RITCHIE DEVELOPMENT, LTD. v. Roys

330 F. Supp. 2d 767, 2002 U.S. Dist. LEXIS 27692, 2002 WL 32627450
CourtDistrict Court, E.D. Louisiana
DecidedJuly 1, 2002
Docket2:01-cr-00003
StatusPublished

This text of 330 F. Supp. 2d 767 (RITCHIE DEVELOPMENT, LTD. v. Roys) is published on Counsel Stack Legal Research, covering District Court, E.D. Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
RITCHIE DEVELOPMENT, LTD. v. Roys, 330 F. Supp. 2d 767, 2002 U.S. Dist. LEXIS 27692, 2002 WL 32627450 (E.D. La. 2002).

Opinion

*769 ORDER AND REASONS

VANCE, District Judge.

1. BACKGROUND

Plaintiff Ritchie Development, Ltd. sued Curtis Roys for correction of inventorship, pursuant to 35 U.S.C. § 236. Plaintiff seeks a ruling that Larry Ritchie was the sole inventor of United States Patent No. 5,835,372 (“the ’372 patent”), on which Larry Ritchie and Curtis Roys are named as co-inventors. 1 Plaintiff also seeks costs and attorney’s fees.

The Court held a bench trial on plaintiffs claims on May 20-21, 2002. Based on the following findings of fact and conclusions of law, the Court determines that plaintiff fails to show by clear and convincing evidence that Larry Ritchie was the sole inventor of the ’372 patent.

II. FINDINGS OF FACT

A. Background

The ’372 patent describes a method and apparatus that measures and controls volume flow through fluid distribution lines. The apparatus is designed to retrofit standard fluid divider valve assemblies. The patent contains 14 claims: the first 6 are apparatus claims and the last 8 are method claims. 2 The resulting technology has been sold under the trademark DNFT, which stands for Digital No-Flow Ther-malizer. (PL’s Ex. 1, Patent ’372.) The DNFT has primary applications in the oil industry where it is used to control lubrication levels in fluid distribution lines. The patent prosecution history reveals that what made the DNFT patentable was *770 that its method and apparatus allowed fluid to be measured without requiring the fluid to flow through the apparatus itself. (Pl.’s Ex. 2, at tab 13) (distinguishing the DNFT from the subject matter of the Stillwell et. al. Patent.) The DNFT contained a “lever arm” that transferred the motion of a piston contained in a separate divider block back to a microprocessor to calculate fluid flow. The advantages of the DNFT were that it was independent of fuel pressure, and it could retrofit onto existing divider block valves and other systems in which fluids are moved with a piston. (Id.)

From 1975 until March 1995, Curtis Roys was employed by United Pump & Supply Company (“UP & S”), a company that supplied equipment for monitoring lubrication in divider block lubrication systems. He sold and installed divider block systems and compressors. Roys also taught training classes and authored a training manual on the operation and maintenance of divider block lubrication systems and the monitors used with those systems. Based on his experience with these systems, Roys determined that there was a problem with the existing mechanical no-flow systems that measured lubrication flow within the divider blocks in that they were big, inaccurate, expensive, affected by the temperature variables, and failed to shut down the unit in the event of a malfunction. In the early 1990s, Roys began to conceive of a smaller and cheaper device to monitor and control lubrication that could attach directly to the divider block. To that end, Roys conceptualized a design that would contain a proximity switch with a digital cub counter and light emitting diode (LED) screen that had shut-down capabilities. He spoke of his idea to his employer at UP & S, Mike Huckaba, and for three to five years, they tried to develop a working shut-down system. Roys determined that he lacked the technical knowledge about electronic circuits necessary to create a working model of his idea. In late 1994, Roys purchased a meter from James Morris Traylor, Jr. He told Traylor that he needed the meter to develop a device that had shut-down capabilities. Roys told Traylor that he was having problems with the size of the device and with incorporating the shutdown function. He asked Traylor if Tray-lor could put electronics for a shutdown function inside the device illustrated in Defendant’s Exhibit 17, which was a cub counter attached to a proximity switch with a plunger. Traylor said that he could not make the device explosion proof and suggested that Roys see Larry Ritchie, who was knowledgeable about electrical circuitry.

Larry Ritchie, the owner and manager of Whitlock Instruments, was widely acknowledged in Odessa, Texas to be an electronics whiz. He worked at Whitlock Watch Clock & Instrument Repairs, Inc. as a teenager, where he worked on watches. He then received a bachelors degree in electrical engineering from Texas Technology College. After college, he worked for Hewlett Packard as a product design engineer in its microwave division for several years. Ritchie then returned to Odessa and purchased the Instruments division of Whitlock, which he renamed Whitlock Instruments.

Roys contacted Whitlock to discuss the possibility of redesigning and miniaturizing the Novatech, a mechanical device for measuring fluid flow with shut-down capabilities. (Pl.’s Ex. 4.) He initially met with Mike Parker, an employee of Whitlock. He then met with Larry Ritchie in a meeting that lasted about an hour. Ritchie was unfamiliar with fluid flow block dividers and the application of Novatech monitors. He had not worked with fluid distribution systems since the 1960’s and had never seen the Novatech. Roys explained his *771 idea for redesigning the Novatech to be digital rather than mechanical. He asked Ritchie to miniaturize the Novatech monitor so that it would be small enough to hook on to the divider block. Within a few weeks, Roys brought Ritchie the device shown in Exhibit 17 (the cub counter attached to a proximity switch which could be hooked on to a divider block). Roys explained that his idea was to put the electronics into it so that it would have an alarm circuit and shut-down function. (Def.’s Ex. 17.)

Ritchie first attempted to redesign the Novatech. This resulted in the DNFT 2, which was a substantially smaller, less expensive and battery-powered fluid flow monitoring device. Roys provided Ritchie with the mathematical formulas used to estimate fluid flow rates in the distribution lines. The DNFT 3 was developed by March 1995. Ritchie and Roys entered into an agreement whereby Whitlock would manufacture the DNFT 2/3 and Roys would sell it for UP & S.

By March 1995, Roys had left his job with UP & S and formed his own company, C.C. Technology, to focus exclusively on the development of the divider block monitoring system. He and Ritchie entered into an agreement to share profits on the DNFT 2/3. Roys operated out of Whit-lock’s building and shared Whitlock’s mailing address. Indeed, he even put a “C.C. Technology” plaque on the outside of the building. The testimony of the witnesses and the documentary evidence show that Ritchie and Roys were in frequent communication and that they collaborated on the development of the DNFT. Ritchie, however, was unhappy that Roys received a greater portion of the profits (70 %) from the DNFT 2/3. Ritchie and Roys worked out an agreement under which they would work to make the product smaller and more reliable, and they would split the profits evenly.

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330 F. Supp. 2d 767, 2002 U.S. Dist. LEXIS 27692, 2002 WL 32627450, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ritchie-development-ltd-v-roys-laed-2002.