United States District Court, E.D. Missouri, Eastern Division
MEMORANDUM AND ORDER
JOHN A. ROSS, District Judge.
This matter is before the court on Defendants' Motion for Summary Judgment (ECF No. 28) and Defendants' Motion for Leave to File Their Motion to Strike the Expert Report of Kristopher Bleich (ECF No. 63). This matter is fully briefed and ready for disposition.
Plaintiff Four Points Communications Service, Inc. ("Plaintiff") is a contractor who engineers, furnishes and installs various types of communications systems, primarily to the military. (Defendants' Statement of Uncontroverted Material Facts in Accordance with Local Rule 7-4.01(c) ("DSUMF"), ECF No. 30, ¶2). Plaintiff was formed in April 1999 by Thomas Foreman, Harry Groppel, and Kevin Pinson. (DSUMF, ¶1). Defendant Bryan Bohnert was Plaintiff's Vice President of Business Development. (DSUMF, ¶4). Plaintiff alleges that it hired Defendant Cory Cannon as a draftsman and network computer engineer from February 2011 through February 2013, and that Bohnert was Cannon's immediate supervisor. (First Amended Complaint, ECF No. 68, ¶¶5, 7).
At issue in this case is whether Defendant Bohnert's development of the Site Survey Assistance Manager ("SSAM") software was "work for hire" by Plaintiff or whether Defendant Bohnert developed the SSAM software on his own time and independent of his employer, Plaintiff. Plaintiff alleges that Cannon used FileMaker Pro to develop the SSAM while employed by Plaintiff. (PSAMF, ¶12).
Bohnert signed an Employment Agreement, which provided in part:
Employee acknowledges that any opportunity, in any way related to the business of the Company, of which he becomes aware during the Employment Period shall be considered to be an opportunity of the Company.... Employee further agrees that, during the Employment Period, he will refer to the Company all ideas, procedures or work of any nature related to the business of the Company (which then become the exclusive property of the Company) which may come to the attention of Employee or be under the control of Employee, but Employee understands that the Company shall have the right to accept or reject any such ideas, procedures or work within its sole discretion and to set fees related thereto.
(First Amended Complaint, ECF No. 68, ¶9).
Part of Bohnert's job description included networking with contacts and learning about requests for proposals to bring new business to Plaintiff. (DSUMF, ¶4). Defendants contend that Bohnert's job description did not include software development. (DSUMF, ¶9). Plaintiff denies this limitation and asserts that Bohnert's job included all tasks assigned to him by the president of the company, Thomas Foreman, and the Board. (PSUMF, ¶9). Mr. Foreman was Bohnert's direct boss while he worked for Plaintiff. (DSUMF, ¶5).
Prior to Bohnert's employment with Plaintiff, Plaintiff's field engineers performed surveys with note pads. (DSUMF, ¶14). When he began working for Plaintiff in October 2007, Bohnert emailed a CITS survey form to several members of Plaintiff. (DSUMF, ¶15). The proposed SSAM application is a digitalized form of the CITS checklist, which has been revised, modified, and supplemented over time. (DSUMF, ¶18; PSUMF, ¶18). The CITS survey form was a standard form used to assist engineers in performing surveys and make the process more uniform. (Id.) On June 20, 2011, Bohnert filed a Certificate of Registration with the U.S. Copyright Office for a document titled CITS Based Survey Checklist. (DSUMF, ¶16). Plaintiff states that it contributed substantially to the form and that Bohnert placed a Four Points copyright on the form and the form was used with Four Points' copyright mark for years. (PSUMF, ¶16).
In the summer of 2011, while they were employed by Plaintiff, Cannon and Bohnert made a PowerPoint presentation to Mr. Foreman, Mr. Groppel, and Mr. Pinson regarding the digitalization of the CITS checklist form. (PSAMF, ¶¶11, 19; DSUMF, ¶¶17, 19). Plaintiff claims that prior to this presentation Mr. Foreman and Bohnert had been discussing digitalizing Plaintiff's survey form and presenting this project to a company named Black Box. (PSUMF, ¶17). In fact, Mr. Foreman and Bohnert presented the concept of a digitalized survey form to Black Box in early June 2011. (PSAMF, ¶4).
Bohnert claims that he talked to Mr. Foreman, Mr. Groppel, and Mr. Pinson about forming a separate entity that would be the owner of the SSAM technology and that Bohnert would own 60% of this entity and Plaintiff would own 40%. (DSUMF, ¶20). Plaintiff states that it rejected Bohnert's idea of a separate entity. (PSUMF, ¶20). Bohnert claims that this project was not high on Plaintiff's priorities. (DSUMF, ¶21). Plaintiff disclaims this idea and says that it thought this project could bring value to the services it provides. (PSUMF, ¶21). Eventually Bohnert told Cannon that Plaintiff was no longer interested in the development of the site survey tool application, and Cannon never discussed this development with anyone at Four Points other than Bohnert. (PSAMF, ¶¶ 28, 30). Bohnert claims that he moved forward with the SSAM development after Plaintiff refused to contribute to the development costs, including purchase the domain named www.ssam.us.com. (DSUMF, ¶25).
Bohnert claims that he presented Mr. Foreman with a proposed budget in the range of $20, 000-$30, 000 for developing the SSAM application. (DSUMF, ¶ 24). Bohnert claims that Plaintiff did not incur any expenses in developing the SSAM technology, other than Bohnert's salary. (DSUMF, ¶23).
In response, Plaintiff claims that it paid Bohnert's salary, Cannon's wages and expenses, paid the costs of the beta testing of the SSAM technology at Fort Gordon, purchased iPads for using the application, and paid for the engineering and design experience that went into the development of the project. (PSUMF, ¶23). Plaintiff contends it was never presented with any bills for Bohnert's purported development costs. (PSUMF, ¶27). Plaintiff claims that Bohnert never presented a budget, just conversations about the possible costs of the project. (PSUMF, ¶24). Plaintiff denies that it refused to fund the SSAM project, but that its employee, Cannon, was obtaining bids from software developers. (PSUMF, ¶25). In fact, Bohnert and Cannon had discussions with and received proposals from several companies, including Black Box, Appiction, Copper Mobile, Inc., [x]cube LABS, Booze/Allen/Hamilton, and RareWire regarding development of the SSAM technology on behalf of Plaintiff. (PSAMF, ¶¶14-26). For example, Cannon sent an email to Kirk Hasenzahl, President of RareWire, LLC, dated February 2, 2012, attaching a non-disclosure agreement between Plaintiff and RareWire requiring confidential information concerning a project titled "SSAM: Apple iPad App." (PSUMF, ¶26). This nondisclosure agreement was signed by Bohnert as Vice President of Four Points. (PSUMF, ¶26).
In April 2012, Bohnert purchased FileMaker software, a personal computer, iPads, lap top computers, and back-up storage for the laptop, with his own funds to develop the SSAM technology. (DSUMF, ¶¶27-28). Bohnert also contends that he hired and paid a software developer, Ryan Dunse, to train him on FileMaker software to develop SSAM. (DSUMF, ¶29). Bohnert claims that he worked on developing the SSAM technology on evenings and weekends, outside of his working hours for Plaintiff. (DSUMF, ¶30).
Plaintiff contends that by the time that Bohnert hired Dunse the SSAM application used at military bases for surveying was almost completed by Cannon. (PSUMF, ¶29). In response to Defendants contention that Bohnert worked on SSAM "on his own time, " Plaintiff points out that Bohnert was a salaried employee, with a base salary of at least $100, 000 per year. (PSUMF, ¶30).
Bohnert told Mr. Foreman that Plaintiff could test the SSAM application on a proposed project at Fort Campbell, but that project never came to fruition. (DSUMF, ¶¶32-33). Bohnert claims that Mr. Foreman told Bohnert that Plaintiff wanted something in writing stating that it did not have to pay Bohnert to use the SSAM application and that Mr. Foreman also wanted the product loaded on to Plaintiff's, not Bohnert's, iPads. (DSUMF, ¶34). Mr. Foreman claims that he wanted the SSAM technology on Plaintiff's iPads because it was a company project. (PSUMF, ¶34). Bohnert purchased two iPads using Plaintiff's funds. (DSUMF, ¶35). The SSAM technology was first used in October 2012 at a project at Fort Gordon. (DSUMF, ¶36). Bohnert claims that he let Plaintiff use the SSAM application for the Fort Gordon project without charge as a "beta test" before selling it on a commercial basis. (DSUMF, ¶31). Bohnert claims that he executed an Intellectual Property/Software License Agreement ("License Agreement") on behalf of Defendant Rapid Jack, and Mr. Scott Roehrig, Plaintiff's operations manager, executed the same document on behalf of Plaintiff. (DSUMF, ¶37). The License Agreement purported to grant Plaintiff a one year use of the SSAM application. (PSUMF, ¶38). Bohnert claims that Mr. Roehrig was second in command under Mr. Groppel over operations for Plaintiff. (DSUMF, ¶40).
Plaintiff claims that Mr. Roehrig was not "second in command" but that he reported directly to Mr. Groppel. (PSUMF, ¶40). Plaintiff states that Mr. Roehrig, an employee of Plaintiff, did not know what the License Agreement was and that Mr. Roehrig signed it at the directive of Bohnert, the Vice President of Plaintiff, in order to take the iPads. (PSUMF, ¶37). Mr. Roehrig did not read the License Agreement prior to signing it. (DSUMF, ¶46; PSUMF, ¶46). Mr. Roehrig was not given a copy of the License Agreement. (PSUMF, ¶37). Rapid Jack was not in existence at the time the License Agreement was executed. (PSUMF, ¶37). Mr. Roehrig did not receive any discipline from Plaintiff for signing the License Agreement, other than counseling from Mr. Foreman regarding Mr. Roehrig's lack of authority to sign contracts. (PSUMF, ¶57).
On May 23, 2013, Plaintiff filed a one-count Complaint for Declaratory Judgment Regarding Ownership of Copyright against Defendants Bryan Bohnert and Rapid Jack Solutions, Inc. (ECF No. 1). On September 11, 2013, Defendants filed their Counterclaim against Plaintiff for Declaratory Judgment Regarding Ownership of the SSAM technology. (ECF No. 17). On July 29, 2014, Plaintiff was granted leave to file a First Amended Complaint that added Cory Cannon ...