Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

First Data Corp. v. Inselberg

United States Court of Appeals, Federal Circuit

September 15, 2017

FIRST DATA CORPORATION, FRANK BISIGNANO, Plaintiffs-Appellants
v.
ERIC INSELBERG, INSELBERG INTERACTIVE, LLC, Defendants-Appellees ERIC INSELBERG, INSELBERG INTERACTIVE, LLC, Plaintiffs-Appellees
v.
FRANK BISIGNANO, Defendant FIRST DATA CORPORATION, Defendant-Appellant

         Appeals from the United States District Court for the District of New Jersey in Nos. 2:15-cv-08301-KM-JBC, 2:16-cv-00317-KM-JBC, Judge Kevin McNulty.

          William Adams, Quinn Emanuel Urquhart & Sullivan, LLP, New York, NY, argued for plaintiffs-appellants in No. 2016-2677 and defendant-appellant in No. 2016-2696. Also represented by Michael Barry Carlinsky, Ellyde R. Thompson, Matthew A. Traupman.

          Brian Christopher Brook, Clinton Brook & Peed, New York, NY, argued for defendants-appellees in No. 2016-2677 and plaintiffs-appellees in No. 2016-2696.

          Before Newman, O'Malley, and Stoll, Circuit Judges.

          O'Malley, Circuit Judge.

         First Data Corporation ("First Data") and Frank Bisi-gnano ("Bisignano") appeal from the district court's dismissal of their counterclaims and their declaratory judgment action under Federal Rule of Civil Procedure 12(b)(1). See Bisignano v. Inselberg, Nos. 15-8301 (KM) (JBC), 16-317 (KM) (JBC), 2016 U.S. Dist. LEXIS 113563 (D.N.J. Aug. 25, 2016) (District Court Opinion). They also object to the district court's order remanding their state law claims to state court. Because the district court correctly dismissed the federal claims for lack of subject matter jurisdiction and we cannot review the remand order, we affirm.

         I. Background

         Eric Inselberg ("Inselberg") is the inventor of various systems by which audiences interact with live events, such as concerts and football games. Id. at *4. The patents he received for his inventions were formerly held by Inselberg Interactive ("Interactive"), which also is a party in this appeal. Id.

         The ownership dispute regarding Inselberg's patent portfolio at the heart of this case stems from a $500, 000 loan that Interactive received from Bisignano in August 2010. Id. at *5. Inselberg personally guaranteed the loan, and Interactive granted Bisignano a security interest in the portfolio of patents it owned at the time. Id.

         In 2011, federal authorities brought criminal charges against Inselberg that allegedly impaired his ability to transact business, and Inselberg and Interactive defaulted on the loan from Bisignano. Id. Inselberg and Bisi-gnano entered into an agreement that purported to convey Interactive's patent portfolio to Bisignano. Id. The assignment agreement specified that Interactive transferred "all right, title and interest" in the patent portfolio. J.A. 351. Shortly thereafter, Bisignano became the CEO of First Data.

         In October 2014, Inselberg met with Bisignano regarding the potential value of the patents. Inselberg noted that First Data was using the patented technology without a license, and he proposed that First Data purchase or license the patents. District Court Opinion, 2016 U.S. Dist. LEXIS 113563, at *7. Around this time, Insel-berg also began claiming that the assignment to Bisi-gnano was invalid. Id. at *11. In November 2014, Inselberg sent First Data a claim chart laying out First Data's alleged infringement of the patents. Shortly thereafter, Bisignano granted First Data a royalty-free license. Id. at *7.

         In December 2014, Inselberg, through counsel, maintained that the assignment agreement was invalid. Id. at *11. Inselberg's counsel wrote to First Data in September 2015 stating that the assignment had "severe problems" that likely made it void under New Jersey state law. Id. at *12. In these communications, Inselberg took issue with Bisignano's failure to monetize the patents and the royalty-free license given to First Data. See id. Inselberg asserted that First Data was infringing the patents and Bisignano was liable for damages "amounting to at least 1/3 of the fair market value of the license." Id.

         In October 2015, Inselberg's counsel sent Bisignano and First Data a draft state court complaint. Id. The draft complaint asserted a number of state law claims and sought a declaration that Inselberg and Interactive were the true owners of the patents and were entitled to sue for infringement. Id. The draft complaint also included one federal law claim of infringement against a First Data subsidiary with respect to one of the patents. Id. at *12- 13.

         On November 19, 2015, Inselberg's counsel sent Bisi-gnano and First Data a second draft of the state court complaint. Id. at *13. The second draft did not contain any claims for patent infringement. Id. Inselberg's counsel stated that it intended to file the draft complaint on November 30, 2015, unless the parties reached a settlement. Id.

         Two cases were filed based on this dispute. First, Bisignano and First Data filed a complaint in the United States District Court for the District of New Jersey seeking declaratory judgment regarding the validity of the license agreement and Bisignano's ownership of the patent portfolio. Id. at *2. According to Bisignano and First Data, they filed their case to preempt what they believed was an inevitable infringement action by Insel-berg and Interactive. Id. First Data asserted that it would win any infringement action brought by Inselberg and Interactive because Bisignano, not Interactive, owns the patents and licensed them to First Data. Id. The amended complaint contained four counts seeking, inter alia, ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.