Goughnour v. Hayward Baker, Inc.

Filing 44

MEMORANDUM OPINION AND ORDER GRANTING PLAINTIFF'S MOTION FOR LEAVE TO FILE SURREPLY, DENYING PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT IN REGARD TO LIABILITY AND GRANTING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT: Denying 21 Motion fo r Summary Judgment; Granting 33 Motion for Summary Judgment; and Granting 37 Motion for Leave to File Surreply; Case to be dismissed and stricken from active docket of the Court. Clerk directed to enter judgment. Signed by Senior Judge Frederick P. Stamp, Jr on 1/2/18. (soa)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF WEST VIRGINIA
R. ROBERT GOUGHNOUR,
an individual,
Plaintiff,
v.

Civil Action No. 5:16CV191
(STAMP)

HAYWARD BAKER, INC.,
a corporation,
Defendant.
MEMORANDUM OPINION AND ORDER
GRANTING PLAINTIFF’S MOTION FOR LEAVE TO FILE SURREPLY,
DENYING PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT
IN REGARD TO LIABILITY AND
GRANTING DEFENDANT’S MOTION FOR SUMMARY JUDGMENT
I.

Background

This civil action arises out of an alleged breach of a
licensing agreement for the rights to practice United States Patent
No.

5,800,090

(“the

‘090

patent”)

and

United

States

Patent

Application No. 10/352,583 (“the Application”). The plaintiff, Dr.
R. Robert Goughnour (“Goughnour”), held the ‘090 patent and the
Application

as

the

assignor.

The

plaintiff

entered

into

a

licensing agreement referred to as the “assignment” with Nilex
Construction, LLC (“Nilex”) as the assignee.

The defendant,

Hayward Baker, Inc. (“Hayward Baker”), purchased some of Nilex’s
assets and obligations, including its rights under the licensing
agreement assignment.

Goughnour alleges that, beginning in April

2016, Hayward Baker has refused to comply with the terms of the
licensing agreement.

Plaintiff’s complaint includes as Count One

a petition for declaratory judgment and as Count Two a petition for

specific performance of the contract. Accordingly, Goughnour seeks
a

declaration

that

Hayward

Baker

is

bound

by

the

licensing

agreement and an order requiring specific performance of the
agreement.
Goughnour originally filed this civil action in the Circuit
Court of Brooke County, West Virginia.

Hayward Baker removed the

case to this Court, citing diversity jurisdiction (ECF No. 1).
Plaintiff filed a motion to remand (ECF No. 4). This Court entered
an order (ECF No. 8) denying plaintiff’s motion to remand.

The

parties filed a stipulation agreeing to waive their right to a jury
trial and requesting a bench trial (ECF No. 17).

This Court

entered an order approving the joint stipulation (ECF No. 18).
Plaintiff Goughnour then filed a motion for summary judgment
in regard to liability (ECF No. 21) and a memorandum brief in
support (ECF No. 22).

Defendant Hayward Baker filed objections

(ECF No. 27) to “plaintiff’s undisputed material facts” and also
filed a response (ECF No. 28) in opposition to plaintiff’s motion
for summary judgment in regard to liability.

Plaintiff then filed

a reply (ECF No. 32) to defendant’s response.
Defendant Hayward Baker then filed a motion for summary
judgment (ECF No. 33) and a memorandum in support of the motion.
Plaintiff filed a response in opposition (ECF No. 34) and defendant
filed a reply (ECF No. 36).

Plaintiff Goughnour then filed a

motion for leave to file a surreply (ECF No. 37) and a surreply
(ECF

No.

38).

Defendant

Hayward

2

Baker

filed

a

response

in

opposition

(ECF

No.

40)

and

a

surrebuttal

(ECF

No.

41)

to

plaintiff’s motion for leave to file a surreply.
This Court finds that the motions have been fully briefed and
that

the

pending

motions

for

summary

judgment

are

ripe

for

decision.
II.

Applicable Law

Under Federal Rule of Civil Procedure 56, this Court must
grant a party’s motion for summary judgment if “there is no genuine
dispute as to any material fact and the movant is entitled to
judgment as a matter of law.”

Fed. R. Civ. P. 56(a).

A fact is

“material” if it might affect the outcome of the case. Anderson v.
Liberty Lobby, 477 U.S. 242, 248 (1986).

A dispute of material

fact is “genuine” if the evidence “is such that a reasonable jury
could return a verdict for the non-moving party.” Id. If the
nonmoving party “fails to make a showing sufficient to establish
the existence of an element essential to that party’s case, and on
which that party will bear the burden of proof at trial,” summary
judgment must be granted against the plaintiff.

Celotex Corp. v.

Catrett, 477 U.S. 317, 322 (1986). In reviewing the supported
underlying facts, all inferences must be viewed in the light most
favorable to the party opposing the motion. See Matsushita Elec.
Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986).
The party seeking summary judgment bears the initial burden of
showing the absence of any genuine issues of material fact.
Celotex, 477 U.S. at 322-23.

See

“The burden then shifts to the

3

nonmoving party to come forward with facts sufficient to create a
triable issue of fact.”

Temkin v. Frederick County Comm’rs, 945

F.2d 716, 718 (4th Cir. 1991), cert. denied, 502 U.S. 1095 (1992).
However, “a party opposing a properly supported motion for summary
judgment may not rest upon the mere allegations or denials of his
pleading, but . . . must set forth specific facts showing that
there is a genuine issue for trial.”

Anderson v. Liberty Lobby,

Inc., 477 U.S. 242, 256 (1986).
III.

Discussion

The parties have now filed cross motions for summary judgment,
which have been fully briefed and are discussed in turn below. For
the following reasons, the plaintiff’s motion for summary judgment
as to liability (ECF No. 21) is denied, and the defendant’s motion
for summary judgment (ECF No. 33) is granted.
Plaintiff Goughnour filed a motion for summary judgment in
regard to liability (ECF No. 21) and a memorandum brief in support
(ECF No. 22).

In support thereof, the plaintiff represents that

the complaint filed by the plaintiff contains two counts.
One

of

the

plaintiff’s

complaint

“contains

a

Count

petition

for

declaratory judgment wherein the Plaintiff requests that the Court
declare that the terms of the contract between the Plaintiff and
the Nilex Corporation are binding upon the Plaintiff and the
Defendant, Hayward Baker, Inc., and that the Defendant, Hayward
Baker, Inc., is legally obligated under the above referenced
contract to make payments to the Plaintiff.”

4

ECF No. 21 at 1.

Count Two of the plaintiff’s complaint “contains a cause of action
which is a petition for specific performance of the same contract
described in Count One of the Complaint which contract was assigned
to the Defendant, Hayward Baker, Inc.”

ECF No. 21 at 1-2.

Plaintiff posits a list of “undisputed material facts” and asserts
that

“there

are

no

genuine

issues

as

to

any

material

facts

concerning the plaintiff’s causes of action set forth in Count One
and Count Two of the Plaintiff’s Complaint,” and that he is
“entitled to judgment as a matter of law in regard to liability
involving Counts One and Two of the Complaint.”

ECF No. 2 at 2-5.

Defendant Hayward Baker filed objections (ECF No. 27) to
“plaintiff’s undisputed material facts” contained within the motion
for summary judgment as to liability and also filed a response (ECF
No. 28) in opposition to plaintiff’s motion.

Defendant asserts,

“[w]ithin its Motion for Summary Judgment in Regard to Liability,
Plaintiff R. Robert Goughnour sets forth thirteen (13) material
facts which he believes are undisputed.”

Hayward Baker “disagrees

with Goughnour’s assertions and believes several of undisputed
material facts put forth by Goughnour are disputed and/or contrary
to the evidence produced to date.”

ECF No. 27 at 1.

In its

response, defendant asserts Goughnour is not entitled to summary
judgment as patent holders cannot charge royalties for the use of
their invention after the patent term has expired and that the
relevant clause of the agreement is ambiguous and the intent of the
parties should therefore dictate its interpretation. ECF No. 28 at

5

9, 13. Defendant further argues the intent of the parties confirms
that the assignee was only required to pay the $0.10 royalty for
each foot installed until the patent expires and that the plaintiff
has failed to establish there are no genuine issues of material
fact in favor of his allegations in this matter and that he is
entitled to summary judgment as a matter of law.

ECF No. 28 at 15,

20.
Plaintiff filed a reply (ECF No. 32) to defendant’s response
and asserts, “the contract entered into between the Plaintiff and
Defendant is plain and unambiguous and is not subject to judicial
construction or interpretation but must be strictly applied as a
matter of law.”

Plaintiff asserts “that the contract is not

ambiguous and the Defendant has raised no issues of fact and the
question of whether a contract is ambiguous is a question of law.”
ECF No. 32 at 5-6.
Defendant Hayward Baker then filed its motion for summary
judgment (ECF No. 33) pursuant to Rule 56 of the Federal Rules of
Civil Procedure, and requests this Court enter summary judgment in
its favor on all counts and claims brought forth by R. Robert
Goughnour as he cannot show there is a genuine issue of material
fact to be tried with respect to said counts and claims.

First,

defendant argues that review of the agreement in question along
with

the

contractual

long-standing
provisions

law

regarding

requiring

the

payment

enforceability
of

royalty

of

and/or

licensing fees after the expiration of the patent shows that any

6

provision within the agreement requiring payment of royalty and/or
licensing fees after expiration of the patents in question is
unenforceable under the law.
this

argument,

defendant

ECF No. 33 at 3-4.

asserts

“Goughnour

is

In support of
seeking

the

court-ordered extension of his receipt of royalty and/or licensing
fees from the use of U.S. Patent No. 5,800,090 beyond the actual
life of the patent” and that “[t]o interpret and enforce the
Agreement as argued by Goughnour would violate long-settled law
regarding the validity of provisions within agreements requiring
the payment of royalty and/or licensing fees after the expiration
of a patent.”

ECF No. 33 at 6, 7.

Second, defendant argues, “the

Supreme Court of the United States has held that when a patent
expires, the patentee’s prerogatives expire too, and the right to
make or use the article, free from all restriction, passes to the
public.”

ECF No. 33 at 6.

Hayward Baker contends that plaintiff

“is seeking to use contractual language within the Agreement to
extend the life of his patent — and therefore extend the life of
his receipt of royalty and/or licensing fees — beyond the time
allowed under the law.”

ECF No. 33 at 8.

Defendant concludes by

citing to Brulotte v. Thys Co., 379 U.S. 29, 85 S. Ct. 176, 13
L.E.2d 99 (1964), and asserts that “because U.S. Patent No.
5,800,090 has expired and is part of the public domain and because
the Agreement requiring payment of royalty and/or licensing fees
past the expiration of the patent is unenforceable pursuant to the
holding of Brulotte, the contractual clause within the Agreement

7

between Goughnour and Nilex dated February 17, 2004 requiring
payment or royalties and/or licensing fees past the patent’s
expiration date is contrary to public policy and therefore void and
unenforceable against Hayward Baker.”

ECF No. 33 at 10.

Hayward

Baker points out that “[a]ll payments made by Nilex and/or Hayward
Baker to Goughnour were for use of the process outlined in U.S.
Patent No. 5,800,090.

Defendant asserts that the process outlined

in U.S. Patent Application No. 10/352,583 has never been used by
Nilex and/or Hayward Baker.

ECF No. 33 at 3, n.2.

Hayward Baker

asserts that because the clause is not enforceable under the law,
there is no genuine issue of material fact as to Goughnour’s claims
and, as a result, the granting of Hayward Baker’s motion for
summary judgment is warranted.
Plaintiff filed a response (ECF No. 35) and makes four primary
arguments. First, plaintiff asserts that “the payment provision as
set forth in the Assignment is not a royalty as defined by federal
law.”

Plaintiff argues that “the payments made to Petitioner were

made as consideration for the assignment of Petitioner’s multiple
patent applications and patents to Respondent rather than for the
use of the patents themselves.”

ECF No. 35 at 5.

Second,

plaintiff argues that “the case law cited by Petitioner provides an
exception to the prohibition against extending payment for a patent
after the same expires.” Plaintiff argues that even if the payment
provision

is

considered

a

royalty,

the

provision

within

the

Assignment is valid under Kimble v. Marvel Entertainment, LLC, 135

8

S. Ct. 2401, 192 L.E.2d 463 (2015).

Third, plaintiff asserts that

“in the alternative, this federal case law does not apply to the
matter at hand as the subject causes of action center around West
Virginia

substantive

law.”

Plaintiff

asserts

an

alternative

argument that federal substantive law does not apply to the matter
at hand as this case centers on declaratory judgment and specific
performance, both of which are state law causes of action. ECF No.
35 at 9.

And lastly, plaintiff argues that “the terms of the

contract are clear and unambiguous and thus preclude Respondent
from succeeding in its Motion for Summary Judgment.”

ECF No. 35

at 5.
Defendant,

in

its

reply

(ECF

No.

36),

seeks

to

refute

plaintiff’s argument that the payment in question is not a royalty,
plaintiff’s
exception

argument
noted

in

that

the

Kimble,

instant
and

matter

plaintiff’s

fits

within

argument

an

that

substantive federal law should not be applied in the instant
matter.

Defendant argues first, that the payment in question

clearly qualifies as a royalty payment and/or licensing fee.
Second, defendant asserts that the exception noted within Kimble is
not applicable to the instant matter as all relevant patents
associated with the process being used by Hayward Baker, just like
those in Brulotte and Kimble, have expired.

Finally, defendant

argues that the federal law regarding patents must be applied to
the instant case as it is directly relevant to the matter at hand
and the cases cited to by Goughnour do not support ignoring the

9

opinions in Kimble and Brulotte.

Defendant concludes by stating,

“Goughnour’s claims fail as a matter of law, and summary judgment
in favor of Hayward Baker is warranted.”

ECF No. 36 at 8.

Plaintiff then filed a motion for leave to file a surreply
(ECF No. 37) with a brief in support thereof (ECF No. 38).
Plaintiff contends that in the reply, defendant “asserts new
factual and legal arguments regarding the exception forth by
Plaintiff/Petitioner under federal case law, Kimble v. Marvel
Entertainment, LLC, 135 S. Ct. 2401, 192 L.E.2d 463 (2015), that is
applicable to the case at hand.”

ECF No. 37.

Plaintiff argues

that he will be without recourse to address these arguments unless
this Court grants him leave to file a surreply.
In the surreply, plaintiff argues that “the exception set
forth in Kimble applies to the instant matter as the subject
Assignment between the parties extends the payment period by
covering multiple patents and nonpatent rights.”

ECF No. 38 at 3.

Plaintiff asserts that “the best reading of Brulotte/Kimble is that
the post-expiration royalty problem does not arise until the moment
that a license agreement no longer contains any unexpired patents”
and because the assignment covers patents that have not yet
expired, and defendant acknowledges that the possible use of these
patents formed its interest in acquiring said package of patents
within the assignment, this Court must rule in accordance with the
exception as set forth herein above that payments must continue to
be paid to plaintiff/petitioner until the expiration of the longest

10

living patent.

ECF No. 38 at 4-5.

Plaintiff concludes by arguing

that “[n]otwithstanding the argument set forth hereinabove, Federal
Law is inapplicable to the matter at hand in accordance with the
Erie doctrine.”

ECF No. 38 at 6.

Plaintiff asks that this Court

(1) find that the payment made to plaintiff/petitioner under the
assignment is consideration for the same rather than a royalty
payment; (2) apply state substantive law as required by the United
States

Supreme

Court

in

the

Erie

decision;

and

(3)

in

the

alternative, should this Court find that federal law is applicable
to the matter at hand, apply the exception as set forth in Brulotte
and Kimble that allows payments to be made to plaintiff until the
expiration of the longest living patent in the assignment between
the parties.
Defendant filed a response in opposition (ECF No. 40) to
plaintiff’s motion for leave to file a surreply and also attached
a surrebuttal memorandum in support (ECF No. 41).

Hayward Baker

disagrees with Goughnour’s position and asserts that no new factual
or legal arguments were raised by Hayward Baker within its reply.
Defendant asserts that “[g]iven that Hayward Baker was the party
who filed the motion for summary judgment, it should be the party
entitled to the last word regarding the motion.”

ECF No. 40 at 3.

In its surrebuttal, Hayward Baker opposes the arguments set forth
in the plaintiff’s surreply and contends that the exceptions cited
in Kimble are not applicable to the case at hand and that there is

11

no justification for the argument that federal law is inapplicable
to the case at hand.
IV.

Analysis

Following its analysis of the fully briefed motions, and the
memoranda and exhibits submitted by the parties, this Court finds
that, for the reasons set forth below, summary judgment in favor of
the defendant is appropriate, there is no genuine dispute as to any
material fact, and the defendant is entitled to judgment as a
matter of law. The plaintiff’s motion for leave to file a surreply
(ECF No. 37) is granted, the plaintiff’s motion for summary
judgment as to liability (ECF No. 21) is denied, and defendant’s
motion for summary judgment (ECF No. 33) is granted.
As an initial matter, federal patent law is applicable to the
case at hand. This is a dispute regarding the payment provision of
an

assignment

which

falls

within

the

purview

of

patent

law

analysis.1

Further, this Court finds the operable language in the

contract,

referred

to

as

the

“assignment,” to be ambiguous.

“payment

provision”

of

the

Under West Virginia law, contract

language is considered ambiguous where an agreement’s terms are
inconsistent on their face or where the phraseology can support
reasonable differences of opinion as to the meaning of words
employed and obligations undertaken.
721

S.E.2d

53

(2011).

The

1

Lee v. Lee, 228 W. Va. 483,

common-law

rule

of

contract

Brulotte v. Thys Co., 379 U.S. 29, 85 S. Ct. 176 (1964)
arrived at the Supreme Court by way of a state law contract suit.
12

interpretation is that a court should construe ambiguous language
against the interest of the party that drafted it.

Mastrobuono v.

Shearson Lehman Hutton, Inc., 514 U.S. 52, 62 (1995).

The reason

for this rule is to protect the party who did not choose the
language from an unintended or unfair result.

Id.

Under West

Virginia law, “in case of doubt, the construction of a written
instrument is to be taken strongly against the party preparing it.”
Lee, 721 S.E.2d 53, 57 (2011) (citing Henson v. Lamb, 120 W. Va.
552, 558, 199 S.E. 459, 461-62 (1938)).

Here, the party that

drafted the language at issue is the plaintiff, as the assignment
agreement between the parties was drafted by plaintiff Goughnour’s
former attorney.

ECF Nos. 28 at 3, 28-3 at 2.

The operable,

pertinent, language of the assignment, referred to throughout the
briefing as the “payment provision” reads as follows:
In consideration for this Assignment, Assignee agrees to
pay to Assignor a lump sum fee of $150,000.00, one third
thereof payable at the time of signing this Assignment
and the remaining two payments being due at the second
and third anniversary dates of this Assignment, and as
further consideration Assignee agrees to pay to Assignor
an additional payment of $.10 per foot for all earthquake
drains installed by Assignee or its licensees or
subcontractors in accordance with the teachings of U.S.
Patent No. 5,800,090 or U.S. Patent Application No.
10/352,583, until such time that the longest lived U.S.
patent expires.
ECF No. 1-3 at 5.
This Court finds that the ambiguous contract language must be
construed against the plaintiff, and that the contract provision at
issue

provides

consideration.

for

a

royalty

payment,

not

a

continuing

As such, considering that the patent at issue
13

expired on April 9, 2016 (ECF No. 21 at 4), this Court finds that
plaintiff’s argument is an attempt to exact royalty payments after
the patent has expired.

This argument fails as a matter of law.

Brulotte, 379 U.S. 29, 32 (1964).
Further, this Court notes that even if the language were to be
construed as unambiguous, the result would not change.

The

“categorical principle that all patent-related benefits must end
when the patent term expires” still applies.
2401, 2405 (2015).

Kimble, 135 S. Ct.

This Court finds that to interpret and enforce

the agreement as argued by the plaintiff would violate long-settled
law regarding the payment of royalty and/or licensing fees after
the expiration of a patent.

See Brulotte, 379 U.S. 29 (1964); see

also Kimble, 135 S. Ct. 2401 (2015).
Plaintiff cites Kimble, and argues that even though U.S.
Patent No. 5,800,090 has expired, he is still entitled to payments
under the agreement because U.S. Patent Application No. 10/352,190
has not yet expired and is included within the licensing agreement.
Plaintiff cites specifically an “exception” in Kimble, asserting
that “[u]nder Brulotte, royalties may run until the latest-running
patent covered in the parties’ agreement expires.”

Kimble 135 S.

Ct. 2401, 2408 (2015) (citing Brulotte 379 U.S. at 30, 85 S. Ct.
176).
This Court has considered the plaintiff’s argument, and finds
that it is misplaced.

The case law and facts in this case do not

support plaintiff’s argument and proposed result.

14

First, this Court finds that Brulotte was affirmed in its
entirety by Kimble and cited by the Court in Kimble as the basis
for the proposition “royalties may run until the latest running
patent covered in the parties’ agreement expires.”

This Court

finds that the plaintiff’s suggested reading of Kimble does not
comport with the holding of Brulotte.

Kimble held that a patent

holder cannot charge royalties for the use of his invention after
its patent term expired.

Id.

To extend the payment of royalties

beyond the expiration date of the patent would be inconsistent with
the Supreme Court’s decision in Brulotte

which held “that a

patentee’s use of a royalty agreement that projects beyond the
expiration date of the patent is unlawful per se.”
U.S. 29, 32 (1964).

Brulotte, 379

The plaintiff’s argument contravenes well-

settled law that “a projection of the patent monopoly after the
patent expires is not enforceable.”

Id. at 32.

Second, this Court finds that the plaintiff’s argument is
based upon judicial dictum in the Kimble opinion, as it was not
essential to the Court’s decision. The Court’s discussion of “ways
around Brulotte” went beyond the analysis necessary to decide the
issue before the Court and was not essential to the disposition.
Kimble, 135 S. Ct. at 2408.

As dictum, this language is part of

the Kimble opinion that this Court, even if it is an inferior
court, is free to reject.
(7th Cir. 1988).

United States v. Crawley, 837 F.2d 291

Finding many reasons for staying the stare

decisis course and no “special justification” for departing from

15

it, the Supreme Court “declined Kimble’s invitation” to overrule
Brulotte.

Kimble at 2404.

The Court in Kimble asserted “nothing

about Brulotte has proved unworkable” in that “[t]he decision is
simplicity itself to apply.”
whether

a

licensing

Id. at 2411.

agreement

post-expiration use of a patent.
dice.”

A court need only ask

provides

royalties

for

“If not, no problem; if so, no

Id.

Third, this Court finds that the case at hand is factually
distinguishable from both Brulotte and Kimble.

In Brulotte, an

inventor licensed his patented hop-picking machine to farmers in
exchange for royalties from hop crops harvested both before and
after his patents’ expiration dates.

The Court held the agreement

unenforceable — “unlawful per se” — to the extent it provided for
the payment of royalties “accru[ing] after the last of the patents
incorporated into the machines had expired.”

Id. at 30.

In

Brulotte, the licenses issued to petitioners listed 12 patents
relating to hop-picking machines, but only seven were incorporated
into the machines sold to and licensed for use by petitioners. Id.
at 29.

Of those seven2 all expired on or before 1957, but the

licenses issued by respondent to the petitioners continued for
terms beyond that date.

Id.

The Court concluded that “the

judgment below must be reversed insofar as it allows royalties to

2

The Court noted that “[a]ll but one of the 12 expired prior
to the expiration of the license agreements. The exception was a
patent whose mechanism was not incorporated in the machines.”
Brulotte v. Thys Co., 379 U.S. 29, 30 n.2 (1964).
16

be

collected

which

accrued

after

the

last

incorporated into the machines had expired.”

of
Id.

the

patents

The Court

ultimately held that a patent holder cannot charge royalties for
the use of his invention after its patent term has expired.
In Kimble, “the sole question presented [] is whether [the
Court] should overrule Brulotte.”

Kimble, 135 S. Ct. at 2405.

Kimble dealt with a single patent obtained on a toy, relating to
the comic-book character Spider-Man, known as a “Web Blaster.” Id.
The petitioner in Kimble entered into an agreement with Marvel
Entertainment, and their agreement provided “that Marvel would
purchase Kimble’s patent in exchange for a lump sum (of about a
half-million dollars) and a 3% royalty on Marvel’s future sales of
the Web Blaster and similar products” and the agreement “set no end
date for royalties”. Id. The Kimble Court stated “[p]atents endow
their holders with certain superpowers, but only for a limited
time.”

Id. at 2406.

Kimble made clear that “when the patent

expires, the patentee’s prerogatives expire too, and the right to
make or use the article, free from all restriction, passes to the
public” and declared that the Court “has carefully guarded that
cut-off date”.

Id. at 2407.

In doing so, the Kimble Court re-

examined Brulotte, and affirmed Brulotte in its entirety.
Here, however, there exist several issues which are not
addressed by Kimble or Brulotte.

In this case, defendant Hayward

Baker acquired patents and other rights from the plaintiff through
language in an assignment which this Court has already found to be

17

ambiguous. Kimble involved a license agreement for a single patent
and Brulotte involved a license agreement covering 12 patents, of
which seven were actually used. Here, the assignment at issue (ECF
No. 1-3 at 8-13) covers a number of various patents with different
filing dates, as well as patent applications, possible future
applications, and possible future inventions.

Id.

This case is

readily distinguished from Kimble and Brulotte in that here, the
Court is not dealing with a single patent, or with the sale of a
piece of machinery which incorporated a number of patents, but
rather, an assignment which deals, in part, with one expired,
utilized patent, and one living, unutilized3 patent application.4
The issues of use and relatedness5 between patents and patent
applications are not expressly discussed by the Court in Kimble.
Further, this Court has already found the “payment provision” in
the assignment to be ambiguous.

These issues, as described above,

3

Defendant Hayward Baker attached to its reply (ECF No. 36) to
plaintiff’s response to its motion for summary judgment the
affidavit of James Cramer, former President of Nilex Construction,
LLC and current Vice President of Hayward Baker. In paragraph 11,
James Cramer declares “[n]either Nilex nor Hayward Baker ever used
the process outlined in U.S. Patent Application No. 10/352,583 and,
as a result, royalties and/or licensing fees were never paid to
Goughnour for the use of said patented process.” ECF No. 36-3 at
2.
4

The Court notes that U.S. Patent Application No. 10/352,583,
as listed, was a patent application at the time of the assignment
in 2004, not a published patent.
5

U.S. Patent No. 5,800,090 was issued on September 1, 1998,
for “Apparatus and Method for Liquefaction Remediation of
Liquefiable Soils.” ECF No. 1-3 at 8. U.S. Patent Application No.
10/352,583 was filed on January 28, 2003 for “Method and Apparatus
for Enhancement of Prefabricated Earth Drains.” ECF No. 1-3 at 9.
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do not fall squarely within the purview of Kimble, and do not
support plaintiff’s argument.
For these reasons, this Court cannot reasonably read Kimble,
as argued by the plaintiff, to allow Goughnour to continue to
collect royalty payments from Hayward Baker on an expired patent.
As the Court in Kimble noted, “[o]verturning Brulotte would thus
upset

expectations,

most

so

when

long-dormant

long-expired patents spring back to life.”
2410.

licenses

for

Kimble, 135 S. Ct. at

This Court agrees, and will not permit plaintiff to revive

an expired patent.
V.

Conclusion

For the reasons stated above, this Court finds that summary
judgment in favor of the defendant is appropriate, as plaintiff is
seeking to use ambiguous contractual language within the agreement
to extend the life of his patent – and therefore extend the life of
his receipt of royalty and/or licensing fees – beyond the time
allowed under the law.

This Court finds that there is no genuine

dispute as to any material fact and that the defendant is entitled
to judgment as a matter of law.
The plaintiff’s motion for leave to file a surreply (ECF No.
37) is GRANTED.

For the reasons stated above, the plaintiff’s

motion for summary judgment as to liability (ECF No. 21) is DENIED,
and defendant’s motion for summary judgment (ECF No. 33) is
GRANTED.

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It is further ORDERED that this civil action be DISMISSED and
STRICKEN from the active docket of this Court.
IT IS SO ORDERED.
The Clerk is DIRECTED to transmit a copy of this memorandum
opinion and order to counsel of record herein. Pursuant to Federal
Rule of Civil Procedure 58, the Clerk is DIRECTED to enter judgment
on this matter.
DATED:

January 2, 2018

/s/ Frederick P. Stamp, Jr.
FREDERICK P. STAMP, JR.
UNITED STATES DISTRICT JUDGE

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