University Patents, Inc. v. Kligman

762 F. Supp. 1212, 20 U.S.P.Q. 2d (BNA) 1401, 1991 U.S. Dist. LEXIS 5348, 1991 WL 66958
CourtDistrict Court, E.D. Pennsylvania
DecidedApril 17, 1991
DocketCiv. A. 89-3525, 90-0422
StatusPublished
Cited by17 cases

This text of 762 F. Supp. 1212 (University Patents, Inc. v. Kligman) is published on Counsel Stack Legal Research, covering District Court, E.D. Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
University Patents, Inc. v. Kligman, 762 F. Supp. 1212, 20 U.S.P.Q. 2d (BNA) 1401, 1991 U.S. Dist. LEXIS 5348, 1991 WL 66958 (E.D. Pa. 1991).

Opinion

MEMORANDUM

WALDMAN, District Judge.

Plaintiffs, The Trustees of the University of Pennsylvania (the University) and University Patents, Inc. (UPI), commenced this action to recover royalties allegedly owed to them by defendants for a preparation for photoaged skin invented by Dr. Klig-man and marketed under license by Johnson & Johnson (J & J), and to seek a declaration of ownership in the patent rights to this product.

.Presently before the court is defendants’ Motion for Summary Judgment premised on the absence of any demonstrated enforceable rights of plaintiffs in Dr. Klig-man’s discovery. The parties have engaged in considerable discovery and have filed voluminous briefs. Oral argument was held on March 27, 1991.

I. PROCEDURAL HISTORY

On May 10, 1989, UPI filed a complaint, claiming that: (1) Dr. Kligman breached his employment contract with the University *1214 and also breached its Patent Policy; (2) UPI, by reason of its agreement with the University, is a third-party beneficiary to the Patent Policy and to the employment contract with Dr. Kligman; (3) because of his wrongful concealment of the invention, Dr. Kligman holds the patent in a constructive trust for the benefit of UPI and the University; and, (4) Dr. Kligman’s conduct constituted a tortious conversion of UPI and University property. UPI, relying on a service agreement with the University, also seeks a judgment declaring that UPI is the owner of and has the right to license the invention to third parties.

On January 22, 1990, the University filed a separate action, claiming that (1) J & J’s conduct constituted a tortious interference with the employment contract between the University and Dr. Kligman; (2) Dr. Klig-man breached his employment contract with the University, specifically Patent and Conflict of Interest Policies set forth in employee handbooks in 1977 and 1983; and, (3) Dr. Kligman and J & J conspired to deprive the University of its rights in the photoaging discovery. The University also claims that J & J failed to pay amounts due under the 1967 and 1975 anti-acne licensing contract. 1 The University seeks an accounting to ascertain the amounts due. Furthermore, the University seeks a judgment declaring (1) that the Kligman/J & J licensing agreement is null and void, and (2) that the University owns all rights and interest in the invention and patent in question. Finally, the University seeks punitive damages from J & J.

The actions filed by UPI and the University were later consolidated. On March 16, 1990, the court granted plaintiffs’ motion to dismiss defendants’ first counterclaim for tortious interference with contract. On May 7, 1990, the court denied plaintiffs’ motion to disqualify defense counsel, but precluded defendants from using information obtained during counsel’s ex parte contacts with certain persons affiliated with the University.

Defendants filed a motion to dismiss plaintiffs’ complaint based on the statute of limitations. With this motion, defendants submitted seventy-one exhibits. Consequently, the court granted plaintiffs’ Rule 56(f) motion to restyle defendants’ motion as one for summary judgment and to permit the parties to take limited discovery. This discovery has been completed and the parties have submitted supplemental briefs and exhibits.

Defendants filed a second motion to dismiss premised upon the alleged non-enforceability of the agreement in question. The court also re-characterized this motion as one for summary judgment and permitted limited discovery. Supplemental briefs, replies, and sur-replies have been filed by the parties. The court denied defendants’ motion to dismiss UPI’s complaint on the ground that it lacked third-party beneficiary standing without prejudice to proffer this contention in an appropriate motion at the close of discovery.

II. LEGAL STANDARD

In considering a motion for summary judgment, the court must determine whether the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, show there is no genuine issue as to any material fact, and whether the moving party is entitled to a judgment as a matter of law. Fed.R.Civ.P. 56(c). Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247, 106 S.Ct. 2505, 2509, 91 L.Ed.2d 202 (1986); Arnold Pontiac-GMC, Inc. v. General Motors Corporation, 786 F.2d 564, 568 (3d Cir.1986); Fragale & Sons Beverage Co. v. Dill, 760 F.2d 469, 472 (3d Cir.1985); Wolk v. Saks Fifth Avenue, Inc., 728 F.2d 221, 224 (3d Cir.1984); First Jersey National Bank v. Dome Petroleum Limited, 723 F.2d 335, 338 (3d Cir.1983). Only facts that may affect the outcome of a case under applicable law are “material.” Anderson, supra 477 U.S. at 248, 106 S.Ct. at 2510.

All reasonable inferences from the record must be drawn in favor of the non-moving party. Anderson, supra at 256, 106 S.Ct. at 2514. The movant has the *1215 burden of demonstrating an absence of genuine issues of material fact. Gans v. Mundy, 762 F.2d 338, 340 (3d Cir.1985); United States v. Athlone Industries, Inc., 746 F.2d 977, 981-82 (3d Cir.1984); Small v. Seldows Stationery, 617 F.2d 992, 994 (3d Cir.1980). The non-movant then must identify evidence on which a verdict in his favor could be sustained. Childers v. Joseph, 842 F.2d 689 (3d Cir.1988).

III. FACTS

The pertinent facts from the uncontro-verted evidence and the balance of the record viewed in a light most favorable to plaintiffs are as follow.

On August 11, 1965, the then President of the University of Pennsylvania, Gaylord P. Harnell, appointed a Patent Policy Committee to meet and make recommendations to the Trustees of the University. 2 The committee consisted of five faculty members, one administrator and University counsel. The committee drafted a policy which was approved by the trustees in January 1966.

Under the policy, all inventions and discoveries resulting from work carried out on University time or at University expense were to be the property of the University. Specifically, the policy provides:

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762 F. Supp. 1212, 20 U.S.P.Q. 2d (BNA) 1401, 1991 U.S. Dist. LEXIS 5348, 1991 WL 66958, Counsel Stack Legal Research, https://law.counselstack.com/opinion/university-patents-inc-v-kligman-paed-1991.