Case 1:19-cv-01334-CJB Document 716 Filed 04/05/24 Page 1 of 6 PageID #: 18030
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF DELAWARE
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`Plaintiffs,
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`Defendants.
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`C.A. No. 19-1334 (CJB)
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`MIDWEST ENERGY EMISSIONS CORP.
`and MES INC.,
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`ARTHUR J. GALLAGHER & CO., et al.,
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`v.
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`CERT DEFENDANTS’ MOTION TO DISMISS PLAINTIFF MES INC. AND TO ALTER
`OR AMEND JUDGMENTS (D.I. 697-708)
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`The CERT Defendants move under Federal Rule of Civil Procedure 12(b)(1) to dismiss
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`Plaintiff MES Inc. (MES) and under Federal Rule of Civil Procedure 59(e) for the Court to alter
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`or amend the judgments entered against each individual defendant (D.I. 697-708) to remove
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`MES from those judgments.
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`MES lacks constitutional standing and must be dismissed from this case immediately for
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`lack of subject matter jurisdiction. See Fed. R. Civ. P. 12(b)(1); Fed. R. Civ. P. 12(h)(3) (“If the
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`court determines at any time that it lacks subject-matter jurisdiction, the court must dismiss the
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`action.”).1 To satisfy the constitutional standing requirements of Article III, a plaintiff must allege
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`and show a concrete and particularized injury that is actual and imminent. That injury must be
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`fairly traced to the defendant and likely redressed by a judgment in its favor. Lujan v. Defenders
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`of Wildlife, 504 U.S. 555, 560-61 (1992). In a case for patent infringement, “those who possess
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`1 “A challenge to constitutional standing goes to the Court's subject matter jurisdiction and may
`be raised at any time.” Cirba Inc. v. VMWARE, Inc., No. CV 19-742-LPS, 2020 WL 7489765, at
`*4 n.4 (D. Del. Dec. 21, 2020).
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`1
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`Case 1:19-cv-01334-CJB Document 716 Filed 04/05/24 Page 2 of 6 PageID #: 18031
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`exclusionary rights in a patent suffer an injury when their rights are infringed.” Lone Star Silicon
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`Innovations LLC v. Nanya Tech. Corp., 925 F.3d 1225, 1234 (Fed. Cir. 2019).
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`MES has no such exclusionary rights in the remaining asserted patents or any right to
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`recover damages for alleged infringement in the time period at issue in this case. The Court
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`previously declined to dismiss MES on the basis that “MES could hold exclusive rights to obtain
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`patent infringement damages as to [the 147 patent] for a portion of the relevant time period.” D.I.
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`279 at 16. The facts, however, have changed. MES did not assert a claim for infringement of the
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`147 patent at trial. Moreover, MES terminated any exclusive license it had to the 147 patent or
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`related applications2 when the EERC assigned the patents-in-suit to ME2C. D.I. 406 ¶ 99. As the
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`Court has recognized, the assignment of rights occurred on April 24, 2017. D.I. 279 at 14. As of
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`that date, MES’s exclusive license was terminated. Regardless of whether it retained a right to
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`recover damages for past infringement of the 147 patent, id. at 14-5, MES has not pled any
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`exclusionary interest or right to recover for damages after April 24, 2017, nor was there any
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`evidence presented at trial that it possesses such rights. The Complaint is clear that ME2C owns
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`“all rights, title, and interest” in the 114 and 517 patents, and that ME2C “holds all substantial
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`rights pertinent to this suit, including the right to sue and recover for all past, current, and future
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`infringement.” D.I. 406 ¶¶ 243, 315 (emphases added). MES is not alleged to hold and not evidence
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`was presented that it holds any rights regarding the 114 and 517 patents. As the case stands now,
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`Plaintiffs are no longer asserting the 147 patent, and no right has been asserted to damages prior
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`to July 2019. Either of those facts standing alone, much less both together, indisputably
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`demonstrate that MES is not asserting and cannot assert a constitutional cognizable injury.
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`2 As the Court recognized, MES’s relevant rights were limited to the 147 patent as it was the
`only asserted patent (at that time) that issued prior to April 24, 2017. D.I. 279 at 14 n.10.
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`2
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`Case 1:19-cv-01334-CJB Document 716 Filed 04/05/24 Page 3 of 6 PageID #: 18032
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`When notified of this issue, Plaintiffs identified the Closing Agreement between ME2C,
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`MES, and the EERC, PTX-054, as evidencing MES’s constitutional standing. Plaintiffs provided
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`no explanation for how this document demonstrates constitutional standing on the part of MES.
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`Plaintiffs did not provide any explanation because there is no reasonable explanation
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`supporting their claim. The Closing Agreement states that “the Company,” defined collectively as
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`ME2C and MES, has “the option to acquire the Patent Rights” and that “the Company has elected
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`to exercise” that option. PTX-054 at 1.3 That statement, however, does not define any division or
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`allocation of rights as between ME2C and MES. On the other hand, the Closing Agreement later
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`provides that the “Assignment of Patent rights” shall be “execute[d] and deliver[ed] to ME2C.”
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`PTX-054 at 1. That provision is wholly in accord with Plaintiffs’ allegations that ME2C owns “all
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`rights, title, and interest” in the 114 and 517 patents. D.I. 406 ¶ 243 (emphasis added). And, indeed,
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`the assignments filed with the PTO, along with the accompanying Assignment agreements, show
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`ME2C as the sole assignee. PTX-039; PTX-046. Plaintiffs adduced no evidence to show that MES
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`holds any title, interest, or rights to recover for infringement of the 114 or 517 patents. Rather, the
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`the pleadings and evidence establish precisely the opposite.
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`MES’s deficiency is of a constitutional, not statutory, nature. The issue is not whether MES
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`has some exclusionary rights that are sufficient to satisfy the requirements of 35 U.S.C. § 281. See
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`Lone Star, 925 F.3d at 1235-36 (concluding that satisfying the “all substantial rights” test of § 281
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`does not go to standing or subject-matter jurisdiction). The issue is whether MES has any
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`exclusionary rights at all sufficient to satisfy Article III. Id. at 1234. Indisputably, it does not.
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`3 The trial exhibits cited herein will be included in the parties’ joint submission of exhibits cited
`in the parties’ briefing regarding CERT’s motions for judgment of a matter of law and a new
`trial.
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`3
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`Case 1:19-cv-01334-CJB Document 716 Filed 04/05/24 Page 4 of 6 PageID #: 18033
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`To the extent that Plaintiffs argue that MES has suffered some constitutionally sufficient
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`harm other than harm to exclusionary rights, that argument should be rejected. To begin, although
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`a limited number of district courts have entertained the argument that harms other than to
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`exclusionary rights might be sufficient for Article III standing, the Federal Circuit has not endorsed
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`that reasoning. Following Lonestar, the Federal Circuit confirmed that its prior decisions
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`“routinely held that constitutional standing requires at least one exclusionary right.” In re Cirba
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`Inc., 2021 WL 4302979, at *3 (Sept. 22, 2021). The Federal Circuit noted that conferring Article
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`III standing on a bare licensee (which MES is not even alleged to be) would be “a change in the
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`law” “contrary to [its] precedent.” Id. The court concluded that it was not clear that Lone Star or
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`the Supreme Court’s decision in Lexmark Int’l, Inc. v. Static Control Components, Inc., 572 U.S.
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`118 (2014), required it to alter its precedent that exclusionary rights were a touchstone for Article
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`III standing. Id. Equally importantly, Plaintiffs did not adduce any evidence that MES suffered any
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`harm other than to the exclusionary rights it held at one time to the 147 patent. So, even if the legal
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`argument didn’t stray beyond Federal Circuit law, it would have no factual basis. Accordingly,
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`MES must be dismissed as a plaintiff.
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`On March 8, 2024, the Court entered judgments on the jury’s verdict in favor of MES as a
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`plaintiff (D.I 697-708). Because MES lacks standing and must be dismissed as a plaintiff, it is not
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`entitled to a judgment against the CERT Defendants. Those judgments must be altered and
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`amended to remove MES.
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`4
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`Case 1:19-cv-01334-CJB Document 716 Filed 04/05/24 Page 5 of 6 PageID #: 18034
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`Dated: April 5, 2024
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` /s/ Kenneth L. Dorsney
`Kenneth L. Dorsney (#3726)
`Cortlan S. Hitch (#6720)
`MORRIS JAMES LLP
`500 Delaware Avenue, Suite 1500
`Wilmington, DE 19801
`Telephone: (302) 888-6800
`kdorsney@morrisjames.com
`chitch@morrisjames.com
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`Jeff Dyess
`Paul Sykes
`Benn Wilson
`BRADLEY ARANT BOULT CUMMINGS LLP
`1819 Fifth Avenue North
`Birmingham, AL 35203
`Telephone: (205) 521-8000
`Facsimile: (205) 521-8800
`Email: jdyess@bradley.com
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`psykes@bradley.com
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`bcwilson@bradley.com
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`Jessica Zurlo
`BRADLEY ARANT BOULT CUMMINGS LLP
`1615 L Street NW Ste 1350
`Washington, D.C. 20036
`Telephone: (202) 393-7150
`Facsimile: (202) 347-1684
`Email: jzurlo@bradley.com
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`Attorneys for Defendants
`CERT Operations IV LLC,
`CERT Operations V LLC,
`CERT Operations RCB LLC,
`CERT Operations II LLC,
`Senescence Energy Products, LLC,
`Springhill Resources LLC,
`Buffington Partners LLC,
`Bascobert (A) Holdings LLC,
`Larkwood Energy LLC,
`Cottbus Associates LLC,
`Marquis Industrial Company, LLC,
`Rutledge Products, LLC
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`5
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`Case 1:19-cv-01334-CJB Document 716 Filed 04/05/24 Page 6 of 6 PageID #: 18035
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF DELAWARE
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`Plaintiffs,
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`Defendants.
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`C.A. No. 19-1334 (CJB)
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`MIDWEST ENERGY EMISSIONS CORP.
`and MES INC.,
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`ARTHUR J. GALLAGHER & CO., et al.,
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`v.
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`[PROPOSED] ORDER GRANTING CERT DEFENDANTS’ MOTION TO
`DISMISS AND TO ALTER OR AMEND JUDGMENTS
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`Whereas, the Court, having considered the CERT Defendants’ Motion to Dismiss Plaintiff
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`MES Inc. and to Alter or Amend Judgments,
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`IT IS HEREBY ORDERED that the CERT Defendants’ Motion is GRANTED. The Court
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`finds and decrees that:
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`1. Plaintiff MES Inc. is dismissed as a plaintiff.
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`2. Amended judgments consistent with this order will be entered.
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`It is so ORDERED.
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`_______________________________________________
`The Honorable Christopher J. Burke
`United States District Court Magistrate Judge
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