same as doing business in Minnesota.”).
Indeed, due process requires more than “contact with parties in the forum state beyond the
sending of cease and desist letters or mere attempts to license the patent at issue there.” See
Breckenridge Pharm., Inc. v. Metabolite Laboratories, Inc., 444 F.3d 1356, 1366 (Fed. Cir.
2006). Where a defendant-licensor grants an exclusive license to a third-party doing business in
a forum, a court must give “close examination” to the license agreement. Id. Personal jurisdiction
is proper in the third party-licensee’s forum where the license gives the defendant-licensor “the
right to litigate infringement cases or granting the licensor the right to exercise control over the
licensee's sales or marketing activities.” Id.
In declarations submitted in support of their motion to dismiss, Defendants aver that no
licensee of the patents in suit is domiciled in Oregon. See Allen Decl., Dkt. 20, ¶ 6; Williams
Decl., Dkt. 21, ¶ 6. Plaintiff argues that there is evidence that product derived from the patents in
suit are manufactured and sold in Oregon. See, e.g., Kelber Decl., Dkt. 32, Exs. B. Defendants
contend that any such licenses would be legally insufficient to support jurisdiction, but their
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argument omits any discussion of the nature of the licenses. Further, the distinction between non-
exclusive and exclusive licenses is not as clear as Defendants suggest. See generally
Breckenridge, 444 F.3d at 1366 (delineating between “mere attempts to license the patent at
issue” and exclusive licenses, without discussing non-exclusive licenses). What is clear,
however, is that the nature of the relationship between Defendants and their licensees in Oregon,
if any, may be relevant to the resolution of the question of personal jurisdiction. See Digeo, Inc.,
505 F.3d at 1370.
Thus, the Court will permit Plaintiff to conduct limited discovery regarding this issue of
personal jurisdiction. To that extent, the Court GRANTS IN PART Plaintiff’s motion for
discovery related to personal jurisdiction. Dkt. 30. Given the potentially dispositive nature of the
still-pending Rule 12(b)(7) motion, however, which can independently resolve this case, the
grant of this discovery is stayed. See, e.g., Alaska Cargo Transp., Inc. v. Alaska R.R. Corp., 5
F.3d 378, 383 (9th Cir. 1993) (affirming a district court’s stay of discovery when there was no
indication “the discovery sought was relevant to whether or not the court has subject matter
jurisdiction”); Jarvis v. Regan, 833 F.2d 149, 155 (9th Cir. 1987) (affirming a district court’s
stay of discovery when the complaint “did not raise factual issues that required discovery for
their resolution”).
Finally, the Court GRANTS Plaintiff’s request for a Rule 16 conference. Dkt. 33. The
Courtroom Deputy will contact the parties to arrange for a telephone conference for that purpose.
CONCLUSION
Defendants’ Motion to Dismiss (Dkt. 18) is GRANTED IN PART AND DEFERRED IN
PART; Defendant University of Massachusetts is DISMISSED, and the Court’s ruling on the
remaining issues contained in Defendants’ motion is DEFERRED. Within 14 days, Plaintiff may
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file a motion for reconsideration as provided for in footnote 3 of the Court’s Opinion and Order.
Also within 14 days, Plaintiff shall file his response to Defendant Carnegie Institution of
Washington’s Motion to Dismiss (Dkt. 18) concerning the argument that the University of
Massachusetts is a necessary party. Defendant Carnegie Institution of Washington shall file its
reply brief 14 days thereafter. As part of this briefing, the parties should also address the
following two questions: (1) If this case must be dismissed because the University of
Massachusetts is necessary party, may Plaintiff bring this action in any other court of competent
jurisdiction; and (2) if not, does this result raise due process concerns? See Xechem Int'l, Inc. v.
Univ. of Tex. M.D. Anderson Cancer Ctr., 382 F.3d 1324, 1332-35 (Fed. Cir. 2004) (Newman, J.
additional views). Plaintiff’s Motion for Jurisdictional Discovery (Dkt. 30) is GRANTED IN
PART AND DENIED IN PART; Plaintiff’s request for discovery regarding personal jurisdiction
is GRANTED BUT STAYED, and Plaintiff’s request for discovery regarding any other matter
is, at this time, DENIED. Plaintiff’s Motion for a Rule 16 conference (Dkt. 33) is GRANTED;
the Courtroom Deputy will contact counsel for the parties to arrange for a telephonic Rule 16
conference. Finally, the deadline for Plaintiff to file an amended complaint will be set during the
Rule 16 conference.
IT IS SO ORDERED
DATED this 28th day of May, 2013.
/s/ Michael H. Simon
Michael H. Simon
United States District Judge
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