An optoelectronic package allows transmission of light carrying data at high speeds over fiber optic networks. In the 1990s, engineers Frank T. Shum and Jean-Marc Verdiell worked together on optoelectronic packaging. After they split up, each separately applied for and received U.S. patents in the optoelectronic packaging field. Mr. Verdiell later sold his company to Intel, which thus became the owner of the patent that Mr. Verdiell obtained.
Mr. Shum learned of the Verdiell-Intel patent in 2001and filed suit in federal court to declare himself, as a matter of patent law, at least a co-inventor. He also alleged that Mr. Verdiell procured the Verdiell-Intel patent by failing to disclose to the U.S. Patent and Trademark Office Mr. Shum's status as a co-inventor. The district court chose to hold a bench trial on the inventorship question before reaching the state law fraud and unjust enrichment claims. Mr. Shum lost the trial. Relying on its findings and conclusions in the bench trial, the district court later granted summary judgment on the state law claims. Shum v. Intel Corp., No. 06-1249 (Fed. Cir. Aug. 24, 2007).
The Federal Circuit, by 2-1, reversed. The majority held that the seventh amendment guaranteed Mr. Shum a trial by jury on his state law claims and that the bench trial of the patent-law inventorship question deprived him of that right. It concluded that the fraud claim required a finding that Mr. Shum conceived the invention before Mr. Verdiell did and that the claim therefore inextricably intertwined with the inventorship issue. Under Beacon Theatres, Inc. v. Westover, 359 U.S. 500 (1959), and Dairy Queen, Inc. v. Wood, 369 U.S. 469 (1962), the court determined, a jury trial of the state law claims had to go first. The court also reversed summary judgment on the unjust enrichment claim, holding (contrary to the district court) that it did not "merely duplicate" the fraud claim under California law.
The outcome reaffirms that courts may not fence jury trial rights by postponing jury trial until after a bench trial and using the findings in the bench trial to resolve the issues to which the jury trial right attaches.
Barry Barnett
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