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M.A. Mobile Ltd. v. Indian Institute of Technology Kharagpur

United States District Court, N.D. California, San Jose Division

March 25, 2014

M.A. MOBILE LTD., a limited liability company chartered in Dominica; and MANDANA D. FARHANG, Plaintiffs,
v.
INDIAN INSTITUTE OF TECHNOLOGY KHARAGPUR, an Indian Institute of Technology incorporated under the

ORDER: (1) DENYING MOTION TO VACATE AND DISMISS ITT; (2) DENYING MOTION TO STAY DISCOVERY; (3) DENYING MOTION TO DISMISS CHAKRABARTI; (4) DENYING MOTION FOR JURISDICTIONAL DISCOVERY [Re: Docket Nos. 403, 413, 420, and 437]

RONALD M. WHYTE, District Judge.

In this case about breach of contract and misappropriation of trade secrets related to a joint venture to exploit a new mobile technology, Defendant Indian Institute of Technology, Kharagpur ("IIT") asks the court to vacate its prior ruling and dismiss IIT as immune under the Foreign Sovereign Immunities Act. Defendant Partha P. Chakrabarti moves the court to dismiss the claims against him pursuant to Federal Rule of Civil Procedure 12(h)(3) for lack of subject-matter jurisdiction based on immunity under the Foreign Sovereign Immunities Act and common law. For the reasons explained below, the court denies the motion to vacate and the motion to dismiss.

I. BACKGROUND

Plaintiffs Mandana Farhang and M.A. Mobile bring claims against alleged former co-participants in a joint venture, IIT and Chakrabarti.

A. The Parties

The IIT is an educational and research institution incorporated under the Indian Institutes of Technology of Act of 1961 with its principal place of business in Kharagpur, West Bengal, India. Third Am. Compl. ("TAC") ¶ 13, Dkt. No. 179. The Indian government funds and runs IIT. Id.

Chakrabarti, an Indian citizen, is Dean of Sponsored Research and Industrial Consultancy and Professor of Computer Science and Engineering at IIT. He is also Secretary and Permanent Member of the Governing Body of dismissed defendant Technology Entrepreneurship and Training Society ("TIETS"). TAC ¶ 15; Order dismissing TIETS, Dkt. Nos. 402, 404, 407 and 487).

Farhang is a citizen of Marin County, California and is the owner of M.A. Mobile, a Dominica chartered LLC operated from California. TAC ¶¶ 1, 8-9. M.A. Mobile is the owner of rights in a mobile device technology that enables dynamic data access and data parsing. TAC ¶¶ 11-12.

B. The Joint Venture

On approximately August 11, 2003, IIT entered into a Mutual Nondisclosure Agreement ("NDA") with plaintiff M.A. Mobile concerning the mobile device technology, which relates to a new platform for mobile computing. TAC ¶ 1. Chakrabarti acted as IIT's representative in signing the agreement. TAC ¶ 29. Farhang subsequently shared the technology with IIT. TAC ¶ 31. After reviewing the technology, defendants launched a joint venture with plaintiffs to exploit the technology through an entity called Cool e-mobile Pvt Ltd. TAC ¶ 33.

One of the early target customers for the technology of the joint venture was Indian Railways, with whom Chakrabarti claimed to have arranged a meeting in June 2004. TAC ¶ 37. Farhang also revealed to IIT that a likely exit strategy for the company would be through an acquisition by IBM. TAC ¶ 44. Plaintiffs allege that sometime in 2005, IIT improperly disclosed the joint venture trade secrets to IBM, and IBM subsequently won the technology deal with Indian Railways that Cool e-mobile sought. TAC ¶ 45(g).

C. Claims

Plaintiffs allege in the operative third amended complaint that IIT breached the NDA through its disclosure of confidential information to persons or entities not bound by its terms.

The TAC further alleges that IIT breached the joint venture agreement by "abandoning all efforts to further Technology on behalf of the Joint Venture, and instead working to deliberately move forward their own plans of commercialization at the expense of the Joint Venture." TAC ¶ 70.

With respect to Chakrabarti, the TAC alleges that he was a "key representative coordinating efforts of IIT[], TIETS [] and IIT[]'s affiliates to achieve their general business objectives under the technology consultancy and incubator, and to specifically gain access to Farhang's technology." TAC ¶ 15. The complaint further alleges that Chakrabarti was authorized by IIT and TIETS to enter into legally binding agreements on behalf of IIT and TIETS, id., and that Chakrabarti, "acting on behalf of IIT[]" entered into a non-disclosure agreement ("NDA") with M.A. Mobile. TAC ¶ 29.

The TAC finally alleges Chakrabarti accepted a role as Co-Founder and Chief Technology Officer ("CTO") of the joint venture in his individual capacity and then failed to fulfill his obligations to ...


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