Allied Mach. & Eng'g Corp. v. Competitive Carbide, Inc.

Where a third party complaint against inventor/patent assignor is based on the defense of invalidity, rather than a cause of action, and the inventor's rights in the patent have been assigned to another party, the third party plaintiff and defendant do not have adverse legal interests sufficient to survive a motion to dismiss under Fed. R. Civ. P. 12(b)(1).

Opinion (BOYKO): Allied Machine and Engineering Corp. (“Allied”) sued Competitive Carbide (“Carbide”) alleging infringement of Patent No. 7,942,616, assigned to Allied by inventors Nuzzi and Kraemer (“the inventors”). As part of its response, Carbide filed a third party complaint against the inventors, and sought a declaratory judgment that the patent was invalid due to inequitable conduct during patent prosecution by the inventors. The inventors moved to dismiss under Fed. R. Civ. P. 12(b)(1), arguing that because they had assigned their rights to the patent to Allied, there was no controversy between themselves and Carbide. Because “invalidity is a defense to a patent infringement claim, not an action in itself,” and because the inventors had assigned their rights in the Patent to Allied, the district court determined that Carbide and the inventors did not have a substantial controversy with adverse legal interests. Accordingly, the court GRANTED the inventors’ motion to dismiss.