605 F. App'x 473
6th Cir.2015Background
- Stolle, a can-making machinery manufacturer headquartered in Colorado/Ohio, alleges former employee Shu An stole trade-secret design drawings before returning to China and founding Suzhou SLAC Precision Equipment (SLAC). An left Stolle in late 2002; SLAC was formed in 2004.
- In late 2003 Stolle employees learned An was soliciting customers in China and "had all the drawings"; Stolle warned suppliers in December 2003 and exchanged letters with An’s counsel in early 2004 but took no suit then.
- Between 2004–2007 Stolle gathered additional evidence (copies of drawings labeled with Chinese company names, photographic similarity of SLAC machines to Stolle’s, and a 2006 SLAC-refurbished machine sold to Simmons Pet Food producing identical can ends).
- Stolle sued in April 2010 asserting claims including copyright infringement, trade-secret misappropriation under the Ohio Uniform Trade Secrets Act (OUTSA), deceptive trade practices, tortious interference, conspiracy, and conversion; summary judgment followed for defendants on most claims.
- The district court held Stolle’s OUTSA claim time-barred (limitations began no later than Dec. 2003) and preempted other state-law claims; it granted summary judgment to SLAC and An except denying summary judgment only on a copyright claim against An.
- On appeal the Sixth Circuit affirmed except reversed as to SLAC on the OUTSA statute-of-limitations issue, holding a genuine factual dispute exists about when the limitations period began to run as to SLAC.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Ohio long-arm and due-process support jurisdiction over An and SLAC | Stolle: An and SLAC purposefully acted to harm Stolle in Ohio by using misappropriated info and soliciting Ohio-related business | An/SLAC: Insufficient contacts with Ohio for jurisdiction | Court: Prima facie showing satisfied; specific jurisdiction exists over both defendants |
| Whether OUTSA claim against An and SLAC is time-barred (4-year SOL from discovery) | Stolle: Discovery occurred no earlier than 2006 (evidence from Simmons machine) so suit timely | Defs: Stolle was on notice by Dec. 2003 (emails, supplier drawings) so suit filed in 2010 is untimely | Court: Claim against An time-barred (discovery by Dec. 2003); claim against SLAC not necessarily time-barred (SLAC founded 2004) — reversed for SLAC |
| Whether state-law claims (conspiracy, tortious interference) are preempted by OUTSA | Stolle: Some claims independently pleaded and not solely based on trade-secret misappropriation | Defs: Those claims rest on the same operative facts as OUTSA misappropriation and are displaced | Court: OUTSA preempts claims that rest on same operative facts; conspiracy and tortious interference preempted |
| Whether Lanham Act / DTPA / Ohio false-advertising and reverse-passing-off claims survive | Stolle: Defendants passed off Stolle design/ goods and falsely advertised by depicting Stolle machines as SLAC’s | Defs: Incorporation of ideas/drawings into goods is not Lanham “origin”; the website photo was not literally false nor shown to cause deception | Court: Reverse passing off fails under Dastar; false-advertising claim failed for lack of literal falsity or evidence of actual deception; summary judgment affirmed |
Key Cases Cited
- Yellowbook Inc. v. Brandeberry, 708 F.3d 837 (6th Cir. 2013) (standard of review for summary judgment)
- Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574 (U.S. 1986) (summary judgment and drawing inferences against nonmoving party)
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (U.S. 1986) (insufficient evidentiary showing at summary judgment)
- Schneider v. Hardesty, 669 F.3d 693 (6th Cir. 2012) (prima facie showing for jurisdiction when no evidentiary hearing held)
- Goodyear Dunlop Tires Operations, S.A. v. Brown, 131 S. Ct. 2846 (U.S. 2011) (general vs. specific jurisdiction framework)
- Burger King Corp. v. Rudzewicz, 471 U.S. 462 (U.S. 1985) (purposeful availment and specific jurisdiction test)
- Dastar Corp. v. Twentieth Century Fox Film Corp., 539 U.S. 23 (U.S. 2003) (Lanham Act ‘‘origin of goods’’ protects tangible-goods producers, not authors of ideas)
- Raytheon Co. v. Indigo Sys. Corp., 688 F.3d 1311 (Fed. Cir. 2012) (discovery rule for trade-secret claims and when statute of limitations begins)
- Murray Hill Publications, Inc. v. Twentieth Century Fox Film Corp., 361 F.3d 312 (6th Cir. 2004) (elements of a copyright-infringement claim)
- Robert R. Jones Assocs., Inc. v. Nino Homes, 858 F.2d 274 (6th Cir. 1988) (using copies to manufacture products does not alone create copyright protection equivalent to a patent)
- Amalgamated Indus. Ltd. v. Tressa, Inc., [citation="69 F. App'x 255"] (6th Cir. 2003) (application of UTSA discovery/confidential-relationship approach)