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MICKOWSKI v. VISI-TRAK CORP.

February 3, 1999

JOHN R. MICKOWSKI, PLAINTIFF,
v.
VISI-TRAK CORPORATION, JOHN R. VANN, JACK BRANDEN, AND YING SHEN DEFENDANTS.



The opinion of the court was delivered by: Sprizzo, District Judge.

  OPINION AND ORDER

BACKGROUND

The Parties

Mickowski is the owner of U.S. Patent 4,504,920, which issued on March 12, 1985 and of U.S. Patent No. Re. 34,559, which issued on March 8, 1994. Visi-Trak, an Ohio corporation located in Cleveland, Ohio, engages in the manufacture and sale of die casting monitoring systems. The individual defendants, Vann, Branden, and Shen, are each officers, shareholders, and employees of Visi-Trak. Vann is president and the principal shareholder of Visi-Trak. Branden is vice president of sales and marketing. Shen is vice president of engineering.

The Patents in Suit

Mickowski alleges that defendants have induced infringement of claim 1 of U.S. Patent No. 4,504,920 and claim 28 of U.S. Patent No. Re. 34,559. The patents in suit relate to the technology for monitoring die casting or injection molding manufacturing processes in which machine operators depend upon data from equipment sensors to alert them to possible product defects and to ensure uniformity in the manufacturing process. In die casting, for example, this technology allows operators to monitor the consistency of each die casting cycle or "shot." In a die casting machine, molten metal is poured into a cylinder, and a piston, referred to as a "ram" or "plunger" moves through the cylinder and forces the metal to the end of the cylinder. There the metal fills a mold or die in the shape of the product to be made. The metal cools and hardens in the mold. Then, the mold opens, releasing the formed product. The ram retracts and the mold closes, and the cycle is then repeated.

Claim 28 of the '559 patent claims a method for graphically displaying a combination plot of data collected during each shot.*fn2 During a shot, the ram will first move at high speed as metal is forced into the die. Then the ram slows and nearly stops as almost all the metal has been forced into the die. The method claimed in claim 28 accounts for these two distinct phases of the shot by displaying different graphs for the two phases of the shot. During the first phase of the shot, pressure is plotted as function of ram position. Then, at a predetermined point in the shot, the computer changes the method of plotting and displays pressure graphed as a function of time. Both graphs are displayed for each shot, allowing the operator to monitor changes in pressure through the entire shot.

Visi-Trak manufactures a computer monitoring and analysis system for the die casting industry. The sales literature and software manual provided by Visi-Trak for this computer monitoring system demonstrate how the monitoring system may be used to practice the monitoring methods taught by claim 1 and claim 28. Although the Visi-Trak computer monitoring system may be used to practice monitoring methods other than the methods taught by claim 1 and claim 28, the sales literature and software manual demonstrate that a primary use for the computer monitoring system is to practice the methods taught by claim 1 and claim 28. These documents describe and specify the methods taught by claim 1 and claim 28 and direct purchasers of the equipment to practice these methods. Visi-Trak has sold the computer monitoring system to customers in the United States during the term of the patent, and purchasers of the system have used the system in the United States to practice the methods taught by claim 1 and claim 28.

In 1994, Mickowski contacted Visi-Trak and requested that Visi-Trak enter into negotiations for a patent licensing agreement under which Visi-Trak would pay Mickowski a royalty from sales of its monitoring system. Failing to reach an agreement, Mickowski commenced the instant action.

DISCUSSION

Jurisdiction and Venue

Because this action involves claims arising under the patent laws of the United States for infringement of United States Letters Patent, this Court has subject matter jurisdiction over the action pursuant to 28 U.S.C. § 1338(a) and 35 U.S.C. § 281. In an action arising under federal law, this Court will ordinarily look to the law of the forum state to determine whether the Court may exercise personal jurisdiction over the defendants. See Fed.R.Civ.P. 4(e); Omni Capital Int'l v. Rudolf Wolff & Co., Ltd., 484 U.S. 97, 104-105, 108 S.Ct. 404, 98 L.Ed.2d 415 (1987). New York law controls the question of personal jurisdiction in this action; venue is governed by 28 U.S.C. § 1400(b).

Visi-Trak has waived any defense that this Court lacks personal jurisdiction over Visi-Trak or that venue in this District is improper by failing to assert personal jurisdiction and venue as disputed questions in the parties' Joint Pre-Trial Order. The Court deems the waiver of these defenses by Visi-Trak as an admission that Visi-Trak has engaged in sufficient contacts with the State of New York and this District to support a finding of both personal jurisdiction and venue by this Court.

Unlike Visi-Trak, however, the individual defendants Vann, Branden, and Shen have raised the defenses of personal jurisdiction and venue. The Court finds that the individual defendants are nonetheless bound by the admission by Visi-Trak that personal jurisdiction and venue are proper at least as to the corporation. The individual defendants are in privity with the corporation as its officers and shareholders, and it is undisputed that defendants directed the infringing activities of Visi-Trak. Vann, Branden, and Shen thus cannot, and indeed have made no attempt to, dispute that Visi-Trak has maintained sufficient contacts with the State of New York and this District to support both personal jurisdiction and venue as to the corporation.

The Court further finds that, for purposes of establishing personal jurisdiction over the individual defendants, Visi-Trak has acted as the agent of Vann in its contacts with the State of New York and this District. Vann admitted at trial his personal knowledge of the patents in suit. In addition, he admitted that he controls the affairs of Visi-Trak and was responsible for the decision to continue manufacture and sale of the Visi-Trak monitoring system after Mickowski first asserted claims of patent infringement. As an officer and principal shareholder of Visi-Trak, Vann has profited from the sales of the Visi-Trak monitoring system. These facts are sufficient to find that, in its contacts with the State of New York and this District, Visi-Trak has acted as the agent of Vann, such that personal jurisdiction is proper at least against Vann, if not Branden and Shen. See Kreutter v. McFadden Oil Corp., 71 N.Y.2d 460, 467, 527 N.Y.S.2d 195, 522 N.E.2d 40 (1988); Retail Software Services, Inc. v. Lashlee, 854 F.2d 18 (2d Cir. 1988); Kinetic Instruments, Inc. v. Lares, 802 F. Supp. 976, 983-85 (S.D.N Y 1992).

These contacts, however, are insufficient to establish venue as to any of the individual defendants. As previously noted, venue in this action is governed by 28 U.S.C. ยง 1400(b), which states in relevant part that an infringement action "may be brought in any district where the defendant resides, or where the defendant has committed acts of infringement and has a regular and established place of business." To establish venue in a district in which the defendant does not reside, plaintiff must show that the defendant both committed acts of infringement in the district and maintains a place of business in the same district. Because neither Vann nor Branden nor Shen reside in this District or maintain a place of business in ...


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