Camsoft Data Systems, Inc. v. Southern Electronics Supply, Inc.
756 F.3d 327
| 5th Cir. | 2014Background
- Camsoft sued Active Solutions and Southern Electronics in Louisiana state court (2009), alleging it "invented" a wireless surveillance system and claiming ownership of related intellectual property tied to a pending patent application.
- Defendants removed the case to federal court asserting federal-question/patent jurisdiction based on an inventorship allegation; Camsoft timely moved to remand.
- While in federal court Camsoft amended its complaint to add many defendants and asserted federal antitrust and RICO claims; district court dismissed those federal claims and later declined to exercise supplemental jurisdiction, remanding the remaining state-law claims to Louisiana.
- Defendants appealed the remand; Camsoft moved to dismiss the appeal for lack of appellate jurisdiction and cross-appealed other adverse district-court rulings.
- The Fifth Circuit considered whether federal courts have jurisdiction over inventorship disputes before a patent issues and whether post-removal federal claims or extended federal litigation preclude remand.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Appellate jurisdiction over remand order | Camsoft: no appellate jurisdiction because remand was for lack of subject-matter jurisdiction or patent-based jurisdiction required Federal Circuit review | Defs: remand was a discretionary decline of supplemental jurisdiction and is reviewable by court of appeals | Court: appellate jurisdiction exists because district court remanded by declining supplemental jurisdiction under §1367(c), not for lack of jurisdiction; Fifth Circuit may review |
| Removal jurisdiction based on inventorship of pending patent | Camsoft: inventorship allegation did not confer federal jurisdiction because no patent had issued and PTO has exclusive authority over unissued application disputes | Defs: inventorship is a federal question; HIF Bio supports district-court jurisdiction even for pending applications | Court: no jurisdiction over inventorship disputes until a patent issues; PTO, not courts, adjudicates inventorship of pending applications; removal improper |
| Waiver of jurisdictional objection by post-removal amendments/pleading federal claims | Camsoft: timely moved to remand at removal and preserved objection; later amendments do not waive that timely objection | Defs: Camsoft took advantage of federal forum and so waived objection | Court: timely remand motion preserved objection; subsequent amendments did not waive the challenge (Caterpillar controls) |
| Whether post-removal federal claims or extended proceedings preclude remand (Caterpillar exception) | Defs: post-removal federal claims and years of federal litigation justify retaining case in federal court; Rule 12 dismissals are equivalent to trial on merits | Camsoft: no trial on merits occurred; Caterpillar exception requires a trial or final judgment on merits | Court: Caterpillar exception does not apply—no trial on merits; Rule 12 dismissals do not substitute for trial; remand required to protect federalism and statutory limits on jurisdiction |
Key Cases Cited
- Carlsbad Tech., Inc. v. HIF Bio, Inc., 556 U.S. 635 (jurisdictional review of remand orders and when remand is unreviewable)
- Caterpillar, Inc. v. Lewis, 519 U.S. 61 (post-removal cure of jurisdictional defect and when remand is precluded after trial on merits)
- Grupo Dataflux v. Atlas Global Grp., L.P., 541 U.S. 567 (limits on creating new jurisdictional exceptions for judicial economy)
- HIF Bio, Inc. v. Yung Shin Pharma. Indus. Co., 600 F.3d 1347 (Fed. Cir.) (Federal Circuit held district courts had jurisdiction over pre-issuance inventorship dispute)
- E.I. Du Pont de Nemours & Co. v. Okuley, 344 F.3d 578 (6th Cir.) (no district-court jurisdiction over inventorship of unissued patents)
- Waste Control Specialists, L.L.C. v. Envirocare of Tex., Inc., 199 F.3d 781 (5th Cir.) (post-removal Rule 12 dismissals do not preclude remand under Caterpillar)
- Blanchard 1986, Ltd. v. Park Plantation, LLC, 553 F.3d 405 (5th Cir.) (statutory standing is a merits question, not Article III jurisdiction)
- Harold H. Huggins Realty, Inc. v. FNC, Inc., 634 F.3d 787 (5th Cir.) (distinguishing statutory standing from Article III standing)
- Cross v. Lucius, 713 F.2d 153 (5th Cir.) (federal courts require definite, concrete controversies, not hypothetical claims)