Timothy L. Taylor, Plaintiff-Respondent v. Ppg Industries, Inc., Defendant-Petitioner

Citations: 256 F.3d 1315; 59 U.S.P.Q. 2d (BNA) 1380; 2001 U.S. App. LEXIS 15502; 2001 WL 775594Docket: 670

Court: Court of Appeals for the Federal Circuit; July 11, 2001; Federal Appellate Court

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PPG Industries, Inc. has filed a petition for permission to appeal a ruling by the U.S. District Court for the Western District of Louisiana, which determined that federal patent law does not preempt certain state law claims brought by Timothy L. Taylor. Taylor's lawsuit includes federal antitrust allegations and various state law claims under Pennsylvania, Louisiana, and California law, as well as a declaratory judgment asserting his sole inventorship of two patents. The district court granted PPG summary judgment on the federal antitrust claim and dismissed the Pennsylvania and California state law claims, but denied PPG's motion concerning the Louisiana claims, ruling they were not preempted by federal patent law.

The district court certified its decision for interlocutory appeal under 28 U.S.C. 1292(b), specifically regarding the Louisiana state law claims. PPG's petition for appeal was deemed appropriate, as the preemption ruling involves a controlling question of law with significant grounds for differing opinions, and an immediate appeal could expedite the overall litigation resolution. The court ordered PPG's petition granted and instructed the clerk to consolidate this case with Taylor's appeal concerning the Rule 54(b) judgment on the other claims.

Immediate appeals of interlocutory orders can be certified by a district court if they involve a controlling legal question with substantial grounds for differing opinions and could materially advance the litigation's resolution, as outlined in 28 U.S.C. § 1292(b). The court has discretion in granting such petitions. In this case, Circuit Judge Arthur J. Gajarsa would deny the petition for an interlocutory appeal, arguing it would prematurely address issues that are not fully developed until trial. He contends that allowing the appeal does not guarantee a streamlined process and places an undue burden on Taylor, who faces defending a legal issue that represents a case of first impression, potentially complicating existing legal precedents.

PPG claims there is substantial ground for differing opinions based on prior case law regarding patent law preemption of state law, suggesting that this should extend to protect assertions of co-ownership from state law liability absent bad faith. They argue that an immediate appeal could resolve litigation issues efficiently, especially regarding jury instructions on bad faith, and conserve judicial resources, particularly as Taylor has appealed summary judgment dismissing his antitrust and state law claims.

However, the court finds PPG's arguments unconvincing. It notes that Taylor's Louisiana law counterclaims—fraud, detrimental reliance, unfair trade practices, and conversion—are not solely based on PPG's assertion of co-ownership. Instead, Taylor cites additional factual bases, including PPG's refusal to sell necessary chemicals to Taylor's business partner, detrimental reliance on legal advice from PPG's patent attorney, and PPG's communications regarding co-ownership. Consequently, resolving the state law claims related to co-ownership would not simplify the litigation because other significant factual issues remain to be tried.

This case presents a unique situation for the Federal Circuit, as acknowledged by PPG. The circumstances suggest that compelling an individual plaintiff to engage in an immediate appeal solely for the purpose of potentially expanding the law would be inequitable. It is anticipated that this litigation will likely be appealed again following the district court’s decision on the declaratory judgment of co-ownership, providing an opportunity to revisit the issue with a clearer record, especially if PPG is determined to be a co-owner. PPG's conduct, whether in good or bad faith, will likely be assessed in the district court proceedings, which is relevant because Louisiana law requires proof of bad faith to establish unfair trade practices or fraud claims. Taylor has presented compelling arguments regarding the preemption rationale established in previous cases, asserting that it applies to existing patentees rather than individuals without recognized legal rights to a patent. PPG has failed to justify excluding allegations of patent co-ownership from state tort liability through preemption or to demonstrate that Taylor's state claims are encompassed by a federal claim. Consequently, Taylor should be permitted to pursue his claims under Louisiana law before facing an appeal that seeks to challenge the district court's ruling by expanding existing legal interpretations.