ROY S. PAYNE, District Judge.
Before the Court are (1) Defendant Imperial Toy LLC's ("Imperial") Motion to Dismiss (Dkt. No. 24); and (2) Plaintiff Pietro Pasquale Antoni Sgromo's ("Sgromo") Motion for Temporary Injunction (Dkt. No. 18). After consideration, the Court grants Imperial's Motion to Dismiss. The Court concludes that Plaintiff lacks standing to assert claims of patent infringement against Imperial. Accordingly, Plaintiff's patent infringement claims against Imperial are dismissed with prejudice. The Court concludes that it lacks subject matter jurisdiction over the state law claims against Imperial, so those claims are dismissed without prejudice. Because Defendant HEB Grocery Company, LP has not appeared in the case, and there is no evidence in the record that Plaintiff has served process on HEB, all claims against it are dismissed without prejudice under Rule 4(m). The Court also denies Plaintiff's Motion for Temporary Injunction.
In the First Amended Complaint (Dkt. No. 16), Sgromo asserts various claims against Imperial:
The Court will first address Counts I and II together. Then, the Court will address the state law claims that are asserted in Counts III through VI. Lastly, the Court will address the Motion for Temporary Injunction.
A party invoking federal jurisdiction bears the burden of showing that it has standing to sue. Lujan v. Defs. of Wildlife, 504 U.S. 555, 561 (1992). "[S]tanding is to be determined as of the commencement of suit." Id. at 571 n.5. "[I]n order to assert standing for patent infringement, the plaintiff must demonstrate that it held enforceable title to the patent at the inception of the lawsuit." Paradise Creations, Inc. v. UV Sales, Inc., 315 F.3d 1304, 1309 (Fed. Cir. 2003) (emphasis in original) (citing Lans v. Digital Equip. Corp., 252 F.3d 1320, 1328 (Fed. Cir. 2001) (holding that the appellant did not have standing, because he had already assigned title to the patent at the inception of the lawsuit); Enzo APA & Son, Inc. v. Geapag A.G., 134 F.3d 1090, 1092 (Fed. Cir. 1998) (holding that a licensee lacked standing where there was no written transfer of rights under the patent at the time the infringement claims were brought and stating that, "[a]s a general matter, parties should possess rights before seeking to have them vindicated in court"); Jim Arnold Corp. v. Hydrotech Sys., Inc., 109 F.3d 1567, 1572 (Fed. Cir. 1997) (holding that an assignor lacked standing, because it had not succeeded in rescinding or canceling its assignment in state court at the time it filed its complaint in federal court); Gaia Techs., Inc. v. Reconversion Techs., Inc., 93 F.3d 774, 778 (Fed. Cir. 1996) (holding that the plaintiff's patent and trademark infringement claims were required to be dismissed for lack of standing, because of its "inability to prove that it was the owner of the Intellectual Property at the time the suit was filed"), as amended on rehearing on different grounds, 104 F.3d 1296 (Fed. Cir. 1996))).
The Federal Circuit's opinion in Jim Arnold is particularly instructive. In that case, the Federal Circuit held that:
Jim Arnold, 109 F.3d at 1571-72. The Jim Arnold opinion also stated that:
Id. at 1577.
Here, Sgromo lacks present ownership of the two patents that he is asserting in this case. The patents themselves show that Imperial is the assignee, not Sgromo. (Dkt. No. 1-2 at [73]; Dkt. No. 1-3 at [73].) Further, Imperial entered into a license agreement ("Agreement") with Sgromo, and this agreement shows that Imperial was assigned rights in the patents. (Dkt. No. 24-2.) The Agreement covers the asserted patents.
(Id. at ¶ 1(b).) The Agreement also states that "Licensor grants to Licensee the right to sublicense, throughout the world, all rights granted in Paragraph (b) of this Section." (Id. at ¶ 1(c).)
The license agreement assigned all rights in the patents from WEM to Imperial. Even if Sgromo asserts that he has the same rights as WEM (he does not
Plaintiff's patent infringement claims formed the basis for this Court's subject matter jurisdiction as alleged in the Complaint. The Court concludes that this Court should not exercise supplemental or pendent jurisdiction over the remaining state law claims for violations of the Texas Uniform Trade Secrets Act, tortious interference, unfair competition, and unjust enrichment.
The Amended Complaint asserts that this Court has subject matter jurisdiction over this case pursuant to 28 U.S.C. § 1331 (Dkt. No. 16 at ¶ 7), which is the section conferring federal question jurisdiction. Since the Court concluded above that Sgromo lacks standing to assert claims of patent infringement against Defendants, and the patent infringement claims were the only claims that involved federal question jurisdiction, there is no continuing basis for this Court's jurisdiction. Plaintiff's claims for violations of the Texas Uniform Trade Secrets Act, tortious interference, unfair competition, or unjust enrichment are each state law claims that do not arise under the Constitution, laws, or treaties of the United States.
The Amended Complaint also asserts that this Court has subject matter jurisdiction over this case pursuant to 28 U.S.C. § 1338(a), but this Court no longer has subject matter jurisdiction pursuant to that provision. (Dkt. No. 16 at ¶ 7.) Section 1338(a) provides:
Further, Section 1338(b) provides that "[t]he district courts shall have original jurisdiction of any civil action asserting a claim of unfair competition when joined with a substantial and related claim under the copyright, patent, plant variety protection or trademark laws." Here, the Court dismissed Sgromo's patent infringement claims for lack of standing. Consequently, any unfair competition or other state law claims are no longer "joined with a substantial and related claim under the copyright, patent, plant variety protection or trademark laws."
To the extent that Plaintiff seeks to assert supplemental jurisdiction or pendent jurisdiction over the state law claims, the Court declines to exercise that jurisdiction because the Court dismissed all claims over which the Court has original jurisdiction. See 28 U.S.C. § 1367; Carnegie-Mellon Univ. v. Cohill, 484 U.S. 343, 350 (1988) (citing Mine Workers v. Gibbs, 383 U.S. 715, 726-27 (1966)). "Whether to refuse, or to retain, supplemental jurisdiction over a pendent state-law claim is committed to a district court's `wide discretion'." Moon v. City of El Paso, 906 F.3d 352, 360 (5th Cir. 2018), cert. denied sub nom. Moon v. Cty. of El Paso, Tex., 139 S.Ct. 2616 (2019).The Court sees no reason to retain jurisdiction over these state law claims because this case is still in its initial stages. Additionally, dismissal is appropriate due to judicial economy concerns as the parties have already arbitrated the same issues. (Dkt. No. 24-3.)
Accordingly, the Court grants Imperial's Motion to Dismiss with respect to the state law claims for violations of the Texas Uniform Trade Secrets Act, tortious interference, unfair competition, and unjust enrichment, without prejudice.
As an initial matter, Plaintiff seeks a temporary injunction, which is a concept from state law. Under federal law, the most comparable form of relief is a preliminary injunction, but Plaintiff has not shown that he is entitled to a preliminary injunction.
A plaintiff seeking a preliminary injunction must clearly show four elements:
Planned Parenthood of Gulf Coast, Inc. v. Gee, 862 F.3d 445, 457 (5th Cir. 2017), cert. denied, 139 S.Ct. 408 (2018). Additionally, Rule 65(c) of the Federal Rules of Civil Procedure requires a party seeking a preliminary injunction or a temporary restraining order to provide "security in an amount that the court considers proper to pay for the costs and damages sustained by any party found to have been wrongfully enjoined or restrained."
Here, Plaintiff has not adequately shown a substantial likelihood that he will prevail on the merits—the Court has dismissed his case on other grounds. Further, Sgromo did not show that he would suffer irreparable injury if the injunction is not granted, and Sgromo has not shown an ability to provide a security as required by Rule 65(c). For at least these reasons, the Court denies Plaintiff's Motion for a Temporary Injunction.
The Court concludes that Plaintiff should not be given the opportunity to amend his Complaint.
As stated above, Plaintiff's Motion for a Temporary Injunction (Dkt. No. 18) is denied, and Imperial Toy LLC's Motion to Dismiss (Dkt. No. 24) is granted. All of Plaintiff's federal claims against Imperial are dismissed with prejudice. The state law claims against Imperial are dismissed without prejudice. All claims against Defendant HEB Grocery Company, LP are dismissed without prejudice under Rule 4(m).