OptoLum Incorporated v. Cree Incorporated

Filing 49

ORDER - Defendant Cree, Inc.'s 22 motion to transfer venue is DENIED and its 24 motion to dismiss counts one and two is GRANTED. FURTHER ORDERED that Plaintiff OptoLum Inc.'s 34 motion to seal its response brief and 43 motion to seal its motion to strike or seal are GRANTED and the Clerk is directed to file under seal the lodged response (Doc. 35 ) and motion (Doc. 44 ). FURTHER ORDERED that Plaintiff OptoLum's 48 motion to strike or seal Cree's 42 reply brief is DENIED. Signed by Judge Douglas L Rayes on 03/21/2017. (ATD)

Download PDF
1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA 8 9 OptoLum, Inc., Plaintiff, 10 11 ORDER v. 12 No. CV-16-03828-PHX-DLR Cree, Inc., 13 Defendant. 14 15 OptoLum and Cree manufacture and sell LED lights. At issue in this case is 16 technology used inside LED lightbulbs allowing them to have the look and feel of 17 traditional incandescent bulbs while also having energy efficiency, a long useful life, and 18 a relatively low cost. OptoLum claims to be the inventor of this technology and alleges 19 that Cree has misappropriated the reputation to which OptoLum is entitled and infringes 20 on OptuLum’s patents. OptoLum filed suit against Cree in November 2016. (Doc. 1.) 21 The amended complaint asserts a false advertising under the Lanham Act, an unjust 22 enrichment claim, and two patent infringement claims. (Doc. 32.) 23 Before the Court are Cree’s motion to transfer and motion to dismiss counts one 24 and two. (Docs. 22, 24.) The motions are fully briefed. (Docs. 31, 35, 41, 42.) For 25 reasons stated below, the motion to transfer is denied and the motion to dismiss is 26 granted.1 27 28 1 OptoLum’s request for oral argument is denied because the issues are adequately briefed and oral argument will not aid the Court’s decision. See LRCiv 7.2(f). 1 I. The Motion to Transfer 2 OptoLum is based out of Tempe, Arizona and chose to file suit in this District. 3 Cree contends that the case should be transferred to the Middle District of North Carolina 4 pursuant to the change of venue statute, 28 U.S.C. § 1404, because Cree’s facilities and 5 records are in North Carolina, several potential witnesses reside there, and the case 6 has little connection to Arizona. (Doc. 22 at 1-2.) Section 1404(a) provides that a court 7 may transfer an action to any other district where it might have been brought for the 8 “convenience of the parties and witnesses, in the interest of justice[.]” 9 There is no dispute that this action could have been brought in North Carolina. 10 The Court therefore must determine whether transfer is warranted for the convenience of 11 the parties and witnesses and in the interest of justice. The Court has broad discretion in 12 making this determination “according to an ‘individualized, case-by-case consideration of 13 convenience and fairness.’” Jones v. GNC Franchising, Inc., 211 F.3d 495, 498 (9th Cir. 14 2000). In Jones, the Ninth Circuit provided a list of non-exclusive factors to consider: 15 (1) the location where relevant agreements were negotiated and executed, (2) the state 16 most familiar with governing law, (3) the plaintiff’s choice of forum, (4) the parties’ 17 contacts with the forum, (5) the contacts relating to the plaintiff’s cause of action, 18 (6) differences in cost to litigate in each forum, (7) the availability of compulsory process 19 to compel witness attendance, and (8) the ease of access to sources of proof. Id. at 20 498-99. Cree bears the burden of showing that a transfer is warranted. See Commodity 21 Futures Trading Comm’n v. Savage, 611 F.2d 270, 279 (9th Cir. 1979). 22 Having carefully considered the relevant factors, the Court finds that Cree has not 23 met its burden. Cree asserts that North Carolina is a more convenient place for it to 24 litigate because its products, documents, and witnesses are located there and this action 25 has only minimal contacts with Arizona. (Doc. 22 at 9-10.) But these are insufficient 26 reasons to transfer the case given that a transfer would merely shift inconvenience from 27 Cree to OptoLum. This Circuit has made clear that a transfer is inappropriate under 28 § 1404(a) if it “would merely shift rather than eliminate the inconvenience.” Decker -2- 1 Coal Co. v. Commonwealth Edison Co., 805 F.2d 834, 843 (9th Cir. 1986). 2 It undoubtedly would be more burdensome for Cree to litigate in Arizona than in 3 North Carolina, where Cree has its principal place of business. Nevertheless, “with the 4 advances in transportation and telecommunications and the increasing interstate practice 5 of law, any burden is substantially less than in days past.” CE Distribution, LLC v. New 6 Censor Corp., 380 F.3d 1107, 1112 (9th Cir. 2004). Moreover, given the growth of 7 “electronic communication and document production, discovery costs should be about 8 the same in either forum.” Roth v. Adtran, Inc., No. CV-13-1735-PHX-DGC, 2013 WL 9 6058294, at *3 (D. Ariz. Nov. 18, 2013). Cree is a multi-million dollar company with 10 employees and offices throughout the world. The burden it might suffer litigating in 11 Arizona is not heavy enough to overcome the “great weight” accorded to OptoLum’s 12 choice of forum. Lou v. Belzberg, 834 F.2d 730, 739 (9th Cir. 1987). 13 The federal Lanham Act and patent law claims asserted by OptoLum would be 14 equally familiar to district courts in both Arizona and North Carolina, but Cree has not 15 shown that the court in North Carolina is more familiar with Arizona law governing the 16 unjust enrichment claim. Furthermore, “Arizona has a strong interest in ensuring that its 17 citizens are compensated for their injuries.” Roth, 2013 WL 6058294, at *3 (citing 18 Ochoa v. J.B. Martin & Sons Farms, Inc., 287 F.3d 1182, 1193 (9th Cir. 2002)). 19 Courts do not lightly disturb a plaintiff’s choice of forum, particularly where, as 20 here, the forum chosen is the plaintiff’s domicile. L.A. Mem’l Coliseum v. NFL, 89 21 F.R.D. 497, 499-500 (C.D. Cal. 1981). Indeed, when “the home forum has been chosen, 22 it is reasonable to assume that this choice is convenient.” Piper Aircraft Co. v. Reyno, 23 454 U.S. 235, 255-56 (1981). The motion to transfer is denied because Cree has not 24 made a “strong showing of inconvenience to warrant upsetting [OptoLum’s] choice of 25 forum,” Decker Coal, 805 F.2d at 843, or that a change of venue otherwise is in the 26 interest of justice. 27 II. 28 The Motion to Dismiss Cree moves to dismiss the Lanham Act and unjust enrichment claims pursuant to -3- 1 Federal Rule of Civil Procedure 12(b)(6). A successful Rule 12(b)(6) motion must show 2 that the complaint lacks a cognizable legal theory or fails to allege facts sufficient to 3 support such a theory. See Balistreri v. Pacifica Police Dep’t, 901 F.2d 696, 699 (9th 4 Cir. 1988). A complaint that sets forth a cognizable legal theory will survive a motion to 5 dismiss only where it contains “sufficient factual matter, accepted as true, to ‘state a 6 claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 7 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “A claim has 8 facial plausibility when the plaintiff pleads factual content that allows the court to draw 9 the reasonable inference that the defendant is liable for the misconduct alleged.” Id. 10 (citing Twombly, 550 U.S. at 556). 11 A. 12 OptoLum purports to assert a false advertising claim under Lanham Act § 43(a), 13 15 U.S.C. 1125(a), in count one of the amended complaint. (Doc. 32 ¶¶ 192-97.) Section 14 43(a) creates a federal remedy against a person who, in connection with any goods, uses 15 in commerce a “false designation of origin, false or misleading description of fact, or 16 false or misleading representation of fact” that is likely to cause confusion as to the origin 17 of the goods, 15 U.S.C. § 1125(a)(1)(A), or misrepresents the nature, characteristics, or 18 qualities of the goods, § 1125(a)(1)(B). The elements of a false advertising claim are: 19 (1) a false statement of fact by the defendant in a commercial advertisement about its 20 own or another’s product, (2) the statement actually deceived or has the tendency to 21 deceive a substantial segment of its audience, (3) the deception is material, in that it is 22 likely to influence the purchasing decision, (4) the defendant caused its false statement to 23 enter interstate commerce, and (5) the plaintiff has been or is likely to be injured as a 24 result of the false statement. Southland Sod Farms. v. Stover Seed Co., 108 F.3d 1134, 25 1139 (9th Cir. 1997). The Lanham Act Claim for False Advertising (Count One) 26 OptoLum alleges that various statements Cree made are false and mislead 27 consumers into believing that Cree, rather than OptoLum, invented the technology inside 28 LED bulbs that allows them to produce omnidirectional light like traditional incandescent -4- 1 bulbs while also having energy efficiency, a long useful life, and a low cost. (Doc. 32 ¶¶ 2 13-21, 122-25, 171-86.) Specifically, OptoLum alleges that the following statements 3 constitute false advertising under § 43(a): 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18  The “Cree Filament Tower™ Technology” is “the genius idea inside” the Cree LED bulb (Id. ¶¶ 17, 124);  Cree “found a way to put the LEDs in the center of the bulb like a traditional light bulb” and “we’re making an LED but we are actually inventing all the technology in between” (¶ 174);  “[O]ne of the technical breakthroughs that enabled Cree to break the $10 threshold is our new Cree Filament Tower™ Technology. The Filament Tower™ is the Cree innovation that lets our LED bulb replicate the look and feel of filament based traditional lights” (¶ 175);  “[Cree] engineers came up with a very elegant solution to the design issues inherent in LED bulbs. In a compact form, the Filament Tower produced the light dispersion we wanted without problematic heat building” (¶ 176);  “[I]nventing the LED technology that delivers like an incandescent was hard work, but designing a bulb in a form-factor that consumers trust at a price they can afford was even harder. Designed with Cree LED Filament Tower Technology, the Cree LED bulb represents a breakthrough in LED bulb design and performance” (¶ 177);  “[Cree] invented the lighting-class LED” (¶ 178); and 19 20  Using in commerce the common law trademarks “Filament Tower™” and “Filament Tower™ Technology” (¶¶ 180-81). 21 22 23 24 Cree argues that the statements are nothing more than mere puffery and any claims to inventorship are not actionable under § 43(a). (Doc. 24 at 8-10.) The Court agrees. 1. § 43(a)(1)(B): The Nature, Characteristics, and Qualities of Goods 25 Statements concerning the nature, characteristics, and qualities of goods are 26 governed by Lanham Act § 43(a)(1)(B). This section renders actionable only non- 27 puffing “statements of fact capable of being proved false.” Coastal Abstract Serv., Inc. 28 v. First Am. Title Ins. Co., 173 F.3d 725, 731 (9th Cir. 1999). “‘Puffing’ is exaggerated -5- 1 advertising, blustering, and boasting upon which no reasonable buyer would rely and is 2 not actionable under § 43(a).” Southland Sod Farms, 108 F.3d at 1145. Although 3 misrepresentations about absolute characteristics of a product are actionable, statements 4 about the product “that are vague or highly subjective often amount to nonactionable 5 puffery[.]” Id. 6 The determination “whether an alleged misrepresentation ‘is a statement of fact’ 7 or is instead ‘mere puffery’ is a legal question that may be resolved on a Rule 8 12(b)(6) motion[.]” Newcal Indus., Inc. v. Ikon Office Solution, 513 F.3d 1038, 1053 (9th 9 Cir. 2008); see Cook, Perkiss & Liehe, Inc. v. N. Cal. Collection Serv., Inc., 911 F.2d 10 242, 245 (9th Cir. 1990) (a court may determine puffery as a matter of law). As 11 explained below, the Court finds the representations made by Cree about its LED 12 technology and lightbulbs are not provable statements of fact but rather “general, vague 13 and unspecified assertions, constituting mere ‘puffery’ upon which a reasonable 14 consumer could not rely.” Glen Holly Entm’t, Inc. v. Tektronix, Inc., 352 F.3d 367, 379 15 (9th Cir. 2003). 16 Cree’s assertion that its Filament Tower Technology was a “genius idea” is 17 the epitome of puffing. 18 of generalized boasting upon which no reasonable buyer would rely.” 19 Sod Farms, 108 F.3d at 1145. Similarly, statements of “innovation” and technological 20 “breakthroughs” are “not specific, not concrete, not measurable, and therefore 21 puffery.” Rosenthal Collins Group, LLC v. Trading Techs. Int’l, Inc., No. 05 C 4088, 22 2005 WL 3557947, at *10 (N.D. Ill. Dec. 26, 2005); see Soilworks, LLC v. Midwest 23 Indus. Supply, Inc., 575 F. Supp. 2d 1118, 1133 (D. Ariz. 2008) (claiming that a product 24 resulted from “state-of-the art innovation” was mere puffery); Loggerhead Tools, LLC v. 25 Sears Holdings Corp., No. 12-cv-9033, at *4 (N.D. Ill. Sept. 2016) (citing cases finding 26 the term “innovative” to be puffery); In re iPhone 4S Consumer Litig., No. C 12-1127 27 CW, 2014 WL 589388, at *6 (N.D. Cal. Feb. 14, 2014) (describing Siri as a 28 “breakthrough” and “intelligent” product constituted puffery); Tomek v. Apple, Inc., The statement is purely subjective and “precisely the type -6- Southland 1 No. 11-cv-02700-MCE, 2012 WL 2857035, at *4 (E.D. Cal July 11, 2012) (statements 2 that the MacBook Pro is a “breakthrough” that provides “huge leaps in performance” 3 were puffery). 4 The Court further finds Cree’s statement that it came up with a “very elegant 5 solution” to LED design problems sufficiently imprecise to constitute puffery. The same 6 is true with respect to Cree’s assertion that its LED bulbs have the “look and feel” of 7 traditional lights, and its boasting about the bulbs’ “long useful life” and “energy 8 efficiency and low cost.” See Newcal Indus., 513 F.3d at 1053 (assertion regarding 9 “low cost and flexibility” was mere puffery); Smith-Victor Corp. v. Sylvania Elec. 10 Products, Inc., 242 F. Supp. 302, 308 (N.D. Ill. 1965) (statement that a lightbulb was 11 “far brighter than any lamp ever before offered” constituted puffery). 12 In summary, OptoLum has failed to allege that Cree made a false or misleading 13 statement of provable fact regarding the nature, characteristics, or qualities of its LED 14 bulbs. Thus, OptoLum has failed to state a plausible claim to relief for false advertising 15 under Lanham Act § 43(a)(1)(B). 16 2. § 43(a)(1)(A): The Origin of Goods 17 Statements concerning the origin, sponsorship, or approval of goods are governed 18 by Lanham Act § 43(a)(1)(A). The amended complaint does not specify whether the 19 false advertising claim is brought under § 43(a)(1)(A) or (B). In its response, however, 20 OptoLum contends that Cree’s statements were misleading because the claimed 21 ingenuity, innovation, and technological breakthroughs resulted in the “Cree Filament 22 Tower™ Technology,” which purportedly was invented by OptoLum’s founder, Joel 23 Dry, many years earlier. (Doc. 31 at 8.) OptoLum alleges that using the trademarks 24 “Filament Tower” and “Filament Tower Technology” in conjunction with the Cree 25 company name falsely implies that Cree created the technology embodied in the Filament 26 Tower and these misleading claims to inventorship are likely to deceive consumers. 27 (Doc. 32 ¶¶ 179-83.) In short, it appears that the gravamen of OptoLum’s claim is that, 28 in marketing and selling LED bulbs with the Filament Tower Technology inside without -7- 1 attributing inventorship to Dry or OptoLum, Cree has made a false designation of origin 2 or representation of fact that is likely to cause consumer confusion as to the origin of 3 Cree’s goods. 4 But as used in § 43(a), the phrase “origin of goods” is “incapable of connoting the 5 person or entity that originated the ideas . . . that ‘goods’ embody or contain.” Dastar 6 Corp. v. Twentieth Century Fox Film Corp., 539 US. 23, 32 (2003) (emphasis added). 7 Instead, the most natural understanding of the “origin of goods,” and the one used for 8 purposes of the Lanham Act, is the actual source of the wares – that is, “the producer of 9 the tangible product sold in the marketplace.” Id. Here, there is no dispute that Cree 10 11 produced the Cree LED bulbs and Filament Tower Technology at issue in this case. OptoLum’s claim undoubtedly would have merit if Cree had bought some of 12 OptoLum’s LED bulbs and simply repackaged them as its own. 13 wrongdoing, however, is vastly different: it claims to have invented the Filament Tower 14 Technology inside its LED bulbs. 15 does not automatically assume that the brand-name company is the same entity that came 16 up with the idea for the product, or designed the product – and typically does not care 17 whether it is. The words of the Lanham Act should not be stretched to cover matters that 18 are typically of no consequence to purchasers.” Id. at 32-33. Cree’s alleged But “[t]he consumer who buys a branded product 19 OptoLum does not allege that someone other than Cree produces the Filament 20 Tower inside Cree’s LED bulbs, but contends instead that Cree falsely implies that it 21 invented the Filament Tower Technology. As noted above, however, Dastar made clear 22 that the phrase “origin of goods” in the Lanham Act refers “to the producer of the 23 tangible goods that are offered for sale and not to the author of any idea, concept, or 24 communication embodied in those goods.” 25 Dastar does not permit [OptoLum] to claim false advertising under [§] 43(a).” Baden 26 Sports, Inc. v. Molten USA, Inc., 556 F.3d 1300, 1306 (Fed. Cir. 2009). A contrary 27 holding – that is, a finding that false claims to inventorship are actionable under § 43(a) – 28 impermissibly “could create overlap between the Lanham and Patent Acts.” Id. at 1307. -8- Id. at 37. Thus, “it is apparent that 1 In summary, “Section 43(a) of the Lanham Act does not create liability from 2 [Cree’s] advertisements because those advertisements do not concern the ‘origin of 3 goods,’ to which [§] 43(a)(1)(A) is directed, nor do they concern the ‘nature, 4 characteristics, [or] qualities’ of the goods, which is what Ninth Circuit law has 5 interpreted [§] 43(a)(1)(B) to address.” Id. at 1305 (applying Sybersound Records, Inc. v. 6 UAV Corp., 517 F.3d 1137, 1144 (9th Cir. 2008)). Because OptoLum has not alleged 7 facts sufficient to state a plausible claim to relief under § 43(a), the false advertising 8 claim asserted in count one of the amended complaint is dismissed.2 9 B. Unjust Enrichment (Count Two) 10 OptoLum asserts that there is significant value in being perceived by consumers as 11 an innovator, inventor, and creator of groundbreaking technology. (Doc. 32 ¶ 193.) 12 OptoLum alleges that it rightly has earned the reputation for inventing the technology 13 enabling LED bulbs to have a long useful life and produce omnidirectional light like 14 traditional incandescent bulbs. (¶ 194.) OptoLum claims that Cree has been unjustly 15 enriched by misappropriating this reputation. (¶¶ 195-97.) 16 17 Cree argues that federal patent law preempts the unjust enrichment claim. (Doc. 24 at 14-17.) The Court agrees. 18 Federal patent law reflects the objectives of Congress, which include fostering and 19 rewarding invention, promoting disclosure of inventions to stimulate further innovation, 20 promoting the stringent requirements for patent protection to assure that ideas remain in 21 the public domain, and promoting nationwide uniformity in patent law. See Aronson v. 22 Quick Point Pencil Co., 440 U.S. 257, 266 (1979); Bonito Boats, Inc. v. Thunder Craft 23 Boats, Inc., 489 U.S. 141, 162-63 (1989). “A state cause of action that frustrates these 24 objectives is preempted.” Ultra-Precision Mfg., Ltd. v. Ford Motor Co., 411 F.3d 1369, 25 1378 (Fed. Cir. 2005) (citing Aronson, 440 U.S. at 262; Bonito Boats, 489 U.S. at 156- 26 57)). 27 2 28 Given this conclusion, the Court need not address Cree’s alternative arguments that OptoLum lacks standing to bring a Lanham Act claim and has failed to plead the claim with particularity. (Doc. 24 at 6-8, 10-12.) -9- 1 “A claim of unjust enrichment under Arizona law has five elements: ‘(1) an 2 enrichment, (2) an impoverishment, (3) a connection between the enrichment and 3 impoverishment, (4) the absence of justification for the enrichment and impoverishment, 4 and (5) the absence of a remedy provided by law.’” Perez v. First Am. Title Ins. Co., 810 5 F. Supp. 2d 986, 991 (D. Ariz. 2011) (quoting Freeman v. Sorchych, 245 P.3d 927, 936 6 (Ariz. Ct. App. 2011)). Thus, a plaintiff must demonstrate that the defendant “‘received a 7 benefit, that by receipt of that benefit the defendant was unjustly enriched at the 8 plaintiff’s expense, and that the circumstances were such that in good conscience the 9 defendant should provide compensation.” Id. 10 The question raised by Cree’s preemption argument is whether permitting the 11 Court to entertain the specific unjust enrichment claim pled by OptoLum – seeking 12 damages for Cree’s alleged misappropriation of the reputation for being the inventor of 13 LED technology – “‘stands as an obstacle to the accomplishment and execution of the 14 full purposes and objectives of Congress’ and is thus preempted.” Ultra-Precision, 411 15 F.3d at 1378 (citation omitted). At the heart of OptoLum’s unjust enrichment claim is the 16 issue of who invented “the technology that enabled LED bulbs to have a long useful life 17 and produce omnidirectional light[.]” (Doc. 32 ¶ 193.) Indeed, OptoLum asserts in its 18 response that “Cree was enriched at OptoLum’s expense because it claimed its bulbs 19 had new and novel features that were, in fact, embodied in earlier prototypes built by 20 Mr. Dry.” (Doc. 31 at 15 (emphasis added).) If Dry did not invent the LED technology 21 at issue here, the unjust enrichment claim fails because Cree could not have unjustly 22 appropriated from OptoLum the reputation for having invented the technology. 23 A claim arises under federal patent law where “‘the plaintiff’s right to relief 24 necessarily depends on resolution of a substantial question of federal patent law, 25 including that of inventorship[.]’” Brown v. Frank, No. 2CA-CV-2011-0039, 2011 WL 26 5137186, at *6 (Ariz. Ct. App. 2011) (quoting Christianson v. Colt Indus. Operating 27 Corp., 486 U.S. 800 (1988)). Here, resolution of OptoLum’s unjust enrichment claim, as 28 pled in the amended complaint, is based in part on a determination of inventorship. - 10 - 1 Significantly, OptoLum does not claim the taking of a tangible object, but alleges instead 2 that Cree has misappropriated the reputation of having invented LED technology. 3 (Doc. 32 ¶¶ 93-96.) 4 Federal patent law, however, “preempts any state law that purports to define rights 5 based on inventorship.” HIF Bio, Inc. v. Yung Shin Pharm. Indus. Co., 600 F.3d 1347, 6 1353 (Fed. Cir. 2010) (citation omitted). “A different state inventorship standard might 7 grant property rights to an individual who would not qualify as an inventor under federal 8 patent law, or might grant greater relief to inventors than is afforded by federal patent 9 law.’” Id. Either outcome would “frustrate the dual federal objectives of rewarding 10 inventors and supplying uniform national patent law standards.” Id. 11 If OptoLum’s unjust enrichment claim were available, “a would-be inventor need 12 not satisfy any of the rigorous standards of patentability to secure a perpetual patent-like 13 royalty under state law based on the use of an unpatented idea.” Ultra-Precision, 411 14 F.3d at 1381. Because OptoLum’s unjust enrichment claim depends on the determination 15 that OptoLum, not Cree, invented the LED technology at issue here, the claim is 16 preempted by federal patent law. See id. at 1381-82 (finding unjust enrichment claim to 17 be preempted where the plaintiff had alleged no confidential relationship with the 18 defendant and had disclosed information without attempting to negotiate terms of 19 payment from the defendant); Brown, 2011 WL 5137186, at *6 (affirming dismissal of 20 unjust enrichment claim alleging theft of an invention because at the core of the claim 21 was a dispute over whether the plaintiff invented the product); Core Wireless Licensing 22 S.a.r.l. v. Apple Inc., No. 12-CV-100-JRG, 2015 WL 4775973, at *4 (E.D. Tex. Aug. 11, 23 2015) (finding unjust enrichment claim preempted by the federal Patent Act); 24 Wawrzynski v. H.J. Heinz Co., No. 11-cv-1098, 2014 WL 4662091, at *1 (W.D. Pa. Sept. 25 18, 2014) (granting summary judgment on unjust enrichment claim as preempted under 26 federal patent law); Auburn Univ. v. IBM Corp., No. 09-cv-694-WHA, 2009 WL 27 3757049, at *2-4 (Nov. 9, 2009) (dismissing unjust enrichment claim as preempted by 28 - 11 - 1 federal patent law).3 2 OptoLum’s reliance on Thompson v. Microsoft Corp., 471 F.3d 1288 (Fed. Cir. 3 2006), is misplaced. (Doc. 31 at 16, n.10.) In that case, the unjust enrichment claim was 4 based on the allegation that the plaintiff had shared his technology with Microsoft in 5 confidence and with the promise that Microsoft would not appropriate the technology for 6 its own use. Id. at 1289-90. In response to Microsoft’s preemption argument, the 7 plaintiff made clear that inventorship was irrelevant to his unjust enrichment claim. Id. at 8 1292. 9 In this case, by contrast, OptoLum’s unjust enrichment claim depends on 10 resolution of the inventorship issue. OptoLum affirmative alleges that it was “Dry who, 11 many years before Cree, created an energy-efficient LED bulb with the structure that 12 Cree calls the Cree Filament Tower™ or the ‘genius’ of its LED bulb . . . and whose 13 patented design for his invention the Cree Filament Tower™ infringes.” (Doc. 32 ¶ 20 14 (emphasis added).) 15 misappropriated at the expense of OptoLum. (Id. ¶¶ 21, 193-97.) It is the reputation for this invention that Cree allegedly has 16 Moreover, unlike the plaintiff in Thompson, OptoLum does not allege that it 17 shared the LED technology in confidence and with the understanding that Cree would not 18 appropriate the technology, which might support an equitable unjust enrichment claim if 19 no formal contract existed between the parties. See Idearc Media, LLC v. Palmisano & 20 Assocs., P.C., No. CV-09-02147-PHX-JAT, 2013 WL 4774772, at *2 (D. Ariz. Sept. 5, 21 2013) (noting that under Arizona law “unjust enrichment is an alternate theory of liability 22 to a breach of contract claim”). Rather, OptoLum alleges that it openly demonstrated its 23 LED bulbs “at lighting conference throughout the world” and that “the participants were 24 25 26 27 28 3 It is worth noting that, consistent with the finding above, claims for unjust enrichment that involve the issue of authorship are preempted by federal copyright law. See McArdle v. Mattel Inc., 456 F. Supp. 2d 769, 779 & n.7 (E.D. Tex. 2006) (finding author’s unjust enrichment claim to be preempted by federal copyright law because the claim is an equitable, quasi-contractual claim that exists where there is no express contract); Tavormina v. Evening Star Productions, Inc., 10 F. Supp. 2d 729, 734 (S.D. Tex. 1998) (claim for unjust enrichment was preempted because it involved the same conduct that would fall under the scope of the Copyright Act). - 12 - 1 very much aware of what others in the community – including Mr. Dry and OptoLum – 2 were doing.” (Doc. 32 ¶¶ 98-99.) OptoLum even “distributed various written materials 3 at these conferences that explained in detail how Mr. Dry’s innovative bulb . . . 4 worked[.]” (Id. ¶ 100.) Based on OptoLum’s own allegations, it is clear that it did not 5 have a confidential or quasi-contractual relationship with Cree regarding the Filament 6 Tower Technology. 7 In summary, federal patent law preempts state law unjust enrichment claims 8 seeking to recover damages for use of public domain information or claiming to be the 9 inventor of a product. See Ultra-Precision, 411 F.3d at 1377-78. The unjust enrichment 10 claim asserted in count two therefore is dismissed.4 11 III. The Motions to Seal and Strike 12 OptoLum has filed a motion to seal its response to Cree’s motion to transfer. 13 (Docs. 34, 35). “[A] party seeking to seal judicial records must show that ‘compelling 14 reasons supported by specific factual findings outweigh the general history of access and 15 the public policies favoring disclosure.’” Pintos v. Pac. Creditors Ass’n, 605 F.3d 665, 16 677-78 (9th Cir. 2010) (citing Kamakana v. City & Cnty. of Honolulu, 447 F.3d 1172, 17 1178 (9th Cir. 2006)). OptoLum’s motion is granted because the Court finds compelling 18 reasons to seal its response brief. 19 OptoLum also has filed a motion to strike or seal Cree’s reply brief and a motion 20 to seal the motion to strike or seal. (Docs. 43, 44.) The latter motion is granted. The 21 reasons asserted by OptoLum to seal Cree’s reply brief, however, are neither compelling 22 nor sufficient to outweigh the public right of access to judicial records. The motion to 23 strike or seal is denied. 24 25 IT IS ORDERED that Defendant Cree, Inc.’s motion to transfer venue (Doc. 22) is DENIED and its motion to dismiss counts one and two (Doc. 24) is GRANTED. 26 4 27 28 Given this ruling, the Court need not consider Cree’s argument that the unjust enrichment claim is based on allegations of fraudulent conduct and barred by the threeyear statute of limitations set forth in A.R.S. § 12-543(3). (Doc. 24 at 12-14.) - 13 - 1 IT IS FURTHER ORDERED that Plaintiff OptoLum Inc.’s motion to seal its 2 response brief (Doc. 34) and motion to seal its motion to strike or seal (Doc. 43) are 3 GRANTED and the Clerk is directed to file under seal the lodged response (Doc. 35) and 4 motion (Doc. 44). 5 6 7 IT IS FURTHER ORDERED that Plaintiff OptoLum’s motion to strike or seal Cree’s reply brief (Doc. 44) is DENIED. Dated this 21st day of March, 2017. 8 9 10 11 12 Douglas L. Rayes United States District Judge 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - 14 -

Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.

Why Is My Information Online?