United States District Court, D. Hawaii
FINDINGS AND RECOMMENDATION TO GRANT PLAINTIFF'S
MOTIONS TO REMAND 
Richard L. Puglisi United States Magistrate Judge.
proceeding pro se, filed a Motion for Remand of This Matter
to State Court as the Notice of Removal is an Attempt to
Avoid Discovery in that Court or in the Alternative to Grant
the Removal on the Basis of Diversity as well as Patent
Violations on May 17, 2017, and filed a Request For Remand of
this Matter to State Court on May 24, 2017 (collectively
referred to as “Motions to Remand”). ECF Nos. 13,
17. On June 7, 2017, the district court administratively
withdrew various dispositive motions regarding
Plaintiff's Third Amended Complaint and referred the two
pending Motions to Remand. See ECF No. 39. Defendant
Barry A. Sullivan filed an Opposition to the Motions to
Remand on June 26, 2017. ECF No. 46. Defendants Nuance
Communications, Saleforce.com Inc., Craig Weissman,
Christopher Fry, and Microsoft filed Joinders in Defendant
Sullivan's Opposition. See ECF Nos. 47, 48, 49,
50. Defendant Sullivan filed a Supplemental Memorandum
addressing the issue of timeliness as directed by the Court
on July 5, 2017. ECF Nos. 51, 83. Plaintiff filed his Reply
on July 13, 2017. ECF No. 84. The Court found this matter
suitable for disposition without a hearing pursuant to Rule
7.2(d) of the Local Rules of Practice of the United States
District Court for the District of Hawaii. ECF No. 40. After
carefully reviewing the submissions of the parties and the
relevant legal authority, the Court FINDS that this case was
not properly removed and RECOMMENDS that the district court
GRANT Plaintiff's Motions.
together with another individual, developed a programable
theory of syntax in the early 1990s. ECF No. 1-3 ¶¶
22-23. In 1995, Plaintiff started a company, Ergo, to develop
syntax software programs for patent. Id. ¶ 24.
The patent, U.S. Patent No. 5, 878, 385 A, entitled
“Method and Apparatus for Universal Parsing of
Language” (“Ergo Patent”) was granted in
1999. Id. ¶ 25, 66. Plaintiff alleges that the
Ergo Patent was used to develop software that provided
structural analysis of sentences generated by speech or text.
Id. ¶ 28. Defendant Sullivan served on
Ergo's board, was its chief financial officer, and acted
as the attorney for the company. Id. ¶ 4. Ergo
closed in 1999. Id. ¶¶ 78, 80.
the same time that Ergo ceased operations, Plaintiff alleges
that Defendant Sullivan formed a competing company, Thrownet.
Id. ¶ 44. Plaintiff alleges that Defendant
Sullivan was granted access to Ergo's software source
code and provided that code to Defendant Fry, Thrownet's
head of engineering, for review. Id. ¶¶
46-48. Plaintiff alleges that Defendant Fry then developed a
software component “with exactly the same number of
lines of code, 30, 000, as the Ergo [software component],
” which Plaintiff alleges is remarkable because
Defendant Fry developed the component in two months and it
took Plaintiff 15 years to develop the Ergo software
component. Id. ¶ 48. Plaintiff alleges that
Defendants used Ergo's patented technology to make their
own software. Id. ¶ 50. Plaintiff alleges that
Defendant Fry worked with other named Defendants to obtain a
series of patents that were dependent on the software
component that Plaintiff alleges was stolen from the Ergo
patented technology. Id. ¶¶ 56-62.
Plaintiff alleges that Defendant Sullivan violated his
fiduciary and legal responsibilities to Plaintiff and
conspired with the other named Defendants to steal Ergo's
patented technologies. Id. ¶ 63. Plaintiff
alleges that he did not learn of the full scope of the
Defendants alleged actions until 2015. Id. ¶
80, 87, 90-94.
COURT PROCEDURAL HISTORY
proceeding pro se, filed this action in the Circuit Court for
the First Circuit of the State of Hawaii, on July 31, 2015.
See ECF No. 1-2 at 1. Plaintiff's initial filing
was styled as a letter to the state court with several
attachments, including a temporary restraining order that had
been issued against Plaintiff in favor of Defendant Sullivan.
See ECF No. 53-4. The temporary restraining order
includes a declaration from Defendant Sullivan that states
that Plaintiff “is accusing me and a former
professional colleague of mine and very well known engineer
in the technology world of somehow ‘stealing' his
intellectual property.” Id. at 6. In his
letter filing, Plaintiff states that he has filed a complaint
against Defendant Sullivan for professional misconduct.
Id. at 9. The complaint against Defendant Sullivan
is also attached to Plaintiff's letter filing.
Id. at 12. The complaint states that Defendant
Sullivan “violated his non-disclosure, violated our
patent, and stole trade secrets.” Id. The
complaint also provides the details of the Ergo Patent,
including the patent number and a description of its use and
a detailed statement of Plaintiff's allegations regarding
Thrownet's alleged misappropriation of the Ergo Patent.
Id. at 12-13. Plaintiff states that he
“recently found proof that Sullivan . . . has indeed
stolen our patented tools and has been illegally trying to
sell them buried in patents by his former head of
engineering, Chris Fry.” Id. at 14.
response to Plaintiff's letter filing, Defendant
Salesforce.com and Defendant Fry filed motions to dismiss, or
in the alternative, for a more definite statement. ECF No.
53-5 at 74; ECF No. 53-6 at 2. In those motions, Defendants
summarize Plaintiff's allegations of wrongdoing, stating
that Plaintiff alleges that Defendant Sullivan, through
Thrownet, improperly used the Ergo Patent and that Defendant
Sullivan had stolen Ergo's patented tools. ECF No. 53-5
at 81. Further, Defendants state that Plaintiff has alleged
that “Mr. Sullivan and Mr. Fry have stolen and
misappropriated intellectual property belonging to Ergo and
Plaintiff.” Id. Defendant Sullivan filed a
position statement and motion for sanctions. ECF No. 53-7. On
February 4, 2016, the state court granted the motions for a
more definite statement. ECF No. 54-5 at 6. The state court
also quashed Plaintiff's attempted service of process of
Plaintiff's initial complaint on Defendant Sullivan.
See ECF No. 57-3 at 2-6.
filed an amended complaint on March 3, 2016, captioned as a
complaint for “Legal Misconduct, fraud, and RICO
Violations.” ECF No. 55-4 at 1. In that amended
complaint, Plaintiff alleged that Defendants
“stole” his information technology
(“IT”), intellectual property (“IP”)
“investments, and source code” and
“violated their non-disclosures and [his]
patent.” Id. at 3. Plaintiff alleges that
Defendants “buried [his] patented software in a variety
of patents by [Thrownet and Defendant] Fry.”
Id. Plaintiff alleges that Defendant Fry accepted
the position at Thrownet knowing that “it was the Ergo
patented IP and IT, ” and knowing that Plaintiff's
“work was patent protected and that [Defendant]
Sullivan had no rights to it.” Id. at 5.
Plaintiff's amended complaint also states that the
alleged conspiracy “is also a violation of both Hawaii
and Federal RICO statutes” and seeks “Federal
RICO treble damages.” Id. at 5-7. As with
Plaintiff's initial letter filing, the amended complaint
identifies the Ergo Patent in detail including the number and
publication date. Id. at 12. The amended complaint
also contains numerous allegations regarding the history of
the Ergo Patent and Defendant Sullivan's alleged actions
in forming Thrownet as a competing company. Id. at
12-15, 21-23. The amended complaint alleges that an
inspection of Defendant Fry's patented technology
“will quickly reveal the Ergo [technology]” and
that Defendants “stole the Ergo IP and IT” from
Plaintiff. Id. at 22-23. Plaintiff alleges that
Defendant Fry's review of prior art in his patent
applications do not include the Ergo Patent, which Plaintiff
alleges is evidence of Defendants' improper use.
Id. at 22.
response to Plaintiff's amended complaint, Defendant
Sullivan filed a motion for a more definite statement or, in
the alternative, a motion to strike on June 2, 2016. ECF No.
60-4 at 1. In that motion, Defendant Sullivan expressly
states that he was properly served with the summons and
amended complaint on May 12, 2016. Id. at 6.
Defendant Sullivan also states that the amended complaint
alleges that he “stole intellectual property from
[Plaintiff] and/or Ergo.” Id. at 10.
August 4, 2016, the state court granted Defendant
Sullivan's motion for a more definite statement and gave
Plaintiff until August 12, 2016, to file a second amended
complaint. ECF No. 62-4 at 65-69. Specifically, the state
court directed Plaintiff to file a second amended complaint
that included numbered paragraphs, was concise, removed all
repetitive and irrelevant matters, and did not include
personal opinions or principles of law. Id. at 66.
Plaintiff did not file a second amended complaint by the
court's deadline, Defendant Sullivan then filed a motion
to dismiss. See ECF No. 64-5 at 1-10. The court
denied Defendant Sullivan's motion to dismiss without
prejudice and quashed attempted service of process of
Plaintiff's late-filed second amended complaint on
Defendant Sullivan on August 12, 2016, and August 26, 2016.
See ECF Nos. 67-7 at 50-52.
filed a request to file a third amended complaint, which was
granted by the state court on January 31, 2017. ECF No. 68-3
at 1, 104-05. Plaintiff filed his Third Amended Complaint on
March 1, 2017. ECF No. 68-4 at 1. Plaintiff served Defendant
Sullivan on April 7, 2017. ECF No. 68-5 at 12-13.