DiManno v. Such

Opinion

USCA1 Opinion

                                [NOT FOR PUBLICATION]

UNITED STATES COURT OF APPEALS
                                FOR THE FIRST CIRCUIT

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No. 93-2336

CARL M. DIMANNO,

                                Plaintiff, Appellant,

                                          v.

                         JAY O. SUCH AND THROTONICS, ET AL.,

                                Defendants, Appellees.

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                     APPEAL FROM THE UNITED STATES DISTRICT COURT

                          FOR THE DISTRICT OF MASSACHUSETTS

                     [Hon. A. David Mazzone, U.S. District Judge]
                                             ___________________

                                 ___________________

                                        Before

                             Torruella, Selya and Stahl,
                                   Circuit Judges.
                                   ______________

                                 ___________________

               Carl M. DiManno on brief pro se.
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               John  O.  Mirick,  Charles  B.  Straus,  III,  and   Mirick,
               ________________   _________________________         _______
          O'Connell, DeMallie & Lougee, on brief for appellees.
          ____________________________

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                                    July 22, 1994
                                  __________________

Per Curiam.    Carl M. DiManno appeals  pro se from
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            the  district court's  dismissal of  his  patent case  on the

            ground  of   res  judicata.    This   court  lacks  appellate
                         ___  ________

            jurisdiction.   We decline to transfer the case to the United

            States Court  of Appeals for  the Federal Circuit,  where the

            appeal should have been  brought originally, however, because

            such a transfer  would not  be "in the  interest of  justice"

            under 28 U.S.C.   1631.

                                      Background
                                      __________

                 DiManno was  issued U.S. Letter Patent  No. 4,339,138 on

            July 13, 1982 ("the Patent") for a "throwing device" known as

            the  Throton.   DiManno  and appellee  Jay  O. Such  together

            incorporated  appellee Throtonics  Corporation ("Throtonics")

            to manufacture and market the Throton.  Such became President

            and Chief  Operating Officer of  Throtonics.  DiManno  was an

            officer  and director until June,  1988, when he resigned and

            entered  into an  Exclusive  License Agreement  ("the License

            Agreement")  and an  Assignment of Proprietary  Patent Rights

            ("the Assignment") with Throtonics.

                 The  License  Agreement  gave  Throtonics  the exclusive

            right to  manufacture and sell  the Throton.   The Assignment

            transferred   ownership  of   the   Patent   to   Throtonics.

            Throtonics failed  to record  the Assignment with  the Patent

            and  Trademark  Office  ("PTO")  until  November  24,   1989.

            Meanwhile, on September 28, 1989, DiManno assigned the Patent

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to another  party, Kozmos, Inc. ("Kozmos").   Kozmos recorded

            that assignment  with  the PTO  on  September 29,  1989,  two

            months before Throtonics' recording of the Assignment to it.

                 In January, 1991, DiManno filed a suit in United  States

            District Court  for the  District of Massachusetts,  claiming

            patent infringement  and breach  of contract.   The complaint

            sought  a declaration  that  he was  the  sole owner  of  the

            Patent.  DiManno invoked  35 U.S.C.   261  in support of  his

            claim that the Assignment  was void.  There was  no diversity

            of  citizenship  between  the  parties  and  the  sole  basis

            asserted for  jurisdiction  was 28  U.S.C.    1338(a).    The

            district court  dismissed the  complaint for lack  of subject

            matter jurisdiction,  ruling that "[n]o claims  raised by the

            plaintiff raise issues of patent law.  At most, the plaintiff

            has  challenged the validity of the  assignment of his patent

            to the defendants and  the outfall of that assignment.   That

            is a contractual dispute which does not  implicate any rights

            under the patent itself." DiManno v. Jay Such and Throtonics,
                                      _______    _______________________

            No. 91-10099-MA (citations omitted).  DiManno appealed to the

            United  States Court of Appeals for the Federal Circuit which

            affirmed the dismissal.

                 DiManno  also  filed suit  in Middlesex  County Superior

            Court   against  appellees,  alleging   breach  of  contract,

            negligence  and  violation  of  G.L.  c.  93A  and seeking  a

            declaration  that  the License  Agreement  was void.    In an

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opinion dated  August 11,  1993, following a  three-day jury-

            waived  trial at  which DiManno  appeared  pro se,  the state
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            court ruled against DiManno on all of his claims and in favor

            of  Such  and  Throtonics  on  all  of  their  counterclaims,

            including  breach of  the Assignment  and  License Agreement.

            The  state  court  concluded  that  DiManno  had  effectively

            conveyed   his  interest   in  the   Patent  in   return  for

            consideration.

                 While the state case was pending, DiManno initiated this

            second  federal  court  action.     The  complaint  sought  a

            declaration  that the  License Agreement and  Assignment were

            invalid and, therefore, could  not be the basis for  a patent

            infringement suit by  Such and Throtonics.   It argued  that,

            pursuant  to 35 U.S.C.   261, the assignment to Kozmos voided

            any  claim Throtonics might have had  to a patent assignment.

            Again, there was no  diversity of citizenship claimed between

            the  parties and the sole basis of jurisdiction was 28 U.S.C.

              1338.   The  district court  granted  appellees' motion  to

            dismiss  on  the  grounds that,  under  the  doctrine of  res

            judicata, the prior federal  and state court decisions barred

            the continuance of the second federal action. 

                                      Discussion
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                 Pursuant to 28 U.S.C.    1295(a)(1), the Federal Circuit

            has exclusive jurisdiction over appeals from final  decisions

            of a district court where jurisdiction was based, in whole or

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in  part, on  28 U.S.C.    1338(a).   In this  case, the only

            plausible  basis  for  federal  jurisdiction  was    1338(a).

            Therefore, this court lacks appellate jurisdiction.

                 Under  28 U.S.C.    1631,  a court  lacking jurisdiction

            "shall" transfer the case to a court where it could have been

            brought  originally, if such transfer is  "in the interest of

            justice."  A transfer  is not in  the interest of justice  if

            the appeal lacks merit.  See Howitt v. Dept. of Commerce, 897
                                     ___ ______    _________________

            F.2d 583, 584  (1st Cir.)  (stating, in dicta,  that case  is

            "sufficiently weak on the merits" to preclude second guessing

            of the Federal Circuit's  determination that transfer was not

            "'in the  interest of justice'")  cert. denied; 498  U.S. 895
                                              ____  ______

            (1990) Galloway  Farms, Inc. v. United States,  834 F.2d 998,
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            1000 (Fed. Cir. 1987) ("The phrase  'if it is in the interest

            of  justice' relates to claims which  are nonfrivolous and as

            such  should be decided on  the merits."); Zinger Const. Co.,
                                                       __________________

            Inc. v. United States,  753 F.2d 1053, 1055 (Fed.  Cir. 1985)
            ____    _____________

            (finding transfer would not  be "in the interest of  justice"

            where there was no merit to underlying claim).

                 We  conclude that  DiManno's attempt  to relitigate  the

            issue of federal subject matter jurisdiction is barred by the

            doctrine  of res judicata.  "Although a dismissal for lack of

            jurisdiction  does not  bar a  second action  as a  matter of

            claim preclusion, it does preclude relitigation of the issues

            determined  in ruling  on the  jurisdiction question."  18 C.

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Wright,  A.  Miller  and  E.  Cooper,  Federal  Practice  and
                                                   ______________________

            Procedure    4436 at 340. See Railway Labor Executives' Ass'n
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            v.  Guilford Transp. Indus., Inc.,  989 F.2d 9,  11 (1st Cir.
                _____________________________

            1993); Walsh v. Int'l Longshoremen's Ass'n, AFL-CIO, 630 F.2d
                   _____    ___________________________________

            864, 870 (1st Cir. 1980).

                 DiManno's first  federal action asserted the  same basis

            of jurisdiction  (  1338(a)) for essentially  the same claims

            as  his second federal action.  In both complaints, he sought

            a determination  that  the Assignment  and License  Agreement

            were  invalid, leaving him the  sole owner of  the Patent. In

            both complaints,  DiManno  relied upon  35  U.S.C.    261  in

            support of his  arguments.  The district  court dismissed the

            first action for lack of federal subject matter jurisdiction.

            The  Federal  Circuit  affirmed  that  dismissal.    DiManno,

            therefore, is  barred from relitigating the  issue of whether

            the  district   court   has      1338(a)  jurisdiction   over

            essentially  the same claims  as those asserted  in his first

            federal complaint.

                 Given our finding that res judicata  applies to bar this

            second federal court action, we conclude that it would not be

            "in  the interest of justice"  to transfer the  appeal to the

            Federal Circuit.  Therefore, we dismiss this case for lack of

            appellate jurisdiction.

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