United States District Court, E.D. Texas, Sherman Division
QUINTEL TECHNOLOGY, LTD. Plaintiff,
HUAWEI TECHNOLOGIES USA, INC., ET AL. Defendants.
ORDER ADOPTING REPORT AND RECOMMENDATION OF THE
UNITED STATES MAGISTRATE JUDGE
L. MAZZANT UNITED STATES DISTRICT JUDGE.
for consideration the report of the United States Magistrate
Judge in this action, this matter having been referred to the
United States Magistrate Judge pursuant to 28 U.S.C. §
636. On March 1, 2017, the Magistrate Judge issued a Report
and Recommendation, recommending Defendant Zhengxiang
Ma's Renewed Motion to Dismiss Plaintiff's First
Amended Complaint (Doc. No. 49) be denied. Zhengxiang Ma
filed objections to the Report and Recommendation, and
Quintel Technology Ltd. (“Quintel”) filed a
response to the objections. The Court conducts a de
novo review of the Magistrate Judge's findings
15, 2015, Quintel filed the above case against Huawei
Technologies USA, Inc., FutureWei Technologies, Inc., Huawei
Technologies Co., Ltd. (collectively “Huawei”),
and Zhengxiang Ma (“Defendant” or “Dr.
Ma”). In its First Amended Complaint
(“FAC”) filed December 1, 2015, Quintel asserts
the following claims against the defendants: (1) breach of
contract; (2) misappropriation of trade secrets; (3) unfair
competition by misappropriation; (4) common law fraud and
fraud in the inducement; (5) promissory estoppel; (6) unjust
enrichment; (7) accounting; and (8) correction of patent
inventorship-35 U.S.C. § 256.
Court provides the following, as outlined in the Report and
Recommendation. Quintel is a United Kingdom company that
“designs, develops, and delivers advanced
high-efficiency, high-performance antenna solutions for
mobile operators to improve their delivery of wireless
network services” and “has developed
cutting-edge, proprietary antenna technology to better serve
wireless network operators and users.” FAC (Doc. No.
20), ¶¶ 2, 10. Futurewei and Huawei Technologies
USA are Texas corporations, and Huawei Technologies China is
a Chinese corporation. Id. ¶¶ 3-5.
Collectively, Huawei is “a telecommunications equipment
maker and, among other things, manufactures base stations for
wireless networks.” Id. ¶ 11.
July of 2008, David Barker, the chief technology officer and
an employee of Quintel, “conceived of a concept to
improve reception between an antenna providing cellular
telephone and/or data services, and a mobile receiving
telephone and/or data services from the antenna” (the
“Per User Tilt Concept”). Id.
¶¶ 12-13. “In 2009, because of potential
synergies in their respective business models, Quintel and
Huawei explored whether they might partner together to
service mobile operators in the wireless network
industry.” Id. ¶ 14. Quintel advised
Huawei “the parties must execute a non-disclosure
agreement (‘NDA') in advance of [a September 15,
2009] meeting.” It sent a draft NDA to Huawei.
Id. ¶ 16.
September 21, 2009, representatives from Futurewei and
Quintel met in California and executed a mutual NDA.
Id. ¶ 20. A copy of the NDA is attached to the
FAC. (Doc. No. 20-1). Dr. Ma participated in this meeting by
telephone from New Jersey. Id. ¶ 30. Among
other things, the NDA provides that “the recipient of
confidential information agrees to accept such information
‘solely for use in connection with Recipient's
business discussions with the disclosing party concerning
potential areas of cooperation.'” Id.
¶ 22 (quoting Doc. No. 20-1, ¶ 2).
to Quintel, after entering into the NDA, Quintel began to
share confidential and proprietary information and trade
secrets, including its proprietary antenna technology, with
Huawei and Dr. Ma. Id. ¶¶ 20, 30-45. In
particular, Quintel showed them how the “Per User Tilt
Concept” works and provided some additional
confidential and proprietary information regarding
Quintel's antenna technology, including information about
Quintel's patents-all information Quintel contends was
information protected under the NDA. Quintel alleges the
parties “ultimately could not agree on final terms to
any business or partnering relationship” and that
“despite its professed interest, Huawei never intended
to enter into a partnering relationship with Quintel.”
Id. ¶¶ 44-46.
alleges that “[a]lthough Huawei had concealed it,
Quintel recently learned that” FutureWei “filed a
provisional patent application with the United States Patent
and Trademark Office (‘USPTO') . . . on or about
October 30, 2009” wherein FutureWei “sought to
establish priority for patent protection of an invention that
is based on Quintel's confidential and proprietary
antenna technology that Quintel had shared under the terms of
the . . . NDA, ” including “a confidential
Quintel slide that Quintel had provided to Dr. Ma on
September 22, 2009.” Id. ¶ 49. Quintel
additionally alleges that “Dr. Ma is listed as the sole
inventor on the provisional patent application.”
to Quintel, approximately one year later, FutureWei filed a
nonprovisional patent application with the USPTO, which
claimed the benefit of its provisional patent application
“seeking protection of an invention based on the
Quintel confidential and proprietary antenna technology that
Qunitel had shared under the terms of the . . . NDA.”
Id. ¶ 50. On November 18, 2014, the USPTO
issued FutureWei Patent No. U.S. 8, 891, 647 B2 (“the
‘647 patent”), entitled “System and Method
for User Specific Antenna Down Tilt in Wireless Cellular
Networks.” Id. ¶ 52. The sole inventor of
the patent is listed as Zhengxiang Ma of Summit, New Jersey,
and FutureWei Technologies, Inc. of Plano, Texas is listed as
the assignee of the patent. The ‘647 patent includes
claims for user specific antenna down tilt, which Quintel
alleges is a characteristic of the Per User Tilt Concept.
Specifically, Quintel alleges the ‘647 patent includes
one or more claims to which David Barker made an inventive
contribution, but the ‘647 patent failed to name David
Barker as a joint inventor. Id.
alleges it had no reason to suspect that Huawei was
misappropriating, using, and disclosing Quintel's
confidential and proprietary antenna technology in
contravention of the September 21, 2009 NDA, because Huawei
concealed its actions and continued to engage Quintel in
discussions about a potential business relationship.
Id. ¶ 51. Quintel alleges the defendants'
actions came to light on March 16, 2015 when the European
Patent Office (“EPO”) rejected a patent
application submitted by Quintel, citing the prior
publication of FutureWei's United States application that
resulted in the ‘647 patent as prior art. Id.
¶ 54. Quintel maintains the information was
“fraudulently concealed” prior to that date,
“in part by [the defendants'] continuing to feign
interest in a partnership agreement.” Id.
December 30, 2015, the defendants filed a motion to dismiss
the FAC, asserting the Court lacks personal jurisdiction over
Dr. Ma; six of the eight causes of action are time barred;
and Quintel fails to state a claim upon which relief can be
granted on all claims except the breach of contract claim
against Huawei. (Doc. No. 25). On September 27, 2016,
District Judge Davidson entered a Memorandum Opinion Granting
in Part and Denying in Part Defendants' Motion to
Dismiss. (Doc. No. 42). Judge Davidson denied the part of the
defendants' motion to dismiss regarding lack of personal
jurisdiction without prejudice and with leave to reurge with
the results of targeted jurisdictional discovery on the issue
of whether the Court has personal jurisdiction over Dr.
Ma.Dr. Ma filed the current renewed motion to
dismiss on December 15, 2016, asserting Quintel has failed to
establish any basis for the exercise of personal jurisdiction
over him in Texas.