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Kim v. Dawn Food Products

March 17, 2006

YOON JA KIM, PLAINTIFF,
v.
DAWN FOOD PRODUCTS, INC., DEFENDANT.



The opinion of the court was delivered by: Amy J. St. Eve, District Court Judge

MEMORANDUM OPINION AND ORDER

Plaintiff Yoon Ja Kim filed a two-count Complaint in the Circuit Court of Cook County, Illinois, that Defendant Dawn Food Products, Inc. ("Dawn Food Products") removed to federal court pursuant to 28 U.S.C. § 1441(a). In her Complaint, Kim alleges a common law breach of contract claim and a trade secret misappropriation claim under the Illinois Trade Secrets Act, 765 ILCS 1065/1 et seq. Before the Court is Dawn Food Products' Motion for Summary Judgment pursuant to Federal Rule of Civil Procedure 56(c). For the following reasons, the Court denies Defendant's Motion for Summary Judgment as to Defendant's Wheat Bread Concentrate, Formula No. 34330. The Court grants Defendant's motion as to the other 39 challenged formulas.

BACKGROUND

I. Prior Lawsuit

In the parties' initial lawsuit in front of this Court, Kim alleged that Dawn Food Products, a manufacturer of bakery mixes for retail sale, infringed on United States Patent No. Re. 36,355 (the "'355 patent") entitled "Potassium Bromate Replacer Composition." See Kim v. Dawn Food Prod., Inc., No. 01 C 1906, 2004 WL 2658068 (N.D. Ill. Oct. 13, 2004). The bread making industry once widely used potassium bromate as an oxidizing agent for bread dough. Its use became less common, however, after the Food and Drug Administration discovered that it caused cancer in laboratory animals. The invention of the '355 patent served as a substitute for potassium bromate. The '355 patent discloses a potassium bromate replacer comprising an ascorbic acid composition that acts as a slow acting oxidant in bread making. Kim is the named inventor and holder of the '355 patent, which the United States Patent and Trademark Office ("PTO") issued on October 26, 1999 as a reissue of United States Patent No. 5,510,129 (the "'129 patent").

In this prior litigation, the Court granted Dawn Food Products' Motion for Summary Judgment and Declaratory Judgment on the issue of non-infringement. The Court declined to exercise its supplemental jurisdiction over Kim's state law claims for breach of contract and trade secret misappropriation because Kim had failed to allege any basis for the Court's subject matter jurisdiction over such claims. Because Defendant removed Kim's state court complaint based on diversity jurisdiction, these claims are presently before the Court.

II. Relevant Facts to the Present Motion for Summary Judgment

On November 5, 1993, Kim filed her first application for a patent, U.S. Patent Application No. 08/147,995 (the "'995 application"). (R. 19-1, Def.'s Rule 56.1 Stmt. Facts ¶ 4.) Kim abandoned the '995 application upon filing the continuation-in-part U.S. Patent Application No. 08/308,617 (the "'617 application"). (Id. ¶ 5.) While the '617 application was pending, Dawn Food Products' Chief Operating Officer, Miles E. Jones, contacted Kim about Kim's potassium bromate replacer composition after which Kim sent a Proprietary Materials Agreement (the "Agreement") to Jones. (R. 32-1, Pl.'s Rule 56.1 Stmt. Facts ¶¶ 1, 2.) Pursuant to the Agreement, Kim mailed Jones the '617 application entitled "Method Of Preparing Potassium Bromate Replacer" on April 10, 1995. (Id. ¶ 3.) For purposes of this motion only, Defendant admits that the '617 application contained twenty-eight of Kim's trade secrets. (Id. ¶¶ 4, 5.) Each one of Kim's trade secrets, which are recipes for potassium bromate replacer, contain varying amounts of food acid. (Id. ¶ 5.)

On April 21, 1995, Jones reviewed Kim's patent application. (Id. ¶ 6.) Thereafter, Jones wrote Kim to inform her that Dawn Food Products already had a potassium bromate replacer similar to Kim's, but that Dawn Food Products' bromate replacers used food acid (tartaric), ascorbic acid, and phosphate, as well as other ingredients. (Id. ¶ 8.) Jones also explained to Kim that one of Dawn Food Products' customers had previously requested a bromate-free yeast raised mix and as of May 18, 1992, Dawn Food Products had supplied this customer and others with this particular formulation. (Id., Pl.'s Ex. 6.) Finally, Jones informed Kim that Dawn Food Products did not want to assert ownership of Kim's formula and also wanted Kim to be aware of Dawn Food Products' use and ownership of a similar formula. (Id., Pl.'s Ex. 6.)

On January 17, 1996, Kim wrote a letter to Jones alleging that Dawn Food Products was infringing on her patent rights. (Id. ¶ 10.) Shortly thereafter, on April 23, 1996, the '617 application issued as U.S. Patent No. 5,510,129 (the "'129 patent"). (Id. ¶ 12; Def.'s Stmt. Facts ¶ 5.) On May 2, 1996, Dawn Food Products sent a letter to Kim informing her why its potassium bromate replacer did not infringe on her '129 patent. (Id., Pl.'s Ex. 19.) Less than two weeks later, Kim filed an application to fix the defects in the '129 patent. (Def.'s Stmt. Facts ¶ 16.) The PTO issued the reissue application as the '355 patent, which was the subject of the parties' patent litigation. (Id.) For purposes of this motion, the parties agree that the relevant time period for Kim's pending trade secret and breach of contract claims is from April 10, 1995 through April 23, 1996. (Pl.'s Stmt. Facts. ¶ 16.)

SUMMARY JUDGMENT STANDARD

Summary judgment is proper when "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). A genuine issue of material fact exists only if "the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). The party seeking summary judgment has the burden of establishing the lack of any genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986). In determining whether a genuine issue of material fact exists, the Court construes the facts in a light most favorable to the non-moving party and draws all reasonable inferences in favor of that party. Anderson v. Liberty Lobby, Inc., 477 U.S. at 255. The existence of a factual dispute is not sufficient to defeat a summary judgment motion, instead the non-moving party must present definite, competent evidence to rebut the summary judgment motion. Butts v. Aurora Health Care, Inc., 387 F.3d 921, 924 (7th Cir. 2004); see also Fed. R. Civ. P. 56(e) (adverse party must set forth specific facts showing that there is genuine issue for trial).

ANALYSIS

I. Misappropriation of ...


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