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CLEAR LAM PACKAGING, INC. v. ROCK-TENN COMPANY

August 21, 2003

CLEAR LAM PACKAGING, INC. PLAINTIFF,
v.
ROCK-TENN COMPANY, DEFENDANT



The opinion of the court was delivered by: Ronald Guzman, District Judge

MEMORANDUM OPINION AND ORDER

This is an action by Clear Lam Packaging, Inc. ("Clear Lam") against Rock-Tenn Company ("Rock-Tenn") for a declaratory judgment of noninfringement, invalidity and unenforceability of Rock-Tenn's U.S. Patent No. 6,430,467 ("the `467 patent"). In addition, Clear Lam alleges tortious interference with economic advantage against Rock-Tenn. Rock-Tenn has counterclaimed based on infringement. For the reasons set forth in this Memorandum Opinion and Order, the Court denies the defendant's motion to dismiss and grants the defendant's motion to transfer.

FACTS

Counts I through III of Clear Lam's complaint seeks a declaration of invalidity, unenforceability and non-infringement of the `467 patent, entitled "Processes for Packaging Perishable and Other Products." (Second Am. Compl., Ex. A, U.S. Patent No. 6,430,467.) The patent relates to packaging and processes for facilitating fast, efficient and reliable automated production line packaging of case-ready meat using non-foam [ Page 2]

trays. "The non-foam trays feature separation structures that permit manufacture, storage, stacking, shipment, and dispensing on processing lines with minimum chance or potential of the sort of locking together which can otherwise occur with non-foam containers." (Id.) Rock-Tenn is the assignee of the `467 patent (Second Am. Compl. ¶ 8.)

Clear Lam's Second Amended Complaint alleges that Rock-Tenn engaged in an unlawful campaign throughout Illinois and elsewhere to interfere with Clear Lam's business with its customers and prospective customers. (Second Am. Compl. ¶¶ 39-45.) The interference allegedly includes Rock-Tenn's numerous contacts with customers and prospective customers of Clear Lam, threats by Rock-Tenn to those customers and prospective customers that they not engage in any further business with Clear Lam, and various statements by Rock-Tenn to customers and prospective customers stating that Clear Lam will not be able to continue in the packaging business. (Id.)

"Prior to Clear Lam's filing of this action on October 17, 2002, Rock-Tenn had previously filed three patent infringement actions [against other entities] in the United States District Court for the Northern District of Georgia asserting infringement of the `467 patent." (Def.'s Mem. Law Supp.Def.'s Mot. Transfer at 3.) "On November 13, 2002 Rock-Tenn filed a fourth patent infringement action in the Northern District of Georgia [asserting] infringement" of the `467 patent. (Id.) "Like Clear Lam, three defendants in the related actions . . . have asserted that Rock-Tenn's `467 patent is invalid." Additionally, two defendants "have asserted that the `467 patent is unenforceable." (Id.) All four cases are pending before the Honorable Jack T. Camp in the United States District Court for the Northern District of Georgia. (Id.) [ Page 3]

Rock-Tenn is a Georgia corporation and its plastic packaging division, which markets and sells nonfoam trays under the name Durafresh(r), is headquartered in Norcross, Georgia and has a second facility in Franklin Park, Illinois. (Id. at 4.) The four inventors of the `467 patent are residents of Georgia. (Id. at 5.) Rock-Tenn claims that the majority of documents, data compilations or tangible things related to the `467 patent are located in Georgia. Rock-Tenn's potential witnesses are in Georgia, Illinois, Missouri, Ohio, Georgia, Virginia, Massachusetts, Texas, South Dakota, and Arkansas. (Id.)

Clear Lam is an Illinois corporation whose principal place of business is in Elk Grove Village, Illinois. (Second Am. Compl. ¶ 1.) They filed the case in Illinois on October 17, 2002. The majority of the plaintiff's potential witnesses are located in Illinois and its relevant documents are located in Illinois. (Pl's. Mem. Opp. Def's. Mot. Transfer at 2-4.) Plaintiff promotes itself as a national company on its website. (Borchers Decl. Ex. 4).

DISCUSSION

I. Rule 12(b)(1)

On a motion to dismiss under Rule 12(b)(1), where the motion challenges the sufficiency of the allegations of subject matter jurisdiction, the district court must accept as true all well-pleaded allegations of the complaint, drawing all reasonable inferences in the plaintiff's favor. United Transp. Union v. Gateway Western Ry. Co., 78 F.3d 1208, 1210 (7th Cir. 1996).

Rock-Tenn argues that this Court lacks subject matter jurisdiction over Clear Lam's state law tortious interference claim against Rock-Tenn. When deciding whether [ Page 4]

to exercise supplemental jurisdiction, "a federal court should consider and weigh in each case, and at every stage of the litigation, the values of judicial economy, convenience, fairness, and comity." Carnegie-Mellon Univ. v. Cohill, 484 U.S. 343, 350 (1988). Supplemental jurisdiction has been codified by 28 U.S.C. ยง 1367 which ...


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