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B.V. OPTISCHE INDUSTRIE DE OUDE DELFT v. HOLOGIC

December 14, 1995

B.V. OPTISCHE INDUSTRIE DE OUDE DELFT, OLDELFT N.V., and OLDELFT CORPORATION OF AMERICA, Plaintiffs, against HOLOGIC, INC. and THE UNIVERSITY OF ROCHESTER, Defendants.


The opinion of the court was delivered by: LEISURE

 LEISURE, District Judge:

 Plaintiffs allege defendants violated (1) the Racketeer Influenced and Corrupt Organizations Act ("RICO"), see 18 U.S.C. §§ 1961-68, and (2) section 2 of the Sherman Act. See 15 U.S.C. § 2. In addition, plaintiffs seek a declaratory judgment, see 28 U.S.C. § 2201, that two United States patents originally obtained by defendant Hologic are invalid and unenforceable. Defendants, pursuant to Fed. R. Civ. P. 9(b) and Fed. R. Civ. P. 12(b)(6), move to dismiss the RICO and antitrust claims. In addition, defendants move to dismiss the request for a declaratory judgment pursuant to Fed. R. Civ. P. 12(b)(1). For the reasons stated below, defendants motion is granted in its entirety. The Court grants plaintiffs leave to replead all three claims.

 BACKGROUND

 This dispute centers around competition between plaintiffs and defendants to develop a new technology used for chest X-rays, known as chest equalization radiography. This competition resulted in the issuance, by the United States Patent and Trademark Office (the "PTO"), of two patents to Hologic. The patents were issued on August 28, 1990. The first is U.S. Patent No. 4,953,189 (the "'189 Patent"). Application for the '189 Patent was filed with the PTO on November 15, 1985 by an inventor, "Bob" Shih-Ping Wang. The second patent is U.S. Patent No. 4,953,192 (the "'192 Patent"). Application for this patent was filed with the PTO on September 13, 1988 by Dr. Donald B. Plewes, also an inventor, and at that time an employee of defendant the University of Rochester.

 Plaintiffs state that in 1988 defendant Hologic entered into an agreement with Konica Corporation to develop an equalized radiography system to compete with plaintiffs' system. Plaintiffs also allege that, beginning in or around 1988, Hologic, in order to unfairly win this competition, created an enterprise consisting of: (1) at least one or more officers of Hologic; (2) Wang (3) Plewes; and (4) Ivan S. Kavrukov, Esq., the patent attorney for defendants. Plaintiffs further allege that the University joined this enterprise in 1990 and supplanted Hologic as its primary instigator in 1992. The apparent purpose of this enterprise was to fraudulently obtain patents from the PTO for chest equalization radiography, and thereby block plaintiffs' efforts to enter the United States markets.

 Hologic's alleged first step was to acquire Wang's pending application for the '189 Patent in June of 1988. By July of 1988, after deciding not to pursue the Wang application, Hologic entered into an agreement with the University for an exclusive license under several of Plewes's pending patent applications, including his application for the '192 Patent. At that time it is alleged that Plewes became a consultant to Hologic. Applications for the '189 and '192 Patents were both directed to an equalized radiography system using a segmented fan beam. Plaintiffs' still-pending patent application also describes an equalized radiography system using a segmented fan beam.

 Hologic, after communications with Konica and Kavrukov in early 1989, was concerned that the Plewes's '192 Patent application was filed too late to pre-date plaintiff's application. Therefore, Hologic decided to obtain rights to the Wang '189 Patent application, and have Wang agree to name Plewes the inventor on a divisional application to the pending '189 Patent application. The purpose of this was to give Plewes the advantage of the earlier filing date and fuller disclosure of the '189 Patent application. Thereafter, Kavrukov, Plewes and Wang, apparently acting at the "behest" of Hologic and Rochester, allegedly participated in various fraudulent acts before the PTO, eventually resulting in the issuance of the '189 Patent and the '192 Patent. Plaintiffs assert that but for the fraudulent activity, neither patent would have been issued.

 Plaintiffs' alleged damage is the cost they incurred defending themselves in three patent enforcement proceedings. The first action was a proceeding before the International Trade Commission (the "ITC"). Hologic began this action by filing a complaint on January 22, 1991, and the ITC instituted an investigation on February 22, 1991. The second proceeding was a patent infringement action filed by Hologic in the Southern District of New York on January 23, 1991, served by mail on January 24, and received by plaintiffs on or before February 8, 1991. The final action is a currently pending interference before the PTO, which was originally provoked by plaintiffs in October of 1990, and formally instituted by the PTO on May 20, 1991. The interference is to determine which patent, among plaintiffs' pending patent application, the '189 and '192 Patents, and the Wang-to-Plewes divisional application, may lawfully issue.

 DISCUSSION

 I. Standard for a Motion to Dismiss

 In deciding defendants' Rule 12(b)(6) motion to dismiss, the Court accepts as true the material facts alleged in the complaint and draws all reasonable inferences in plaintiffs' favor. See Kaluczky v. City of White Plains, 57 F.3d 202, 206 (2d Cir. 1995) (citing Hill v. City of New York, 45 F.3d 653, 657 (2d Cir. 1995)). A motion to dismiss must be denied "unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Scheuer v. Rhodes, 416 U.S. 232, 236, 40 L. Ed. 2d 90, 94 S. Ct. 1683 (1974) (citing Conley v. Gibson, 355 U.S. 41, 45-46, 2 L. Ed. 2d 80, 78 S. Ct. 99 (1957)).

 In their opposition to defendants' motion, plaintiffs filed a lengthy declaration from one of their counsel, and voluminous exhibits in support of this declaration, including deposition testimony of Wang, Plewes and Kavrukov, and documents produced by defendants. Defendants request that the Court not consider these submissions. Plaintiffs, in their request to have the submissions considered, do not cite any legal authority.

 In deciding whether or not to consider these submissions, the Court must make several inquiries. First, in certain situations, when a party seeks to introduce "affidavits, depositions or other extraneous documents not set forth in the complaint for the court to consider on a Rule 12(b)(6) motion," Cortec Indus., Inc. v. Sum Holding L.P., 949 F.2d 42, 47 (2d Cir. 1991), conversion of the motion to a Rule 56 summary judgment motion may be appropriate. See id.; Fed. R. Civ. P. 12(b)(6). However, conversion is only appropriate when the parties should reasonably recognize the motion as one for summary judgment. See Krijn v. Pogue Simone Real Estate Co., 896 F.2d 687, 689 (2d Cir. 1990). Because in this case it was the non-movant who offered the supplemental submissions, the movants could not have had adequate notice that this motion might be treated as one for summary judgment. Therefore, conversion is inappropriate.

 Having concluded that the motion is properly a motion to dismiss under Rule 12(b)(6), it is still necessary to determine whether the Court should consider plaintiffs' submissions. Fed. R. Civ. P. 10(c) provides: "Statements in a pleading may be adopted by reference in a different part of the same pleading or in another pleading or in any motion. A copy of any written instrument which is an exhibit to a pleading is a part thereof for all purposes." Relying on Fed. R. Civ. P. 10(c), the Court of Appeals for the Second Circuit has held that "the complaint is deemed to include ...


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