Opinion ID: 779248
Heading Depth: 2
Heading Rank: 1

Heading: The Parties' Marketing Relationship

Text: 2 In 1992, Vanguard and PEAT's predecessors, Plasma Energy Applied Technology, Inc. (Plasma Energy) and its parent corporation, Mason & Hanger National, Inc., entered into a series of contracts enabling Vanguard to license and market Plasma Energy's TDR technology. Plasma Energy filed a U.S. patent application on its TDR technology in 1994, and two years later, PEAT was incorporated and acquired most of the assets of Plasma Energy. The `659 patent, entitled an Apparatus and Method for Treating Hazardous Waste, issued on July 9, 1996, and was assigned to PEAT. 3 On December 10, 1997, Vanguard and PEAT entered into a two-year Marketing and Licensing Agreement (Agreement) that continued their relationship. Vanguard subsequently marketed the TDR technology as PEPS, which stood for Plasma Energy Pyrolysis System. The Agreement provided that [a] license to use or operate, with appropriate royalties, will be negotiated and included in each contract for the delivery of a PEPS to [Vanguard] by PEAT. 4 In late 1997, Vanguard entered into a contract with the Tennessee Valley Authority (TVA) for which Vanguard subcontracted PEAT to construct a waste disposal unit incorporating the TDR technology. The parties refer to the TVA project as a Phase I System and the system developed for the TVA project as a Fixed System. A version of the Fixed System that can be taken apart and moved sometimes is called a transportable fixed system, to distinguish it from a Mobile System, or Phase II System, which is built and then transported by flatbed to a customer's property. In June 1998, Vanguard was named a sub-contractor to build a Mobile System for the U.S. Army and Navy. PEAT and Vanguard did not enter into a sub-contract for this work. The Agreement expired under its own terms on December 10, 1999. 5 On February 15, 2000, PEAT wrote Vanguard asserting that Vanguard no longer ha[d] the right to market PEAT's TDR technology under any name, or to use PEAT['s] Intellectual Property for the development of future contracts relating to TDR or PEPS technology. According to Vanguard, PEAT's counsel had contacted the Department of the Army and implied that the Phase II System uses PEAT's technology without a license. Vanguard asserts that on August 31, 2000, representatives of the Department of Defense and the Senate Armed Services Committee questioned Vanguard about the Mobile System's use of PEAT's technology. Vanguard contends that at the same time it learned of an alleged effort by PEAT to block Congressional funding of the Phase II contract.