Leitner-Wise v. LWRC International, LLC et al
Filing
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MEMORANDUM OPINION. Signed by Judge George Jarrod Hazel on 2/28/2017. (aos, Deputy Clerk)
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IN TIlE UNITED STATES I)ISTRICT COURT
FOR Tin: I)ISTRICT OF MARYLAND
Southern Di,.ision
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PAUL ANDREW LEITNER-WISE,
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Plaintiff,
Case No,: G.IH-16-2.BO
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LWRC INTERNATIONAL, LLC, l'f :11.,
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Defendants,
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MEMORANDUM OPINION
Plainti IT Paul Andrcw
Intcrnational.
Gas Opcrating
and unjust cnrichmcnt
Systcm I()r a Fircarm."
Motion to Dismiss,
Altcrnativc,
L WRC
I.I.C ("I. WRC!"') and Sig Saucr, Inc. ("Sig Saucr") allcging patcnt infi'ingcmcnl.
brcach o(contract
Saucr's
Lcitncr- Wisc brings this casc against Dcfcndants
lor Summary
hcaring is unnccessary.
gran! Dcfendant
in rclation to his 200-1 invcntion
ECF NO.1. Pcnding bcl()rc the Court arc Dcfendant
ECF No. 1-1.and Dcfcndant
Judgmcnl.
ofa "Sell~Clcaning
LWRCl's
Sig
Motion to Dismiss. or in thc
ECF No. 15. Thcse issucs have bccn fully bricfed and a
Loc. R. 105.0 (D. Md. 2016). For thc rcasons statcd belo\\', thc Court "ill
Sig Saucr. Inc.'s Motion to Dismiss in full and Delendant
I.WRC.Ts Motion to
Dismiss as it rclatcs to thc patcnt inli'ingcmcn!
claim. Furthcrmorc.
thc Court will convcr!
I.WRCI's
Summary
".ith rcspcct to thc brcach of
Motion to Dismiss into a Motionl()f'
contract and unjust cnrichmcnt
as to thosc claims.
Judgment
claims. and will grant LWRCI's
Motion I()f' Summary
Judgmcnt
I.
BACKGROUND!
In 2004. PlaintilTcrcatcd
a "Sell~Cleaning
Gas Opcrating
Systcm It)r a Fircarm:'
a sell~
regulating short-stroKc piston operating systcm ItH AR-15 typc sell~Ioading rilles. and was
subscquently
awarded a patent It)r his inyelJlion by the U.S. Patcnt Oflicc (..thc .581 patcnt").
ECF NO.1 '119: ECF NO.1-I.
Inc. ("L WRC).
Plaintiff founded a company named Leitncr-Wise
which he then sold in 2005. ECF NO.1
'I,j 21-22.
On April 11.2005.
was rctaincd by LWRC as an exccutivc and cntcrcd into an cmploymcnt
terms of thcir relationship.
ECF NO.1 at
'i
Rille Company.
Plaintiff
agreemcnt delining thc
22: see a/so ECF No. 1-2. The cmploymcnt
agrecmcnt
containcd a proyision aCKnowledging that Plaintiff had
dcvclopcd ccrtain Intelicctual Propcrty prior to thc execution of this Agrcement
which Employer dcsires to cxcrcisc owncrship rights .... Employcr will separatcly
pay a royalty of onc half of one pcrcent (.05%.) on thc nct salc pricc of cach
product containing a previously patcntcd or patentable or othc!wise protccted
deyice deycloped by the Executivc .... Paymcnt of royalties under this scction shall
not be withheld or terminated regardless of any Termination of the Executiye It)r
any reason.
lOCI' NO.1 '123: .Iee a/so ECF No. 1-2 at 8.2PlaintilTieli
his cmployment
with LWRC on
October 3 J. 2006. and on the same date. assigned tbc pending' 581 patenl to his ItJrlllCr
employcr.
ECF No. I ~ 24: see a/so ECF No. 1-3. Thc Assignmcnt
stated that
[i In considcration of thc sum of Onc Dollar ($1.00) or cquivalent and other good
and valuable consideration paid to ... Paul Leitncr- Wisc. thc undcrsigned. hcrcby
scII(s) and assign(s) to Leitncr-Wisc Rillc Company. Inc ... their cntirc right. titlc
and interest ... in thc invcntion Known as "Sci I' Cleaning Gas Opcrating Systcm for
a Fircann:"
lOCI' No. 1-3.
I Unless stated otherwise. all facts arc taken from Plaintiffs Complaint or documents allached 10 and relied
upon in the Complaint. and . I>efendants'
Defendants
detending
of the Court.
substantive
Properties:").
tact regarding
LWRCI's
fur Atturneys'
10
Thus. Plaintiff has tai led
lhat he conferred
Motion tor Summary
Judgment
a
will be
Fees and Custs
fees and costs associated
to either 35 U,S,c. ~ 285, authorizing
An "exceptional"
strength ofa party's
Wise ] may ha\'e
his contention
also request that the Court award attorneys'
party in "exceptional"
II
Intcllectual
I Leitner-
claim of unjust enrichment.
Request
this case. pursuant
the prevailing
interest
patent inti'ingement
reasonable
attorney's
eases. or under the "inherent
with
ICes to
powers"
case is one that "stands out from others with respect to the
litigating position (considering
tilcts of the case) or the unreasonable
both the governing
manner ,in which the case was litigated:'
law and the
Oel(///(' FiII1('SS,
L1.C \', ICON 11('(//111 Fill1('ss, Il1e, , 134 S, Ct. 1749, 1756 (2014), "A movant must establish
&
exceptional
ease by a preponderance
No, 14-CY-0245.
2016 WI. 4141006.
addition
to any sanctions
'''willful
disobedience
vexatiously.
l'il'('/il1('
of the evidence:'
wantonly,
provided
11.1"/11/"11('1
T('"l1s" Ille. \', BAt: '<':I's .. 111",.
at *3 (D, Md, 2(16) (citini.: 0"'(///('.134
by statute. the Court's
of a court order'"
an
S. Ct, at 1758), In
inherent powers allow fee-shining
lill'
or "when the losing party has 'acted in bad tilith.
or for oppressi ve reasons ..... "
()"!aI1(',
134 S, Cl. at 1758 (citing ,I~\'('sk(/
S('ITiec Co, \', Wild('/"11('ss SOc/('ly. 421 LJ ,S. 240. 258-259 (1975)).
l() "Assigned
Intellectual
PropcI1ics"
is defined in the contract
10 include
the "581 patent. Sec ECF No. 15-8
at 2.
II Dclcndant Sig. Sauer's rcfcrcIH.:c 10 35 U.S.c. ~ 1<)27 appears to be a cOlll1ation 01'28 U.S.c. ~ 1927
(counsel's liability for excessive costs) and 35 U.S,c. ~ 285 (award ofattorncy's fees to prevailing party in patent
cases). As Defendant goes Oil to cite (}clane Filness. I./.(, ", leO,\' f1f!olll, & rirl1e.\'s, Il1c.. 134 S. Ct. 1749. 1756
(2014). which addressed the later statute. the Court will interpret its request as onc for attorncy's fees pursuant to 35
U.S.c. ~ 2&5.
IS
llerc. whilc both Dcfcndants
infringement
ultimately prevailed. the CourCs decision on the patent
claim turned on an unpublished
decision by thc Fcderal Circuit. finding that thc
retention of royalty rights does not provide a former patent holder with standing to bring a claim.
While Delcndants
highlight additional
pleading deficiencies
in Plaintiffs
complaint.
failure to specify whcther Plaintiff was alleging direct or indirect inti'ingemcnt.
such as a
Defcndant Sig
Sauer itself points out that the pleading standard on which Plaintiff incorrectly relied was
abrogated only six months prior to the liling of the case. Thcrefi.)re. although the Court filily
acknowledges
the time and expense required to produce the Delcndants'
well-written
linds that they have failed to make a sufficicnt showing that this is an "cxccptional
allowing
briefs. it
easc"
linancial rccovery for thcir labors.
Thc Court ncxt turns to Dcfcndants'
rcqucst liJr sanctions undcr thc court's inhcrcnt
authority. Although this authority "cxtcnds to a full rangc of litigation abuses" including bad
I[lith. S!!!! Thollll/s \'. Ford ,Ilolor Co .. 244 F. App'x 535. 53X (4th Cir. 2(07). it "must be
exercised with rcstraint and discretion."
Kreischer
\'. Kerriso/l
/),)' (jood,'.
n9
F.3d 1143 (4th
Cir. 2(00) (quoting Chl/lIlh!!rs \'. ,vASCO. I/lc .. 501 U.S. 32. 44 (1991)) (unpublished).
Court declines to cxereise its discrction to award attorneys'
aftinnative
falsehoods submitted
time and expense of discovery
Ilere. the
Ices whcre thcre is no evidence of
to the court and the casc is bcing resolved promptly. prior to thc
proceedings.
Thus. Defendants'
denied.
\9
request for attorncys'
ICcs is
IV.
CONCLUSION
For the foregoing reasons, Defendant Sig Sauer's Motion to Dismiss, ECF No. 14, is
granted and Defendant LWRCl's Motion to Dismiss or in the Alternative. for Summary
Judgment, ECF No. 15, is granted. A separate Order follows.
Dated: FebruaryZl;"2017
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GEORGE J. HAZEL
United States District Judge
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