Opinion
Case No. 3:19-cv-508
03-31-2023
UNIVERSITY OF TENNESSEE RESEARCH FOUNDATION, Plaintiff, v. CAELUM BIOSCIENCES, INC. and the Trustees of Columbia University in the City of New York, Defendants.
Daniel P. Hipskind, Pro Hac Vice, Erin E. McCracken, Pro Hac Vice, Berger & Hipskind LLP, Beverly Hills, CA, Dorian S. Berger, Pro Hac Vice, Berger & Hipskind LLP, Los Angeles, CA, Wayne A. Ritchie, II, Ritchie, Dillard, Davies & Johnson, P.C., Knoxville, TN, for Plaintiff. Anna K. Finger, Pro Hac Vice, Christopher Strongosky, Pro Hac Vice, Michael David Hynes, Pro Hac Vice, DLA Piper LLP, New York, NY, John W. Elder, Lindsey M. Collins, Thomas Howard Jarvis, Paine Tarwater & Bickers LLP, Knoxville, TN, John Wellschlager, Pro Hac Vice, DLA Piper LLP, Baltimore, MD, Leeanne S. Mancari, Pro Hac Vice, DLA Piper LLP, Los Angeles, CA, for Defendant Caelum Biosciences, Inc. Jimmie C. Miller, Hunter, Smith & Davis, Kingsport, TN, John D. Murnane, Pro Hac Vice, Zachary L. Garrett, Pro Hac Vice, Becky E. Steephenson, Pro Hac Vice, Venable LLP, New York, NY, for Defendant The Trustees of Columbia University in the City of New York.
Daniel P. Hipskind, Pro Hac Vice, Erin E. McCracken, Pro Hac Vice, Berger & Hipskind LLP, Beverly Hills, CA, Dorian S. Berger, Pro Hac Vice, Berger & Hipskind LLP, Los Angeles, CA, Wayne A. Ritchie, II, Ritchie, Dillard, Davies & Johnson, P.C., Knoxville, TN, for Plaintiff. Anna K. Finger, Pro Hac Vice, Christopher Strongosky, Pro Hac Vice, Michael David Hynes, Pro Hac Vice, DLA Piper LLP, New York, NY, John W. Elder, Lindsey M. Collins, Thomas Howard Jarvis, Paine Tarwater & Bickers LLP, Knoxville, TN, John Wellschlager, Pro Hac Vice, DLA Piper LLP, Baltimore, MD, Leeanne S. Mancari, Pro Hac Vice, DLA Piper LLP, Los Angeles, CA, for Defendant Caelum Biosciences, Inc. Jimmie C. Miller, Hunter, Smith & Davis, Kingsport, TN, John D. Murnane, Pro Hac Vice, Zachary L. Garrett, Pro Hac Vice, Becky E. Steephenson, Pro Hac Vice, Venable LLP, New York, NY, for Defendant The Trustees of Columbia University in the City of New York. MEMORANDUM OPINION AND ORDER CHARLES E. ATCHLEY JR., UNITED STATES DISTRICT JUDGE
This matter concerns the 11-1F4 antibody, developed and used as a possible treatment for the rare disease of Amyloidosis. The Second Amended Complaint alleges that Caelum Biosciences, Inc. wrongfully used or otherwise interfered with the property rights, know-how, and trade secrets involving and concerning this 11-1F4 antibody, allegedly held by Plaintiff. The Second Amended Complaint further requests declaratory relief.
Before the Court is Defendant Caelum Biosciences, Inc.'s Motion to Dismiss the Second Amended Complaint. [Doc. 76]. Through this motion, Defendant argues inter alia that all claims against it are either preempted, counter to established law, or that Plaintiff failed to state a claim for which relief may be granted. For the reasons explained below, Defendant's Motion to Dismiss the Second Amended Complaint [Doc. 76] is GRANTED in part and DENIED in part.
I. PROCEDURAL BACKGROUND
University of Tennessee Research Foundation ("UTRF") filed this action against Caelum Biosciences, Inc. ("Caelum") in December 2019. [Doc. 1]. After Caelum filed a Motion to Dismiss, UTRF filed an Amended Complaint. [Doc. 30]. Caelum filed another Motion to Dismiss [Doc. 34], which this Court addressed in its Memorandum Opinion and Order [Doc. 60]. The Court held that Columbia University is a necessary party, withheld ruling on the Rule 12(b)(6) arguments from Caelum, and granted UTRF leave to amend its complaint once more. [Doc. 60].
In accordance with this Court's Order, UTRF filed its Second Amended Complaint. [Doc. 61]. Plaintiff included claims against The Trustees of Columbia University in the City of New York ("Columbia"). [Id.]. In its Second Amended Complaint, UTRF alleges the following against Caelum: (1) conversion; (2) slander of title; (3) interference with business relationship with Columbia University; (4) interference with business relationship with industry partners; and (5) unjust enrichment. [Id. at 41-59]. UTRF also brings breach of contract and misappropriation of trade secrets claims against Caelum. [Id. at 38-40, 59-62]. Finally, Plaintiff seeks several declaratory judgments from this Court concerning the ownership or rights to the 11-1F4 antibody and associated data, research, and the like. [Id. at 61-70].
Both Caelum and Columbia filed separate Motions to Dismiss. [Docs. 76, 88]. This Order specifically addresses Caelum's Motion to Dismiss [Doc. 76]. Through its Motion, Caelum argues this case should be dismissed because: (1) UTRF's tort and unjust enrichment claims are preempted by application of the Tennessee Uniform Trade Secrets Act; (2) UTRF otherwise fails to state its tort, unjust enrichment, breach of contract, and Tennessee Uniform Trade Secrets Act claims; and (3) because UTRF's declaratory judgment claims fail as a matter of law. [See Docs. 76, 77].
II. FACTUAL BACKGROUND
The Court accepts as true all factual allegations in the complaint. Directv, Inc. v. Treesh, 487 F.3d 471, 476 (6th Cir. 2007). This case largely concerns the ownership and development of the 11-1F4 monoclonal antibody and related research material(s). [Doc. 61 at 1]. Dr. Alan Solomon developed the antibody while employed by the University of Tennessee. [Id. at ¶ 1]. The 11-1F4 antibody has the potential to treat Amyloidosis, an often fatal disease that causes Amyloids (a type of protein) to build up in vital organs. [Id. at ¶¶ 66-67].
For consistency and ease of reference, record citations are to the CM/ECF-stamped document and page number, not to the internal pagination of any filed document. Where possible, citation is made to more specific subdivisions within a document.
UTRF is a nonprofit headquartered in Tennessee that commercializes developments made by faculty at the University of Tennessee on behalf of the University. [Id. at ¶¶ 8-10]. Specifically, UTRF pursues patents, license agreements, and other means of creating profit off the inventions of University of Tennessee professors, and it seeks to enforce these items. [Id. at ¶¶ 12-13]. Caelum is a corporation headquartered in New York and incorporated in Delaware that was created to commercialize the 11-1F4 antibody. [Id. at ¶¶ 16, 18-19]. Columbia is a corporation headquartered and incorporated in New York. [Id. at ¶ 22].
After developing the antibody, Dr. Solomon and his colleagues successfully applied for a patent that covered "certain methods of amyloid removal using anti-amyloid antibodies." [Id. at ¶ 68]. UTRF (the University of Tennessee Research Corporation ("UTRC") at that time) took control of the patent, as well as "the 11-1F4 property rights and all know-how relating to synthesizing and the use of the antibody." [Id. at ¶ 69]. In 2009, Dr. Solomon applied for and received Orphan Drug Designations for "two indications of the 11-1F4 antibody": designation requests #09-2937 and #09-2903. [Id. at ¶¶ 72-75]. These designations have value, as they provide benefits like tax incentives and market exclusivity to their holders. [Id. at ¶ 73]. Through express, written assignment from Dr. Solomon and his colleagues, UTRF alleges that it owns the 11-1F4 Orphan Drug Designations. [Id. at ¶ 77]. Following Dr. Solomon's discovery, UTRF (again, UTRC at the time) entered negotiations "with several pharmaceutical companies relating to the development of amyloidosis therapies derived from the 11-1F4 antibody," and these companies "specifically inquired into licensing and utilizing the totality of the 11-1F4 property rights and know-how" to "commercializ[e] therapies utilizing the 11-1F4 antibody" [Id. at ¶ 78].
The University of Tennessee Research Corporation was reorganized into UTRF. All relevant property interests transferred to UTRF. [Doc. 61 at ¶ 71].
More specifically, UTRF claims "property rights and know-how" includes:
[A]ll 11-1F4 antibody products (including all non-human, chimeric, humanized, and human versions, as well as analogs, variants, fragments of such versions), formulations, and conjugates thereof; the chimeric 11-1F4 antibody; cell clones utilized in the production of the chimeric 11-1F4 antibody; all know-how associated with the development and use of the antibody products, including the results, data, information and materials relating to antigens, antibodies, and cell lines necessary or useful for development or commercialization of the 11-1F4 antibody products; research data utilized in the Investigational New Drug application file submitted with the U.S. Food and Drug Administration in connection with an approval request for 11-1F4 therapies (including IND No. 117, 316 entitled, "Chimeric Monoclonal Antibody 11-1F4"); and the Orphan Drug Designations for 11-1F4 issued by the U.S. Food and Drug Administration.[Id. at ¶ 70].
In 2011, the University of Tennessee and National Cancer Institute ("NCI") entered into a Material Transfer Agreement, wherein Dr. Solomon and his colleagues sent NCI "murine versions of the 11-1F4 antibody along with data from their research." [Id. at ¶ 79]. NCI prepared and transferred back "chimeric versions" of the 11-1F4 antibody. [Id.]. The Material Transfer Agreement confirmed the murine and chimeric antibodies, know-how, and data generated by NCI's work remained the property of the University of Tennessee. [Id.]. The Material Transfer Agreement granted NCI the right to utilize this material, but "only for non-commercial, non-profit purposes" involving clinical research. [Id. at ¶ 80]. NCI was also given the right to supply the chimeric version of the antibody (and provide research data) to third-party non-profits. [Id.]. UTRF claims that, to the extent Caelum received material from NCI, it was unauthorized. [Id. at ¶ 81].
In 2013, Dr. Solomon began collaborating with Dr. Suzanne Lentzsch of Columbia to assist with the development of 11-1F4 technology. [Id. at ¶ 82]. UTRF negotiated with Columbia Technology Ventures ("CTV") and created an Inter-Institutional Agreement ("IIA") between UTRF and Columbia. [Id. at ¶ 84-85]. UTRF gave Columbia license and the ability to sublicense "only the patent rights covering 11-1F4" technology. [Id. at ¶ 85]. UTRF claims the IIA did not provide the ability to sublicense or out-license "any of the 11-1F4 property rights or know-how (e.g. the physical antibody materials, protein sequences, or research data regarding the 11-1F4 antibodies) or . . . the 11-14F Orphan Drug Designations" and "expressly excluded any license to the know-how related to the 11-1F4 antibody." [Id. at ¶ 86]. Pursuant to the IIA, any consideration received by the joint venture "was to be split evenly between UTRF and Columbia." [Id. at ¶ 87]. Dr. Solomon and his colleagues sent 11-1F4 antibody materials, including a variety of data, to Dr. Lentzsch. [Id. at ¶ 88].
After this first contract, between 2014 and early 2016, UTRF began negotiating with CTV to amend and expand the IIA. [Id. at ¶ 89]. The proposed amendment would give Columbia the right to license the physical materials and know-how associated with the 11-14F antibody. [Id.]. UTRF claims that CTV never "raise[d] any question or issues challenging UTRF's ownership rights in the property rights and know-how relating to 11-1F4," and several communications supported this ownership. [Id. at ¶¶ 91-93]. During negotiations, Columbia disclosed that another party was interested in licensing the property rights and know-how related to the 11-1F4 antibody. [Id. at ¶ 94]. UTRF asserts this other entity was Caelum. [Id. at ¶ 98]. UTRF alleges that Caelum "began conducting secret discussions" with Columbia, and ultimately UTRF and Columbia never amended the IIA. [Id. at ¶¶ 99-100]. The IIA was ultimately terminated via termination agreement on June 12, 2017. [Id. at ¶ 64]. Despite the fact this IIA was never amended, Caelum began to represent that it had obtained the relevant rights and information related to the 11-1F4 technology from Columbia. [Id. at ¶ 102].
In 2017, Caelum also entered into a Confidentiality Agreement with UTRF. [Id. at ¶ 104]. Under the Agreement, Caelum agreed not to "undertake research, development, or trials with respect to tangible property relating to the acceleration of amyloid removal by anti-amyloid monoclonal antibodies" without receiving written authorization from UTRF. [Id.]. After entering the Confidentiality Agreement, Caelum and employees of the University of Tennessee "exchanged extensive confidential information, materials, and research data." [Id. at ¶ 105; see id. at ¶¶ 106-109]. UTRF represents that the Confidentiality Agreement applies to research materials obtained by Caelum before execution of the Agreement. [Id. at ¶ 110]. In breach of this Confidentiality Agreement, UTRF claims, Caelum "has proceeded to utilize the 11-1F4 property rights and know-how in an effort to commercialize the technology." [Id. at ¶ 112]. This includes utilization of "murine 11-1F4 materials; chimeric 11-1F4 materials; cell clones utilized in the production of chimeric 11-1F4 antibodies[;] . . . research data, clinical trial and laboratory testing protocols, and [other] documentation." [Id. at ¶ 116]. Caelum also claims to have acquired the 11-1F4 Orphan Drug Designations from Columbia. [Id. at ¶ 117].
UTRF asserts that Caelum's business is entirely "dedicated to the development of Dr. Solomon's 11-1F4 technology." [Id. at ¶ 121]. UTRF argues, inter alia, that Caelum's actions breached the Confidentiality Agreement. [Id. at ¶¶ 125-37]. UTRF also sues Caelum for: (1) conversion; (2) slander of title; (3) tortious interference of business relationships; (4) unjust enrichment; and (5) misappropriation of trade secrets. [Id. at ¶¶ 138-253]. Finally, UTRF seeks several declaratory judgments related to the property and commercialization rights of 11-1F4 materials, know-how, and other confidential data. [Id. at ¶¶ 254-77].
III. STANDARD OF REVIEW
Rule 12(b)(6) provides that a defendant may move to dismiss for "failure to state a claim upon which relief can be granted." Fed. R. Civ. P. 12(b)(6). In considering a motion to dismiss under Rule 12(b)(6), the Court "must construe the complaint in the light most favorable to the plaintiff, accept all of the complaint's factual allegations as true, and determine whether the plaintiff undoubtedly can prove no set of facts in support of his claim that would entitle him to relief." Engler v. Arnold, 862 F.3d 571, 574-75 (6th Cir. 2017) (internal quotations omitted).
"The [plaintiff's] factual allegations, assumed to be true, must do more than create speculation or suspicion of a legally cognizable cause of action; they must show entitlement to relief." League of United Latin Am. Citizens v. Bredesen, 500 F.3d 523, 527 (6th Cir. 2007). "Mere labels and conclusions are not enough; the allegations must contain 'factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.' " Id. at 575 (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S. Ct. 1937, 173 L. Ed. 2d 868 (2009)). "Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Iqbal, 556 U.S. at 678, 129 S.Ct. 1937. Further, the Court is "not bound to accept as true a legal conclusion couched as a factual allegation." Papasan v. Allain, 478 U.S. 265, 286, 106 S. Ct. 2932, 92 L. Ed. 2d 209 (1986). Finally, courts "may consider the Complaint and any exhibits attached thereto, public records, items appearing in the record of the case and exhibits attached to defendant's motion to dismiss so long as they are referred to in the Complaint and are central to the claims contained therein." Bassett v. Nat'l Collegiate Athletic Ass'n, 528 F.3d 426, 430 (6th Cir. 2008).
IV. ANALYSIS
Caelum states that each of UTRF's claims fail as a matter of law. It argues that some are preempted by application of the Tennessee Uniform Trade Secrets Act, while others fail because Plaintiff failed to state a claim upon which relief can be granted. Defendant Caelum's arguments are explored below.
a. Preemption by Tennessee Uniform Trade Secrets Act
Defendant Caelum argues that UTRF's tort and unjust enrichment claims are preempted by the Tennessee Uniform Trade Secrets Act ("UTSA"). Tenn. Code Ann. § 47-25-1701 et seq. The Tennessee UTSA explicitly "displaces conflicting tort, restitutionary, and other law . . . providing civil remedies for misappropriation of a trade secret." T.C.A. § 47-25-1708(a). That is, the statute plainly preempts tort and restitution-based claims that seek to remedy the broader misappropriation of trade secret(s). Under the statute, "trade secret" means "information, without regard to form, including, but not limited to, technical, nontechnical or financial data, a formula, pattern, compilation, program, device, method, technique, process, or plan . . . ." T.C.A. § 47-25-1702(4). Thus, the preemption provision in Tennessee's UTSA has "generally been interpreted to abolish all free-standing alternative causes of action for theft or misuse of confidential, proprietary, or otherwise secret information falling short of trade secret status (e.g., idea misappropriation, information piracy, theft of commercial information, etc.)." Hauck Mfg. Co. v. Astec Indus., Inc., 375 F. Supp. 2d 649, 655 (E.D. Tenn. 2004); see PartyLite Gifts, Inc. v. Swiss Colony Occasions, 246 F. App'x 969, 976 (6th Cir. 2007) (citing the Hauck case in a favorable manner); see also Windrock, Inc. v. Resonance Sys., Inc., No. 3:21-cv-288, 2022 WL 202891, at *4 (E.D. Tenn. 2022) ("Thus . . . the Court concludes that the Tennessee General Assembly must have determined that interests in non-trade secret confidential information are not sufficiently important to protect via third-party tort remedies."). Contractual remedies are not preempted, nor are civil remedies not based on "trade secret" misappropriation. See T.C.A. § 47-25-1708(b).
When dealing with the specific issue of preemption, courts in this circuit have adopted the "same-proof" test; that is, "if proof of a non-UTSA claim would also simultaneously establish a claim for misappropriation of trade secrets, it is preempted irrespective of whatever surplus elements of proof were necessary to establish it." Hauck, 375 F. Supp. 2d at 658. Here, this means that the state tort and unjust enrichment claims may only go forward to the extent they state a claim for relief in the absence of misappropriation allegations. See Knox Trailers, Inc. v. Maples, 581 F. Supp. 3d 1000, 1010 (E.D. Tenn. 2022).
Caelum claims that all of UTRF's tort claims—conversion, slander of title, and tortious interference with business relationship(s)—are preempted by the Tennessee UTSA. Caelum further claims UTRF's unjust enrichment claim is preempted by the state's UTSA. These arguments are explored more fully below.
i. Conversion (Count II)
To state a claim for conversion in Tennessee, a plaintiff must prove "(1) the appropriation of another's property to one's own use and benefit, (2) by the intentional exercise of dominion over it, and (3) in defiance of the true owner's rights." Hauck, 375 F. Supp. 2d at 661 (collecting cases). Caelum argues that this claim essentially restates the misappropriation of trade secrets claim. [See Doc. 77 at 15-16]. However, UTRF claims that its conversion allegation does not concern trade secrets or confidential information and is thus not preempted. [See Doc. 110 at 9-11].
In the Second Amended Complaint, UTRF's conversion claim revolves around the "11-1F4 Converted Property," comprised of "(1) the chimeric 11-1F4 antibody, (2) cell clones utilized in production of the chimeric 11-1F4 antibody, and (3) the 11-1F4 Orphan Drug Designations . . . ." [Doc. 61 at ¶ 139]. UTRF continuously refers to the "11-1F4 Converted Property," alleging that Caelum exercised dominion over the property, and did so despite knowledge that UTRF possessed all right, title, and interest in it. [Id. at ¶¶ 142-44]. Plaintiff also states that Caelum "published false information supporting its claim that it allegedly has the right to utilize the 11-1F4 Converted Property in an effort to commercially develop an 11-1F4 amyloidosis therapy. [Id. at ¶ 150] (emphasis added). That is, UTRF's allegations show the "11-1F4 Converted Property" are important pieces of Caelum's scheme to commercialize the 11-1F4 antibody. And UTRF claims the information and know-how needed to commercialize this material was misappropriated through Count VII of the Second Amended Complaint—the Tennessee UTSA claim. [See id. at ¶¶ 238-53]; see T.C.A. § 47-25-1702(4)(A) (defining "trade secret" to include a "method, technique, process or plan" that "[d]erives independent economic value, actual or potential, from . . . not being ready ascertainable by proper means").
While UTRF argues its conversion claim involves non-trade secrets and non-confidential information, the Court finds the situation in Hauck instructive. In Hauck, the plaintiff's conversion claim was "not based solely on allegations of theft of trade secrets," but rather that Defendants "stole documents, including computer files and drawings, which contained, at least in part, trade secrets." 375 F. Supp. 2d at 661. The court found the claim preempted largely because the "physical property Plaintiff alleges to have been stolen derived its primary, if not entire, value from the trade secrets contained therein." Id. Similarly here, the primary value of the 11-1F4 Converted Property is derived from the trade secrets—or confidential information—needed to actually commercialize the antibody treatment to Caelum's financial benefit. That is, the 11-1F4 Converted Property derives its value from its ability to be utilized, when combined with the know-how and confidential information that UTRF claims was misappropriated, in commercializing an antibody therapy. To receive the alleged benefit, Caelum must have used the information and materials expressly at issue in the Tennessee UTSA claim. [See Doc. 61 at ¶¶ 238-53]. As such, UTRF's conversion claim is preempted and shall be dismissed.
ii. Slander of Title (Count III)
To state a claim for slander of title, a plaintiff must allege "(1) that it has an interest in the property, (2) that the defendant published false statements about the title to the property, (3) that the defendant was acting maliciously, and (4) that the false statements proximately caused the plaintiff a pecuniary loss." Lick Branch Unit, LLC v. Reed, No. 3:13-cv-203, 2014 WL 546696, *19 (E.D. Tenn. Feb. 10, 2014) (citing Brooks v. Lambert, 15 S.W.3d 482, 484 (Tenn. Ct. App. 1999)). Caelum argues that this claim is preempted. However, UTRF argues that the claim is not preempted because it "does not require proof that Caelum misappropriated any confidential materials." [Doc. 110 at 13].
Here, UTRF is correct. While identical proof may be offered to establish both UTRF's slander of title and misappropriation claims, slander of title can be proven without showing that any trade secrets or confidential information were actually misappropriated. That is, UTRF need demonstrate merely that it had an interest in the property at issue, that Caelum maliciously published false statements about the title to this property, and that those false statements caused UTRF a pecuniary loss—not that Caelum actually misappropriated or took control of the property. See Lick Branch, 2014 WL 546696 at *19. Thus, this claim is not preempted by Tennessee's UTSA.
iii. Tortious Interference with Business Relationships (Counts IV and V)
Courts have found tortious interference claims preempted by Tennessee's UTSA where confidential information or trade secrets are used to induce conduct or interfere with prior business relationships. See Wachter, Inc. v. Cabling Innovations, LLC, 387 F. Supp. 3d 830, 846-47 (M.D. Tenn. 2019) (explaining that, because plaintiff alleged defendants interfered with business relationships "by using proprietary and confidential information" the "gravamen of Plaintiff's tortious interference claim rest[ed] on the appropriation of confidential information that would be considered a 'trade secret' under the [Tennessee] [ ]UTSA"). Here, UTRF does not allege in either Count IV or Count V—tortious interference with UTRF's business relationship with Columbia and other third parties in the industry, respectively—that Caelum specifically used confidential or trade secret information to interfere with the business relationships at issue. In fact, UTRF specifically alleges that Caelum induced Columbia to do business with it "not by offering [ ] Columbia confidential information . . . but by . . . seeking to do business with Columbia to the injury of UTRF" as well as "to the injury of UTRF's relationships with third-party pharmaceutical companies." [Doc. 61 at ¶¶ 205, 226].
Further, courts have found in situations similar to this that tortious interference claims "are based on conduct that is at least one step removed from the alleged misappropriation of trade secrets." SDC Fin., LLC v. Bremer, No. 3:19-cv-525, 2019 WL 4393543, *9 (M.D. Tenn. Sep. 13, 2019). That is, courts have held that tortious interference claims not alleging inducement via confidential information or trade secrets do not, in practice, require proof of actual misappropriation. See id. For instance, in SDC Fin., the plaintiffs alleged defendants wrongfully interfered in its business relationships by "inducing" an entity "to do business with them at all, not by . . . offering the plaintiffs' confidential information . . . in order to induce the relationship." Id. Thus, "[r]egardless of whether the plaintiffs [were] able to prove the existence of trade secrets or misappropriation," plaintiffs could still prove the tortious interference claim. Id. Here, the interference alleged in both counts naturally concerns the alleged confidential information and trade secrets—at least to some degree. However, proof of tortious interference here does not require proof that Caelum actually misappropriated the know-how, confidential material, and/or other trade secrets alleged by UTRF. In other words, UTRF could prove Caelum tortiously interfered with its business relationship(s) simply through Caelum's claim to have exclusive title and license to the 11-1F4 material at issue—even if they did not actually possess such title or license. Thus, UTRF's tortious interference claims are not preempted by Tennessee's UTSA.
iv. Unjust Enrichment (Count VI)
To plead a claim for unjust enrichment, a plaintiff must adequately allege "(1) there is no contract between the parties or a contract has become unenforceable or invalid, and (2) the defendant will be unjustly enriched absent a quasi-contractual obligation." Hauck, 375 F. Supp. 2d at 662 (citing Whitehaven Cmty. Baptist Church v. Holloway, 973 S.W.2d 592, 596 (Tenn. 1998)). Caelum claims that UTRF's unjust enrichment claim is preempted because it relates to the alleged trade secret(s) misappropriation, and because restitutionary remedies are explicitly preempted through Tennessee's UTSA. [Doc. 77 at 15-16; Doc. 115 at 8]; see T.C.A. § 47-25-1708(a) ("[E]xcept as provided in subsection (b), this part displaces conflicting tort, restitutionary, and other law of this state providing civil remedies for misappropriation of a trade secret") (emphasis added). UTRF argues that this is contractual and explicitly not preempted.
As a preliminary matter, the unjust enrichment claim is not contractual but rather a restitution-based prayer for relief. The elements of the claim itself confirm as such. See Hauck, 375 F. Supp. 2d at 662 (explaining that the first element requires "no contract between the parties" or a "contract [that] has become unenforceable or invalid"). Because this claim requires there be no contract or an invalid/unenforceable contract, unjust enrichment does not fall under the Tennessee UTSA's "contractual remedies" exemption. SDC Fin., 2019 WL 4393543 at *10. That said, the unjust enrichment claim is not necessarily preempted just because it is restitutionary; the claim must still "provid[e a] civil remed[y] for misappropriation of a trade secret." T.C.A. § 47-25-1708(a).
Here, it is apparent that UTRF's unjust enrichment claim is related to the alleged misappropriation of trade secrets. In the Second Amended Complaint, UTRF explicitly ties Caelum's supposed unjust and wrongful enrichment to "commercialization of the 11-1F4 technology" and "possession and use of the 11-1F4 property rights, know-how, and the 11-1F4 Orphan Drug Designations." [Doc. 61 at ¶¶ 233-235] (emphasis added). Similar to the materials at issue in the conversion claim, for Caelum to have been unjustly enriched, it must have necessarily utilized confidential information to commercialize the 11-1F4 antibody. And UTRF claims the confidential information needed to do so was misappropriated through its Tennessee UTSA claim. [See id. at ¶¶ 238-53]. Therefore, to prove that Caelum was unjustly enriched, UTRF would need to show Defendant Caelum misappropriated trade secret(s). The gravamen of this claim is that Caelum utilized information and materials it should not have (including confidential information) and profited off of it, which is covered by the misappropriation claim. As such, UTRF's unjust enrichment claim is preempted by Tennessee's UTSA and shall be dismissed.
b. Remaining Tort Claims
As explained above, the claims of slander of title, tortious interference with business relationship with Columbia University, and tortious interference with industry partners, are not preempted by Tennessee's UTSA. Nonetheless, Caelum argues that UTRF fails to state a claim on these counts. Further examination is therefore necessary.
i. Slander of Title (Count III)
To state a claim for slander of title, a plaintiff must allege "(1) that it has an interest in the property, (2) that the defendant published false statements about the title to the property, (3) that the defendant was acting maliciously, and (4) that the false statements proximately caused the plaintiff a pecuniary loss." Lick Branch Unit, LLC v. Reed, No. 3:13-cv-203, 2014 WL 546696, *19 (E.D. Tenn. Feb. 10, 2014) (citing Brooks v. Lambert, 15 S.W.3d 482, 484 (Tenn. Ct. App. 1999)).
Caelum argues that UTRF "does not have a protectable property interest in" the allegedly slandered property. [Doc. 77 at 18]. To support this assertion, Caelum explains that the cells that produce the 1101F4 antibodies "have been publicly available . . . since at least 2012, and a 'recipe' allowing anyone to develop their own similar antibody products has been publicly available since the 1990s." [Id. at 19]. Further, Caelum claims the "Orphan Drug Designations are intangible and cannot be a protectable property right for tort purposes." [Id.]. UTRF responds by noting that the Second Amended Complaint explicitly states that it owns the property rights in the materials at issue in this claim. [Doc. 110 at 13]. Plaintiff also argues that, even if the Orhan Drug Designations are intangible property, "slander of title can arise from false statements about ownership of intangible property." [Id.].
Whether or not UTRF possesses protectable interest in allegedly slandered property at issue in this claim is a question of fact. Caelum argues that the chimeric 11-1F4 antibody and cell clones used to produce the antibody are publicly available. However, UTRF alleges that "the original murine version of the 11-1F4 antibody as well as the chimeric version generated by NCI and any data and know-how regarding NCI's work on the 11-1F4 antibody [ ] remain the property of The University of Tennessee." [Doc. 61 at ¶ 79]. Thus, Plaintiff and Defendant disagree on whether or not a protectable interest exists. Such determination of fact is not appropriate to determine at this stage, and construing the complaint in a light most favorable to UTRF, it has properly alleged such an interest in the Second Amended Complaint.
Caelum argues that the Orphan Drug Designations are intangible property and cannot be protectable, but the Court agrees with UTRF's assessment. Slander of title may arise from false statements regarding ownership of even intangible property. See Hicks v. Deutsche Bank Tr. Co. Am., No. 3:17-cv-396, 2019 WL 464968, at *4 (E.D. Tenn. Feb. 6, 2019) (explaining that "[a]ny kind of legally protected interest in . . . intangible things may be disparaged if the interest is transferable and therefore salable or otherwise capable of profitable disposal . . . [i]t may be a patent right, a copyright, or the right to use a trademark or trade name. It may be intangible property") (quoting Restatement (Second) of Torts § 624 cmt. c (1977)). Thus, UTRF has alleged a colorable claim for slander of title, and the claim shall proceed.
ii. Tortious Interference with Columbia (Count IV)
To state a claim for tortious interference with a specific business relationship, a plaintiff must allege: (1) it had an existing business relationship; (2) defendant knew about this relationship; (3) defendant intended to cause the breach or termination of the business relationship; (4) defendant had an improper motive or used improper means to do so; and (5) damages resulted from the tortious interference. Nat'l Fitness Center, Inc. v. Atlanta Fitness, Inc., 902 F. Supp. 2d 1098, 1110 (E.D. Tenn. 2012) (quoting Trau-Med of Am., Inc. v. Allstate Ins. Co., 71 S.W.3d 691, 701 (Tenn. 2002)). Defendant Caelum claims that UTRF fails to allege it caused the end of Plaintiff's business relationship with Columbia, and notes that UTRF terminated the IIA agreement on its own accord. [Doc. 77 at 19]. Caelum further argues that UTRF did not make the required, heightened showing that Caelum's actions were improper. [Id. at 13].
While true that UTRF's admission terminated the IIA contract on its own accord might be evidence against Caelum's alleged interference, it is not dispositive at this stage. In Golf Sci. Consultants, Inc. v. Cheng, cited favorably by Caelum, summary judgment was at issue and the fact that one entity chose to end the relationship seemed to be a factor in plaintiff failing to carry the requisite burden. See No. 3:07-cv-152, 2009 WL 1256664, at *11 (E.D. Tenn. May 4, 2009). Here, however, it is not the Court's role to weigh the evidence. Rather, when looking to the complaint, UTRF has alleged enough to suggest Caelum induced Columbia to not execute the IIA Amendment being negotiated. [See Doc. 61 at ¶ 191] (claiming that Caelum "requested that Columbia not amend its IIA with UTRF"); ¶¶ 193, 199 (claiming that Caelum conducted "secret meetings" with Columbia and "requested that Columbia cease negotiations with UTRF and not agree to amend the IIA").
Caelum's argument that UTRF failed to meet a heightened standard regarding motive or actions similarly fails. Plaintiff must allege either "improper motive or improper means." See Nat'l Fitness, 902 F. Supp. 2d at 1110; id. at 1111 (explaining that improper motive and improper means are "alternative theories" and plaintiff "only needs to establish one or the other"). UTRF has alleged that Caelum's actions were malicious, "directed at causing harm," and sought to "deprive UTRF." [Doc. 61 at ¶ 201]. UTRF claims there were secret meetings, and the gravamen of the Second Amended Complaint suggests that Caelum's actions were underhanded. While certainly possible that Caelum was motivated and acted in its own business interest, as Caelum alleges, this is a factual determination not appropriate at this stage. That Caelum was "motivated purely by its own business interests" is certainly not the "only reasonable inference to be drawn" from the Second Amended Complaint. [See Doc. 115 at 11].
Because the alleged improper motive is enough to establish a cognizable claim and survive this Motion to Dismiss, the Court will not analyze whether UTRF adequately pled improper means. The other elements of this claim are not disputed, and the court finds each adequately stated. Therefore, UTRF has sufficiently stated a claim for tortious interference with its business relationship with Columbia. The claim will not be dismissed at this stage.
iii. Tortious Interference with Third Parties (Count V)
To state a claim for tortious interference with third-party business relationships, a plaintiff must allege: (1) it had a prospective relationship with an identifiable class of third parties; (2) defendant knew about these potential relationships; (3) defendant intended to interfere with the business relationship; (4) defendant had an improper motive or used improper means to do so; and (5) damages resulted from the tortious interference. See Nat'l Fitness Center, 902 F. Supp. 2d at 1110 (quoting Trau-Med, 71 S.W.3d at 701). Caelum asserts that Plaintiff does not adequately allege that it acted with improper motive or means by entering the License Agreement with Columbia. [Doc. 77 at 21]. Particularly, Caelum explains that the License Agreement explicitly states that "neither the execution of [the] Agreement nor the performance of its obligations hereunder will constitute a breach of the terms and provisions of any other agreement to which Columbia is party." [Doc. 77 at 21]; See [Ex. 2 at ¶ 8].
However, this claim does not arise from the aforementioned License Agreement. Rather, UTRF alleges that Caelum tortiously interfered with its professional relationships through other specific and overt actions, including the alleged publication of false statements about Columbia's ownership of 11-1F4 materials and know-how. See [Doc. 61 at ¶ 223]. That is, Plaintiff alleges that Caelum intended to interfere with UTRF's relationship with third-party pharmaceutical companies "by clouding UTRF's title to the 11-1F4 property rights and know-how, as well as the 11-1F4 Orphan Drug Designations." [Id. at ¶ 224]. Plaintiff further alleges that Caelum "has, and at all relevant times, had knowledge that UTRF possesses all right, title, and interest in the 11-1F4 [material]," and that Caelum knew about UTRF's claim to title and interest is a reasonable inference to draw when considering the totality of the Second Amended Complaint in a light most favorable Plaintiff. [Id. at ¶ 144]. Therefore, this claim shall not be dismissed.
c. Breach of Contract (Count I)
Caelum further posits that UTRF's breach of contract claim fails as a matter of law. The elements of breach of contract in Tennessee are: "(1) the existence of an enforceable contract; (2) non-performance amounting to breach; and (3) damages resulting from the breach." Nat'l Fitness, 902 F. Supp.2d at 1105 (citing ARC LifeMed, Inc. v. AMC-Tennessee, Inc., 183 S.W.3d 1, 26 (Tenn. Ct. App. 2005)). Caelum argues this claim should be dismissed because: (i) the Confidentiality Agreement at issue is unenforceable and (ii) the Confidentiality Agreement cannot apply retroactively. UTRF disputes these arguments.
i. Enforceability of Confidentiality Agreement
Caelum argues its Confidentiality Agreement with UTRF is unenforceable because, "[a] confidentiality agreement governing the disclosure of confidential information is unenforceable as a matter of law where there is no such disclosure." [Doc. 77 at 22]. UTRF claims that it adequately alleged that the parties exchanged information and material covered by the Confidentiality Agreement. [Doc. 110 at 21].
In its Second Amended Complaint, UTRF states that "[f]ollowing execution of the . . . Agreement, the parties exchanged information and material covered by the Agreement." [Doc. 61 at ¶ 132]; [see id. at ¶ 105] (alleging the parties exchanged "extensive confidential information, materials, and research data under the terms of th[e] Agreement"). This statement alone might appear conclusory. However, UTRF provides more context surrounding the alleged disclosure. UTRF alleges that representatives from the parties exchanged "various aspects of clinical trial design," "the 11-1F4 monoclonal antibody, a potential competitive therapy for amyloidosis, and possible laboratory testing that Caelum sought to conduct [concerning the antibody]." [Id. at ¶¶ 106-07]. Plaintiff also alleges that the parties discussed "data generated using 11-1F4 in studies . . . as part of a collaborative research agreement" and exchanged more than 150 emails related to the 11-1F4 antibody and its potential use to treat amyloidosis. [Id. at ¶¶ 108-09]. Covered information as provided in the Confidentiality Agreement includes "confidential data, information, tangible materials, and/or documents related to [UTRF's] inventions, intellectual property, products, technologies, know-how, marketing activities, business and product development and the like." [Doc. 80-1 at 2]. The material and information UTRF alleges it shared with Caelum plausibly fits within this covered information. Thus, in viewing the Second Amended Complaint in a light most favorable to UTRF, it has alleged enough facts to support its assertion that information governed by the agreement was exchanged.
Ultimately, Caelum is correct that a Confidentiality Agreement is not enforceable when covered information is not exchanged. See Amberley Co. v. Brown Co., 408 F.2d 1358, 1362 (6th Cir. 1969) ("Because there was no disclosure . . . the consideration for the agreement failed and [there was] no obligation to perform it."). However, while Caelum claims that no disclosure of items or materials covered by the Confidentiality Agreement occurred whatsoever, Plaintiff alleges that it did. Whether confidential information covered by the Confidentiality Agreement was actually disclosed at the meetings or through the emails alleged in the Second Amended Complaint is a question of fact not ripe for determination at this stage. As such, this claim shall not be dismissed for lack of consideration.
ii. Retroactive Application of the Confidentiality Agreement
Caelum initially argues that the Confidentiality Agreement does not apply retroactively, and because UTRF claims that Caelum had proprietary research materials prior to execution of the Confidentiality Agreement, the claim should be dismissed. [Doc. 77 at 23-24]. Plaintiff responded that the First Amendment to Caelum's License Agreement with Columbia suggests at least some of the material was acquired after execution of the agreement. [Doc. 110 at 22]. Plaintiff further claims that the information was received not from Plaintiff but from a third party and, thus, acquired indirectly by Caelum. [See id.]. The Court agrees that Caelum plausibly received information indirectly from a third party after execution of the Confidentiality Agreement. Further, looking to the face of the Second Amended Complaint, UTRF alleges that discussions and communications about material supposedly covered by the Confidentiality Agreement occurred after execution of the Agreement. [See Doc. 61 at ¶¶ 106-109].
Again, a determination as to what material was acquired and when, as well as whether that material is actually covered by the Confidentiality Agreement, is a factual determination not appropriate at this stage. Doubt as to whether some of the information or material received by Caelum, and alleged by UTRF, is covered by the Confidentiality Agreement does not negate the other allegations. Specifically, the allegations that information covered under the Confidentiality Agreement was disclosed after execution of the Agreement. [See Doc. 61 at ¶¶ 106-09]. Certainly, what information or material Caelum acquired, and whether it is covered by the Confidentiality Agreement, may be narrowed in the future. However, Caelum's argument here is not enough to dismiss the claim outright. UTRF's breach of contract claim shall proceed.
d. Misappropriation of Trade Secrets Under the Tennessee Uniform Trade Secrets Act (Count VII)
To state a claim under Tennessee's UTSA, a plaintiff must allege: (1) the existence of a trade secret; (2) misappropriation of the trade secret by the defendant; and (3) resulting detriment to the plaintiff. Partylite Gifts, Inc. v. Swiss Colony Occasions, No. 3:06-cv-170, 2006 WL 2370338, at *3 (E.D. Tenn. Aug. 15, 2006) (citing T.C.A. §§ 47-25-1701 to 1709) (citing Stratienko v. Cordis Corp., 429 F.3d 592, 600 (6th Cir. 2005)). Caelum argues that this claim should be dismissed because (i) UTRF's alleged "know-how" is not a trade secret pursuant to Tennessee law and (ii) UTRF did not take reasonable efforts to maintain secrecy of the alleged trade secrets. [Doc. 77 at 17-18, Doc. 115 at 16-18].
i. Failure to Adequately State Existence of Trade Secret(s)
To support its contention that UTRF does not adequately state the existence of a trade secret, Caelum relies on Miller v. Crescent Homes Tenn., LLC, No. 3:18-cv-267, 2018 WL 4701594 (E.D. Tenn. Oct. 1, 2018). In Miller, the court found that plaintiff failed to sufficiently plead a claim for trade secret misappropriation because "her knowledge and expertise does not constitute a trade secret . . . ." Id. at *3. The court further explains that expertise alone is not a trade secret in Tennessee. Id. However, in Miller, the plaintiff "only allege[d] Defendant misappropriated her expertise," which led to the straightforward dismissal of the claim. Id. Here, Plaintiff provided a rather extensive list of trade secrets allegedly misappropriated by Caelum, "including the results, data, and information relating to antigens, antibodies, and cell lines necessary or useful for development or commercialization . . . as well as research data prepared by University of Tennessee researchers . . . . ." [Doc. 61 at ¶ 239]. These items meet the definition of trade secret in Tennessee. See T.C.A. § 47-25-1702(4) (defining "trade secret" as information "including . . . technical, nontechnical or financial data, a formula pattern, compilation . . . method, [or] technique").
"[A] plaintiff is required only to overcome the ordinary Rule 8 bar of pleading facts sufficient to give defendants notice of what was appropriated." Great Am. Opportunities, Inc. v. Cherry Bros., LLC, No. 3:17-cv-1022, 2018 WL 418567, at *4 (M.D. Tenn. Jan. 16, 2018) (quoting Am. Registry, LLC v. Hanaw, No. 2:13-cv-352, 2013 WL 6332971, at *4 (M.D. Fla. Dec. 5, 2013)) (cleaned up). Here, UTRF has done so. The information and data alleged as trade secrets in the Second Amended Complaint are enough to put Caelum on notice as to what is at issue, and it has given significant detail as to how these were developed and used. See Great Am. Opportunities, 2018 WL 418567 at *4 (explaining that, "[w]hile [plaintiff] ha[d] not listed all of the details of its alleged trade secrets," the fact that it had "describe[ed] the secrets generally, pleaded a great deal of context explaining how the secrets were developed and used . . . why [they] are valuable, [and] why [defendant] sought them" was enough to put defendant on notice).
ii. Efforts to Maintain Secrecy
Caelum further argues that this claim fails because UTRF did not adequately maintain secrecy of any "results, data, or information," and did not plead any facts that demonstrate such efforts. [Doc. 77 at 17]. However, UTRF did plead such facts. UTRF outlines several specific steps it took to maintain secrecy. For instance, this information was filed as part of an investigational new drug application ("IND"), which is "subject to significant confidentiality restrictions." [Doc. 61 at ¶ 243]. UTRF also explains that it has "enter[ed] into confidentiality agreements that restrict the distribution of the" trade secrets. [Id. at ¶ 244].
According to Caelum, the existence of the IND does not substantiate an attempt to maintain secrecy because it "fails to allege that Dr. Solomon submitted his IND application with any confidentiality designations." [Doc. 77 at 18]. However, as UTRF notes, IND applications are "not subject to disclosure except in very limited circumstances." [Doc. 110 at 24]. Caelum cites Waelde v. Merck, Sharp and Dohme to argue that everything in a new drug application ("NDA") file is not necessarily a trade secret. 94 F.R.D. 27 (E.D. Mich. 1981). This case is not exactly on point, as it does not concern an IND and revolves around a motion for protective order. See id. Ultimately, "no data or information in the [IND] is available for public disclosure" unless the application was previously disclosed. 21 C.F.R. § 314.430(c). Looking to the Second Amended Complaint, there is no indication that the IND was publicly disclosed by Plaintiff.
In its reply brief, Caelum discusses UTRF's Material Transfer Agreement with NCI, which was filed by Columbia in its separate Motion to Dismiss. [Doc. 115 at 17]. The Court will not consider this here, as it was not previously raised in Caelum's motion and UTRF has not had a chance to respond to this particular argument. See Scottsdale Ins. Co. v. Flowers, 513 F.3d 546, 553 (6th Cir. 2008) (explaining that arguments raised for the first time in reply briefs are waived).
Construing the Second Amended Complaint in the light most favorable to Plaintiff, and accepting all factual allegations as true, UTRF has successfully stated a Tennessee UTSA claim. As such, this cause of action shall proceed.
e. Declaratory Judgments
Beyond the aforementioned substantive claims, Plaintiff UTRF also seeks declaratory relief from this Court through Counts VIII, IX, and X. [Doc. 61 at ¶¶ 254-77]. Generally, Caelum believes that these should be dismissed because: (i) they are duplicative of UTRF's substantive claims; (ii) they improperly seek advisory opinions from this Court; and (iii) the Sixth Circuit factors weigh in favor of dismissal. [See Doc. 115 at 18]. UTRF disagrees with these assertions. This Court's previous Order dismissed Columbia from this matter. [Doc. 258]. Thus, it will only examine the declaratory relief sought against Caelum.
The Declaratory Judgment Act "confers a discretion on the courts rather than an absolute right upon the litigant." Wilton v. Seven Falls Co., 515 U.S. 277, 287, 115 S.Ct. 2137, 132 L.Ed.2d 214 (1995) That is, "district courts possess discretion in determining whether and when to entertain an action under the Declaratory Judgment Act, even when the suit otherwise satisfies subject matter jurisdiction prerequisites." Id. at 282, 115 S.Ct. 2137. In determining when district courts should exercise its jurisdiction over a declaratory judgment, the Sixth Circuit weighs five factors: (1) whether the judgment would settle the controversy; (2) whether the declaratory judgment action would serve a useful purpose in clarifying the legal relations at issue; (3) whether the declaratory remedy is being used merely for "procedural fencing"; (4) whether the use of a declaratory action would increase fracture between federal and state courts; and (5) whether there is an alternative remedy that is better or more effective. AmSouth Bank v. Dale, 386 F.3d 763, 784-85 (6th Cir. 2004); Scottsdale Ins. Co. v. Roumph, 211 F.3d 964, 968 (6th Cir. 2000).
i. Declaratory Judgments as Duplicative of Other Claims
Caelum argues that UTRF's requests for declaratory judgment should be dismissed because they are duplicative of the relief already sought through its substantive claims. Particularly, Caelum argues that the conversion and slander of title claims necessarily resolve the issues underlying the requested declaratory relief. [See Doc. 115 at 19]. UTRF's primary argument is that the claims are not duplicative because Columbia is a party to this action. [See Doc. 110 at 24-27]. However, Columbia has been dismissed as a party. [Doc. 258]. Further, UTRF's claim for conversion against Caelum will be dismissed as preempted by the Tennessee UTSA. This Court will therefore examine whether the requests are duplicative given this new context.
1. Counts VIII and IX
Caelum argues that the relief sought in Counts VIII and IX is duplicative. Particularly, it identifies UTRF's slander of title claim (Count III) as necessarily determining the underlying conflicts at issue in these claims. Yet UTRF's requested declaratory relief is more detailed than Caelum acknowledges. Success on the slander of title claim depends on whether UTRF can prove it has interest in "(1) the chimeric 11-1F4 antibody, (2) cell clones utilized in production of the chimeric 11-1F4 antibody, and (3) the 11-1F4 Orphan Drug Designations." [Doc. 61 at ¶ 162]. Counts VIII and IX both request declaratory relief concerning the ownership of the chimeric 11-1F4 antibody and cell clones utilized in production of the chimeric 11-1F4 antibody. [Id. at ¶¶ 258-59, 267-68]. However, Counts VIII and IX also request declaratory relief concerning materials and information not at issue in the slander of title claim—particularly, the know-how associated with the development and use of the antibody products and research data used in the IND application file. [See id.]. Thus, Counts VIII and IX request relief that will not necessarily be addressed through UTRF's remaining substantive claims. As such, the Court finds they are not duplicative.
2. Count X
Count X requests a declaratory judgment that UTRF "is the sole and exclusive owner of the 11-1F4 Orphan Drug Designations" and that Caelum does not "own any right, title, or interest" in them. [Doc. 61 at ¶¶ 275-76]. Unlike the other requests for declaratory relief, this request only concerns the Orphan Drug Designations. UTRF's slander of title claim (Count III) expressly alleges that Caelum falsely claimed (and continues to claim) title to these Orphan Drug Designations. [Id. at ¶¶ 167-70, 181-83]. As previously discussed, the first element in a slander of title claim is proving that a plaintiff has interest in the item or items at issue. See Lick Branch Unit, 2014 WL 546696 at *19. Thus, whether UTRF is successful in its slander of title claim as to the Orphan Drug Designations inherently depends on whether UTRF can prove ownership over them. Whether UTRF is the "sole and exclusive owner" will thus be determined. This request is addressed through one of UTRF's remaining substantive claims and will be dismissed as duplicative.
ii. Discretion on Declaratory Judgments
Because Counts VIII and IX are not duplicative, the Court must now determine whether to exercise its jurisdiction over them. In its discretion, the Court finds that the Sixth Circuit factors weigh in favor of doing so.
Here, the declaratory judgments would likely settle the overall controversy between the parties—the ownership and rights to the many 11-1F4 materials. They would further help to clarify the legal relations at issue by doing so. Caelum initially argued that the declaratory relief was added merely as a means to add Columbia, and that this amounts to "procedural fencing." [Doc. 77 at 19-22]. But Caelum seemingly concedes this is not actually at issue in its reply brief. [See Doc. 115 at 20 n.4]. There is no indication that any state court is involved in this matter. And while UTRF does seek other relief through its substantive claims, the declaratory relief requested would help to clarify future dealings involving the 11-1F4 materials. Thus, in its discretion, the Court finds that Counts VIII and IX may proceed.
V. CONCLUSION
Accordingly, Caelum's Motion to Dismiss the Second Amended Complaint is GRANTED in part and DENIED in part:
(1) UTRF's claims of Conversion (Count II) and Unjust Enrichment (Count VI), are hereby DISMISSED;
(2) Claim X is likewise DISMISSED;
(3) The remaining claims may proceed.
SO ORDERED.