Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-alsd-1_05-cv-00601/USCOURTS-alsd-1_05-cv-00601-1/pdf.json

Nature of Suit Code: 830
Nature of Suit: Patent
Cause of Action: 35:145 Patent Infringement

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IN THE UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF ALABAMA

SOUTHERN DIVISION

BRYAN R. GIPSON, et al., )

 )

Plaintiffs, )

 )

v. ) CIVIL ACTION 05-0601-WS-C

 )

MARK A. MATTOX, )

 )

Defendant. )

ORDER

This matter comes before the Court on plaintiffs’ Motion to Strike an Affirmative

Defense and for a Summary Judgment on Two Affirmative Defenses (doc. 41), as well as on

defendant’s Motion for Summary Judgment (doc. 43). Both motions have been briefed and are

ripe for disposition.

I. Background.

A. Nature of the Case.

On October 17, 2005, plaintiffs Bryan R. Gipson (“Gipson”) and Chem Technologies of

Mississippi, Inc. (“ChemTech”) filed a Complaint for Declaratory Judgment and Relief Pursuant

to 35 U.S.C. § 256 (doc. 1). The Complaint alleges that the United States Patent and Trademark

Office wrongfully issued U.S. Patent No. 6,866,048 (the “‘048 Patent”) to defendant Mark A.

Mattox (“Mattox”) on or about March 15, 2005. According to the Complaint, Gipson developed

the formula for the ‘048 Patent on his own, prior to being employed by Mattox’s company;

however, Mattox applied for and received the ‘048 Patent, by concealing and misrepresenting

material facts. (Complaint, ¶¶ 8-10.) The Complaint further alleges that Gipson has assigned all

of his interests in the invention to plaintiff ChemTech. (Id., ¶ 12.) Plaintiffs seek a declaratory

judgment that Mattox improperly obtained the ‘048 Patent because he did not invent the subject

invention, that any assignment of the ‘048 Patent by Mattox is null and void, and that any

agreement Mattox may have made concerning the invention is null and void. Plaintiffs also

request that this Court order the Director of the U.S. Patent and Trademark Office to substitute

Case 1:05-cv-00601-WS-C Document 54 Filed 11/27/06 Page 1 of 20
1 The Court is mindful of its obligation under Rule 56 to construe the record,

including all evidence and factual inferences, in the light most favorable to the nonmoving party. 

See Lofton v. Secretary of Dept. of Children and Family Services, 358 F.3d 804, 809 (11th Cir. 

2004); Johnson v. Governor of State of Fla., 405 F.3d 1214, 1217 (11th Cir. 2005). Thus, as to

Mattox’s motion for summary judgment, plaintiffs’ evidence is taken as true and all justifiable

inferences are drawn in their favor.

2 The product name is short-hand for the “Southern Water Pipeline” and the 5%

blend of the active ingredient used in the product. (Gipson Dep., at 91.)

3 Neither side’s briefs spell out the factual sequence of events with clarity. 

Accordingly, the recitation of facts presented herein is based on scrutiny of the often

fragmentary and incomplete summary judgment record.

4 SWM became Synergy Chemicals, Inc. in August 2001. (Mattox Dep., at 12.) 

The name change is not material to these proceedings; therefore, to avoid confusion, the

company will be referred to herein as “SWM” both prior to and subsequent to the name change.

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Gipson as inventor of the ‘048 Patent and to delete Mattox as inventor of that patent, pursuant to

35 U.S.C. § 256.

 In his Answer (doc. 26), Mattox denied the substantive allegations of the Complaint

pertaining to the ‘048 Patent’s inventorship, and proffered a number of affirmative defenses,

including, inter alia, defenses of breach of employment agreement and misappropriation of trade

secret information.

B. Factual Background for Defendant’s Motion for Summary Judgment.1

The ‘048 Patent recites Mattox as the inventor and reflects that the invention “relates to a

method of treating dry gas pipe or processed fluid pipe lines that are susceptible to the build up

of iron sulfide deposits, by complexing iron sulfide found in these pipe lines.” (Defendant’s

Exh. A, at 2.) The ‘048 Patent has been used to market a product known as SWP-105. (Mattox

Dep., at 44.)2 The primary question posed by this lawsuit is whether Mattox or Gipson should be

credited with inventorship of the chemical formula for SWP-105, and other aspects of the ‘048

Patent.3

Defendant Mattox is the founder and sole shareholder of a company called Southern

Water Management, Inc. (“SWM”), which is not a party to this action. (Mattox Dep., at 12.)4

SWM’s initial focus was in the water treatment and specialty chemical business. (Id. at 14.) 

Case 1:05-cv-00601-WS-C Document 54 Filed 11/27/06 Page 2 of 20
5 Gipson described a “eureka” moment in which he had mistakenly left the bung

out of a drum that he had been using to pump MPA 7747 into the lines at an oil field production

water treatment system in Citronelle, Alabama in or around 1999. By the time he used the drum

again, it had rained heavily, filling the drum half-full of water and diluting the MPA 7747. A

short time after he dumped this diluted solution into the tank, Gipson discovered that the entire

iron sulfide collection on the bottom of the tank was gone, such that the solution had dissolved

the existing iron sulfide deposits. (Gipson Dep., at 51.) By Gipson’s calculations, the

rainwater/THPS solution he had used had a concentration of THPS of approximately 5%. (Id. at

52-53.) By contrast, the concentration of THPS in MPA 7747 as used by Gipson’s employer for

biocide purposes was 10%. (Id. at 50-51.)

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Mattox hired Gipson to work for SWM in April 2000. (Id. at 27; Gipson Dep., at 19.) Mattox

testified that he (Mattox) invented SWP-105 over a period of months, beginning in the late

spring or early summer of 2000, and extending into 2001. (Mattox Dep., at 36, 44.) Mattox

flatly denied that Gipson conceived the idea of a product to dissolve iron sulfide deposits in

pipelines utilizing a compound containing tetrakis (hydroxymethyl) phosphonium sulfate

(“THPS”). (Id. at 36.) Indeed, according to Mattox, Gipson did not contribute to the invention

of SWP-105 at all and never had a good idea relating to this invention. (Id. at 59, 61.)

Gipson’s account of the invention of SWP-105 is far different. Gipson testified that in

1999, before he began working for SWM, his duties for his then-employer included cleaning

bacteria and debris out of gas pipelines using a product called MPA 7747, which was a blend of

THPS and water. (Gipson Dep., at 45.) As shipped by the manufacturer, Rhodia, MPA 7747

featured a blend of 20% THPS, but Gipson’s then-employer (non-party SII ChemTechnologies

of Louisiana) diluted it further to 10%. (Id. at 50-51, 71.) Apparently water and THPS were the

only ingredients in the MPA 7747 product. The 10% mixture of THPS was intended for use as a

biocide, to kill bacteria that otherwise built up in the gas pipelines. (Id. at 46.) Gipson

discovered through his activities in the field that as the percentage of THPS was lowered (e.g., as

the MPA 7747 product was diluted), the solution became less effective for its stated purpose of

killing bacteria but dramatically more effective in dissolving iron sulfide deposits in tanks and

pipelines. (Id. at 48-50.)5

 Upon observing that a weaker solution eradicated iron sulfide, Gipson

began conducting independent research and field studies at his house. (Id. at 53.) Such testing

consisted of trying different blends of THPS and water (with no other ingredients), from 20%

THPS down to 1% THPS, and observing their effects on iron sulfide. (Id. at 61-62, 67-68.) 

Case 1:05-cv-00601-WS-C Document 54 Filed 11/27/06 Page 3 of 20
6 In addition to his field testing, Gipson reviewed technical papers on the subject. 

(Id. at 53-54, 56-58.) However, he acknowledged that he did not have knowledge, from a

scientific standpoint, of why the product worked better with a 5% THPS blend than with other

percentages. (Id. at 67.) He also disclaimed any understanding of why ammonium chloride

caused the mixture to be more reactive, how THPS was manufactured, or even what the acronym

THPS stood for. (Id. at 80.) When asked to explain how THPS dissolves iron sulfide, Gipson

testified, “All I know is it works. That’s it.” (Id. at 98-99.) Of course, scientific expertise as to

why an invention works is not a legal prerequisite to inventorship status.

7 Gipson’s Affidavit conflicts in this regard with his deposition testimony, wherein

he stated that he never shared his findings that diluting MPA 7747 reduced iron sulfide with

anyone until he arrived at SWM. (Gipson Dep., at 53, 57.) Gipson would explain the

inconsistency by stating that he “was confused with the questioning” in his deposition. (Gipson

Aff., ¶ 5.) An affidavit may be stricken as a sham when it directly contradicts, without

explanation, a witness’s previous sworn testimony. See McCormick v. City of Fort Lauderdale,

333 F.3d 1234, 1240 n.7 (11th Cir. 2003). However, defendant has not invoked the sham

affidavit rule, nor has he otherwise sought to have Gipson’s affidavit stricken, and Gipson has

offered an explanation for the discrepancy. The undersigned will not unilaterally strike down

this affidavit as improper.

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Based on these tests, Gipson concluded that a blend of 95% water and 5% THPS “really did the

job” in removing iron sulfide deposits. (Id. at 65-67.) Gipson felt that the effects of diluting

MPA 7747 were “definitely different” than what others in the field were doing because the

product became “more reactive,” such that he regarded his formula as an invention. (Id. at 64-

65.)6

 

According to Gipson, prior to arriving at SWM in April 2000, Gipson discussed aspects

of his invention with Kansas Hernandez (a representative of Rhodia, the manufacturer of MPA

7747) and Mattox. (Gipson Aff., ¶ 5.)7 Moreover, the record reflects that other employees of SII

Chem Tech (for whom Gipson was working in 1999) reported that the 10% blend of THPS

yielded iron sulfide reduction as compared to the 20% blend, and the topic was discussed at staff

meetings. (Gipson Dep., at 60.)

When Gipson began working at SWM in April 2000, a customer contacted him and

expressed interest in this iron-sulfide reducing product for a gas transmission pipeline. (Id. at

68-69.) Mattox agreed to allow Gipson to try Gipson’s formula on the customer’s pipeline. (Id.

at 69.) In the summer of 2000, Mattox and Gipson met with Hernandez, the Rhodia

representative, about whether SWM could use the Rhodia MPA 7747 product in diluted fashion

Case 1:05-cv-00601-WS-C Document 54 Filed 11/27/06 Page 4 of 20
8 At his deposition, Gipson was unable to recall whether ammonium chloride

tended to reduce or increase the observed pH, again underscoring his lack of scientific expertise

in the chemistry field. (Id. at 77-78.) He was also unable to recite the specific formula of the

product, including its precise concentration of ammonium chloride. (Id. at 76, 83, 85, 139-41.) 

As discussed infra, these facts have negligible bearing on whether Gipson is the true inventor.

9 Just as the summary judgment record reflects a lack of chemistry knowledge on

Gipson’s part, it does the same for Mattox. For example, in May 2001, Mattox e-mailed Dr.

Edward Valente, a chemistry professor at Mississippi College, concerning SWP-105. Mattox

indicated that he would be sending samples to Dr. Valente because he “would like to see if we

can determine the mechanism [sic] of the product .... If we can determine how the product is

working, then we can provide a better product for the field.” (Mattox Dep., at 38 and Exh. 1.) 

Thus, Mattox effectively confessed ignorance of why SWP-105 worked the way it did. Again,

however, there is no legal requirement of chemistry expertise as a prerequisite to claiming

inventorship rights, so any weaknesses of Mattox and Gipson in this department are largely

irrelevant.

-5-

for iron sulfide removal, as compared to the biocide applications for which Rhodia marketed and

sold the product. (Id. at 72, 81.) Hernandez gave the pair Rhodia’s blessing to use the diluted

MPA 7747 for iron sulfide applications, suggested that they add a small quantity of ammonium

chloride to the mixture to improve its reactivity, and also recommended that they keep the

product within a target pH range. (Id. at 72-75.) Hernandez specifically suggested that

ammonium chloride be added at a ratio of 0.1% for each 1% of THPS. (Id. at 140-41, 174-75.) 

Because the total THPS concentration was 5%, Hernandez recommended adding 0.5%

ammonium chloride. (Id. at 141, 174-76, 177.)

Armed with Hernandez’s suggestions, Mattox and Gipson “did the same pretty much

backyard testing” that Gipson had done earlier, with the addition of ammonium chloride and

monitoring pH levels. (Id. at 75-76.)8

 Gipson initially did this testing himself, then he and

Mattox “sat there and played with it as far as those different blends.” (Id. at 78.) Based on these

efforts, they found that the product “worked even better” with Hernandez’s modifications. (Id.

at 72.)9 Gipson admits that the ideas of adding ammonium chloride and remaining within a

designated pH range originated from Hernandez, and that Gipson simply “followed his recipe” in

modifying the invention. (Id. at 82.) Once Gipson and Mattox began using SWP-105 in the

field, they found that it worked successfully, and that no changes to the formula were necessary. 

(Id. at 96.) SWP-105 was blended to consist of 5% THPS and 0.5% ammonium chloride, mixed

Case 1:05-cv-00601-WS-C Document 54 Filed 11/27/06 Page 5 of 20
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in water. SWM’s records reflect that the product was first sold in August 2000. (Mattox Dep. at

116.)

Hernandez’s Affidavit corroborates Gipson’s narrative. According to Hernandez, before

Gipson began working for SWM, Gipson informed him that “he had discovered by trial and error

about iron sulfide dissolving capabilities of a 5% blend of THPS. ... Mr. Gipson was the first

person I know of that discovered the 5% solution for that application. ... Mr. Gipson and I

discussed his 5% blend discovery numerous times.” (Hernandez Aff., ¶ 6.) Hernandez also

confirms Gipson’s account of the meeting among Hernandez, Gipson and Mattox, at which

Hernandez authorized SWM to use the 5% blend and suggested the inclusion of ammonium salts

at a specific ratio. (Id., ¶ 7.) Hernandez avers that Mattox did not actively participate in the

meeting’s technical discussions regarding the invention. (Id., ¶ 8.) Hernandez also minimizes

his ammonium salts modification, which he describes as “merely an arithmetic function based on

Mr. Gipson’s 5% THPS blend discovery.” (Id., ¶ 10.)

II. Summary Judgment Standard.

Summary judgment should be granted only if “there is no issue as to any material fact

and the moving party is entitled to a judgment as a matter of law.” Fed. R. Civ. P. 56(c). The

party seeking summary judgment bears “the initial burden to show the district court, by reference

to materials on file, that there are no genuine issues of material fact that should be decided at

trial.” Clark v. Coats & Clark, Inc., 929 F.2d 604, 608 (11th Cir. 1991). Once the moving party

has satisfied its responsibility, the burden shifts to the nonmovant to show the existence of a

genuine issue of material fact. Id. “If the nonmoving party fails to make 'a sufficient showing

on an essential element of her case with respect to which she has the burden of proof,' the

moving party is entitled to summary judgment.” Id. (quoting Celotex Corp. v. Catrett, 477 U.S.

317 (1986)) (footnote omitted). “In reviewing whether the nonmoving party has met its burden,

the court must stop short of weighing the evidence and making credibility determinations of the

truth of the matter. Instead, the evidence of the non-movant is to be believed, and all justifiable

inferences are to be drawn in his favor.” Tipton v. Bergrohr GMBH-Siegen, 965 F.2d 994, 999

(11th Cir. 1992) (internal citations and quotations omitted). “Summary judgment is justified only

for those cases devoid of any need for factual determinations.” Offshore Aviation v. Transcon

Lines, Inc., 831 F.2d 1013, 1016 (11th Cir. 1987) (citation omitted).

Case 1:05-cv-00601-WS-C Document 54 Filed 11/27/06 Page 6 of 20
10 The rationale for this heightened standard is that, in the inventorship context, “the

temptation for even honest witnesses to reconstruct, in a manner favorable to their own position,

what their state of mind may have been years earlier, is simply too great to permit a lower

standard.” Hess v. Advanced Cardiovascular Systems, Inc., 106 F.3d 976, 980 (Fed. Cir. 1997).

-7-

III. Analysis of Defendant’s Motion for Summary Judgment.

In a nutshell, Mattox argues that he is entitled to summary judgment because plaintiffs

have failed to make a legally sufficient showing that Gipson invented the invention that is the

subject of the ‘048 Patent.

A. Applicable Patent Law Principles.

Because a patent carries a statutory presumption of validity, a plaintiff seeking to

substitute himself as inventor on an existing patent must show by clear and convincing evidence

that he in fact invented the invention that is the subject of the patent. See Stern v. Trustees of

Columbia University in City of New York, 434 F.3d 1375, 1377 (Fed. Cir. 2006); Trovan, Ltd. v.

Sokymat SA, Irori, 299 F.3d 1292, 1301 (Fed. Cir. 2002) (recognizing “presumption that the

named inventors on a patent are the true and only inventors”); Chiron Corp. v. Genentech, Inc.,

268 F. Supp.2d 1126, 1130 (E.D. Cal. 2002) (“A party seeking to invalidate a patent for failure

to name an inventor ... bears the burden of proving invalidity by clear and convincing

evidence.”); 35 U.S.C. § 282 (“A patent shall be presumed valid. ... The burden of establishing

invalidity of a patent or any claim thereof shall rest on the party asserting such invalidity.”). 

Thus, the critical question on summary judgment is whether Gipson and ChemTech can show by

clear and convincing evidence, after all reasonable inferences are drawn in their favor, that

Gipson invented the ‘048 Patent. See Stern, 434 F.3d at 1377.10 

To meet this heightened threshold, plaintiffs must present more than Gipson’s testimony,

but must also submit corroboration. See Stern, 434 F.3d at 1378; Medichem, S.A. v. Rolabo, S.L.,

437 F.3d 1157, 1170 (Fed. Cir. 2006) (“the corroboration requirement provides an additional

safeguard against courts being deceived by inventors who may be tempted to mischaracterize the

events of the past through their testimony”). The sufficiency of plaintiffs’ corroborating

evidence turns on evaluation of all pertinent evidence so that a sound determination of the

credibility of Gipson’s story may be reached. See Trovan, 299 F.3d at 1302. Corroborating

evidence “preferably comes in the form of physical records that were made contemporaneously

Case 1:05-cv-00601-WS-C Document 54 Filed 11/27/06 Page 7 of 20
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with the alleged prior invention,” id., but may also consist of circumstantial evidence about the

inventive process or reliable testimony from someone other than the plaintiff. Id. at 1302-03;

Checkpoint Systems, Inc. v. All-Tag Sec. S.A., 412 F.3d 1331, 1339 (Fed. Cir. 2005)

(corroborating evidence may include physical, documentary or circumstantial evidence, or

reliable testimony from one other than an interested party). The sufficiency of corroborating

evidence is evaluated on a “rule of reason” basis, and is a question of fact reviewed on appeal for

clear error. Medichem, 437 F.3d at 1170-71.

“A patent is invalid if more or fewer than the true inventors are named.” Gemstar-TV

Guide Int’l, Inc. v. International Trade Com’n, 383 F.3d 1352, 1381 (Fed. Cir. 2004). “The

‘inventor,’ in patent law, is the person or persons who conceived the patented invention.” C.R.

Bard, Inc. v. M3 Systems, Inc., 157 F.3d 1340, 1352 (Fed. Cir. 1998); see also Burroughs

Wellcome Co. v. Barr Laboratories, Inc., 40 F.3d 1223, 1227-28 (Fed. Cir. 1994) (“Conception

is the touchstone of inventorship.”). “Conception is the formation in the mind of the inventor, of

a definite and permanent idea of the complete and operative invention, as it is hereafter to be

applied in practice.” Trovan, 299 F.3d at 1302 (citations omitted). “An idea is definite and

permanent when the inventor has a specific, settled idea, not just a general goal or research plan

he hopes to pursue.” Burroughs Wellcome, 40 F.3d at 1228. Stated differently, conception is

complete when the inventor’s idea is so clearly defined that one of ordinary skill could reduce

the invention to practice, without extensive research or experimentation. See Stern, 434 F.3d at

1378; Invitrogen Corp. v. Clontech Laboratories, Inc., 429 F.3d 1052, 1063 (Fed. Cir. 2005) (in

context of chemical compound, conception is complete when inventor can define compound so

as to distinguish it from other materials, and can describe how to obtain it).

“Inventorship is a question of law, applied to the relevant facts.” Chiron, 268 F. Supp.2d

at 1131. It also has been characterized as “one of the most difficult issues in American patent

law.” C.R. Bard, 157 F.3d at 1352 (citation omitted). It is that weighty endeavor to which the

Court now dedicates itself.

B. Sufficiency of Plaintiffs’ Evidence of Inventorship.

Mattox’s position on summary judgment is that plaintiffs have failed to proffer sufficient

corroborated evidence of inventorship to satisfy the clear-and-convincing standard. The Court

disagrees. Viewed in the light most favorable to plaintiffs, the evidence shows that Gipson

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discovered, based on his own field research and testing, that a 5% blend of THPS has iron

sulfide-depleting properties superior to other formulations and concentrations. Gipson’s

evidence is that he made this discovery in 1999, long before he began working for SWM, based

on his own field experiences and extensive research. Gipson’s evidence further shows that he

informed Mattox of his invention and subsequently began working for Mattox’s company, at

which time Gipson secured a customer who was interested in the iron sulfide-removal treatment

contemplated by the invention, and set up a meeting with Hernandez to discuss Rhodia’s

position on the invention, all without material involvement by Mattox. Based on Hernandez’s

suggestions, Gipson’s evidence demonstrates, Gipson refined the invention slightly by adding a

small concentration of ammonium salts and monitoring the pH levels.

If Gipson’s testimony is accepted as true, as it must be for summary judgment purposes,

conception of the invention was complete before he ever went to work for SWM. Based on his

own field research and experimentation, Gipson had formed a definite and permanent idea that a

5% solution of THPS in water would dissolve iron sulfide deposits in pipelines. His idea was

specific and settled, and was not simply a general notion that dilution of THPS from its

concentrations in MPA 7747 might remove iron sulfide. Moreover, Gipson was ready to apply

that idea to practice, long before his association with Mattox. Viewing the evidence in the light

most favorable to plaintiffs, then, Gipson conceived the invention covered by the ‘048 Patent

before he ever presented the idea to Mattox and before the time when Mattox claims to have

commenced the inventorship process. Because conception is the touchstone of invention,

Gipson’s unequivocal testimony of how and when he developed the formula for the invention of

the ‘048 Patent constitutes clear and convincing evidence that, if believed at trial, would

establish him as the true and rightful inventor.

That said, Gipson’s own testimony is not enough to overcome defendant’s summary

judgment challenge; rather, it must be corroborated by other evidence using a rule of reason. 

Unquestionably, plaintiffs’ primary source of evidence presented on summary judgment is

Gipson’s testimony. Plaintiffs have failed to corroborate the testimony with contemporaneous

physical evidence; however, they have offered the testimony of Kansas Hernandez (who does

not claim co-inventorship and who is not an interested party) to corroborate Gipson’s statements. 

Hernandez confirms many relevant and highly significant aspects of Gipson’s story, including

Case 1:05-cv-00601-WS-C Document 54 Filed 11/27/06 Page 9 of 20
11 Defendant complains that plaintiffs’ corroboration evidence at trial may include

documents that plaintiffs failed to disclose in their Rule 26 disclosures or otherwise in the

discovery process. (Reply Brief, at 5-6.) But plaintiffs do not contend that they intend to use

any such documents; rather, plaintiffs state only that in addition to the documents that were

disclosed, “[t]hey also plan to call corroborating witnesses” who have been identified to

defendant. (Opposition Brief, at 7.) As defendant’s claim of potential discovery violations does

not relate to any document submitted on summary judgment, the issue is not properly before the

undersigned. To the extent that defendant wishes to pursue this issue further, it should be

addressed via motion in limine at an appropriate time.

12 Those claims are as follows: the method of cleaning iron sulfide deposits from dry

gas pipelines by using water, 5% THPS and 0.5% ammonium salts (Claim 1), the method of

adding that solution continuously to a dry gas pipeline (Claim 2), the method of adding that

solution intermittently to a dry gas pipeline (Claim 3), the method of cleaning iron sulfide

deposits from dry gas pipelines by using water, 5% THPCl (tetrakis (hydroxymethyl)

phosphonium chloride), and 0.5% ammonium salts (Claim 4), the method of using that THPCl

solution continuously (Claim 5), the method of using that solution intermittently (Claim 6), the

method of cleaning iron sulfide deposits from oil pipelines using the THPS solution (Claim 7),

the method of adding that solution continuously (Claim 8), the method of adding that solution

intermittently (Claim 9), the method of cleaning iron sulfide deposits from oil pipelines using the

THPCl solution (Claim 10), and the method of adding that solution continuously (Claim 11) or

intermittently (Claim 12).

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the timing of Gipson’s discovery, the substance of that discovery, Hernandez’s input regarding

ammonium salts, and the relative non-involvement of Mattox. Applying the rule of reason, and

viewing all evidence in the light most favorable to the non-movants, the Court concludes that

Hernandez’s Affidavit provides sufficient corroboration of Gipson’s account of the inventorship

of SWP-105 to withstand summary judgment.11

Confronted with plaintiffs’ factual showing, Mattox proffers three distinct

counterarguments. First, he insists that plaintiffs’ evidence is insufficient because Gipson has

not shown by clear and convincing evidence that he invented each of the 12 claims set forth in

the ‘048 Patent. Second, defendant insists that even under Gipson’s account, his conception of

the invention was incomplete without the ammonium salts component added while Gipson was

working for SWM. Third, defendant argues that Gipson’s evidence cannot be deemed clear and

convincing because his deposition testimony evinced uncertainty and confusion about the actual

formula of the invention.

Defendant is correct that the ‘048 Patent specifies 12 claims.12 Mattox argues that

Case 1:05-cv-00601-WS-C Document 54 Filed 11/27/06 Page 10 of 20
13 For example, the Court cannot determine from the record what involvement, if

any, Gipson had in developing a THPCl formulation for cleaning iron sulfide deposits, as all of

his testimony in the record relates to THPS. Likewise, the Court cannot assess what interest (if

any) plaintiffs have in the intermittent vs. continuous aspects of the invention, or in its

application in oil vs. dry gas pipelines. The record and parties’ briefs are woefully

underdeveloped in these respects.

14 It is expected that the parties’ evidence at trial will be organized and presented on

a claim-by-claim basis. Moreover, the parties’ respective counsel are ordered to conference

(telephonically or otherwise) on or before December 8, 2006 to discuss whether there is a bona

fide disagreement as to Mattox’s inventorship status for each of the 12 claims. Reviewing the 12

claims set forth in the ‘048 Patent, it appears likely that the parties’ good-faith dispute embraces

only certain of those claims. Therefore, it appears likely that the issues for trial may be

substantially narrowed without either party abandoning its entrenched position in this case. The

parties are ordered to file a joint status report, on or before December 15, 2006, stating the

results of this conference and identifying the particular claims of the ‘048 Patent that are

disputed for trial purposes.

-11-

Gipson cannot defeat summary judgment without clear and convincing evidence of Gipson’s

inventorship of “each of the twelve (12) claims contained in the ‘048 Patent.” (Reply Brief, at

1.) This is a correct statement of law. See, e.g., Trovan, 299 F.3d at 1302 (“inventorship is

determined on a claim-by-claim basis”). Pragmatically, however, neither side has made any

effort to compare plaintiffs’ evidence to the ‘048 Patent on a systematic, claim-by-claim basis. 

Instead, both sides focus on the chemical formula aspect, without separating out particular

claims or aligning particular facts to particular claims. The interests of justice, efficiency and

judicial economy would not be served by the Court unilaterally analyzing the sufficiency of

plaintiffs’ evidence as to each of the 12 claims, without the benefit of any assistance, input or

argument from any party, and without an adequately developed record. It is clear that plaintiffs

have proffered sufficient evidence to defeat summary judgment as to at least certain of the

claims. As to others, defendant may well be entitled to judgment as a matter of law.13 On this

record and given this glaring omission from the record and the parties’ briefing, however, the

Court is not equipped to make that determination. Accordingly, the sufficiency of plaintiffs’

evidence to show inventorship of each of the 12 claims encompassed by the ‘048 Patent must

await disposition at trial.14

With regard to the ammonium salts issue, defendant’s position is that Gipson cannot

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claim inventorship because Hernandez and not Gipson developed the ammonium feature of the

formula. There are two problems here. First, Mattox is trying to have it both ways. In his reply

brief, Mattox takes pains to assert that “ammonium is an integral part of the ‘048 patent .... 

Without ammonium, conception would not be complete because further extensive research or

experimentation would be necessary to ensure the proper functionality of the invention.” (Reply

Brief (doc. 52), at 4.) Yet in his initial brief, Mattox admits that “[t]he ratio of one percent

THPS to point one percent ammonium salt in connection with iron sulfide depletion was well

known in the industry” before the invention of SWP-105. (Defendant’s Brief (doc. 43), at 8.) 

Which is it, an integral part demanding extensive research, or a ratio that is common knowledge? 

Plaintiffs’ evidence (including the Hernandez Affidavit) strongly suggests the latter. Second,

Mattox places too much weight on Hernandez’s involvement. The law is clear that an “inventor

may use the services, ideas, and aid of others in the process of perfecting his invention without

losing his right to a patent.” Ethicon, Inc. v. U.S. Surgical Corp., 135 F.3d 1456, 1461 (Fed. Cir.

1998). If the ratio of 0.1% ammonium chloride per 1% THPS is a simple arithmetic function

that is well-known in the industry, which the Court must assume for summary judgment

purposes, then the mere fact that Hernandez proposed it to Gipson does not deprive Gipson of

inventorship or negate prior conception. See C.R. Bard, 157 F.3d at 1352 (“others may provide

services in perfecting the invention conceived by another without becoming an ‘inventor’ by

operation of law”); Ethicon, 135 F.3d at 1460 (one who “simply provides the inventor with wellknown principles” after conception is not a joint inventor). In this view, the ammonium salts

addition was simply part of applying Gipson’s invention to practice, and could be done by one of

ordinary skill without extensive experimentation. That viewpoint is supported by plaintiffs’

evidence, and therefore must prevail at the Rule 56 stage.

Finally, Mattox points to inconsistencies in Gipson’s deposition testimony as to the

actual chemical formula of the compound covered by the ‘048 Patent. To be sure, Gipson’s

testimony on this front was quite shaky. He initially testified that 0.01% of ammonium chloride

was added, or “hardly nothing,” yielding a final mix of 5% THPS and 0.01% ammonium

chloride. (Gipson Dep., at 76, 79, 83.) Gipson then changed his testimony to 0.1% ammonium

chloride. (Id. at 85, 90.) He then doubled back to “point oh-one” percent, with the qualifier,

“I’m still not sure with my math.” (Id. at 106, 140.) After a break, Gipson indicated that he had

Case 1:05-cv-00601-WS-C Document 54 Filed 11/27/06 Page 12 of 20
15 There is substantial deviation in the record as to the proper spelling of this other

invention. In various places, it is labeled FESFLO, FeSFLOW, FeSFlow, and FESFLOW. For

simplicity’s sake, the undersigned will rely on the spelling and capitalization utilized in the

Assignment document, without attempting to reconcile these myriad discrepancies.

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“discovered an error” in his testimony, and that the proper ammonium chloride fraction was

0.1% for every 1% THPS, or a total of 0.5% ammonium chloride for the 5% THPS solution. (Id.

at 140-41.) Such testimony could certainly be used at trial to challenge Gipson’s credibility. 

But the Court finds for summary judgment purposes that Gipson’s lack of clarity as to the

specific formula of the ‘048 Patent, in a deposition taken more than six years after the invention

was made, does not preclude Gipson from showing by clear and convincing evidence that he, in

fact, invented SWP-105. Inventorship and ability to recall specifics of that invention many years

later are two entirely different questions.

For all of these reasons, there are genuine issues of material fact as to whether Gipson

will be able to demonstrate at trial by clear, convincing and corroborated evidence that he

invented the formula that is the subject of the ‘048 Patent. Accordingly, Mattox’s Motion for

Summary Judgment (doc. 43) is denied as to that issue.

C. Sufficiency of Plaintiffs’ Evidence of Assignment.

In the alternative, Mattox argues that even if there is sufficient evidence of Gipson’s

inventorship to withstand Rule 56 review, ChemTech’s claims must be dismissed because there

is no evidence that Gipson ever assigned his rights to the invention covered by the ‘048 Patent to

ChemTech.

On September 30, 2005, less than three weeks before suit was filed, Gipson and

ChemTech executed a one-page document labeled “Assignment of Rights to Invention.” 

(Plaintiffs’ Exh. B.) The Assignment provides that Gipson assigned all of his rights, title and

interest in “Gipson’s invention relating to a method and composition to decrease iron sulfide

deposits in pipelines and other conduits (the “Invention”) which is currently being marketing

[sic] by ChemTech under the trademark ‘FESFLO’, ... including, but not limited to any patent

rights....” (Id.) The scope of this Assignment is challenged by Mattox on summary judgment. It

is undisputed that FESFLO is a different product, a different formula, and a different invention

than SWP-105.15 (Gipson Dep. at 189.) Plaintiffs submit affidavits from both Martin Stephens

Case 1:05-cv-00601-WS-C Document 54 Filed 11/27/06 Page 13 of 20
16 Gipson testified in his deposition that “FeS Flow is not the same as the 048

patent.” (Gipson Dep., at 123.) He repeated the point emphatically: “I’m saying [the ‘048

patent] is different from FeS Flow.” (Id. at 131.) In further testimony, he indicated as follows:

A: The assignment was FeS Flow.

Q: And not for the 048 patent; correct?

A: Not for the 048 patent.

Q: Thank you. So it is your claim you have developed two inventions, two different

formulas; is that right?

A: They’re two different formulas. So, yes.

(Id. at 135.) Gipson has signed no other assignment for ChemTech’s benefit. (Id. at 127, 132.)

17 See Harbison v. Strickland, 900 So.2d 385, 391 (Ala. 2004) (“It is elementary that

it is the terms of the written contract, not the mental operations of one of the parties, that control

its interpretation.”); Fadalla v. Fadalla, 929 So.2d 429, 438 (Ala. 2005) (“General rules of

contract interpretation require that the intent of the parties be derived from the words of the

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(President of ChemTech) and Gipson himself stating their understanding that the Assignment

encompasses all of Gipson’s rights and interests in any inventions relating to methods for

decreasing iron sulfide deposits in pipelines and other conduits, without limiting it to FESFLO. 

(Stephens Aff., ¶ 4; Gipson Aff., ¶ 4.)

The Assignment is unambiguous that it is limited to an invention “which is currently

being marketing [sic] under the trademark ‘FESFLO.’” Likewise, the record is clear that

FESFLO is not the same as Patent ‘048 or SWP-105, but is instead an altogether different

invention for removing iron sulfide deposits.16 FESFLO is not at issue in, and does not appear

relevant to, this lawsuit. These undisputed facts create standing problems for ChemTech,

inasmuch as Gipson has never assigned his ‘048 Patent rights to ChemTech, yet ChemTech is

litigating this action as a plaintiff to vindicate precisely those rights, which do not belong to it. 

ChemTech would overcome this defect by pointing to evidence that both signatories intended the

Assignment to embrace the invention that is the subject of the ‘048 Patent as well. (Opposition

Brief, at 8.) But the agreement is unambiguous. Irrespective of whether the assignment is

governed by Alabama or Mississippi law, the meaning of an unambiguous contract is derived

from the plain meaning of its terms, rather than from the parties’ extrinsic evidence as to their

subjective intent.17 Because the Assignment is unambiguously confined on its face to an

Case 1:05-cv-00601-WS-C Document 54 Filed 11/27/06 Page 14 of 20
contract, unless an ambiguity exists.”); Royer Homes of Mississippi, Inc. v. Chandeleur Homes,

Inc., 857 So.2d 748, 752-53 (Miss. 2003) (“Only if the contract is unclear or ambiguous can a

court go beyond the text to determine the parties’ true intent.”).

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assignment of FESFLO, Gipson and ChemTech cannot rewrite it after the fact to embrace an

assignment of the formula for the ‘048 Patent, as well. Plaintiffs are bound by the plain language

of their Assignment.

At present, then, ChemTech lacks standing to pursue Gipson’s patent inventorship claims

against Mattox. Of course, there is a simple solution to this technical defect, one which plaintiffs

could and should have performed as soon as Mattox raised this shortcoming. They could simply

execute a new assignment, specifically including Gipson’s rights and interests (if any) in the

invention covered by the ‘048 Patent. Both Gipson and ChemTech express willingness to

execute another assignment to effectuate this objective. (Stephens Aff., ¶ 4; Gipson Aff., ¶ 4.) 

For whatever reason, they have not done so. If ChemTech wishes to remain a plaintiff in this

litigation, it must promptly execute an appropriate assignment with Gipson. If such an

assignment is not executed and filed on or before December 15, 2006, ChemTech’s claims will

be dismissed without prejudice for lack of standing.

IV. Analysis of Plaintiffs’ Motion Regarding Affirmative Defenses.

Plaintiffs have filed a dispositive motion (doc. 41) of their own, relating to certain

affirmative defenses. Mattox’s Answer (doc. 26) interposed the following affirmative defenses,

among others: (a) Gipson was an employee of SWM at all times relevant to development of

technology covered by the ‘048 Patent, and was subject to an employment agreement regarding

intellectual property (Defense #1); (b) misappropriation of trade secrets (Defense #3); and (c)

breach of employment agreement (Defense #4). (Answer, at 2.) Defenses #1 and #4 are

overlapping, and plaintiffs request summary judgment as to them for failure to comport with the

Statute of Frauds. As for Defense #3, plaintiffs ask that it be stricken as irrelevant.

A. Employment Agreement Defenses.

Alabama’s Statute of Frauds provides, in pertinent part, that “[e]very agreement which,

by its terms, is not to be performed within one year” is “void unless such agreement ...

expressing the consideration is in writing and subscribed by the party to be charged.” Ala. Code

Case 1:05-cv-00601-WS-C Document 54 Filed 11/27/06 Page 15 of 20
18 In addition to Mattox’s deposition testimony, there was sworn testimony at a state

court hearing provided by both Mattox and Julie Andrews (a secretary at Mattox’s company) that

Gipson executed such an agreement. At the hearing, Mattox testified that Gipson signed the

employment agreement in Mattox’s presence. (Defendants’ Exh. B (doc. 48), at R-9.) Andrews

testified that she did not observe Gipson signing the document, but that she did see the original

of that agreement with Gipson’s signature immediately after he executed it. (Id. at 6.)

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§ 8-9-2(1). The parties agree that a written employment agreement between Gipson and SWM is

needed to satisfy the Statute of Frauds. (Plaintiffs’ Motion (doc. 41), at 4; Defendant’s Brief

(doc. 48), at 2, 5.) Mattox testified that he does not have a copy of any agreement executed by

Gipson in connection with his employment by SWM, and no such document appears in the

record. (Mattox Dep., at 8-9, 98.) On that basis, plaintiffs argue that defendant’s affirmative

defenses relating to the employment agreement are barred by the Statute of Frauds. Stated

differently, even if Gipson did sign an employment agreement with SWM, even if that agreement

did cover intellectual property, and even if Gipson’s claim of ownership in the ‘048 Patent is

violative of that agreement, plaintiffs maintain, the Alabama Statute of Frauds and the absence of

any written agreement in the record preclude Mattox from establishing such a defense, as a

matter of law.

If there were no evidence that Gipson had signed an employment agreement, Defenses #1

and #4 could be quickly dispatched on Statute of Frauds grounds. But that’s not what happened

here. To the contrary, the record includes substantial evidence that Gipson executed a written

employment agreement at SWM. (Mattox Dep., at 88-89, 96.)18 There is also evidence that this

agreement “covered confidential, intellectual property regarding ownership assignment to the

company, trade secrets.” (Id. at 92.) More specifically, the agreement protected intellectual

property developed by an employee during his employment. (Defendant’s Exh. B, at 4.) Mattox

has a “template” of the agreement that Gipson signed, so its specific terms are available in this

action. (Mattox Dep., at 88-89.) According to Mattox, however, the signed agreement vanished

from his office when Gipson separated from the company, prompting Mattox to conclude that

Gipson had stolen it. (Id. at 89.)

Plaintiffs’ Motion for Summary Judgment contends that the mere fact that no written

contract now exists means that Defenses #1 and #4 are violative of the Statute of Frauds. The

Case 1:05-cv-00601-WS-C Document 54 Filed 11/27/06 Page 16 of 20
19 Courts in other jurisdictions have adopted these principles in similar fact

scenarios. See, e.g., McInnis v. Lind, 108 P.3d 578, 582 n.2 (Or. App. 2005) (observing many

common-law exceptions to statute of frauds’ prohibition on parol evidence of agreement,

including where writing is lost or is in possession of adverse party); Latino Food Marketers, LLC

v. Ole Mexican Foods, Inc., 2003 WL 23220142, *5 (W.D. Wis. Aug. 20, 2003) (“if the parties

did indeed form a contract that met the requirements of the statutes of frauds, the contract is

enforceable even if the writing is lost or destroyed”); Connecticut Bank & Trust Co. v. Wilcox,

518 A.2d 928, 931 (Conn. 1986) (“the loss or destruction of a memorandum does not deprive it

of effect under the Statute of Frauds,” where the writing can be proven by secondary evidence). 

This line of authority is echoed by Section 137 of the Restatement (Second) of Contracts. See

also comment a (“In cases of loss or destruction, the contents of a memorandum may be shown

by an unsigned copy or by oral evidence.”); 4 Corbin on Contracts § 23.10 (2006) (“If the

requirements of the statute of frauds are satisfied by a signed contract or memorandum, the

contract remains enforceable even though the writing is lost or destroyed. The contents of the

writing can then be proved by parol testimony and the contract enforced.”). And Justice

Johnstone of the Alabama Supreme Court has opined that when a writing required by Alabama’s

Statute of Frauds “has been lost or destroyed, it may be proved by secondary evidence” pursuant

to Rule 1004(1) of the Alabama Rules of Evidence. Holman v. Childersburg Bancorp., 852

So.2d 691, 702 (Ala. 2002) (Johnstone, J., concurring).

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Court cannot adopt this strained logic. That no written agreement has been produced today does

not require a conclusion that no such document ever existed. If a written agreement previously

existed, but was lost, destroyed, or purloined, then defendant can introduce evidence to that

effect in order to satisfy the Statute of Frauds. See Rule 1004(1), Fed.R.Evid. (allowing

secondary evidence of a writing if the originals have been lost or destroyed); Klein v. Frank, 534

F.2d 1104, 1108 (5th Cir. 1976) (describing “generally accepted rule that if the party relying upon

the writing can prove that a writing existed and has been lost or destroyed, he is relieved of the

burden of producing the original and can present secondary evidence of its contents”); Sims v.

Callahan, 112 So.2d 776 (Ala. 1959) (secondary evidence deemed admissible if writing

constituting primary evidence is shown to have been lost or destroyed without fault of party

desiring to prove the fact).19

Because the evidence taken in the light most favorable to the non-movant demonstrates

that the requisite written employment agreement was executed, but has simply been lost,

destroyed, or stolen, the Statute of Frauds does not bar these defenses. Accordingly, Plaintiffs’

Case 1:05-cv-00601-WS-C Document 54 Filed 11/27/06 Page 17 of 20
20 As an aside, plaintiffs suggest that even if there were a written employment

agreement, Mattox was not a party to it and lacks standing to invoke it as a defense. (Plaintiffs’

Motion, at 5-6.) At trial, this argument may have merit. At this juncture, however, movants

offer no evidence that (a) the written agreement claimed by defendant lacked a valid assignment

of intellectual property by Gipson to SWM (or its successor), or (b) SWM (or it successor) failed

to assign its rights in SWP-105 to Mattox for patent purposes. Absent such a showing, this

theory cannot be eliminated from consideration on summary judgment. Stated differently, if

Gipson promised in an enforceable written contract to assign rights to intellectual property he

developed in SWM’s employ to SWM, if Gipson developed the SWP-105 formula while

working for SWM, and if SWM in turn assigned its rights in SWP-105 to Mattox in connection

with the ‘048 Patent, then the employment agreement could be both relevant and admissible.

-18-

Motion for Summary Judgment as to Defenses #1 and #4 is denied.

20

B. Misappropriation of Trade Secrets Defense.

Finally, plaintiffs seek to strike Defense #3, which alleges that Gipson misappropriated

trade secrets from SWM. In a cursory one-paragraph argument, plaintiffs maintain that this

defense is simply irrelevant to the inventorship issues at the heart of this action. (Motion, at 2.) 

Defendant’s response inexplicably ignores plaintiffs’ relevance objection, but instead identifies

the trade secrets that Gipson is alleged to have misappropriated, including not only the formula

of SWP-105, but also “processes and methods of application of said technology.” (Opposition

Brief, at 1.)

The Court understands Mattox’s view that the simple chemical formula of SWP-105 is

not sufficient to use the product effectively, without knowledge of the particular manners and

methods of applying that product. The Court also understands Mattox’s position that those

manners and methods of application are trade secrets of SWM, are “not contained in” the ‘048

Patent, and are not public information. What the Court does not understand is why any of this

matters in a case litigating inventorship rights in the ‘048 Patent. If everything Mattox says

about trade secrets is correct (e.g., that the application methods are trade secrets of SWM, that

those methods are outside the scope of the ‘048 Patent, and that Gipson stole those trade secrets

from SWM), how do those facts have any bearing on whether Gipson is entitled to inventorship

status for the ‘048 Patent? Defendant has never answered this question, despite it being squarely

presented by plaintiffs’ Motion. The Court does not perceive any manner in which

misappropriation of trade secrets could pose a viable defense to Gipson’s inventorship claims. If

Case 1:05-cv-00601-WS-C Document 54 Filed 11/27/06 Page 18 of 20
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the alleged trade secrets are outside the scope of the ‘048 Patent, then they are clearly not

germane to this action because this action is confined to the ‘048 Patent. If those trade secrets

are embedded within the claims of the ‘048 Patent, then the question of misappropriation

remains distinct from that of inventorship. If SWM conceived those trade secrets, then that

conception is the end of the patent inquiry. That Gipson may have later misappropriated such

trade secrets is logically irrelevant.

For these reasons, the injection of misappropriation of trade secrets issues into this

litigation is unwarranted, and would only serve to cloud the issues at trial. Defendant has not

articulated any plausible scenario in which Gipson’s alleged misappropriation of trade secrets

might be a defense to plaintiffs’ inventorship claim. The only question presented by this

litigation is who invented the invention covered by the ‘048 Patent. What might have happened

after conception, or what Gipson might have done with respect to techniques and processes

outside the patent, is entirely collateral. It would be an inefficient use of litigants’ and judicial

resources to devote time and attention to this collateral matter at trial. Accordingly, Defense #3

is stricken. 

V. Conclusion.

For all of the foregoing reasons, it is hereby ordered as follows:

1. Defendant’s Motion for Summary Judgment (doc. 43) is denied.

2. Because neither side has performed a claim-by-claim analysis and it appears

unlikely that all 12 claims within the ‘048 Patent are legitimately in dispute, the

parties’ respective counsel are ordered to conference (telephonically or

otherwise) on or before December 8, 2006 to discuss whether there is a bona fide

disagreement as to Mattox’s inventorship status for each of the 12 claims. The

parties are ordered to file a joint status report, on or before December 15, 2006,

stating the results of this conference and identifying which particular claims of the

‘048 Patent are disputed.

3. Defendant has correctly argued that the Assignment from Gipson to ChemTech

excludes Gipson’s interests in the ‘048 Patent. As such, ChemTech presently

lacks standing. If ChemTech wishes to remain a plaintiff, it must execute an

Case 1:05-cv-00601-WS-C Document 54 Filed 11/27/06 Page 19 of 20
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appropriate assignment with Gipson, and file same on or before December 15,

2006. Failure to do so will result in dismissal of ChemTech’s claims without

prejudice.

4. Plaintiffs’ Motion to Strike an Affirmative Defense and for a Summary Judgment

on Two Affirmative Defenses (doc. 41) is granted in part, and denied in part. 

The summary judgment aspect of the Motion is denied; however, the Motion to

Strike is granted, and Defense #3 (misappropriation of trade secrets) is stricken

from the Answer as irrelevant to these proceedings.

DONE and ORDERED this 27th day of November, 2006.

s/ WILLIAM H. STEELE 

UNITED STATES DISTRICT JUDGE

Case 1:05-cv-00601-WS-C Document 54 Filed 11/27/06 Page 20 of 20