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Caldera Pharmaceuticals, Inc v. the Regents of the University of California; Los Alamos National Security

May 11, 2012

CALDERA PHARMACEUTICALS, INC., PLAINTIFF,
v.
THE REGENTS OF THE UNIVERSITY OF CALIFORNIA; LOS ALAMOS NATIONAL SECURITY, LLC; AND DOES 1 THROUGH 50, DEFENDANTS.



The opinion of the court was delivered by: United States District Judge Elaine E. Bucklo

MEMORANDUM OPINION AND ORDER

In September 2005, plaintiff Caldera Pharmaceuticals, Inc. ("Caldera") entered into a patent licensing agreement ("License Agreement") with the Regents of the University of California ("Regents"), which later assigned the License Agreement to defendant Los Alamos National Security LLC ("LANS"). Currently before me is Caldera's motion to remand. For all the reasons that follow, that motion is granted.

Caldera alleges that the License Agreement granted Caldera an exclusive license to multiple patent rights related to technology, apparatuses and methods for detecting binding using micro x-ray fluorescence. On or around April 25, 2006, the Regents assigned the License Agreement, and all of the rights, duties and obligations associated with it, to LANS.

Prior to executing the License Agreement, Caldera relied upon multiple representations that defendants were the lawful owners of the subject patent rights. However, according to Caldera, defendants did not own the rights that were sold to Caldera pursuant to the License Agreement, a fact that Caldera did not discover until it had invested millions of dollars in the technology, and paid defendants millions of dollars in fees, royalties and equity payments for these exclusive rights. Further, as a result, Caldera was unable to consummate certain lucrative contractual relationships, one of which was valued by defendants at over $600 million. In addition, defendants have worked with Caldera's competitors to improperly utilize and profit from the technology that was exclusively licensed to Caldera.

This case was filed in state court in the Circuit Court of Cook County. Caldera explains that it filed this action "in order to preserve its cause of action against The Regents, which historically have taken great advantage of its Eleventh Amendment immunity in federal court." Mem. at 1. Shortly thereafter, LANS removed this case to federal court. The Regents communicated to LANS that it refused to join the removal. Caldera now seeks remand based both on procedural and subject matter jurisdiction grounds. I address each in turn.

Procedural Arguments

Caldera argues that removal was procedurally improper because the Regents did not join in the removal. LANS responds by arguing that Caldera's argument is untimely, as Caldera waited more than 30 days to raise this argument. In reply, Caldera maintains that I should exercise estoppel and order remand on procedural grounds.

Motions for remand, based on procedural grounds, must be filed within thirty days of removal. 28 U.S.C. § 1447(c) ("A motion to remand the case on the basis of any defect other than subject matter jurisdiction must be made within 30 days after the filing of the notice of removal."). The 30-day time limit for motions to remand is strictly enforced to prevent "shuttling of cases between state and federal court" and "extended litigation that does no more than determine where litigation shall proceed." In the Matter of Continental Casualty Co., 29 F.3d 292, 295 (7th Cir. 1994).

Here, LANS filed its Notice of Removal on October 13, 2011, setting November 12, 2011 as the deadline to file a motion to remand. Caldera, however, did not file its motion until February 3, 2012. Caldera argues that, in the interim, there was a "confused slew of subsequent motions." In addition to a motion to dismiss, LANS filed a motion to stay this action pending a decision from the California Court of Appeals. Judge Norgle, who presided over the case at that time, set a briefing schedule on the motion to stay. On November 11, 2011, one day before the remand deadline, the parties stipulated to a stay pending a ruling on LANS' motion to stay. LANS' motion to stay was thereafter denied on December 22, 2011. This decision terminated the effect of the parties' stipulation. Thus, Caldera's motion to remand was due one day later, on December 23, 2011. Caldera waited another 42 days to file its motion.

In the interim, on November 29, 2011, LANS filed a motion to disqualify Caldera's counsel. In addition, the Regents also filed a motion to dismiss. Caldera asserts that on December 12, 2011, while appearing for the Regents' presentment of its motion to dismiss, counsel for Caldera was told by a clerk of the court that the court did not wish to address substantive motions until after the disqualification issue was resolved.

Recognizing that it did not meet the 30-day time limitation, Caldera argues that the critical date for purposes of § 1447 is not the date of the filing of the motion, but rather the date that Caldera "communicated" its objections to the removal to the court and LANS. Caldera argues that it should be permitted to seek remand because it alerted the defendants and the court that it intended to seek remand. Caldera points to various statements it made in documents (its 11/7/11 opposition to LANS' motion to reassign, the parties' 11/11/11 stipulation, and two December 2011 letters to defendants' counsel) that it intended to seek remand. In addition, on December 20, 2011, Caldera filed a "Statement" with the court in response to the Regents' presentment of its motion to dismiss. Caldera's main argument in the "Statement" was that the parties had agreed to a stay pending the court's ruling on LANS' motion to stay (related to the California Appellate Court's opinion), and that the Regents were violating that stipulation by seeking a briefing schedule on its motion to dismiss. Caldera went on to request that the court set a briefing schedule for Caldera's motion to remand.

I am not convinced by Caldera's reliance on Northern California District Council of Laborers v. Pittsburg-Des Moines Steel Co., 69 F.3d 1034, 1038 (9th Cir. 1995). In that case, the party filed a timely motion to remand, but raised a new argument in its reply brief. The court held that the argument raised in reply was not timely because it was raised after the 30-day deadline had passed.

That case does not support Caldera's novel position here that they should be deemed to have met the 30-day deadline because they indicated a desire to remand prior to the expiration of the deadline. The only way for a party to properly preserve its right to seek remand is to actually file a motion for remand. Here, Caldera had until December 23, 2011 to do so. When Caldera did not receive a response from the court to its request in the December 20, 2011 "Statement," Caldera should have simply filed its motion for remand at that time.

Finally, I reject Caldera's assertion that equitable tolling is appropriate here. I have reviewed the cases cited by Caldera, none of which are from this circuit, and find them quite distinguishable from the facts here. Most of the cases cited by Caldera involve scenarios where a party timely filed a motion to remand, but had trouble with the court's internal computer docketing system. In those cases, the court deemed the motion filed on the day the party attempted to file the motion, even though the motion was ...


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