Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_10-cv-00972/USCOURTS-casd-3_10-cv-00972-1/pdf.json

Nature of Suit Code: 830
Nature of Suit: Patent
Cause of Action: 35:271 Patent Infringement

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

FASTEK, LLC,

Plaintiff,

CASE NO. 10 CV 0972 MA (CAB)

NOTICE AND ORDER

PROVIDING TENTATIVE

RULINGS RE: FASTEK’S

MOTION FOR LEAVE TO FILE

AN AMENDED COMPLAINT AND

MODIFY THE SCHEDULING

ORDER

[Doc. No. 139]

vs.

STECO, et al.,

Defendants.

Currently pending before the Court, and set for hearing on Tuesday, July 19, 2011 is

Plaintiff Fastek LLC’s motion to file a second amended complaint adding Advanced Steel

Recovery, LLC (“ASR LLC”) as a co-plaintiff, and to modify the scheduling order. Having

considered the submissions of the parties, and in anticipation of Tuesday’s hearing, the Court

issues the following tentative rulings:

(i) The Court tentatively GRANTS Fastek’s motion for leave to file a second amended

complaint to add ASR LLC as a co-plaintiff. 

(ii) The Court tentatively finds that Fastek has satisfied the requirements of Federal

Rule of Civil Procedure 16(b)(4), and demonstrated good cause to amend the scheduling order to

file its motion for leave to amend the complaint. Fastek appears to have litigated this matter in

good faith, and otherwise appears to have been diligent in seeking leave to amend its complaint to

add ASR LLC. 

Case 3:10-cv-00972-MMA-CAB Document 162 Filed 07/18/11 Page 1 of 2
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(iii) The Court tentatively concludes the record does not demonstrate the existence of an

exclusive license agreement between Fastek and ASR, Inc., prior to ASR, Inc.’s restructuring in

May 2008. Under Spine Solutions, Inc. v. Medtronic Sofamor Danek USA, Inc., 620 F.3d 1305

(Fed. Cir. 2010), Fastek’s implied oral understanding with ASR, Inc. regarding the use of the three

patents in suit, coupled with the companies’ organization, is not sufficient to show that ASR, Inc.

was the exclusive licensee. 

However, the Court tentatively finds that the May 15, 2008 Operating Agreement does

evidence Fastek’s intent to grant ASR LLC an exclusive license. “To demonstrate entitlement to

join as a co-plaintiff [ASR] must have the right to exclude others from making, using or selling the

invention.” Morrow v. Microsoft Corp., 499 F.3d 1332, 1343 (Fed. Cir. 2007). ASR LLC’s

Operating Agreement appears to grant ASR this important right. Specifically, section 6.4.28

provides that the board of managers must unanimously approve a decision to “license any

intellectual property rights owed by [ASR] or its subsidiary to a third party, including, without

limitation, the patents owned by Fastek.” [Frankel Decl.. Exh. 5 at FAS002070, 2073 (emphasis

added).] Under the plain language of section 6.4.28, Fastek cannot license its patents to a third

party without the unanimous approval of ASR LLC’s board. Accordingly, it appears that as of

May 15, 2008, Fastek conveyed a right to ASR LLC to exclude third parties from practicing the

relevant patents. Thus, ASR LLC is a proper co-plaintiff and may seek recovery for alleged

infringement occurring after May 15, 2008. Further, when Fastek assigned the patents to ASR

LLC on May 19, 2011, ASR LLC became the only proper plaintiff for alleged infringement

occurring after May 19, 2011. The Court is not inclined to sever or stay ASR LLC’s potential

infringement claims. 

Counsel is advised the Court’s rulings are tentative and the Court will entertain additional

argument at the hearing on July 19, 2011.

IT IS SO ORDERED.

DATED: July 18, 2011

Hon. Michael M. Anello

United States District Judge

Case 3:10-cv-00972-MMA-CAB Document 162 Filed 07/18/11 Page 2 of 2