Howard M. Cooper and Joseph M. Cacace obtained a U.S. District Court decision remanding a case to state court that provides important guidance on the limits of federal jurisdiction when a defendant asserts patent counterclaims and attempts to remove a case from state to federal court.
The federal court judge – interpreting the jurisdictional provisions of the America Invents Act (AIA) – issued the first known ruling in the District of Massachusetts that a federal court lacks subject matter jurisdiction over counterclaims for declaratory judgment of non-infringement of patents because the dispute failed to meet the "case or controversy" requirement under Article III of the U.S. Constitution.
The AIA permits removal to federal court where a counterclaim arises under the patent laws, but such a counterclaim must present a justiciable case or controversy under Article III. The judge determined that no alleged facts showed a present dispute over patent infringement.
The ruling also provides guidance on when a state law claim does not "arise under" the patent laws. The complaint of the firm's clients involves numerous state law claims, including breach of fiduciary duty, breach of licensing agreements, conversion, and violation of G.L. c. 93A. The judge concluded that the defendants failed to meet their burden of proving that any of the plaintiffs’ claims sought relief in any way related to patent infringement, and therefore did not “arise under” patent law.
The dispute is rooted in a soured business relationship concerning technology aimed first at treating hazardous wastes and later at manipulating and creating matter, among other things. The crux of the complaint is that the defendants allegedly stole trade secrets and confidential proprietary information from plaintiffs to use at a competing business.
Mr. Cooper regularly represents clients in major civil cases, including in the areas of corporate, closely-held business, real estate, partnership, malpractice, trade secret and franchise litigation. Mr. Cacace concentrates his practice on complex civil matters, including business disputes.