Cooper v. Digital Processing Systems, Inc.

182 F.R.D. 242, 1998 U.S. Dist. LEXIS 15689, 1998 WL 707584
CourtDistrict Court, N.D. Ohio
DecidedSeptember 30, 1998
DocketNos. 1:97-CV-00732, 1:98-CV-00792
StatusPublished
Cited by4 cases

This text of 182 F.R.D. 242 (Cooper v. Digital Processing Systems, Inc.) is published on Counsel Stack Legal Research, covering District Court, N.D. Ohio primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Cooper v. Digital Processing Systems, Inc., 182 F.R.D. 242, 1998 U.S. Dist. LEXIS 15689, 1998 WL 707584 (N.D. Ohio 1998).

Opinion

OPINION AND ORDER

GWIN, District Judge.

In this patent infringement action and action to decide the validity of certain patents, the Court decides whether a certain party is a necessary and indispensable party. After deciding that such party, a California corporation, is a necessary party, the Court decides whether it has jurisdiction over this party and, if such jurisdiction is lacking, whether this action should go on.

On March 11, 1998, defendants Digital Processing Systems Inc.1 moved this court to dismiss this action for failure to join an indispensable party [Doc. 53]. In this motion, Digital Processing Systems argued that Video Processing Technology, a California corporation, is an indispensable party necessary for a full adjudication of rights in this patent infringement action.

While Defendants Digital Processing Systems’s motion was pending, this Court granted defendants’ motion to add Video Processing Technology as an involuntary plaintiff. After having been served with a summons and an amended complaint, Video Processing Technology moved this Court to dismiss it as a party for lack of personal jurisdiction and improper venue [Doc. 76], Plaintiff Cooper filed a motion to dismiss for misjoinder [Doc. 81],

Finding that Video Processing Technology is a necessary party over whom this Court does not have personal jurisdiction and that it is indispensable to a full adjudication of the action, the Court grants Defendants Digital Processing Systems’ motions to dismiss for failure to join an indispensable party, all for the reasons that follow. The Court further grants Involuntary Plaintiff Video Processing Technology’s motion to dismiss for lack of personal jurisdiction. Finally, the Court’s ruling makes Plaintiff Cooper’s motion to dismiss for misjoinder moot.

I. Introduction

This is a patent infringement action under 35 U.S.C. § 271. On March 21, 1997, Plaintiffs J. Carl Cooper, Pixel Instruments Corporation, and Technology Licensing Corporation2 filed this action and alleged that Defendants Digital Processing Systems infringed twelve patents relating to video signal processing technology. In answer, defendants deny infringement and say that Plaintiff Cooper’s patents are invalid.

Plaintiff twice amended its complaint. In the Second Amended Complaint, Plaintiff Cooper made claim that Defendants Digital Processing Systems infringed two additional patents. See Second Amended Complaint, H1Í 7-8.

On March 11, 1998, defendants Digital Processing Systems Inc. moved this court to [245]*245dismiss this action for failure to join an indispensable party. In this motion defendants argue that Video Processing Technology has an interest in the patents that require that Video Processing Technology be made a party to this action. If this Court does not have jurisdiction over Video Processing Technology, defendants Digital Processing Systems say this Court must dismiss this case.

The Court’s determination involves review of Video Processing Technology’s contractual relationship with Plaintiff Cooper.

II. Plaintiff Cooper’s Relationship to Video Processing Technology

Plaintiff Cooper asserts that it has the right to enforce certain patents. On December 30, 1988, Cooper entered a Commercialization Agreement with VidTech Corporation3 to commercialize and license various technologies owned by Plaintiff Cooper that concerned video noise reduction and audio/video synchronization. In the 1988 agreement, Plaintiff Cooper gave Video Processing Technology the right to market four of the patents-in-suit here, i.e., U.S. Patent Nos. 4,305,091; 4,573,070; 4,313,135; and 5,202,761.

Video Processing Technology asserts that the 1988 agreement granted it an “exclusive worldwide license” with respect to the “Licensed Technology.”4 The agreement defined “Licensed Technology” to include:

[A]ll rights with respect to patent rights, copyrights, mask work rights, tradenames, trademarks, trade secrets, and know-how of whatsoever kind or nature and in whatever form which relate to VNR [video noise reduction] or AVS [audio/video synchronization] technology and in which [Cooper] or his affiliates have an interest to the extent of such said interest.

The License Agreement further granted to Video Processing Technology the:

[Exclusive, worldwide right to regulate and control by license, sublicense, affiliation, or other agreement the practice and/or use of the Licensed Technology, and to otherwise pursue the Commercialization thereof and the manufacture, sale, and use of products and/or services relying upon the Licensed Technology.5

With the 1988 agreement, any “[d]ecisions to license, exchange, encumber, transfer, sell, litigate, arbitrate, affiliate, or settle any right or claim with respect to [Video Processing Technology] its assets, or any right or claim with respect thereto” were to be made by VidTech. Id. H J(2), at 7.6

On January 19, 1991, Cooper and Video Processing Technology agreed to amend the 1988 agreement. With this amendment, Plaintiff Cooper and Video Processing Technology agreed to extend the agreement to additional technologies and patents, including patents acquired by Cooper since the 1988 agreement.7 With this amendment, Plaintiff [246]*246Cooper gave Video Processing Technology rights in U.S. Patents Nos. 4,062,041, 3,900,-885, 3,860,952, 4,018,990, 3,993,982; and 4,803,547. Thus, in the 1988 agreement, Plaintiff Cooper gave Video Processing Technology rights in four patents here involved. With the amendment to the original agreement, plaintiff Cooper gave Video Processing Technology rights in six additional patents here involved.8

III. Discussion of Fed.R.Civ.P. 19

Defendants Digital Processing Systems says that Video Processing Technology has rights to the patents involved in this suit as the result of the 1988 agreement, the amendment to that agreement, and the December 1995 agreement. The defendant argues that Defendant Video Processing Technology is a necessary and indispensable party to this case. The defendant says that the Court must dismiss this case unless Video Processing Technology continues as a party to this action. Video Processing Technology denies that this Court has jurisdiction over it.

Fed.R.Civ.P. 12(b)(7) provides that a complaint may be dismissed for “failure to join a party under Rule 19.” Questions concerning joinder of indispensable parties require courts to consider the policy considerations underlying the established federal rules. Boles v. Greeneville Housing Auth., 468 F.2d 476, 478 (6th Cir.1972).

Resolving the question of joinder under Rule 19, and thus of dismissal for failure to join an indispensable party under Rule 12(b)(7), involves a three-step process. Local 670 v.

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182 F.R.D. 242, 1998 U.S. Dist. LEXIS 15689, 1998 WL 707584, Counsel Stack Legal Research, https://law.counselstack.com/opinion/cooper-v-digital-processing-systems-inc-ohnd-1998.