United States District Court, D. Colorado
DAVID L. HILDEBRAND, Plaintiff,
WILMAR CORPORATION a/k/a Performance Tool, Defendant.
A. BRIMMER UNITED STATES DISTRICT JUDGE
matter is before the Court on the Recommendation of United
States Magistrate Judge (the “Recommendation”)
[Docket No. 30] filed on March 29, 2018. The magistrate judge
recommends that Defendant Wilmar Corporation's Motion to
Dismiss and Alternative Motion to Transfer [Docket No. 7] be
granted and plaintiff's claims be dismissed without
prejudice. Plaintiff filed a timely objection. Docket No. 31.
In light of plaintiff's pro se status, the Court
construes his filings liberally. See Haines v.
Kerner, 404 U.S. 519, 520 (1972); Hall v.
Bellmon, 935 F.2d 1106, 1110 & n.3 (10th Cir. 1991).
David L. Hildebrand is an inventor and owner of U.S. Patent
No. 5, 737, 981 (the “'981 patent”), which
issued on April 14, 1998. Docket No. 1 at 4, ¶¶ 5-
7. In February 2009, plaintiff sued defendant Wilmar
Corporation and other defendants in this district for
infringement of the '981 patent. Id. at 2;
see also Hildebrand v. BJ's Tools, No.
09-cv-00349-REB-MEH, Docket No. 1 (filed Feb. 19, 2009). As a
result of that litigation, plaintiff and defendant entered
into a settlement agreement under which defendant would pay
plaintiff a lump sum, pay ongoing royalties, and provide
certain information to defendant. Docket No. 8-1 at 1-2.
Plaintiff claims that defendant has not paid royalties or
provided reports as required under the agreement. Docket No.
1 at 3, ¶¶ 1-3.
November 22, 2017, plaintiff filed his complaint in this
case. Docket No. 1. Plaintiff brings two claims for relief:
(1) infringement of the '981 patent and (2) an accounting
of income defendant realized from its infringement.
Id. at 4-5. On December 21, 2017, defendant filed
its motion to dismiss or transfer. Docket No. 7. Defendant
argued that venue was not proper in this district and that
plaintiff's claims should be dismissed because the patent
has expired, rendering the ongoing royalty and related terms
of the settlement agreement unenforceable. Id. at
2-5; see also Kimble v. Marvel Entm't, LLC, 135
S.Ct. 2401, 2411 (2015) (discussing Brulotte v. Thys
Co., 379 U.S. 29 (1964)).
Judge Michael E. Hegarty recommends that plaintiff's
motion to dismiss or transfer be granted in part because this
district is not a proper venue under 28 U.S.C. §
1400(b). Docket No. 30 at 5. The magistrate judge recommends
dismissal without prejudice, instead of transfer, because he
found that plaintiff was unlikely to prevail in light of the
expiration of his patent. Id. at 8 (citing
Brulotte, 379 U.S. at 32). Regarding plaintiff's
accounting claim, the magistrate judge stated that,
“because Mr. Hildebrand's state law claim for an
accounting is derivative of his patent infringement cause of
action, I find that it would be improper to retain
jurisdiction over this claim.” Id. at 9.
STANDARD OF REVIEW
Court must “determine de novo any part of the
magistrate judge's disposition that has been properly
objected to.” Fed.R.Civ.P. 72(b)(3). An objection is
“proper” if it is both timely and specific.
United States v. One Parcel of Real Property Known as
2121 East 30th St., 73 F.3d 1057, 1060 (10th Cir. 1996).
To be sufficiently specific, an objection must
“enable the district judge to focus attention on
those issues-factual and legal-that are at the heart of the
parties' dispute.” See Id. at 1059
(quoting Thomas v. Arn, 474 U.S. 140, 147 (1985)).
In the absence of a proper objection, the Court may review a
magistrate judge's recommendation under any standard it
deems appropriate. See Summers v. Utah, 927 F.2d
1165, 1167 (10th Cir. 1991); see also Thomas, 474
U.S. at 150 (“[i]t does not appear that Congress
intended to require district court review of a
magistrate's factual or legal conclusions, under a de
novo or any other standard, when neither party objects to
states in his objection that he “agrees in part that
the Patent Infringing portion of said complaint being
dismissed without prejudice would be the appropriate way to
proceed on that claim.” Docket No. 31 at 6. Plaintiff,
however, argues that dismissal in part would be more
appropriate because his “remaining claim for violating
the settlement agreement would exceed the $75, 000 required
for jurisdiction under 28 U.S.C. 1332.” Id. at
2. The Court interprets this statement to mean that plaintiff
believes that the Court has diversity jurisdiction over his
accounting claim and that it should not be dismissed.
is no basis in federal or Colorado law for an accounting
“claim” for damages of the type contemplated by
plaintiff's complaint and objection. See Docket
No. 1 at 5-6; Docket No. 31 at 3. “The equitable remedy
of an accounting [is] not the same as damages.” SCA
Hygiene Prod. Aktiebolag v. First Quality Baby Prod.,
LLC, 137 S.Ct. 954, 964 (2017). Plaintiff's
accounting claim cannot be grounded in federal patent law
because “Congress abolished [claims for accounting] in
the patent context in 1946.” Id. (citations
omitted). Colorado recognizes accounting claims to resolve
disputes in the context of a business partnership. See,
e.g., Tafoya v. Perkins, 932 P.2d 836, 838 (Colo.App.
1996), as modified on denial of reh'g (Aug. 8,
1996). In other contexts, however, Colorado treats accounting
as an equitable remedy that is available where a party is
otherwise unable to determine the amount of damages under a
separate claim for damages. See Andrikopoulos v.
Broadmoor Mgmt. Co., 670 P.2d 435, 440 (Colo.App. 1983)
(citing Bradshaw v. Thompson, 454 F.2d 75, 79 (6th
Cir. 1972) (“An accounting is a species of disclosure,
predicated upon the legal inability of a plaintiff to
determine how much, if any, money is due him from another. It
is an extraordinary remedy, and like other equitable
remedies, is available only when legal remedies are
inadequate.”)). Consistent with an accounting being a
remedy for a separate claim for damages, plaintiff's
accounting claim seeks a “full accounting” of all
“income or other value realized from [defendant's]
infringing acts.” Docket No. 1 at 6, ¶ 15.
Therefore, as the magistrate judge concluded, plaintiff's
accounting claim is “derivative” of his claim for
patent infringement because it seeks to determine the amount
of damages under his patent infringement claim. See
Docket No. 30 at 9. The Court will overrule plaintiff's
also states that he “will move to amend the pleadings,
” but he has not done so. See Docket No. 31 at
3. “Merely suggesting he should be allowed to amend if
the judge concludes his pleadings are deficient ‘is
insufficient.'” Requena v. Roberts, 893
F.3d 1195, 1204 n.3 (10th Cir. 2018) (quoting Garman v.
Campbell Cty. Sch. Dist. No. 1, 630 F.3d 977, 986 (10th
Cir. 2010). Plaintiff must, instead, “file a written
motion for leave to amend, giving adequate notice of the
basis of the proposed amendment.” Id. (citing
same). This rule applies equally to pro se litigants.
Id. (citing Ogden v. San Juan Cty., 32 F.3d
452, 455 (10th Cir. 1994)). Therefore, the Court will not
grant leave to amend.
Court has also reviewed the portions of the Recommendation to
which plaintiff does not object to satisfy itself that there
is “no clear error on the face of the
record.” Fed.R.Civ.P. 72(b), Advisory Committee
Notes. The Court finds no clear error with respect to
Magistrate Judge Hegarty's recommendations and will adopt