Opinion
Civil Action No. 21-11088
04-29-2022
Ziv HARISH v. Isaac RUBINSTEIN, et al.
Noam Joseph Kritzer, Bakos & Kritzer, Florham Park, NJ, Ryan Scott McPhee, Bakos & Kritzer, San Diego, CA, for Ziv Harish. Katherine Ann Escanlar, Saiber LLC, Florham Park, NJ, for Ehud Arbit, Isaac Rubinstein.
Noam Joseph Kritzer, Bakos & Kritzer, Florham Park, NJ, Ryan Scott McPhee, Bakos & Kritzer, San Diego, CA, for Ziv Harish.
Katherine Ann Escanlar, Saiber LLC, Florham Park, NJ, for Ehud Arbit, Isaac Rubinstein.
LETTER ORDER
MADELINE COX ARLEO, United States District Judge Dear Litigants:
This matter comes before the Court on Defendants Isaac Rubinstein's ("Rubinstein") and Dr. Ehud Arbit's ("Dr. Arbit" and together with Rubinstein, "Defendants") Motion to Dismiss the Complaint, ECF No. 8. Plaintiff Dr. Ziv Harish ("Plaintiff") opposes the Motion, ECF No. 15. For the reasons explained below, the Motion is GRANTED .
The following facts are drawn from the Complaint, ECF No. 1.
This patent action arises out a dispute over the inventorship of an allergy-skin test that inflicts reduced amounts of pain on the patient. See generally Compl. Plaintiff asks this Court to determine that he is the sole inventor of U.S. Reissue Patent No. RE46,823. See id. Ex. A, ECF No. 1.2 (the "’823 Patent"). The ’823 Patent presently names Plaintiff, Defendants, and nonparty Russel Weinzimmer ("Weinzimmer") as inventors (collectively, the "Named Inventors").
In December 2009, Plaintiff began developing an improved automatic syringe to inject medicines. Id. ¶ 15. Plaintiff convened a group with Defendants to "further develop and commercialize the automatic syringe" and sought the services of Weinzimmer, a patent attorney. Id. ¶¶ 15-16. In March 2010, Plaintiff "contemplated adding a pain reducing component to the automatic syringe." Id. ¶ 17. After Plaintiff asked Dr. Arbit to identify a theory concerning "the use of a non-painful input to impact pain," Dr. Arbit directed Plaintiff to the "gate control" theory, which states that "application of a non-painful input can affect a person's nerves, thereby reducing a pain sensation from traversing the person's nervous system." Id. ¶¶ 17-18. Several hours after meeting with Dr. Arbit, Plaintiff conceived of a new medical device with "alternating sharp and dull pressure heads" to reduce the pain resulting from an allergy skin test. Id. ¶¶ 19-20.
By May 2010, the Named Inventors had agreed to cooperate to seek patent protection and commercialize Plaintiff's invention. Id. ¶ 22. In September 2010, Weinzimmer provided a draft patent application to Plaintiff and Defendants, and the Named Inventors each signed a declaration of inventorship. Id. ¶¶ 26-27. Weinzimmer filed the application on October 11, 2010, which listed himself, Plaintiff, and Defendants as co-inventors. Id. ¶ 28. On December 3, 2013, the United States Patent & Trademark Office ("USPTO") issued Patent No. 8,597,199, which identifies each of the Named Inventors. See id. Ex. B. (the " ’199 Patent") at 2, ECF No. 1.3.
The Court refers to the page numbers on the electronically filed versions of the patents attached to the Complaint.
Some time after the ’199 Patent issued, Plaintiff and Weinzimmer determined that the patent's specification provided legal support for broader claims than those previously asserted and prepared to file a reissue application with the USPTO. Compl. ¶¶ 32-33. Plaintiff and Weinzimmer also allegedly concluded that Plaintiff was the "only true inventor" of the invention to be claimed in the new application. Id. ¶¶ 34-35. However, Weinzimmer nonetheless listed each of the Named Inventors on the reissue application. Id. ¶ 40.
35 U.S.C. § 251(d) permits an inventor to seek reissuance of a patent to enlarge the scope of claims within two years of the issuance of the original patent.
The USPTO issued the ’823 Reissue Patent on May 8, 2018, again listing each of the Named Inventors as joint inventors. See ’823 Patent at 1. On October 1, 2019, Weinzimmer assigned his interest in the ’823 Patent to Plaintiff. Compl. ¶ 54. Thereafter, in June 2020, Defendants executed an assignment to transfer their interests in the ’823 Patent to nonparty Lincoln Diagnostics, Inc. ("Lincoln"), in exchange for compensation. Id. ¶¶ 64-66; see also Declaration of Brian Apel ("Apel Decl.") Ex. 1, ECF No. 17.1.
The reissuance of a patent results in "the surrender of the original patent," but the reissued patent acts as a "continuation" of the original patent to the extent its claims are substantially identical. 35 U.S.C. § 252.
Defendants’ assignment was publicly filed with the USPTO and may be considered on a motion to dismiss.
Plaintiff initiated this action on May 11, 2021 by filing a four-count Complaint seeking (1) correction of inventorship to name Plaintiff as the sole inventor of the ’823 Patent, pursuant to 35 U.S.C. § 256 (" Section 256"), Compl. ¶¶ 67-70 ("Count I"); (2) a declaratory judgment to quiet title in the ’823 Patent, id. ¶¶ 71-78 ("Count II"); (3) damages for Defendants’ alleged unfair competition, id. ¶¶ 79-82 ("Count III"); and (4) renumeration for Defendants’ alleged unjust enrichment, id. ¶¶ 83-87 ("Count IV"). Defendants now move to dismiss the Complaint. ECF No. 8.
The Complaint does not allege that Defendants or Weinzimmer were incorrectly named as inventors on the original ’199 Patent.
II. LEGAL STANDARD
In considering a Rule 12(b)(6) motion to dismiss, the Court accepts all pleaded facts as true, construes the complaint in the plaintiff's favor, and determines "whether, under any reasonable reading of the complaint, the plaintiff may be entitled to relief." Phillips v. County of Allegheny, 515 F.3d 224, 233 (3d Cir. 2008) (internal quotation marks and citation omitted). To survive a motion to dismiss, the claims must be facially plausible, meaning that the pleaded facts "allow[ ] the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). The allegations must be "more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007).
III. ANALYSIS
Defendants argue that each count of the Complaint fails to state a claim upon which relief may be granted. The Court agrees but will grant Plaintiff leave to amend the Complaint.
A. Correction of Inventorship (Count I) and Quiet Title (Count II)
Plaintiff asks the Court to "correct" the ’823 Patent to remove Defendants as misjoined inventors, and to list Plaintiff as the sole inventor, because neither Defendants nor Weinzimmer contributed to the invention's conception. Defendants maintain that Plaintiff has failed to set forth a plausible claim for correction under Section 256 and that even if Plaintiff could state such a claim, it is barred by laches. Further, the parties agree that Plaintiff's quiet title claim rises or falls with the correction claim because "in the context of joint inventorship, each co-inventor presumptively owns a pro rata undivided interest in the entire patent, no matter what their respective contributions." Ethicon, Inc. v. U.S. Surgical Corp., 135 F.3d 1456, 1465 (Fed. Cir. 1998).
The Court finds that Counts I and II must be dismissed for two reasons, which it addresses in turn. First, Plaintiff has not indicated whether he has provided notice of this action to Weinzimmer or Lincoln, who are not named as defendants. Second, the Complaint fails to plausibly rebut the presumption of inventorship through allegations that neither Rubinstein nor Dr. Arbit contributed to the conception of the invention claimed in the ’823 Patent.
1. Notice to Concerned Parties
Section 256 creates a cause of action for judicial correction of "the error of omitting inventors or naming persons who are not inventors" on a patent "on notice and hearing of all parties concerned." 35 U.S.C. § 256 ; see MCV, Inc. v. King-Seeley Thermos Co., 870 F.2d 1568, 1570 (Fed. Cir. 1989). "Concerned" parties in this context are the "named inventors, omitted inventors, and assignees." Janssen Pharms., Inc. v. Teva Pharms. USA, Inc., No. 18-734, 2021 WL 5323737, at *42 (D.N.J. Nov. 16, 2021) (citation and quotation marks omitted).
While Plaintiff has alleged that Weinzimmer, a listed inventor on the ’823 Patent, "does not oppose a correction of inventorship," Compl. ¶ 53, Plaintiff has not named Weinzimmer as a defendant nor indicated whether Weinzimmer has been notified of this action. Plaintiff has also not specified whether he notified Lincoln, the assignee of Defendants’ interests in the ’823 Patent. Count I is subject to dismissal on that basis alone. See, e.g., Dyke v. Wake Forest Univ. Health Scis., No. 21-627, 2021 WL 5566505, at *7 (M.D.N.C. Nov. 29, 2021).
Section 256 does not necessarily require each concerned party to be named as a defendant; however, they must at least be notified of the pending action and given the opportunity to be heard with respect to issues impacting their interests.
Moreover, providing notice of the instant Complaint would be futile because it fails to state a plausible claim of sole inventorship under Section 256, as discussed below.
2. Sole Inventorship Claim
"[S]ection 256 allows deletion of a misjoined inventor whether that error occurred by deception or by innocent mistake." Stark v. Advanced Magnetics, Inc., 119 F.3d 1551, 1555 (Fed. Cir. 1997). However, "[t]he inventors as named in an issued patent are presumed to be correct," and a plaintiff bears a "heavy" burden to show misjoinder. Hess v. Advanced Cardiovascular Sys., Inc., 106 F.3d 976, 980 (Fed. Cir. 1997). Ultimately, a plaintiff must prove misjoinder by clear and convincing evidence. Id. At the pleading stage, a claim of sole inventorship must set forth "specific allegations" plausibly suggesting that the plaintiff "conceived of the total patented invention and that any contribution by the [other] named inventors ... was insignificant." Opternative, Inc. v. Jand, Inc., No. 17-6936, 2018 WL 3747171, at *8 (S.D.N.Y. Aug. 7, 2018). "Conclusory and vague statements" of sole ownership are insufficient. Id.
The Court need not address Defendants’ argument that Rule 9(b) applies to a Section 256 claim arising from a "mistake" in naming inventors. Even under the more permissive "plausibility" standard of Rule 8, the Complaint fails to state a claim for relief.
A person is a joint inventor if he "contribute[d] to the conception of the claimed invention." Blue Gentian v. Tristar Prod., Inc., 434 F. Supp. 3d 203, 217 (D.N.J. 2020) (citing Fina Oil & Chem. Co. v. Ewan, 123 F.3d 1466, 1473 (Fed. Cir. 1997) ). There is no "lower limit on the quantum or quality of the inventive contribution required for a person to qualify as a joint inventor," and a meaningful contribution to the conception of even one claim in a patent can suffice to establish inventorship. Id. (citation and quotation marks omitted). Still, courts have drawn a distinction between "actual contributions to conception" and "more prosaic contributions to the inventive process." See Eli Lilly & Co. v. Aradigm Corp., 376 F.3d 1352, 1359 (Fed. Cir. 2004). For example, a person who merely provides "well-known principles or explains the state of the art" cannot, without more, be named as a joint inventor. Ethicon, 135 F.3d at 1460.
Plaintiff's claim requires specific, nonconclusory factual allegations that, if true, would plausibly rebut each Defendant's presumption of inventorship. With respect to Dr. Arbit, The Complaint appears to have satisfied this burden. Plaintiff alleges that in September 2010, as Weinzimmer was preparing the application for the initial ’199 Patent, Dr. Arbit identified his contribution to the invention as "The Gate theory of pain – the incorporation of a blunt probe to the array of sharp tips." Compl. ¶ 55. The Complaint further sets forth specific allegations that (a) Dr. Arbit provided information to Plaintiff about the gate theory only in response to a specific request by Plaintiff to identify a "theory directed to the use of a non-painful input to impact pain," id. ¶ 17; (b) the gate theory was conceived of in 1960, id. ¶ 56; and (c) after learning about the gate theory from Dr. Arbit, Plaintiff, building off his prior work into automatic syringes, alone conceived of a new allergy skin test with "alternating sharp and dull pressure heads," id. ¶¶ 15, 19-20. Taken as true, these allegations plausibly suggest that Dr. Arbit's sole contribution to the invention was providing "well-known principles" to Plaintiff. See Ethicon, 135 F.3d at 1460.
Defendants also argue that even if Plaintiff can state a claim for misjoinder, it is barred by the equitable doctrine of laches. They specifically contend that a presumption of laches attaches because the original ’199 Patent issued more than six years ago and that despite the reissuance of the patent in 2018, Plaintiff's claim of misjoinder arises from the inventive process preceding the original application. See Serdarevic v. Advanced Med. Optics, Inc., 532 F.3d 1352, 1360 (Fed. Cir. 2008) ("[A] delay of more than six years after the omitted inventor knew or should have known of the issuance of the patent will produce a rebuttable presumption of laches."); see also 35 U.S.C. § 252 (providing that a reissued patent "shall have the same effect and operation in law, on the trial of actions for causes thereafter arising, as if the same had been originally granted in such amended form"). While Defendants’ argument carries some weight, laches is an affirmative defense typically unsuitable for resolution on a motion to dismiss. See Advanced Cardiovascular Sys., Inc. v. Scimed Life Sys., Inc., 988 F.2d 1157, 1161 (Fed. Cir. 1993) (holding that in a Section 256 claim, laches cannot be decided at the pleading stage "based solely on presumptions"). Even assuming a presumption of laches applies, Plaintiff must be afforded an opportunity to rebut it.
By contrast, Plaintiff asserts only conclusory allegations against Rubinstein. The Complaint alleges that in September 2010, Rubinstein wrote that his contribution to the invention was "the mechanical aspects of the preferred embodiment." Compl. ¶ 59. The Complaint does not further explain Rubinstein's role in the inventive process nor attempt to identify the relevant "mechanical aspects" of the patent. Instead, Plaintiff merely alleges that "Mr. Rubinstein did not contribute the mechanical aspects of the preferred embodiment." Id. ¶ 60. Even at the pleading stage, Plaintiff must supply more than this conclusory statement to plausibly rebut the presumption of inventorship. Plaintiff has therefore failed to plausibly allege misjoinder as to Rubinstein, which is fatal to his claim of sole inventorship. See Opternative, 2018 WL 3747171, at *8 ("[A] claim of sole inventorship necessitates that the proposed inventor conceived of the total patented invention."). The Court will dismiss Counts I and II of the Complaint.
In opposing the Motion, Plaintiff has submitted a December 2015 email sent from Weinzimmer to his paralegal in connection with the reissue application, in which Weinzimmer states "if [Rubinstein] invented anything, it's the FLEXIBLE arms ... that's what's being removed from the claims." Declaration of Ziv Harish Ex. A, ECF No. 15.2. Claim 10 of the original ’199 Patent referred to an allergy skin test device with heads supported by flexible arms, while the broader claim 10 of the reissued ’823 Patent removed such references. See ’199 Patent at 6; ’823 Patent at 14.
Weinzimmer's email is not attached to, incorporated by, or relied on by the Complaint and cannot be considered on a motion to dismiss. Regardless, and even accepting the mental impressions of Plaintiff's attorney as true, the email still does not fully explain Rubinstein's role in the inventive process. Moreover, Plaintiff has not explained how a contribution Rubinstein may have made to claims in the ’199 Patent could be effectively erased by reissuing the patent to broaden those claims.
While Plaintiff could conceivably proceed on a misjoinder claim solely against Dr. Arbit, the Complaint clearly asserts only a claim of sole inventorship. Compl. ¶¶ 67-70.
B. Unfair Competition (Count III)
Count III of the Complaint alleges that Defendants engaged in unfair competition but does not indicate the governing law or operative facts supporting Plaintiff's claim. See Compl. ¶¶ 79-82. In opposing the Motion, Plaintiff clarifies that he is asserting a claim under New Jersey common law based on a theory that Defendants misappropriated Plaintiff's commercial property when they assigned their interests in the ’823 Patent to Lincoln. Pl. Opp. at 23. Defendants argue that Plaintiff has failed to plausibly allege such a claim, and the Court agrees.
A plaintiff asserting a common law claim for unfair competition must allege two essential elements: (1) "the misappropriation of one's property by another ... which has some sort of commercial or pecuniary value"; and (2) "bad faith or malicious conduct." Vorhees v. Tolia, No. 16-8208, 2020 WL 1272193, at *11 (D.N.J. Mar. 17, 2020) (citation and quotation marks omitted); see also Hoffman-La Roche Inc. v. Genpharm Inc., 50 F. Supp. 2d 367, 380 (D.N.J. 1999) ("The key to the tort of unfair competition is misappropriation of property of commercial value."). Plaintiff has failed to plausibly allege either element.
First, Plaintiff has not alleged that Defendants misappropriated any commercial property belonging to Plaintiff. Absent an agreement to the contrary, each co-owner of a patent has the right to license or assign his interest without the consent of any other co-owner. See Schering Corp. v. Roussel-UCLAF SA, 104 F.3d 341, 344 (Fed. Cir. 1997) ; see also Ethicon, 135 F.3d 1456 at 1468 ("[P]atent co-owners are at the mercy of each other."). The publicly-filed assignment to Lincoln indicates that Defendants assigned only their own interest in the ’823 Patent and makes no representations with respect to other inventors. See Apel Decl. Ex. 1 ("WE covenant that WE have full right to convey our entire interest herein assigned."). As Defendants correctly argue, even if Plaintiff prevailed on his correction claim, the result would simply be that Defendants had no interest to assign. In either case, and despite any grievance Lincoln may have with that result, Plaintiff's own interest in the ’823 Patent is not impacted.
Second, Plaintiff has failed to plausibly allege that Defendants acted maliciously or in bad faith. Plaintiff's opposition seeks to merge the two separate elements of unfair competition by arguing that "assigning rights one does not possess is conduct performed in bad faith and/or constitutes malicious conduct." Pl. Opp. at 24. Yet Plaintiff also expressly concedes that he "does not allege deceptive intent on the part of Defendants in being named inventors of the ’823 patent." Id. at 7. Absent any allegations of wrongful conduct in acquiring inventorship rights, Defendants’ apparent reliance on a presumption of ownership in assigning their respective interests does not create an inference of bad faith. A later ruling that Defendants were erroneously, but honestly, listed as inventors would not retroactively alter Defendants’ state of mind at the time of the assignment nor provide evidence that Defendants acted maliciously.
Count III therefore fails to state a claim for unfair competition.
C. Unjust Enrichment (Count IV)
Defendants last argue that Count IV fails to state a claim for unjust enrichment. The Court again agrees.
A claim for unjust enrichment under New Jersey common law requires allegations that (1) "the opposing party received a benefit;" (2) "retention of that benefit without payment would be unjust;" and (3) the plaintiff "expected remuneration from the defendant at the time it performed or conferred a benefit on defendant and that the failure of remuneration enriched defendant beyond its contractual rights." Thieme v. Aucoin-Thieme, 227 N.J. 269, 288, 151 A.3d 545 (2016).
Plaintiff appears to set forth two theories of unjust enrichment, each of which is unavailing. First, the Complaint alleges that "[p]ermitting [Defendants] to retain the benefits of the misuse and misappropriation of [Plaintiff's] rights in the ’823 Patent" would be inequitable. Compl. ¶ 86. As discussed above, however, Defendants have not misappropriated Plaintiff's patent interest, but have simply assigned their own rights, to the extent they exist. Second, Plaintiff argues that he conferred a benefit when he "invited Defendants to ‘cooperate to further seek patent protection for Dr. Harish's invention and to seek manufacturers or licensees to commercialize the product.’ " Pl. Opp. at 26 (quoting Compl. ¶ 22). Plaintiff, however, has not alleged that he expected any payment from Defendants at the time he extended such invitation.
Plaintiff's opposition also suggests that after the ’823 Patent issued, Plaintiff was "willing to continue to share the benefit with his friends who were going to help him commercialize the invention," but that Defendants then "licensed Plaintiff's’ patent without his permission." See Opp. 4, 27. But the Complaint does not allege that Defendants’ assignment breached any express or implied promise to commercialize his invention.
Consequently, the Court will dismiss Count IV for failure to state a claim for unjust enrichment.
IV. CONCLUSION
For the reasons stated above, Defendants’ Motion to Dismiss, ECF No. 8, is GRANTED . The Complaint is DISMISSED WITHOUT PREJUDICE . To the extent Plaintiff can cure the deficiencies identified in this Motion, he may file an amended pleading within thirty (30) days.