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Betak v. Miftakhov

United States District Court, N.D. California

October 31, 2019

GEORGE BETAK, Plaintiff,
v.
VALERY MIFTAKHOV, et al., Defendants.

          ORDER RE: DEFENDANTS' MOTIONS TO DISMISS RE: DKT. NOS. 22, 30

          JACQUELINE SCOTT CORLEY, UNITED STATES MAGISTRATE JUDGE.

         George Betak sues Electric Motor Werks, Inc. (“EMW”), Enel X North America (“Enel X”) (together, “Corporate Defendants”), and Valery Miftakhov for correction of inventorship of two patents related to Plaintiff's work on an electric vehicle charging product. (Dkt. No. 1 at 2.)[1]Before the Court are Corporate Defendants' and Mr. Miftakhov's motions to dismiss, (Dkt. Nos. 22 & 30), pursuant to Federal Rule of Civil Procedure 12(b)(6).[2] After careful consideration of the parties' briefing and having had the benefit of oral argument on October 30, 2019, the Court DENIES Defendants' motions.

         BACKGROUND

         I. The Parties

         A. Plaintiff

         Plaintiff is an “electrical engineer, software engineer, and computer scientist.” (Dkt. No. 1 at ¶ 12.) He has worked for multiple “technology and automotive companies in the United States and Europe, ” and “holds a Master of Science degree in Computer Science.” (Id.) Plaintiff is “well-known in the local and national electric vehicle community” through his role as “co-founder and former President of a non-profit organization called the San Francisco Bay Area Nissan LEAF Owners Association” (“SF BayLEAF”), as well as other “work in the electric vehicle community.” (Id. at ¶¶ 14-19.) He resides in California. (Id. at ¶ 1.)

         B. Defendants

         EMW is a corporation organized under Delaware law, with its principal place of business in California. (Id. at ¶ 3.) It is “registered to do business in California and can be served through its agent for service of process, ” Mr. Miftakhov. (Id.) EMW applied for and was granted two patents that are the subject of this litigation (“Patents at Issue”). (See Dkt. No. 1, Exs. A-B at 30-56.)

         Enel X[3] is a corporation organized under Delaware law, with its principal place of business in Massachusetts. (Dkt. No. 1 at ¶ 4.) On October 25, 2017, Enel X acquired EMW for approximately $153, 460, 000. (Id. at ¶ 69.) Through this transaction Enel X acquired “EMW's assets, including all of EMW's patents, patent applications, and other intellectual property.” (Id. at ¶ 70.) EMW remains in operation, however. (Id. at ¶ 77.)

         Mr. Miftakhov is the current Chief Executive Officer (“CEO”) of EMW “and a substantial shareholder of that entity.” (Id. at ¶¶ 2, 77.) He has held the position of CEO at all times relevant to the instant action. (Id.) The Patents at Issue identify Mr. Miftakhov as an inventor. (See Dkt. No. 1, Ex. A at 30, Ex. B at 43.)

         II. Complaint Allegations

         The gravamen of the complaint is that Plaintiff contributed to the conception of certain technologies reflected in the Patents at Issue, but those patents do not identify him as an inventor.

         A. The JuiceBox/JuiceNet Project

         Plaintiff met Mr. Miftakhov at an SFBayLEAF meeting in July 2013. (Dkt. No. 1 at ¶ 21.) Mr. Miftakhov was promoting an EMW fundraising campaign “to fund the development and production of an open source do-it-yourself kit for building a level 2 electric vehicle charging station” that would use a 240-volt outlet instead of the 120-volt outlet used in level 1 charging stations. (Id. at ¶ 22.) EMW's fundraising campaign advertised “its charging station, known as ‘JuiceBox, '” as a less expensive version of “other level 2 charging stations” on the market at the time. (Id.) Plaintiff and Mr. Miftakhov “discussed their shared interest in electric vehicles and their involvement in the electric vehicle industry” and “remained in contact after the event.” (Id. at ¶ 23.)

         In May 2014, Plaintiff met with Mr. Miftakhov “and proposed the idea of making a new JuiceBox product in which every JuiceBox unit would be Wi-Fi-enabled and ‘connected' to the internet.” (Id. at ¶ 24.) Plaintiff further proposed enabling the new product to “collectively operate in communication with other entities and information sources, such as grid operators and energy providers.” (Id.) Plaintiff then worked with Mr. Miftakhov “and others to refine the system that [Plaintiff] had envisioned, through periodic communications, meetings, and ‘brainstorming' sessions.” (Id. at ¶ 25.) “Through these joint efforts, they determined that the system that [Plaintiff] contemplated could use cloud-based software and data from grid operators and energy providers to automatically charge the electric vehicles during periods when the energy providers and grid operators offered electricity at lower prices.” (Id.) Further, “by controlling the collective network of JuiceBox charging stations, the system that Plaintiff . . . conceived and helped refine could generate a new revenue stream.” (Id. at ¶ 27.)

         On May 21, 2014, Mr. Miftakhov “approached Plaintiff . . . about collaborating on the next generation of JuiceBox product, which would include the connectivity features that [Plaintiff] had proposed.” (Id. at ¶ 28.) The product that “eventually resulted from this collaboration was controlled using a platform called ‘JuiceNet,' which included, among other things, software and a mobile device application that uses historical patterns, real-time input, and data from energy providers, grid operators, and other sources to aggregate and manage charging station usage.” (Id.)

         In June 2014, Mr. Miftakhov and Plaintiff agreed that Plaintiff would join the JuiceBox/JuiceNet collaboration (the “Project”) “in a ‘co-founder sort of role' [in] the business that resulted from the . . . collaboration.” (Id. at ¶ 30.) Mr. Miftakhov proposed that the Project would proceed “under the auspices of a new company called EV Juice, Inc.” (“EV Juice”), instead of through EMW. (Id. at ¶ 31.) However, the Project did not proceed under EV Juice, and was instead held out by Mr. Miftakhov and EMW “as an EMW endeavor.” (Id. at ¶ 37.) Likewise, Mr. Miftakhov and EMW “held out Plaintiff . . . as part of the EMW organization, ” assigned him an EMW email account, and publicly identified him “as EMW's ‘VP, Business Development & Community'” on EMW's website.[4] (Id. at ¶¶ 37-38, 40.) “Because the [P]roject progressed under EMW, [Plaintiff] never worked for EV Juice, as an employee or otherwise.” (Id. at ¶ 37.)

         At the time Plaintiff and Mr. Miftakhov began collaborating on the Project, Plaintiff “was the only formally-trained engineer working on the [P]roject.” (Id. at ¶ 36.) Plaintiff worked fulltime on the Project for the first nine months, and “[o]ver the course of his work . . . with Miftakhov and others, [Plaintiff] conceived, or helped conceive many significant inventions that were ultimately incorporated into the [P]roject.” (Id. at ¶ 44.) These inventions include:

(1) “making every JuiceBox ‘connected' via Wi-Fi and the JuiceNet cloud-based software, including with the grid operators and energy providers, so that the resulting system can automatically charge the electric vehicles during times when electricity is inexpensive and reduce charging when the grid operators and energy providers offer incentives for reducing electricity usage”;
(2) “adding and communicatively coupling a revenue-grade electric meter with each JuiceBox charging station”; and
(3) “using a ‘user preference' approach for the software controlling each JuiceBox charging station, in which the user would enter their charging preferences . . ., and the software would then model and control the charging station based on the user's preferences and their actual charging behavior.”

(Id. at ¶¶ 45-47.) Plaintiff also “actively participated and collaborated” in conceiving “many if not all of the other significant inventions associated with the [Project].” (Id. at ¶ 48.)

         Mr. Miftakhov and EMW filed patent applications with the United States Patent and Trademark Office (“USPTO”) that describe inventions that Plaintiff “invented or helped to invent, including by conceiving of the inventive elements described above” (the “Applications at Issue”). (Id. at ¶ 49.) Despite being aware of Plaintiff's “significant contributions to the conception of the inventions described and claimed in the Applications at Issue, ” Mr. Miftakhov and EMW did not identify Plaintiff “as an inventor in filing and prosecuting some of the[ ] applications.”[5] (Id. at ¶ 50.) Further, Mr. Miftakhov and EMW excluded Plaintiff “from the process of filing and prosecuting the Applications at Issue.” (Id.)

         B. The Patents at Issue

         In June 2018, the USPTO “granted and issued United States Patent No. 9, 987, 941, entitled ‘Systems and Methods for Local Autonomous Response to Grid Conditions by Electric Vehicle Charging Stations.'” (Id. at ¶ 54; see also id., Ex. A at 30-41 (the “'941 Patent”).) The '941 Patent issued from an application EMW filed on September 14, 2015. (Dkt. No. 1, Ex. A at 30.) The September 2015 application “claim[ed] priority to a provisional application that was filed” exactly one year earlier. (Dkt. No. 1 at ¶ 81; see also id., Ex. A at 30.) The '941 Patent includes Mr. Miftakhov, among others, as an inventor. (Dkt. No. 1, Ex. A at 30.) However, the “Patent does not identify [Plaintiff] as an inventor, ” despite Plaintiff's “contribut[ion] to the technologies claimed in the '941 Patent.” (Dkt. No. 1 at ¶ 54.)

         In July 2018, “the USPTO granted and issued United States Patent No. 10, 025, 277, entitled ‘Systems and Methods for Electrical Charging Load Modeling Services to Optimize Power Grid Objectives.” (Id. at ¶ 55; see also id., Ex. B at 43-56 (the “'277 Patent”).) The '277 Patent issued from an application EMW filed on January 24, 2016. (Dkt. No. 1, Ex. B at 43.) The January 2016 application “claim[ed] priority to a provisional application that was filed” on September 14, 2014. (Dkt. No. 1 at ¶ 87; see also id., Ex. B at 43.) The Patent lists the same inventors as listed for the '941 Patent, including Mr. Miftakhov. (Id.) And as with the'941 Patent, the '277 Patent does not include Plaintiff as an inventor, despite his “contribut[ion] to the technologies claimed in the '277 Patent.” (Dkt. No. 1 at ¶ 55.)

         Mr. Miftakhov and the other inventors identified in the Patents at Issue assigned their rights to the inventions claimed in the patents to EMW. (Id. at ¶ 56.) Plaintiff had no knowledge of, and did not consent to, that assignment. (Id.) Further, Plaintiff “did not execute, and has not executed, any assignments with regard to the Applications at Issue, or any patents that resulted from th[ose] applications.” (Id. at ¶ 57.)

         C. Enel ...


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