Fink v. Anderson

477 S.W.3d 460, 2015 Tex. App. LEXIS 9994, 2015 WL 5634306
CourtCourt of Appeals of Texas
DecidedSeptember 24, 2015
DocketNO. 01-14-00990-CV
StatusPublished
Cited by32 cases

This text of 477 S.W.3d 460 (Fink v. Anderson) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Fink v. Anderson, 477 S.W.3d 460, 2015 Tex. App. LEXIS 9994, 2015 WL 5634306 (Tex. Ct. App. 2015).

Opinion

OPINION

Harvey Brown, Justice

Manfred Fink is a physics professor at The University of Texas at Austin. ’ He invented a technology that UT patented and licensed to a private entity, IsoSpec, for development and marketing. UT obtained an equity interest in IsoSpec. ,

Some of the IsoSpec investors sued Fink, alleging common-law fraud and securities fraud, for statements he allegedly made regarding the efficacy of an instrument he and his cq-inventors created that utilized their hewly discovered technology. Fink moved for dismissal under the eleetion-of-remedies provision of the Texas Tort Claims Act. His motion was denied.

Fink asserts that the trial court erred by denying his motion because (1) he established that he was within the scope of his employment when he spoke at IsoSpec meetings about his invention and (2) the claims asserted against him could have been brought under the Texas Tort Claims Act and, therefore, are subject to dismissal under Section 101.106(f) of that statute.

We reverse the trial court’s order denying Fink’s motion to dismiss and render judgment in his favor.

Background

Manfred Fink has been a physics professor at The University of Texas at Austin for more than 40 years. One of his assigned duties is to conduct research. Along with fellow UT professor, Philip Varghese, and Michigan professor, Jacek Borysow, Fink utilized the concepts underlying Ra-man Spectroscopy technology to invent a new technology he termed ANDRaS. According to an affidavit fled by Fink, the professors created prototype machines that utilizes ANDRaS technology.

The patent for the technology is not held by the individual professors, but by their institutional employers. As Professor Varghese explained: “Pursuant to UT policy, I conveyed my rights as an employee of the University to our invention and. allowed UT to file patent applications for the technology on behalf of the University.” See Regents’ Rules and Regulations, Rule 90102, sec. 2 (providing that intellectual property developed by UT System employee within- course and scope of employment is owned by UT). Though the university owned the patent rights, its rules gave Fink a right to provide input regarding his invention’s commercialization. See id., Rule 90101, sec. 7 (stating that creator of intellectual property “may give reasonable input on commercialization of inventions” but that UT has final decision authority “concerning whether and how to develop and commercialize an invention”).1

[463]*463UT licensed the technology to a private company for development. The Patent License Agreement is between UT and In-noSpec Technologies, LP. It states that UT, as licensor, “owns or controls the entire right, title, and interest in and to the Patent Rights,” and InnoSpec, as licensee, “desires to secure the right- and license to use, develop, manufacture, market, and commercialize the Patent Rights.” The agreement lists Fink, Varghese, and Bory-sow as the “inventors.” The inventors are not parties to the agreement. The Agreement grants UT a 5% equity interest in the venture. No equity interest is extended to any of the inventors.

IsoSpec later became the designated licensee of the ANDRaS technology in place of InnoSpec. IsoSpec issued a. Private Placement Memorandum (PPM) that sought $1,000,000 in investments in exchange for. limited partnership interest in the company. The PPM named Fink as a member of its “Technology and Business Advisory Group” and listed his relationship to IsoSpec as “Co-Inventor and Scientific Developer of the Technologies.” Fink did not receive any compensation from Isos-pec. He averred that he refused Isospec’s offer of a written consultation agreement. IsoSpec’s PPM disclosed, under the heading “Risk Factors,” the following:

IsoSpec is dependent on key relationships.
IsoSpec intends to look to the Technology Advisors as a source of counsel and development of new technologies. The Technology Advisors have been developed as a result of personal and business relationships with, the General Partners, the inventors of the technologies licensed by IsoSpec, and the Research Institutions. IsoSpec is dependent upon the involvement and contribution of the inventing scientists. The loss of these relationships could have a. materially adverse impact upon IsoSpec.

The PPM informed potential investors that “ANDRaS is rugged, inexpensive, small and portable providing'onsite analytical capabilities.” Further, “[t]wo operating prototype' instalments have proven the accuracy and operating capabilities of AN-DRaS.”

IsoSpec held various meeting with potential investors, including at least some of the plaintiffs. Fink attended at least one of these meetings. Professor Varghese also attended at least one meeting- along with -Fink and established, through documentation attached to his affidavit, that UT reimbursed some of his travel expenses to meet with IsoSpec. The UT travel voucher form states that Professor Varghese was being reimbursed for travel to IsoSpec in Houston to discuss “commercializing their technology.” The UT travel addendum states that he “is driving to Houston, TX to meet with [IsoSpec] to discuss their collaboration on -the commercialization of their- technology” and to “[h]elp accomplish research objectives.”

The role Fink played at the meetings he attended is contested. He averred that “the purpose of the meeting was only to answer technical questions about AN-DRaS technology.” While there, he “answered very specific scientific questions that certain individuals had about Raman Spectroscopy and ANDRaS technology.” Professor Varghese described his role similarly, stating that he attended the meeting to answer technical questions about the technology' they developed as UT employees.

Fink ayerred that he did not participate in drafting the PPM or other marketing materials or receive any compensation [464]*464from Iso Spec. Additionally, he stated that all of his involvement with IsoSpec was “a result of the work [he was] doing as a professor of physics at UT and UT’s licensing of [his] technology to IsoSpec.” Accordingly, when he attended the IsoS-pec meetings, he “thought it was in the scope and course of [his] responsibilities as a UT professor.” Professor Varghese stated the same belief in his affidavit.

The investors describe Fink’s role and relationship differently. In their unverified response to Fink’s motion to dismiss, they allege that Fink was involved in the development and issuance of the PPM, Fink intentionally engaged in conduct “designed to obtain investments for IsoSpec, a private company,” and such actions were not in the scope of his employment at the university. They argue that Fink’s involvement at the IsoSpec meeting was not on UT’s behalf and did not further any interest of the university. The investors contend that Fink’s role was, instead, to solicit investors for the benefit of IsoSpec and his son, Dr. Rainer Fink, who was IsoSpec’s Chief Technology Officer.

The investors asserted that Fink must have realized the actual nature of his role:

It is inconceivable to me that Dr. Manfred Fink would not have known the purpose of the meeting was to obtain investors in IsoSpec specifically based upon what was said at the meeting by IsoSpec representatives, the marketing materials distributed at the meeting, the fact that Dr. Manfred Fink’s son was part of the management team of IsoSpec and Dr.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Padmanee Sharma, M.D., PH.D. v. Jamie Lin
Court of Appeals of Texas, 2025
Frias v. Hernandez
142 F.4th 803 (Fifth Circuit, 2025)
Wells v. Texas Tech
Fifth Circuit, 2025
Roy Garcia v. Juan Guerra, Individually
Court of Appeals of Texas, 2023
Brown v. United States of America
D. South Carolina, 2023
Sims v. Mc Dilda
W.D. Texas, 2021
Sam Andrews, M.D. v. Rebecca Villareal Ortiz
Court of Appeals of Texas, 2020
Layne Walker v. Stephen Hartman
Court of Appeals of Texas, 2020
Stephen Hartman v. Steven Broussard
Court of Appeals of Texas, 2020
Amboree v. Bonton
575 S.W.3d 38 (Court of Appeals of Texas, 2019)
Fort Worth Transp. Auth. v. Rodriguez
547 S.W.3d 830 (Texas Supreme Court, 2018)

Cite This Page — Counsel Stack

Bluebook (online)
477 S.W.3d 460, 2015 Tex. App. LEXIS 9994, 2015 WL 5634306, Counsel Stack Legal Research, https://law.counselstack.com/opinion/fink-v-anderson-texapp-2015.