Court Opinion

ID: 7801610
Source: CourtListenerOpinion
Date Created: 2022-08-18 14:07:45.511577+00
Date Added: 2024-06-11T16:29:18.636713
License: Public Domain

NOT FOR PUBLICATION WITHOUT THE
                               APPROVAL OF THE APPELLATE DIVISION
        This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the
     internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.

                                                        SUPERIOR COURT OF NEW JERSEY
                                                        APPELLATE DIVISION
                                                        DOCKET NO. A-1024-20
WALTER TORMASI,

          Appellant,

v.

NEW JERSEY DEPARTMENT
OF CORRECTIONS,

     Respondent.
___________________________

                   Submitted December 8, 2021 – Remanded January 26, 2022
                   Resubmitted February 15, 2022 – Decided August 18, 2022

                   Before Judges Hoffman, Whipple and Susswein.

                   On appeal from the New Jersey Department of
                   Corrections.

                   Walter Tormasi, appellant pro se.

                   Matthew J. Platkin, Acting Attorney General, attorney
                   for respondent (Jane C. Schuster, Assistant Attorney
                   General, of counsel; Christopher C. Josephson, Deputy
                   Attorney General, on the brief).

PER CURIAM
      Walter Tormasi, a State Prison inmate, appeals from a final agency

decision by the New Jersey Department of Corrections (DOC), denying his

request to file a patent infringement lawsuit against a computer company that he

alleges has infringed upon his patent. We were previously "constrained to

remand for DOC to clarify whether it approved or denied Tormasi's request [to

file a patent infringement lawsuit], and if denied, to provide a statement of

reasons to permit meaningful appellate review." Tormasi v. N.J. Dep't of Corr.,

A-1024-20 (Jan. 26, 2022) (slip op. at 2). We retained jurisdiction. Id. at 8.

      On February 2, 2022, DOC issued a revised decision and denied Tormasi's

request. After carefully reviewing the record in light of the governing legal

principles, we affirm.

      We presume the parties are familiar with the facts underlying this case.

We add that on January 26, 2022, we remanded to DOC for clarification on

whether the agency denied Tormasi's request to file a patent infringement

lawsuit. Id. at 2, 8. We determined that,

            [i]n this instance, the Administrator's initial response
            was so cryptic that we cannot even be sure whether it
            constitutes an acceptance or denial of Tormasi's request
            [to file a patent infringement lawsuit]. The replies to
            Tormasi's two administrative appeals via the electronic
            grievance system shed no light on the situation and
            reveal little more than the administration's irritation
            with Tormasi's persistence.

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                                       2
            [Id. at 6–7.]

      We further directed

            DOC to issue a clarified final decision within forty-five
            days of [our] decision. We offer[ed] no opinion on
            whether permission to file a patent infringement action
            in federal court should be granted. If the final agency
            decision is to deny Tormasi's request for permission to
            file a patent infringement suit, that decision shall
            include a statement of findings of fact and law that are
            sufficiently detailed to permit meaningful appellate
            review.

            [Id. at 8.]

      On February 2, 2022, in response to our remand, DOC issued a final

decision, denying Tormasi's request because he was in violation of the "no -

business" rule. In rendering its decision, DOC noted that pursuant to N.J.A.C.

10A:4-4.1(a)(3)(xviii) (.705),1 "[t]he [d]epartment's 'no business' rule prohibits

inmates from commencing or operating a business without prior approval from

the Administrator." DOC noted that Tormasi had been violating the no-business

rule since 2005, which is when he formed a company called Advanced Data

Solutions Corp. (ADS); he never sought prior approval from the Administrator

1
  We note that DOC's final agency decision indicates that the "no-business" rule
is codified at N.J.A.C. 10A:4-4.1(a)(3)(xix) (.705). Our research shows the "no-
business" rule is found in N.J.A.C. 10A:4-4.1(a)(3)(xviii) (.705).
                                                                            A-1024-20
                                        3
to form ADS. DOC also recognized that multiple federal courts have determined

that he was violating the no-business rule. See, e.g., Tormasi v. Hayman, 443

F. App'x 742 (3d Cir. 2011). In particular, DOC was persuaded by the Federal

Circuit's 2020 decision that concluded:

            Mr. Tormasi's lawsuit is in furtherance of his
            intellectual property business by taking certain business
            actions purely to preserve the commercial value of his
            intellectual property . . . . For instance, Mr. Tormasi
            asserts that he took "precautionary measures to ensure
            that [his] intellectual property remained enforceable,
            licensable, and sellable to the fullest extent possible
            . . . ." Mr. Tormasi further asserts that "[t]he purpose
            of [one of his] transfer[s] in ownership was to permit
            [himself] to . . . personally benefit from, an
            infringement action against WDC and other entities
            . . . ." Mr. Tormasi then sued WDC for infringing the
            '301 patent and sought damages of at least $5 billion
            . . . . Accordingly, Mr. Tormasi's patent infringement
            suit is in furtherance of operating an intellectual
            property business for profit, and, therefore, prohibited
            under the "no business" rule.

            [Tormasi v. W. Digit. Corp., 825 F. App'x 783, 788
            (Fed. Cir. 2020).]

      On February 15, 2022, we received a letter from Tormasi that contained

DOC's final decision. Tormasi's letter also requested that his appeal be re -

submitted. In his original appeal, Tormasi raised the following contention:

                                                                         A-1024-20
                                          4
            POINT I

            THE DEPARTMENT OVERSTEPPED ITS BOUNDS
            IN REFUSING TO APPROVE TORMASI'S
            LAWSUITS FOR FILING/LITIGATION.

            A.  LEGAL STANDARDS GOVERNING DOC
            RULING

            B. ALLOWANCE OF INTELLECTUAL-PROPERTY
            THEFT

            C. INJURY TO U.S. PATENT SYSTEM AND ITS
            BENEFICIARIES

            D. INCONSISTENCY WITH PRIOR DOC RULING

            E. VIOLATION OF ADMINISTRATIVE RULES
            AND REGULATIONS

            [Tormasi, A-1024-20 (slip op. at 5).]

      We begin our analysis by acknowledging certain basic principles

governing this appeal. The scope of our review of a final agency action is

limited. See R. 2:2-3(a)(2). A final agency action will be reversed only if it is

"arbitrary, capricious or unreasonable or it is not supported by substantial

credible evidence in the record as a whole." Henry v. Rahway State Prison, 81

N.J. 571, 580 (1980) (citing Campbell v. Dep't of Civ. Serv., 39 N.J. 556, 562

(1963)).   In applying this highly deferential standard, courts inquire into

"whether the decision conforms with relevant law, whether there is substantial

                                                                           A-1024-20
                                       5
credible evidence in the record as a whole to support the agency's decision, and

whether in applying the relevant law to the facts, the agency clearly erred in

reaching its conclusion." In re State & Sch. Emps.' Health Benefits Comm'ns'

Implementation of Yucht, 233 N.J. 267, 280 (2018).

      Importantly, the agency is required to make findings of fact and give a

statement of reasons.

            [D]eference does not require that we forego a careful
            review of administrative decisions simply because an
            agency has exercised its expertise. We cannot accept
            without question an agency's conclusory statements,
            even when they represent an exercise in agency
            expertise. The agency is "obliged . . . 'to tell us why.'"'

            [Balagun v. N.J. Dep't of Corr., 361 N.J. Super. 199,
            202–03 (App. Div. 2003) (quoting In re Valley Hosp.,
            240 N.J. Super. 301, 306 (App. Div. 1990))].

      Pursuant to N.J.A.C. 10A:4-4.1(a)(3)(xviii) (.705) (the "no-business"

rule) an inmate "commencing or operating a business or group for profit or

commencing or operating a nonprofit enterprise without the approval of the

Administrator" is subject to disciplinary actions or sanctions. Here, DOC denied

Tormasi's request because he has been violating the no-business rule since 2005,

the year in which he formed ADS without prior approval from the Administrator.

Additionally, DOC concluded, in reliance on the Federal Circuit's decision, that

filing a patent-infringement lawsuit on behalf of ADS would be in furtherance

                                                                          A-1024-20
                                        6
of his intellectual property business, and therefore would be a violation of the

no-business rule.

      The record before us supports DOC's determination that Tormasi never

sought approval from the Administrator to operate ADS. Further, filing a patent-

infringement lawsuit would be an attempt to preserve the commercial value of

his intellectual property, which is clear evidence of operating a business for

profit. See Tormasi, 825 F. App'x at 788. Accordingly, Tormasi has failed to

show that DOC has acted arbitrarily, capriciously, or unreasonably in denying

his request. We are satisfied, moreover, that the agency's final decision is

supported by substantial credible evidence in the record as a whole. R. 2:11-

3(e)(1)(D). To the extent we have not addressed them, any remaining arguments

raised by Tormasi lack sufficient merit to warrant discussion in a written

opinion. R. 2:11-3(e)(1)(E).

        Affirmed.

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