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KELLER-DORIAN COLORFILM CORP. v. EASTMAN KODAK CO.

November 21, 1949

KELLER-DORIAN COLORFILM CORPORATION
v.
EASTMAN KODAK CO. KELLER-DORIAN COLORFILM CORPORATION v. EASTMAN KODAK CO. et al.



The opinion of the court was delivered by: RYAN

Defendant Eastman Kodak moves to transfer two actions- Nos. 48-168 and 48-169, to the United States District Court for the Western District of New York, pursuant to Section 1404(a), 28 U.S.C.A. The two motions will be considered together in this memorandum.

Plaintiff is a Delaware corporation; its executive officers reside in the vicinity of New York City, in this district.

Defendant Kodak is a New Jersey corporation licensed to do business in New York; its principal offices are located in Rochester, but it does business in this district maintaining offices at 342 Madison Avenue and 10 East 40th Street, New York city.

 Technicolor, Inc., and Technicolor Motion Picture Corporation are named as additional defendants in action No. 48-169. Technicolor, Inc., is a Delaware corporation having its principal office at 15 Broad Street, New York City, and Technicolor Picture Corporation, a wholly-owned subsidiary of it, is a Maine corporation with a plant and principal place of business in Hollywood, California, and an office at 30 Rockefeller Plaza, New York City.

 These Technicolor defendants do not move for transfer of action No. 169, in which they are defendants. While they have no reason for urging it they have no objection to such transfer. They believe that it will appear, as the preparations for trial advance, that they have no knowledge or interest in a great many of these matters that will form the subject of these actions. They regard their position in this litigation as 'minor and incidental.' Furthermore, they assert that their officers who do have some knowledge of the matters in suit spend most of their time in California, and that consequently, insofar as the convenience of these witnesses is concerned, it would make no difference to them whether the trial were held in this or in the western district (letter of attorney for Technicolor defendants, dated October 24, 1949).

 In action No. 168, plaintiff alleges claims extending over a period of over twenty-two years; it seeks a declaratory judgment settling the rights and obligations of plaintiff and defendant Kodak under an alleged patent license and royalty agreement and specific performance of the terms of the agreement; it further seeks an accounting for alleged royalties due for that same period and damages of $ 50,000,000.

 In action No. 169 plaintiff asserts three claims against the three-named defendants; here, plaintiff seeks treble damages in the sum of $ 150,000,000 for alleged anti-trust violations reaching back over a period of 20 years; $ 50,000,000 damages for alleged tortious injury to its property rights, and an additional $ 50,000,000 damages for alleged breach of contract to exploit plaintiff's inventions during the past 20 years.

 The answer of Technicolor defendants is a general denial of the principal allegations of the complaint. Kodak's answers, in addition to a similar denial, assert three counterclaims against plaintiff, asking for damages in the sum of $ 1,000,000 and for a declaratory judgment. Kodak not only pleads the invalidity of the patents pertaining to the Keller-Dorian process but alleges also breach of certain warranties contained in the agreement between plaintiff and Kodak.

 The general theory of both complaints is fairly described by plaintiff's attorneys, as follows:

 '(a) that Kodak, upon and by taking certain exclusive patent licenses from plaintiff or plaintiff's assignor with respect to the Keller-Dorian process, and, also, by retaining as it has said exclusive licenses, became, has been and is obligated, both by the terms of such licenses and as a matter of law, not only to develop or exploit the process commercially to the exclusion of other competitive processes, and to pay to plaintiff the agreed royalties payable as a result of such exploitation but also to declare and make known to plaintiff all patents, inventions, improvements, developments and experience with respect to lenticulated film and all other phases of the lenticulated process which Kodak at any time develops or in which it at any time obtains or has directly or indirectly any right or interest and to share the benefit of the same with plaintiff.

 '(b) that, Kodak, in pursuance of its monopolistic conspiracy in restraint of trade and contrary to the Federal anti-trust laws, together with the Technicolor defendants, not only suppressed the process instead of exploiting it, but also exclusively exploited the Technicolor and other color film processes; and

 '(c) that Kodak and the Technicolor defendants breached and/or induced the breach of Kodak's obligations to plaintiff, violated said anti-trust laws and became liable to plaintiff in damages and otherwise.'

 Kodak concedes that 'all three defendants are found and transact business in the Southern District of New York,' It does not dispute that venue is properly laid in this district in both actions. Since Kodak (the sole defendant in No. 168) has its principal place of business in Rochester, venue could have been laid in the Western district, 28 U.S.C.A. § 1391(a)(c); and since the actions are not of a local nature, they could have been brought against all defendants in the Western district. 28 U.S.C.A. § 1392(a). Therefore, plaintiff had a choice of forums and the question presented is whether a transfer should be effected for the convenience of parties and witnesses and in the interests of justice. Section 1404(a).

 Defendant Kodak urges that since plaintiff on a prior motion stated that a large part of the evidence which it will require to establish its case is solely within the knowledge of the officers, agents and employees of defendant and is to be found in documents and records in possession or control of defendant, it is for the convenience of the parties and witnesses and in the interests of justice that a transfer to the Western district be granted. This contention is further supported by its (Kodak's) assertion that since the suit involves matters pertaining to its investigation and research in the color film field, ...


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