[00:00:05] Speaker ?:
The United States Department of Appeals for the Federal Circuit is now open and in session.

[00:00:10] Speaker ?:
God save the United States and this honorable court.

[00:00:13] Speaker 01:
Good morning.

[00:00:14] Speaker 01:
Please be seated.

[00:00:14] Speaker 01:
The first case for argument this morning is 15-1284.

[00:00:27] Speaker 01:
New Evolution versus Peterson.

[00:00:29] Speaker 01:
And I understand the appellants are splitting the argument, so we're running the clock for you each individually.

[00:00:36] Speaker 02:
Hey, please be quiet.

[00:00:45] Speaker 02:
I'm Jonathan Freiman on behalf of New Evolution.

[00:00:48] Speaker 02:
And the council table is Richard Peyser on behalf of Peter Rasmussen, addressing the issue specific to Mr. Rasmussen.

[00:00:54] Speaker 02:
We've also reserved five minutes for rebuttal in addition to the divided time here.

[00:00:59] Speaker 02:
Your honors, 10 years ago in the Vota case, this court held that our courts should not determine the validity and infringement of foreign patents.

[00:01:08] Speaker 02:
This case raises the flip side of that question, whether foreign courts can determine substantive issues of US patent law.

[00:01:15] Speaker 02:
And it's a flip side that Vota saw coming.

[00:01:18] Speaker 02:
Vota based its decision in part on concerns of reciprocity.

[00:01:21] Speaker 02:
that if U.S.

[00:01:23] Speaker 02:
courts determine substantive issues of foreign patent law, then foreign courts could make determinations regarding substantive issues of U.S.

[00:01:30] Speaker 02:
patent law.

[00:01:31] Speaker 00:
And what's wrong with that?

[00:01:33] Speaker 02:
I'm sorry, Your Honor?

[00:01:33] Speaker 00:
What's wrong with that?

[00:01:34] Speaker 02:
Well, as Vota put it, foreign courts exercising jurisdiction over claims based on U.S.

[00:01:39] Speaker 02:
patents would destroy Congress's intent to foster uniformity.

[00:01:43] Speaker 00:
But we don't look into the inventorship of a case that's filed based on an international patent, do we?

[00:01:52] Speaker 00:
Our patent office?

[00:01:53] Speaker 02:
We look at the U.S.

[00:01:54] Speaker 02:
patents that are issued.

[00:01:55] Speaker 02:
They may derive from previous PCT application.

[00:01:58] Speaker 02:
They may trace their priority to that PCT application.

[00:02:01] Speaker 02:
But United States courts look at United States patent substantive issues.

[00:02:05] Speaker 00:
I don't remember and I don't believe that you cited any cases in which that had been an issue.

[00:02:12] Speaker 00:
And to try and understand how dispositive such a question might be.

[00:02:17] Speaker 00:
As you know, there are all sorts of international rules, international comedy,

[00:02:22] Speaker 00:
international procedures that accommodate property rights in various countries.

[00:02:29] Speaker 02:
That's correct, Your Honor.

[00:02:30] Speaker 02:
As Voda explained, in fact, the grant of patent rights is a sovereign grant within the territory of the sovereign.

[00:02:38] Speaker 02:
And for one sovereign to reach into another sovereign's territory and make determinations about that other sovereign's unique grant of property, in fact, violates comedy.

[00:02:47] Speaker 02:
That was one of the core concerns of Voda.

[00:02:50] Speaker 00:
Precisely.

[00:02:50] Speaker 00:
And therefore,

[00:02:52] Speaker 00:
What's wrong with the Danish court deciding who the inventor is?

[00:02:55] Speaker 02:
Well, what's wrong with that is that the Danish court is then reaching into the U.S.

[00:02:59] Speaker 02:
sovereign's territory and making determinations regarding U.S.

[00:03:02] Speaker 02:
intellectual property rights within the territory of the U.S.

[00:03:05] Speaker 02:
And that's the exact problem that Voda identified.

[00:03:08] Speaker 01:
What if the parties were to agree that they would be bound by the determination in the Danish court with respect to inventor rights?

[00:03:17] Speaker 02:
Well, Your Honor, that would still... First of all, that hasn't happened here, but second of all,

[00:03:20] Speaker 02:
that would cause independent concerns other than the territorial and reciprocity and sovereignty concerns identified by VOTA.

[00:03:29] Speaker 02:
It would also mean that if a foreign court is making determinations about substantive questions of U.S.

[00:03:33] Speaker 02:
patent law, well then the uniform federal patent law that Congress meant to create is put in the hands of a foreign court.

[00:03:41] Speaker 01:
Well, it's not making determinations about substantive patent law.

[00:03:45] Speaker 01:
It's making its own determination, and then the parties are agreeing to be bound by that for purposes of enforcing the US patent.

[00:03:55] Speaker 02:
Well, it's making determinations regarding inventorship of a US patent.

[00:03:59] Speaker 02:
And the inventorship of a US patent, this court has identified as something that is of public interest.

[00:04:04] Speaker 02:
It has multiple consequences, aside from whatever implications of ownership may flow from the determination of inventorship.

[00:04:10] Speaker 02:
For instance, one of the purposes of the correct inventors being on the patents are that people can reach out and see who's coming up with the new subject matter and collaborate.

[00:04:19] Speaker 02:
They can, in fact, advance the useful arts, as the patent clause says.

[00:04:23] Speaker 02:
That's the very purpose of it.

[00:04:24] Speaker 02:
So the correction of inventorship is important for that.

[00:04:26] Speaker 02:
It's also important because if there are going to be continuation applications, you need to have the right inventor on the continuation application.

[00:04:33] Speaker 02:
And it needs to be consistent with the prior patent.

[00:04:35] Speaker 02:
So if the prior patent was wrong, there's a problem.

[00:04:37] Speaker 01:
Can I ask you, what's the status of the Danish litigation now?

[00:04:40] Speaker 02:
Well, that's outside the record, Your Honor, but to my understanding, the status of the Danish litigation right now is that the Court of First Instance has made the determination that the 2007 settlement agreement bars litigation of the issues in Denmark.

[00:04:54] Speaker 02:
That's on appeal in the Danish High Court right now.

[00:04:56] Speaker 02:
There's a proceeding scheduled for next month at which that court will determine whether to remand to the Court of First Instance.

[00:05:02] Speaker 02:
I should say that that all deals with new evolutions claims.

[00:05:05] Speaker 02:
Mr. Rasmussen's claims have not been addressed at all as of yet by the court in first instance.

[00:05:11] Speaker 01:
And if this were to be heard by the US Patent Office and by the court, the judiciary system here in the US,

[00:05:18] Speaker 01:
What effect, if any, would any settlement agreement, would they be required to construe the settlement agreement in terms of whatever they're deciding with respect to inventorship?

[00:05:28] Speaker 02:
Well, certainly one of my opponent's claims is that the settlement agreement bars the consideration of whether inventorship should be corrected.

[00:05:36] Speaker 02:
And we explain that that's not so for two reasons.

[00:05:40] Speaker 02:
One is that under the Lear decision,

[00:05:42] Speaker 02:
a no challenge clause to the inventorship of a US patent, especially here where it's entered into before the US patent even issued, is contrary to public policy.

[00:05:51] Speaker 01:
But that's an issue that would have to be adjudicated here too, even though the same issue is being adjudicated.

[00:05:57] Speaker 01:
The Danish courts are reviewing the impact of the settlement agreement.

[00:06:02] Speaker 01:
As a matter, if the courts here in the PTO were to review your inventorship claim, they would necessarily or likely

[00:06:09] Speaker 01:
have to construe the settlement agreement as a threshold issue?

[00:06:12] Speaker 02:
Yes, Your Honor, but the important point there is that the Danish courts are not considering the US public policy enunciated in Lear against no-challenge clauses of this sort.

[00:06:23] Speaker 02:
And that's exactly the sort of reason why Voda says those foreign courts shouldn't be deciding US patent issues, because that Danish court decision under the no-challenge clause could undermine the public policy identified by the US Supreme Court in Lear.

[00:06:37] Speaker 02:
So that's the very core of the problem, Gerard.

[00:06:41] Speaker 04:
What's the harm in allowing the Danish proceeding to play out and resolve whatever issues are there, issues relating to the invention, who made the invention in Denmark, issues relating to the contract, issues relating to your client's rights under that contract.

[00:07:00] Speaker 04:
And then, depending upon how that falls out,

[00:07:06] Speaker 04:
You're not foreclosed to come back to the United States either in a district court proceeding or before the Patent Office to get inventorship resolved.

[00:07:15] Speaker 02:
Well, Your Honor, of course, we do ask that the foreign non-convenience dismissal be reversed.

[00:07:19] Speaker 02:
But in the event this court were to affirm the dismissal, we have asked that the court specifically do what the Fourth Circuit did in the Campagna Naviera case, which is to say explicitly that if the foreign court does not reach the substantive issue, then we do have a right to come back in this court.

[00:07:34] Speaker 02:
We're not asking for this court or any court to stay the Danish proceedings.

[00:07:38] Speaker 02:
The Danish proceedings are going forward on the European and Danish patents.

[00:07:42] Speaker 04:
But you're not foreclosed, as things stand right now, you're not foreclosed from coming back after the Danish proceeding is resolved.

[00:07:51] Speaker 02:
Well, there are, in fact, the question, Your Honor, of the raised Judicata or collateral estoppel effect of a forum non-convenience dismissal is not clear.

[00:08:00] Speaker 02:
either in the circuit or the Fourth Circuit.

[00:08:03] Speaker 02:
And there have been district court cases that have said, I'll give you one quick example, one called Ingrid, I believe it's West Caribbean Airlines, where the Southern District of Florida had a case where it dismissed it in lieu of litigation in France.

[00:08:14] Speaker 02:
They then filed in France.

[00:08:15] Speaker 02:
It went up to the French Supreme Court.

[00:08:17] Speaker 02:
The French Supreme Court said, no, we don't have jurisdiction because you filed first in the US.

[00:08:21] Speaker 02:
They then came back to the Southern District of Florida and said, look,

[00:08:23] Speaker 02:
France isn't an available alternative forum, and the Southern District of Florida said, well, we don't defer to the French Supreme Court.

[00:08:30] Speaker 02:
Our previous decision is binding, and so you can't bring the claim.

[00:08:33] Speaker 02:
So that sort of concern is why we ask that if you were to affirm, which of course we hope you won't, that you would condition it explicitly on our ability to come back on the merits of inventorship, if in fact the Danish court... Even if we agree with you on forum non-convenience, don't you have a standing problem?

[00:08:52] Speaker 02:
We don't have a standing problem, Your Honor.

[00:08:54] Speaker 02:
I believe the core of the standing issues are directed to Mr. Rasmussen rather than New Evolution.

[00:08:58] Speaker 04:
We clearly have a claim to... No, I think there's a standing problem with New Evolution as well, isn't there?

[00:09:03] Speaker 02:
Well, Your Honor, we clearly have a claim to ownership in the Danish courts under Danish law and under a Danish contract if, in fact, the inventor is Peterson and not Rasmussen.

[00:09:17] Speaker 02:
So that's a clear financial interest that we have that gives us the concrete

[00:09:22] Speaker 02:
injury and the redressability through this court's decision of, or the district court's decision correcting the mattresship.

[00:09:28] Speaker 04:
No, but that question, you would need to establish in the district court both that Mr. Peterson is the inventor and that you have the right under the agreement to ownership of that U.S.

[00:09:44] Speaker 04:
Pat.

[00:09:45] Speaker 02:
Is that right?

[00:09:45] Speaker 02:
I don't believe that's correct, Your Honor.

[00:09:47] Speaker 02:
I don't believe there's any case ever saying that in order to have standing,

[00:09:50] Speaker 02:
you must be able to achieve the financial benefit in this particular proceeding as opposed to in another proceeding.

[00:09:56] Speaker 02:
So whereas here, there are different parts of the dispute that are properly resolved in different countries, we have the financial interest that will occur in Denmark if inventorship changes in the US.

[00:10:07] Speaker 04:
But your injury for standing has to be immediate and direct and redressable.

[00:10:14] Speaker 04:
Well, it is, Your Honor, in that our injury is not redressable in the district court because

[00:10:19] Speaker 04:
the district court can't resolve the question of ownership.

[00:10:23] Speaker 02:
That's correct.

[00:10:23] Speaker 02:
The district court cannot resolve the question of ownership, but it is still redressable in the sense that if Peterson has declared the inventor, we then have a right that we can seek to vindicate in the second forum.

[00:10:37] Speaker 00:
But is it correct that the parties no longer are in dispute as to who the correct inventors are?

[00:10:43] Speaker 02:
No, Your Honor, there is a lot of dispute as to that.

[00:10:46] Speaker 02:
We assert that Peterson is the correct inventor and that Rasmussen being listed as the inventor was simply procured by fraud, something that Rasmussen himself has acknowledged in his out of date.

[00:10:57] Speaker 00:
The other side is insisting that Dr. Rasmussen is the inventor.

[00:11:01] Speaker 00:
I'll inquire of counsel.

[00:11:04] Speaker 00:
Thank you.

[00:11:06] Speaker 01:
Thank you.

[00:11:13] Speaker 01:
So you're taking three minutes on behalf of Mr. Rasmussen?

[00:11:16] Speaker 03:
Yes, Your Honor.

[00:11:17] Speaker 03:
Thank you.

[00:11:18] Speaker 03:
May I please support?

[00:11:19] Speaker 03:
My name is Rick Beiser, and together with Tiffany Weinman, we represent Dr. Rasmussen in this case.

[00:11:24] Speaker 03:
The issue for Dr. Rasmussen, as the court has alluded to, is whether or not he has a standing.

[00:11:30] Speaker 03:
This court in the shoot case,

[00:11:32] Speaker 03:
decided after the proceedings were held in the district court and the district court rendered its decision that a reputational injury by itself may suffice for an injury in fact.

[00:11:44] Speaker 03:
In this case, Dr. Rasmussen has suffered a reputational injury.

[00:11:51] Speaker 03:
That injury is an injury in the fact that he is associated

[00:11:55] Speaker 03:
in the United States by being listed as the inventor of the 381 patent, as the inventor of the patent, which he is not.

[00:12:04] Speaker 03:
That's a reputational injury.

[00:12:06] Speaker 03:
It affects public recognition.

[00:12:08] Speaker 03:
It affects its vocational leverage and perhaps its pecuniary gain.

[00:12:15] Speaker 03:
In the Pedersen case, relied on by the appellee in this case, the district Maryland, said,

[00:12:23] Speaker 03:
that in that case was not the appropriate case to recognize a reputational injury from being listed as the inventor.

[00:12:32] Speaker 03:
This case is markedly different from that case.

[00:12:35] Speaker 00:
Why doesn't he just clear the air, file a paper with the patent office, and say, I'm not the inventor, remove me from this patent?

[00:12:44] Speaker 03:
I believe, Your Honor, that he has filed an affidavit to that effect.

[00:12:48] Speaker 03:
And this matter being in litigation, I believe that that has forestalled that opportunity to do so.

[00:12:57] Speaker 01:
But if it weren't in litigation, if we were to affirm the district court here, does that mean that the patent office could entertain his affidavit?

[00:13:07] Speaker 03:
I'm not sure, Your Honor, I don't know the answer to that.

[00:13:09] Speaker 03:
I think that if for one reason, it depends on the reason that the court affirms,

[00:13:16] Speaker 03:
But if he doesn't have standing to address the injury, then I wonder whether the patent office could entertain his... It sounds a little odd to me.

[00:13:26] Speaker 01:
I mean, you're trying to reverse the district court and to get into district court on this case, but you're saying that that is arguably, or at least possibly, impeding your client's ability to get the only relief he's seeking, which is to get his name off the patent as an inventor.

[00:13:44] Speaker 01:
You understand my question?

[00:13:48] Speaker 01:
I think you represented that arguably, at least, the fact that we're in district court and that issue hasn't been resolved could arguably be precluding your client from going straight to the patent office and getting the relief that he seeks overall, which is just to get his name off of the patent.

[00:14:08] Speaker 01:
So that strikes me as a little circuitous way of getting what you want, right?

[00:14:13] Speaker 03:
Well, I think it's our understanding that because the district court has thrown out the issue of inventorship on foreign known convenience grounds, that while that matter is still pending there or here, that we cannot go to the patent office and simply say, change the name on the inventorship.

[00:14:34] Speaker 03:
That's my understanding.

[00:14:35] Speaker 01:
And what if we were to affirm what the district court did?

[00:14:38] Speaker 01:
Would that give you the ability then to go to the patent office and get your name off?

[00:14:43] Speaker 03:
Well, we certainly tried to do that, but I'm not sure that we would be successful in doing that because there would be, in effect, a ruling that, in fact, the apprenticeship stands.

[00:14:56] Speaker 00:
But it's an international application.

[00:15:00] Speaker 00:
So if the Danish court resolves this question, which, from what the trial judge said here, all the parties are Danish citizens.

[00:15:08] Speaker 00:
They're all there.

[00:15:10] Speaker 00:
They can appear.

[00:15:12] Speaker 00:
Fully all arguments can be heard.

[00:15:15] Speaker 00:
If the international application has a correct inventorship, isn't that a straightforward procedure than under 256 to correct the U.S.

[00:15:26] Speaker 00:
inventorship in the office without going through this complicated judicial process?

[00:15:33] Speaker 03:
Your Honor, I'd rely on the argument that Mr. Freiman made with respect to that.

[00:15:38] Speaker 03:
I think there is still an issue of whether or not a court in Denmark, however resolves inventorship over there, can decide inventorship here.

[00:15:46] Speaker 03:
So my argument is the same as his in response to your question.

[00:15:50] Speaker 00:
So you're saying that the case on appeal here was wrongly decided with a deference to the Danish court.

[00:16:00] Speaker 03:
I'm saying that.

[00:16:02] Speaker 03:
I'm sorry, I don't understand your question.

[00:16:03] Speaker 03:
With respect to the finding in the Danish court, a first instance was wrongly decided.

[00:16:08] Speaker 00:
Well, you say that Dr. Rasmussen has standing.

[00:16:11] Speaker 00:
I want to understand what it is that you're asking us to do.

[00:16:15] Speaker 00:
Are you asking us, this court, the federal circuit, to decide whether he is or is not an inventor?

[00:16:23] Speaker 00:
He's already sworn on every document I've seen that he's not an inventor.

[00:16:28] Speaker 00:
So I'm not sure what you're asking us to decide.

[00:16:30] Speaker 03:
I'm asking you to remand the case to the district court so that the district court can entertain whether or not there's subject matter jurisdiction outside the pleadings as it can, take evidence on whether or not there's subject matter jurisdiction to determine whether or not he suffered an injury in fact, and whether or not it is redressable, caused by Dr. Peterson and redressable.

[00:16:53] Speaker 03:
When the court decides that, then it can address the

[00:16:56] Speaker 03:
issue that we believe should be straightforward as to who the actual inventor is.

[00:17:01] Speaker 03:
And with the determination there, then we can take it back to the public record of the United States and the Patent Office and have listed who the true inventor is.

[00:17:12] Speaker 01:
Why don't we hear from Mr. Smith?

[00:17:18] Speaker 05:
Thank you, Your Honor.

[00:17:20] Speaker 05:
As you know, I represent the defendants below.

[00:17:24] Speaker 05:
Dr. Henrik Pedersen and Kenji Nolde.

[00:17:27] Speaker 05:
And Judge Newman, let me see if I can answer one of the questions that you were looking for correction on.

[00:17:33] Speaker 00:
Yes, I had assumed from the papers that there's no longer a dispute as to who the correct inventor is.

[00:17:39] Speaker 05:
That is still a disputed issue in deadline.

[00:17:42] Speaker 00:
Disputed in what way?

[00:17:43] Speaker 00:
As to what is your client's position?

[00:17:47] Speaker 05:
My client's position is that the principal inventor on the invention covered by this patent is Dr. Rasmussen.

[00:17:56] Speaker 05:
Dr. Pedersen worked with Rasmussen on certain aspects of it, and I think you'll see when you look at the pleadings that are filed in the Danish case that what Rasmussen is actually looking for, or New Evolution as well, as they're paired up here,

[00:18:16] Speaker 05:
They're looking to establish Pedersen either as the inventor or the co-inventor.

[00:18:22] Speaker 05:
So even they and their pleadings have allowed for the possibility that Dr. Rasmussen is a co-inventor on it.

[00:18:30] Speaker 05:
So it's still a disputed issue.

[00:18:32] Speaker 01:
So this is all about whether or not new evolution under whatever employment contract they think they have with your client that they can get ownership of the patent?

[00:18:43] Speaker 01:
What's going on?

[00:18:45] Speaker 05:
Let's go back to first principles.

[00:18:46] Speaker 05:
If we start with foreign non-convenience, I think this is a textbook case for that.

[00:18:53] Speaker 05:
I don't think there's any dispute here.

[00:18:54] Speaker 05:
If there wasn't this patent element, which is the tail wagging the dog here, if there wasn't this patent element, the issues between these three parties would all be resolved and should be resolved in Denmark.

[00:19:08] Speaker 05:
You have two Danes, three Danish entities now.

[00:19:12] Speaker 05:
in a dispute over an employment agreement, which was struck in Denmark between Danish parties.

[00:19:19] Speaker 05:
It's written in Danish and it has a foreign selection clause that says this has to be decided in Denmark.

[00:19:27] Speaker 01:
Well, what is the potential for the Danish court to do with respect to the inventorship question in the United States?

[00:19:34] Speaker 05:
It has to decide the issue that Judge Lynn has spotted, which is it has to decide the condition preceding

[00:19:41] Speaker 05:
to new evolution coming into the United States and petitioning to change inventorship.

[00:19:47] Speaker 05:
That's the question of ownership.

[00:19:49] Speaker 05:
And the whole appeal here centers around the question of, are we here on an inventorship issue or are we here on an ownership?

[00:19:57] Speaker 01:
Wait, are you talking about a connection with standing?

[00:20:00] Speaker 01:
Yes, with standing.

[00:20:01] Speaker 01:
So you're saying that we need to wait to see what the Danish courts do

[00:20:07] Speaker 01:
to even establish standing.

[00:20:09] Speaker 01:
So is that the only reason you're here fighting whether or not they ought to be able to adjudicate the inventorship rights of the U.S.

[00:20:17] Speaker 01:
patent here in the U.S.

[00:20:18] Speaker 01:
courts?

[00:20:19] Speaker 05:
Yes.

[00:20:19] Speaker 05:
Well, when we first started this case, remember, this was a case in which the complaint was framed as ownership, ownership, ownership.

[00:20:28] Speaker 05:
That's what they were fighting over.

[00:20:30] Speaker 05:
And that's the nature of the claim they filed in the Eastern District of Virginia.

[00:20:34] Speaker 05:
One count to change the

[00:20:37] Speaker 05:
the name of the inventor, but in two counts, one for conversion, one for unjust enrichment, all premised on the notion of ownership.

[00:20:45] Speaker 05:
And the decretal paragraph, or the Addendum Clause said, we want this court in the Eastern District of Virginia to decide ownership, as well as inventorship, but ownership, declare new evolution to be the owner.

[00:20:59] Speaker 05:
We said, look, that question is before the court in Denmark.

[00:21:03] Speaker 05:
It was New Evolution that started that case in Denmark.

[00:21:06] Speaker 05:
And it's been proceeding for a year and a half, and now you come to the United States and you ask a US court to decide the question of ownership.

[00:21:14] Speaker 01:
And the question of... But as you acknowledge, whether it's everything they've asked for in the US or one of the things, one of the things is certainly the inventorship question of the US patent.

[00:21:25] Speaker 01:
Yes.

[00:21:25] Speaker 01:
That's what they're asking the court here to resolve.

[00:21:28] Speaker 01:
And do you agree that the Danish court doesn't have the authority to make that determination?

[00:21:36] Speaker 01:
I do not.

[00:21:37] Speaker 05:
It has the authority, and this actually answers another question of Judge Newman, it has the authority to tell the parties before it to direct them to do something.

[00:21:47] Speaker 05:
I agree that they can't tell the patent and trademark office in the United States, you have to change the inventorship, but certainly it can tell Dr. Peterson

[00:21:56] Speaker 05:
You have to change the ownership or you have to work with new evolution.

[00:22:00] Speaker 01:
We're not talking about the ownership.

[00:22:02] Speaker 01:
I'm sorry.

[00:22:03] Speaker 05:
The inventorship.

[00:22:04] Speaker 05:
You have to change the inventorship.

[00:22:05] Speaker 05:
You have a party.

[00:22:07] Speaker 05:
There is an individual in Denmark who was before a Danish court and that court has the power to direct anything within the normal scope.

[00:22:18] Speaker 05:
And if this was the United States and I could have a Connecticut judge order me to suspend

[00:22:24] Speaker 05:
a lawsuit in Virginia, for example.

[00:22:29] Speaker 05:
But the Connecticut court couldn't order the Virginia court to do anything.

[00:22:34] Speaker 04:
Can the Danish court resolve the underlying factual issues relating to inventorship of the US patent?

[00:22:44] Speaker 05:
Yes, the Danish court is being asked to do that.

[00:22:48] Speaker 04:
So if the Danish court rules on inventorship of the US patent

[00:22:54] Speaker 04:
under U.S.

[00:22:55] Speaker 04:
patent law principles and then directs the parties to take steps to effectuate the change of inventorship in the U.S., doesn't that resolve the question?

[00:23:08] Speaker 05:
It would seem to, in my mind, Your Honor, yes.

[00:23:11] Speaker 01:
But isn't that problematic?

[00:23:13] Speaker 01:
I mean, we don't, you know, the Patent Office is being told, I mean, that all foreign courts could adjudicate

[00:23:20] Speaker 01:
the inventorship of US patents under US law, which is what our courts have the authority to do, and then force the parties to effectuate that foreign determination through our courts and through the Patent Office.

[00:23:36] Speaker 01:
Doesn't that sound problematic to you?

[00:23:38] Speaker 01:
in terms of the way these things ought to work.

[00:23:40] Speaker 05:
It does not, because in many, many, many cases where litigants start off in the United States and are dismissed to a more appropriate forum abroad, that is the practical outcome.

[00:23:51] Speaker 05:
But if you're troubled by adopting some general rule that a Danish court can make a determination that will be binding somehow on a US court, and we're not asking for that.

[00:24:05] Speaker 05:
We're not asking for that.

[00:24:06] Speaker 01:
You're asking to effectuate the same result by leaving it to the Danish court to have the authority to order the parties to do something in the United States.

[00:24:18] Speaker 05:
Your honor, this happens all the time outside of the patent context.

[00:24:22] Speaker 01:
Let's assume hypothetically that in mentorship we have some unique jurisprudence that has, you have to meet these five tests and this is how you have to adjudicate it.

[00:24:31] Speaker 01:
Let's assume the Danish court reaches that question, but doesn't apply our precedent at all.

[00:24:40] Speaker 01:
You're still saying that, yes, it's OK.

[00:24:43] Speaker 01:
They don't get to adjudicate it in the United States.

[00:24:47] Speaker 01:
And then the parties are going to, in essence, be compelled to act in the United States to change inventorship, whereas that issue has been adjudicated under principles that are contrary to the ones we apply in our courts.

[00:25:01] Speaker 05:
Well, I'm going to start by challenging the core assumption, which is that there is a difference between U.S.

[00:25:06] Speaker 05:
inventorship and Danish inventorship.

[00:25:08] Speaker 01:
But how do we know that?

[00:25:09] Speaker 01:
You want us to adjudicate that?

[00:25:11] Speaker 01:
Are you saying that in order to resolve this case, we have to adjudicate that issue and make the determination there's no difference in the law they apply in order to... You do not.

[00:25:22] Speaker 01:
Okay.

[00:25:23] Speaker 01:
So why does it matter?

[00:25:24] Speaker 01:
We're not going to take your word for it.

[00:25:26] Speaker 01:
It's either something we would have to adjudicate in the first instance here or not.

[00:25:31] Speaker 05:
Now, you don't need to create the problem that is the hypothetical that you posed.

[00:25:36] Speaker 05:
And I appreciate the hypothetical, and I understand what is giving you pause.

[00:25:40] Speaker 05:
But the simple answer here is the question of standing.

[00:25:45] Speaker 05:
In order for new evolution to challenge the inventorship, it has to show an actual injury.

[00:25:53] Speaker 05:
There are standing requirements under Article III.

[00:26:00] Speaker 05:
And this is where the cart before the horse issue comes up.

[00:26:05] Speaker 05:
Plaintiff says, this is an inventorship case, pure and simple.

[00:26:10] Speaker 05:
And they're just playing to the music of, that's a nice federal patent issue.

[00:26:15] Speaker 05:
And that's why it has to stay here, because after all, the US Patent Office runs its own set of rules.

[00:26:23] Speaker 05:
But it's not that simple.

[00:26:25] Speaker 05:
Ownership has to be decided first.

[00:26:27] Speaker 05:
You cannot get to the question of inventorship

[00:26:30] Speaker 05:
without first resolving the question of ownership.

[00:26:33] Speaker 05:
And if new evolution is ruled to have no interest in this invention, or the patents that originated, the original Danish patents against which we claim the first priority, then there is no standing here.

[00:26:51] Speaker 00:
And there's the case... But it can have... Its interest depends entirely on whether Peterson is a sole or a joint inventor, does it not?

[00:27:00] Speaker 05:
Yes, New Evolution has no rights at the moment as an owner of the patent unless it can demonstrate to the court in Denmark that Pedersen was the inventor, number one, and number two, and therefore it fits within the scope of the employment agreement.

[00:27:21] Speaker 05:
So you see we have these two threshold issues to be resolved by a Danish court.

[00:27:28] Speaker 05:
One of them is construing an employment agreement to see whether any of the activity that Dr. Rasmussen mentions in his affidavit constitutes activity that fits within the employment agreement.

[00:27:40] Speaker 01:
So are you saying that we wait for the Danish court to make that determination, and if they determine there is some ownership,

[00:27:49] Speaker 01:
then that gives them standing to proceed in the US courts with respect to the inventorship question.

[00:27:54] Speaker 01:
I am.

[00:27:55] Speaker 01:
And let me just cite the court to that.

[00:27:56] Speaker 01:
So you're not saying that they're foreclosed or that it is not appropriate for the US courts to determine inventorship under the patent.

[00:28:04] Speaker 01:
You're just making a temporal argument that you have to wait and see about this threshold issue being resolved before they can do that.

[00:28:11] Speaker 05:
I agree with you.

[00:28:11] Speaker 05:
That is the practical overlay.

[00:28:13] Speaker 05:
And then for precision's sake, I'm following up with Judge Lynn's

[00:28:19] Speaker 05:
question.

[00:28:20] Speaker 05:
There's a standing issue which makes it even easier for you to resolve the case.

[00:28:24] Speaker 04:
I want to go back to inventorship for a minute.

[00:28:26] Speaker 04:
We talked about having the Danish court resolve the questions, the factual issues underlying inventorship of the U.S.

[00:28:35] Speaker 04:
patent.

[00:28:36] Speaker 04:
Our case are pretty clear that the state courts are preempted from doing exactly that.

[00:28:45] Speaker 04:
In other words, parties cannot go to a state court

[00:28:49] Speaker 04:
and ask the state court to resolve underlying issues relating to inventorship, that's preempted.

[00:28:58] Speaker 04:
Why should it be any different?

[00:29:00] Speaker 04:
And the reasoning, the rationale for that, is to avoid lack of uniformity in application of these somewhat nuanced laws relating to inventorship.

[00:29:13] Speaker 04:
Well, why should there be any difference with respect to a foreign

[00:29:17] Speaker 05:
Well here is not the, remember that these are patents that originate with an underlying Danish patent and all the patenting that's being done in Europe as well as in the United States all flows directly, this is Judge Newman started with that question, they flow directly from those, that originating patent.

[00:29:35] Speaker 04:
Yeah, but the fact that the invention originated in Denmark doesn't mean that a different law of inventorship applies.

[00:29:42] Speaker 05:
If a different law of inventorship applies, then you're right.

[00:29:46] Speaker 05:
They should have the ability to challenge the outcome.

[00:29:53] Speaker 05:
I should be saying I have the right to challenge the outcome.

[00:29:58] Speaker 04:
I mean, you can't be arguing that Danish law applies to inventorship of the US.

[00:30:03] Speaker 04:
No, I'm not.

[00:30:04] Speaker 04:
So the fact that the invention originated in Denmark doesn't make any difference in terms of the question of inventorship.

[00:30:13] Speaker 04:
That needs to be resolved by a U.S.

[00:30:17] Speaker 04:
court or the Patent Office under U.S.

[00:30:19] Speaker 04:
law.

[00:30:20] Speaker 05:
And that, I submit, is a temporal issue to pick up on that hypothetical.

[00:30:29] Speaker 05:
It's a matter of timing.

[00:30:31] Speaker 05:
It doesn't make sense here because

[00:30:33] Speaker 05:
They may have no rights at all to appear in the court, any court in the United States, if they don't have an interest, if New Evolution does not have an interest in the patent.

[00:30:42] Speaker 01:
So why couldn't the court hear?

[00:30:44] Speaker 01:
Is there something that would preclude the court here from determining?

[00:30:47] Speaker 01:
I mean, obviously, if the case is appropriately before the court here on the question of inventorship, they have to also determine threshold issues with respect to standing.

[00:30:58] Speaker 01:
What's wrong with that?

[00:30:59] Speaker 05:
Because to get to that, they have to decide the ownership issue.

[00:31:03] Speaker 05:
And that issue is being litigated in Denmark between Danish parties and will be determined on the application of a Danish employment agreement.

[00:31:13] Speaker 05:
And so in that setting.

[00:31:15] Speaker 01:
But why would the court here be compelled to accept or be bound by that determination by the Danish court in terms of its determination?

[00:31:25] Speaker 05:
It will be a US court.

[00:31:30] Speaker 05:
If we take away the inventorship issue and only focus on ownership, a US court must honor the determination that the Danish court makes.

[00:31:37] Speaker 05:
That's fundamental comity.

[00:31:39] Speaker 05:
And remember, we're not forcing anybody to do anything here.

[00:31:44] Speaker 05:
Judge Hilton decided in the case below that he would exercise his discretion and dismiss the case so that the Danish court could make the important threshold rulings, particularly the ruling regarding ownership,

[00:31:59] Speaker 05:
regarding whether the statute of limitations has run, and whether or not New Evolution waived its claims to this patent and agreed that it would not challenge the patent.

[00:32:10] Speaker 05:
That issue was before the court in Denmark.

[00:32:12] Speaker 05:
And in fact, in the five years that have passed since that case was decided, as you've heard, the Danish court has said that the settlement agreement bars New Evolution from bringing these cases here in the United States.

[00:32:29] Speaker 05:
Now that's challenged on appeal, that's outside the record, I recognize that, but that demonstrates why Judge Hilton was right.

[00:32:36] Speaker 05:
This is an abuse of discretion standard.

[00:32:38] Speaker 05:
All he did was dismiss a case without making any determinations upon the merits.

[00:32:43] Speaker 05:
He dismissed it and sent it back to Denmark so that all this groundwork could be resolved of these important questions of Danish law.

[00:32:54] Speaker 05:
Has there been waiver?

[00:32:55] Speaker 05:
Has there been settlement?

[00:32:56] Speaker 05:
Is the statute of limitations run on this claim?

[00:33:00] Speaker 05:
They can decide the inventorship issue.

[00:33:02] Speaker 05:
And if they decide against my client, then that issue is either they will direct my client to take the steps necessary to correct inventorship, if it's needed here in the United States, or they will

[00:33:20] Speaker 05:
it'll be subject to a fresh challenge, but at least there'll be the full record of what happened in Denmark.

[00:33:27] Speaker 01:
So you acknowledge it will be subject to a fresh challenge, and that that challenge would appropriately occur?

[00:33:33] Speaker 05:
Yes, only if there's standing.

[00:33:34] Speaker 05:
I just want to be sure that we're clear on that standing issue, because Judge Lynn is right.

[00:33:40] Speaker 05:
It's the Larson case that you had before you in 2015.

[00:33:45] Speaker 05:
In that case, the patented item was

[00:33:50] Speaker 05:
a wakeboard tower that they used to, to behind a boat.

[00:33:53] Speaker 05:
And they had the, the, uh, the putative inventor, Larson's had assigned away his rights.

[00:34:00] Speaker 05:
So it's sort of similar here.

[00:34:02] Speaker 05:
They didn't have the rights of him.

[00:34:03] Speaker 05:
And this court said, unless and until Larson obtains equitable relief that restores his ownership rights, he has no standing to bring a standalone action under 256.

[00:34:16] Speaker 05:
his only path to financial reward under 256, that's our change of inventorship statute, in this case involves him first succeeding on his state law claims and obtaining rescission of the patent assignments.

[00:34:29] Speaker 05:
So I submit that the Larson case is a perfect analogy for what we're doing here.

[00:34:35] Speaker 05:
New Evolution has to go back to Denmark and establish its rights first.

[00:34:41] Speaker 05:
And then we'll see where the parties stand.

[00:34:44] Speaker 05:
And it can come into court

[00:34:45] Speaker 05:
And that's exactly why Judge Hilden exercised his discretion in dismissing the case on foreign nonconvenience grounds.

[00:34:54] Speaker 05:
Could I have just take one minute to address reputational injury because it's very unusual.

[00:35:00] Speaker 05:
What we have here with Mr. Rasmussen is a strictly a reputational injury standing position.

[00:35:09] Speaker 05:
He has no financial interest in the outcome of any of this.

[00:35:13] Speaker 05:
He signed away, he has a waiver, or an indemnity, rather, from New Evolution that says, I'm going to indemnify you against any possible claim.

[00:35:23] Speaker 05:
And that's in the record at Joint Appendix 151.

[00:35:27] Speaker 04:
Your position is that that indemnity provision protects him against the claim for attorney's fees and costs.

[00:35:35] Speaker 05:
Yes.

[00:35:36] Speaker 05:
And I was a little shocked that that's been part of the record, this indemnity provision.

[00:35:43] Speaker 05:
And since the beginning, even on reply, they don't mention that indemnity letter.

[00:35:50] Speaker 05:
It establishes that there is no exposure to any claims by my client against me.

[00:35:56] Speaker 05:
So it's strictly a reputational injury.

[00:35:58] Speaker 05:
And we have this very odd and somewhat perverse situation of the reputation that he's alleging is I'm wrongly named as something.

[00:36:07] Speaker 05:
I am an included inventor rather than an excluded inventor.

[00:36:12] Speaker 05:
And I know this court has always been reluctant to deal with reputational injury alone as being a claim that got resolved in the Shook case.

[00:36:21] Speaker 05:
I agree.

[00:36:22] Speaker 05:
But the Shook case was an excluded inventor saying, there's a lot of rewards and pecuniary benefit that we get from being an inventor.

[00:36:31] Speaker 05:
That's not the case here.

[00:36:32] Speaker 05:
Rasmussen is saying, I just don't want to be named as an inventor.

[00:36:36] Speaker 05:
That's a hypothetical injury.

[00:36:38] Speaker 05:
It's what that Maryland court said.

[00:36:41] Speaker 05:
That's not enough.

[00:36:42] Speaker 05:
You can't just call this being an inventor an albatross.

[00:36:46] Speaker 05:
Thank you.

[00:36:47] Speaker 01:
Thank you.

[00:36:50] Speaker 01:
Will we store five minutes for rebuttal?

[00:36:55] Speaker 02:
Thank you, Your Honor.

[00:36:56] Speaker 02:
I just want to start with the standing issue, and I've been authorized to make things easier, so we're not jumping up and down just to respond to one quick point for Dr. Rasmussen.

[00:37:05] Speaker 02:
The fact that there's an indemnification clause doesn't somehow erase the fact that there's exposure.

[00:37:11] Speaker 02:
The indemnifying party here at New Evolution could be bankrupt, could just choose not to live up to its contractual obligation.

[00:37:17] Speaker 02:
The ultimate obligation, the financial obligation at Denmark still rests on Dr. Rasmussen, so it's both financial and reputational.

[00:37:23] Speaker 02:
Standing as to new evolution, standing is of course based on what's alleged in the complaint.

[00:37:28] Speaker 02:
And this is a motion to dismiss.

[00:37:30] Speaker 02:
What's alleged on the complaint here is that new evolution suffers damage because under both Danish statutory law and the employment agreement, it would have ownership rights if Peterson were the inventor.

[00:37:43] Speaker 02:
That's all that's required is the allegation in the complaint.

[00:37:46] Speaker 04:
I want to move to really the substance of this, which is whether... It's not that he would have ownership rights, or new evolution would have ownership rights.

[00:37:55] Speaker 04:
It's that new evolution would have a claim to ownership.

[00:38:00] Speaker 04:
Isn't that right?

[00:38:01] Speaker 02:
That's right, Your Honor.

[00:38:01] Speaker 04:
But the fact that that claims... But that's different.

[00:38:03] Speaker 04:
That's different, isn't it?

[00:38:04] Speaker 02:
Well, the only difference is whether both of those things are occurring in the same forum or not.

[00:38:08] Speaker 04:
But still, at the end of the day, new evolution... But it's relevant to standing in the sense that there's an immediacy.

[00:38:15] Speaker 04:
part that's missing if the only thing new evolution has is a claim and not an absolute right.

[00:38:22] Speaker 04:
In other words, new evolution does not possess an assignment from Peterson.

[00:38:28] Speaker 04:
It just has an employment contract with a provision that might apply.

[00:38:34] Speaker 02:
And the operation of danger statutory law, similar to the Bayh-Dolec Charter.

[00:38:40] Speaker 02:
Yes, but again, there's no case that says you have to get it all in one shot.

[00:38:43] Speaker 02:
that if you can't get all of the relief that you're seeking, if that can't all be redressed in one shot, then you don't have standing.

[00:38:50] Speaker 04:
But the injury has to have some immediacy.

[00:38:55] Speaker 02:
Well, it is immediate in that we know that there are proceedings regarding ownership in Denmark, and the determination of a U.S.

[00:39:03] Speaker 02:
court regarding inventorship is a necessary predicate to the claim of ownership.

[00:39:09] Speaker 02:
Inventorship has to come before ownership.

[00:39:11] Speaker 02:
In the Larson case, the opposing counsel mentioned is different because Larson wouldn't have a claim to ownership even if he were the inventor.

[00:39:17] Speaker 02:
So that's a factual distinction in that case.

[00:39:21] Speaker 02:
I do want to turn to this notion that somehow the Danish courts can compel

[00:39:26] Speaker 02:
Peterson and parties to come before the U.S.

[00:39:28] Speaker 02:
Patent Office to correct the inventorship of this patent.

[00:39:31] Speaker 02:
And Judge Prost, as you mentioned, that would be odd because the Danish courts might not apply U.S.

[00:39:37] Speaker 02:
law the right way.

[00:39:37] Speaker 02:
Certainly, this court would have no supervisory review power over the way that the Danish court was employing inventorship law, U.S.

[00:39:45] Speaker 02:
inventorship law.

[00:39:48] Speaker 02:
And I want to turn to a question also that you asked, Judge Newman, regarding his

[00:39:54] Speaker 02:
filed all these things saying he's not the inventor.

[00:39:56] Speaker 02:
Why can't he just go to the patent office and do that?

[00:39:59] Speaker 02:
And we'll be done with this.

[00:40:01] Speaker 02:
Taking a step back, section 256 has two clauses.

[00:40:04] Speaker 02:
The first clause allows correction by just going to the PTO.

[00:40:07] Speaker 02:
But you have to have, as it says, it has to be on application of all the parties.

[00:40:12] Speaker 02:
One individual can't go there and say, here's my paper.

[00:40:14] Speaker 00:
Yes, I had assumed that by now the parties had resolved between themselves.

[00:40:20] Speaker 00:
But you will have that resolution from the Danish court.

[00:40:25] Speaker 02:
Well, Your Honor, that goes back to the question of, does the Danish court have the power to determine U.S.

[00:40:29] Speaker 00:
invective law?

[00:40:30] Speaker 00:
But it relates to the international application.

[00:40:33] Speaker 02:
Let me point to a case involving an international application that this court decided just last year, the Lismont case.

[00:40:38] Speaker 02:
The Lismont case involves a U.S.

[00:40:41] Speaker 02:
patentee.

[00:40:41] Speaker 00:
Based on the international application.

[00:40:44] Speaker 02:
Yeah, well, the European patents flow from an international application in that case as well.

[00:40:49] Speaker 02:
And in that case, there's litigation brought in Germany, and he loses, the patentee loses in Germany.

[00:40:55] Speaker 02:
And then in the United States, he brings claims as well, seeking to correct inventorship.

[00:41:00] Speaker 00:
And ultimately this court says... Well, now if the international application, the Danish court decides that either this is a joint invention or it's the sole invention of Dr. Pedersen, I gather it's no longer on the table that it's the sole invention of Dr. Rasmussen.

[00:41:17] Speaker 00:
Is that right?

[00:41:18] Speaker 02:
Well, Your Honor, as has been discussed here, the different nations' substantive laws of patent differ.

[00:41:24] Speaker 02:
And there is not an assumption that Danish patent law is the same as US patent law.

[00:41:29] Speaker 00:
That wasn't my question.

[00:41:30] Speaker 00:
My question is what's before the Danish court?

[00:41:33] Speaker 02:
What's before the Danish court right now are the questions of the inventorship of the European patents as well as the international application.

[00:41:41] Speaker 00:
Isn't that what's before the court, the Danish court?

[00:41:44] Speaker 00:
The first application that was filed was filed in Denmark.

[00:41:48] Speaker 00:
Correct.

[00:41:48] Speaker 00:
Is that right?

[00:41:49] Speaker 00:
Isn't that what's before the Danish court?

[00:41:51] Speaker 00:
It was filed as the sole invention

[00:41:53] Speaker 00:
of Dr. Rasmussen.

[00:41:55] Speaker 00:
And this now, I gather, everyone agrees is incorrect.

[00:42:00] Speaker 00:
That it's either a joint invention or it's the sole invention of Dr. Pedersen.

[00:42:05] Speaker 02:
No, Your Honor, but that's not something that the parties agree on at this point.

[00:42:08] Speaker 02:
Opposing counsel continues to take the position that Rasmussen is the sole inventor.

[00:42:12] Speaker 00:
So that's still before the Danish court?

[00:42:15] Speaker 00:
That Rasmussen is the sole inventor despite the affidavit that he's filed?

[00:42:20] Speaker 00:
That's correct.

[00:42:20] Speaker 00:
That he's not the inventor?

[00:42:22] Speaker 00:
Yes.

[00:42:23] Speaker 02:
That's correct.

[00:42:25] Speaker 02:
And Your Honor, the notion that a Danish court could determine inventorship and could compel the parties to go before the PTO to correct inventorship says that if any court has personal jurisdiction and the contempt power, that's enough to order parties to go before the PTO.

[00:42:41] Speaker 02:
But as Judge Lynn, as you identified, that would mean that the Connecticut court could do that.

[00:42:45] Speaker 02:
That would mean the courts of Delaware.

[00:42:47] Speaker 02:
If the courts of Delaware can't do that, why can the courts of Denmark do that?

[00:42:51] Speaker 02:
If this court has made clear and Congress has made clear

[00:42:53] Speaker 02:
that federal patent law and federal inventorship law is meant to be uniform and supervised only by this court, then it's not something to be decided by the courts of Delaware or the courts of Denmark.

[00:43:04] Speaker 04:
But what do you make of the fact that the original application that was filed was filed in Denmark and the U.S.

[00:43:15] Speaker 04:
application was based upon that?

[00:43:18] Speaker 02:
It's my understanding, Your Honor, that there are differences in terms of the claims in any event between the patents, but there is plenty of authority, which we've cited in our briefs, saying that the mere fact that a determination is made with regard to a substantive issue of patent law under another nation's patent laws, even if it flows from the same PCT application, that's not binding in the U.S.

[00:43:38] Speaker 02:
There is not collateral estoppel effect.

[00:43:40] Speaker 02:
There is not race-to-cata effect.

[00:43:42] Speaker 02:
It's something for the U.S.

[00:43:43] Speaker 02:
courts and U.S.

[00:43:44] Speaker 02:
federal district courts to determine in the first instance.

[00:43:46] Speaker 02:
What are the substantive requirements of US patent law and how do they apply to the facts of this case?

[00:43:51] Speaker 04:
Can there be a difference of inventors as between an international application and the US application based there on?

[00:44:02] Speaker 02:
Sure, there could be different standards for inventorship, where one country could say, well, if someone is coached along to develop something, that's okay, they can still be the inventor, where another nation, ours, might say, no, they actually have to be the one who conceives of it in the first instance.

[00:44:19] Speaker 02:
and otherwise it's the other person.

[00:44:20] Speaker 02:
So these are these are national questions to go back to VOTA.

[00:44:24] Speaker 02:
These are questions that are within the sovereign prerogative of each nation determining the intellectual property rights within its own borders.

[00:44:30] Speaker 04:
Do you know of any case that addresses that?

[00:44:33] Speaker 02:
I'm not going to call them off hand, Your Honor, but we do have a couple of them cited in our briefs.

[00:44:38] Speaker 01:
Thank you.

[00:44:39] Speaker 01:
We thank both sides and the case is submitted.