Opinion
00 Civ. 00503 (MBM).
June 21, 2001
MORRIS E. COHEN, ESQ. and ANDREW S. LANGSAM, ESQ., Levisohn Lerner Berger Langsam, New York, NY., (Attorneys for Plaintiff).
BRAD ADOLPHSON, ESQ., Ware Fressola Van der Sluys Adolphson, Monroe, CT., (Attorney for Defendants),
OPINION AND ORDER
Plaintiff, New Century Manufacturing, Inc. ("New Century"), sues Vacu-Products, Vacu-Vin and The Corkscrew Store for patent infringement. Defendants Vacu-Products and Vacu-Vin move to dismiss New Century's complaint, arguing (a) that New Century is not a real party in interest, and (b) that New Century lacks the capacity to sue under New York law. For the reasons set forth below, defendants' motion is denied.
I.
This dispute relates to Patent No. 4,324,111 entitled "Freezing Gel Containment Structure and Method" (the "'111 Patent"), which was issued to Jerry B. Gallant on April 13, 1982. (Compl. ¶ 15). The '111 Patent was assigned to New Century Marketing Distributors, an affiliate of plaintiff, on November 17, 1995, (see Def. Mem., Exh. A, B), and subsequently was assigned to plaintiff on August 12, 1999. (See Pl. Reply Mem. Exh. A) The complaint alleges that defendants have infringed on the '111 Patent by "making, using, selling and offering to sell a line of products which incorporate the claimed inventions of the '111 Patent." (Compl. ¶ 16).
II.
Defendants argue first that the complaint should be dismissed because New Century is not a real party in interest in this action. According to defendants, the U.S. Patent Trademark Office has no record of the '111 Patent having been assigned to New Century; only the assignment from Jerry B. Gallant to New Century Marketing Distributors is on file. Accordingly, defendants argue that New Century is not a proper assignee of the '111 Patent and cannot maintain this suit. However, recordation in the Patent Trademark Office is not a prerequisite for assignment of a patent. See 35 U.S.C. § 261 (1994). United States law requires only that the assignment of a patent be in writing. Id.
Here, New Century has submitted a copy of a patent assignment dated August 12, 1999, in which New Century Marketing Distributors, Inc. assigns to New Century "the entire right, title and interest" in the '111 Patent. (See Pl. Reply Mem., Exh. A) This evidence is sufficient to demonstrate that New Century is the assignee of the '111 Patent, and a real party in interest in this suit. See Shattuck v. Hoegl, 523 F.2d 509, 511 (2d Cir. 1975) (noting that assignees of patents were real parties in interest in patent infringement suit).
Defendants argue also that dismissal is appropriate because plaintiff is a dissolved corporation and, as such, has no capacity to sue or be sued. However, the only evidence submitted by defendants to prove New Century's dissolution is an unverified copy of a computer printout from the "Corporations Public Inquiry System," which appears to list New Century as a dissolved corporation. (See Def. Reply Mem., Exh. A). Even if this evidence is sufficient to support a finding that New Century is a dissolved corporation, defendants' argument is without merit.
Under Fed.R.Civ.Pro. 17(b), the capacity of a corporation to sue or be sued is determined by the law of the jurisdiction where the corporation was organized. Here, the complaint alleges that New Century was organized under the laws of New York. (See Compl. ¶ 1). Accordingly, New York law controls whether or not New Century has capacity to bring the present suit.
N.Y. Business Corporation Law § 1006 provides that a dissolved corporation "may continue to function for the purpose of winding up its affairs in the same manner as if the dissolution had not taken place." N.Y. Bus. Corp. § 1006 (McKinney, 1986) Moreover, § 1006(4) further provides that, in the process of winding up its affairs, a dissolved corporation "may sue or be sued in all courts and participate in actions and proceedings." Id. Accordingly, under New York law, New Century has the capacity to sue or be sued even if it has been dissolved. See, e.g., Harris v. Michael Gangi Plumbing Heating Contractors, 221 A.D.2d 833, 633 N.Y.S.2d 691 (3d Dep't 1995) (holding that corporation dissolved by proclamation of Secretary of State may sue or be sued).
Defendants cite Lorisa Capital Corp. v. Gallo, 119 A.D.2d 99, 506 N.Y.S.2d 62 (2d Dep't 1986) to support their argument that New Century lacks capacity to sue. However, defendants' reliance on Lorisa is misplaced. In Lorisa, the court set forth a narrow exception to the general rule that dissolved corporations may sue and be sued, holding that, because a dissolved corporation may not conduct new business, it may not sue to recover obligations arising from that new business. See also Metered Appliances, Inc. v. 75 Owners Corp., 225 A.D.2d 338, 638 N.Y.S.2d 631 (1st Dep't 1996).
Here, New Century is not suing to enforce rights it acquired after its alleged dissolution. New Century acquired the '111 Patent on August 12, 1999, and defendants alleged infringement began even earlier. (See Compl. ¶ 19). New Century's purported dissolution did not occur until December 29, 1999. Unlike the plaintiff in Lorisa, therefore, New Century seeks to enforce rights it held in the '111 Patent prior to its dissolution. Accordingly, under New York law, New Century has the capacity to sue to enforce its rights under the '111 Patent. See N.Y. Bus. Corp. § 1006.
For the reasons set forth above, defendants' motion to dismiss the complaint is denied.