Searching over 5,500,000 cases.

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

MCR Oil Tools LLC v. Spex Offshore Ltd.

United States District Court, N.D. Texas, Dallas Division

February 16, 2018

MCR OIL TOOLS, LLC, Plaintiff,
SPEX OFFSHORE, LTD., et al., Defendants.



         Before the Court is the Motion to Remand (ECF No. 10), filed by Plaintiff MCR Oil Tools, LLC (“MCR”). After consideration, the Motion is GRANTED IN PART and DENIED IN PART.

         I. BACKGROUND

         This action concerns a dispute involving an alleged breach of contract and misuse of MCR's intellectual property. MCR invents, develops, manufactures, and sells oilfield tools, products, and equipment. (Original Petition, ECF No. 1-1, at ¶ 1). These tools include thermite-based tools, including a pipe cutter and a torch fueled by a solid combustible charge. (Id.). MCR's tools are protected through patents, trade secrets, confidential and proprietary information, and license agreements (collectively, the “Licensed Technology.”). (Id.).

         Beginning in 2009, Defendant SPEX Offshore, Ltd. (“SPEX”) entered into multiple technology licenses with MCR. (Id. at ¶ 2). MCR alleges that SPEX recently breached numerous provisions of the 2014 License Agreement (including a 2015 Extension), misappropriated MCR's Licensed Technology, and used MCR's stolen technology to obtain numerous patents in SPEX's own name. (Id. at ¶ 4).

         On December 27, 2017, MCR filed this lawsuit in the 95th Judicial District Court of Dallas County, Texas, and asserted causes of action against Defendants for breach of contract, declaratory judgment, violations of the Texas Uniform Trade Secrets Act, common law misappropriation, unfair competition under Texas law, common law fraud, fraudulent inducement, and conspiracy. (Id. at ¶¶ 38-67). MCR also requested a temporary restraining order, temporary injunction, and permanent injunction to enjoin SPEX's further use of the Licensed Technology. (Id. at ¶¶ 68-74). To clarify that none of the claims seeks relief under federal patent law, the Original Petition states: “Nothing herein is presented to the Court which seeks a determination of the validity of a patent or calls for the application of U.S. Federal Law. . . .” (Id. at ¶ 76).

         On December 28, 2017, Defendants removed the state court action to this Court, arguing that “[t]his case concerns a federal question involving patents.” (Notice of Removal, ECF No. 1, at 2 ¶3). On January 4, 2018, SPEX Group U.S. LLC (“SPEX Group”)-but not the other two Defendants-filed an answer and asserted affirmative defenses. (ECF No. 4). SPEX Group also alleged two counterclaims under the Federal Declaratory Judgment Act, 28 U.S.C. § 2201, et seq., for a declaration of non-violation of the Defend Trade Secrets Act, 18 U.S.C. § 1836, et seq., and a declaration of non-infringement of MCR's patents. (ECF No. 4 at ¶¶ 12-18).

         On January 5, 2018, the Court, on its own accord, set a hearing on whether federal question jurisdiction exists in this case. (ECF No. 5). MCR and SPEX Group submitted briefing and appeared for an oral argument on February 13, 2018.


         A defendant may remove a state court action to federal court if the case originally could have been filed in federal court. 28 U.S.C. § 1441(a). The removing party bears the burden of establishing the federal court's jurisdiction. Howery v. Allstate Ins. Co., 243 F.3d 912, 916 (5th Cir. 2001).

         A federal district court has subject matter jurisdiction over a civil action that “arises under the Constitution, law, or treaties of the United States.” 28 U.S.C. § 1331. To evaluate whether a federal question exists, the court examines the well-pleaded complaint as it existed at the time of removal. Merrell Dow Pharms. v. Thompson, 478 U.S. 804, 808 (1986); Allen v. Bank of Am., N.A., 5 F.Supp.3d 819, 829 (N.D. Tex. 2014). The basis for jurisdiction must be found in the allegations supporting the plaintiff's claim. Carpenter v. Wichita Falls Indep. Sch. Dist., 44 F.3d 362, 366 (5th Cir. 1995). Federal jurisdiction cannot rest on the defendant's answer or petition for removal. See Stump v. Potts, 322 F. App'x 379, 380 (5th Cir. 2009) (citing MSOF Corp. v. Exxon Corp., 295 F.3d 485, 490 (5th Cir. 2002)). Nor does it suffice if the defendant's counterclaim raises the federal question. Vaden v. Discover Bank, 556 U.S. 49, 60 (2009).

         Federal question jurisdiction does not exist merely because federal law may be tangentially involved. Merrell Dow, 478 U.S. at 813. The federal law must create the plaintiff's cause of action, or the plaintiff's claim must necessarily depend on a substantial federal law question. Borden v. Allstate Ins. Co., 589 F.3d 168, 172 (5th Cir. 2009); see Am. Tel. & Tel. Co. v. Integrated Network Corp., 972 F.2d 1321, 1324 (Fed. Cir. 1992) (“[E]very theory of a claim as pled must depend on patent law if there is to be federal jurisdiction.”).

         III. ANALYSIS

         A. Federal ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.