The opinion of the court was delivered by: Hon. Mitchell D. Dembin U.S. Magistrate Judge
ORDER ON JOINT MOTION FOR DETERMINATION OF DISCOVERY DISPUTE RE: DAMAGES DISCOVERY [Re: ECF No. 266]
Before the Court is the joint motion of the parties to resolve a discovery dispute. (ECF No. 266). Plaintiffs are seeking financial discovery regarding damages in connection with their surviving contract claims upon a theory of unjust enrichment. (ECF No. 266 at 6-8). Defendants assert that Plaintiffs are not entitled to this discovery because the Court has dismissed Plaintiffs' claim for unjust enrichment in its entirety. (ECF No. 266 at 9-11). Plaintiffs claim that despite the dismissal, they are entitled to claim damages for unjust enrichment in connection with the remaining contract claims in the case. (Id.). On June 15, 2012, this Court required the parties to submit supplemental briefing. The issue to be briefed was whether, considering the posture of this case, Plaintiffs may avail themselves of a theory of unjust enrichment as a remedy to their remaining breach of contract claims. (ECF No. 269). Briefs were filed as required by the Court. (ECF Nos. 272, 274, 275). In addition, on July 6, 2012, the Court requested further briefing on the issue of whether the requested discovery would impose an undue burden or expense upon Defendants. (ECF No. 276). Briefs on that issue also were filed as required by the Court. (ECF Nos. 282, 284).
Plaintiffs' surviving claims include a claim for breach of the 2006 Amended and Restated License Agreement between Trace Technologies, LLC and Snaptrack, Inc. That claim is limited to allegations that Snaptrack took ownership of Locate's patents, copyrights and other intellectual property rights and filed patent applications and patents without listing Locate as an assignee or Locate personnel as inventors. (ECF Nos. 53 at 28; 252 at 22). Also surviving are Plaintiffs' claims for correction of inventorship pursuant to 35 U.S.C. § 256 (ECF No. 53 at 29); and, for declaratory judgment of ownership interest in patents pursuant to 28 U.S.C. § 2201. (ECF No. 53 at 29-30).
As to the latter claims, it does not appear that Plaintiffs would be entitled to any financial remedy. Under 35 U.S.C. § 256, the only available remedies are correction, if the error in attribution was made without deceptive intent, or invalidity of the affected patents. Under 28 U.S.C. § 2201, declaratory relief is the sole remedy. Accordingly, the question before the Court is whether Plaintiffs may obtain discovery of financial information from Defendants based upon their surviving contract claims.
In dispute are Plaintiffs' notice for deposition pursuant to Fed.R.Civ.P. 30(b)(6) and related requests for production of documents. Plaintiffs identified nine topics in their Rule 30(b)(6) notice pertaining to Defendants' licensing, valuation and revenues for six patents owned by Defendants. Those patents, say Plaintiffs, were obtained or filed by Defendants in violation of the License Agreement between the parties.
In summary, Plaintiffs' topic areas request deposition testimony and documents reflecting:
1) the extent to which Defendants have licensed any of the six patents to others, separately or in packages with other patents, and the nature of those licenses;
2) the revenues received by Defendants for any licensing of any the six patents or for patent packages including any of the six patents; and,
3) any valuation of the six patents by Defendants individually or as part of a package.
Rather than assert specific objections, Defendants object to having to provide any discovery in response to the requests. The essence of Defendants' argument is that Plaintiffs cannot succeed on their breach of contract claim because it actually is based upon the dismissed claims of theft of trade secrets. And, even if Plaintiffs did prevail, financial remedies are not available because Plaintiffs' unjust enrichment claim has been dismissed and any financial remedy for the breach of contract is based upon a theory of unjust enrichment. Consequently, say Defendants, Plaintiffs are not entitled to the requested discovery.
Plaintiffs assert that they are entitled to financial remedy in the event that they prevail on their breach of contract claim and that a possible measure of damage is the extent ...