Best Energy Reduction Technologies v. Boss Controls et. al.

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UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA

BEST ENERGY REDUCTION TECHNOLOGIES, LLC,

Plaintiff, v.

BOSS CONTROLS, LLC, GREGORY PUSCHNIGG, and MICHAEL KRUMMEY

Defendants.

) ) ) ) ) ) ) )

Civil Action No. _________

JURY TRIAL DEMANDED

COMPLAINT

Plaintiff, Best Energy Reduction Technologies, LLC (“BERT”), brings this Complaint

against Defendants Boss Controls, LLC (“Boss”), Gregory Puschnigg, and Michael Krummey,

as outlined below.

THE PARTIES

1. Plaintiff BERT is a Delaware Limited Liability Company having a principal place

of business located at 840 First Ave, Suite 300, King of Prussia, PA 19406. Plaintiff BERT was

formerly known as Green Power Technologies, LLC (“Green Power”) until a certificate of

amendment was filed with the State of Delaware on May 10, 2013.

2. Upon information and belief, Defendant Boss is a Pennsylvania Limited Liability

Company having a principal place of business located at 215 East Main Street, Ligonier, PA

15658.

3. Upon information and belief, Defendant Gregory Puschnigg resides at 1700 Piper

Rd., Ligonier, PA 15658.

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4. Upon information and belief, Defendant Michael Krummey resides at 108 Stoney

Creek Ln., Harrison City, PA 15636.

JURISDICTION AND VENUE

5. This Court has subject matter jurisdiction over the claims for patent infringement

under 35 U.S.C. § 271 et seq. pursuant to 28 U.S.C. §§ 1331 and 1338(a) as they arise under the

patent laws of the United States.

6. This is also an action for misappropriation of trade secrets and breach of contract,

over which this Court has subject matter jurisdiction under 28 U.S.C. § 1367 as the claims are

related to the claims for patent infringement so as to form part of the same case or controversy.

7. Upon information and belief, Defendant Boss is subject to the jurisdiction of this

Court because Defendant Boss is a Pennsylvania Limited Liability Company and has its

principal place of business in the Commonwealth of Pennsylvania. Upon information and belief,

Defendant Boss further makes, imports, distributes, uses, sells, and/or offers to sell the infringing

devices (defined hereinafter) in the Commonwealth of Pennsylvania.

8. Upon information and belief, Defendant Puschnigg is subject to the jurisdiction of

this Court because Defendant Puschnigg resides in the Commonwealth of Pennsylvania.

9. Upon information and belief, Defendant Krummey is subject to the jurisdiction of

this Court because Defendant Krummey resides in the Commonwealth of Pennsylvania.

10. Upon information and belief, venue is proper in this judicial district pursuant to

28 U.S.C. §§ 1391 because a substantial amount of the events giving rise to the causes of action

occurred in this district. In addition, Defendant Boss transacts business selling the accused

devices in this district through QVC, Inc. (“QVC”).

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FACTS

11. Defendants Puschnigg and Krummey invented a device for remotely controlling

power to an electrically powered apparatus, which was subsequently marketed as the “Bert”

smart plug (“Bert Plug”).

12. Defendant Puschnigg founded Green Power and, along with Defendant

Krummey, executed an Assignment and Agreement (“Assignment Agreement”, attached hereto

as Exhibit A) assigning certain rights related to a product by the name of “WattPatrol,” which

later became the Bert Plug, to Green Power..

13. The Assignment Agreement contained a clause restricting Defendants Puschnigg

and Krummey’s use of “Confidential Information,” as defined in the Assignment Agreement.

14. On September 9, 2010, Defendants Puschnigg and Krummey caused a patent

application directed to the Bert Plug to be filed at the United States Patent & Trademark Office

(“USPTO”), which ultimately issued as U.S. Patent No. 7,964,989 (“the ‘989 Patent”), and the

rights to which Defendants Puschnigg and Krummey assigned to Green Power.

15. On June 16, 2011, a continuation application of the ‘989 Patent was filed at the

USPTO, which ultimately issued as U.S. Patent No. 8,093,751 (“the ‘751 Patent”) and was also

assigned to Green Power. A true and correct copy of the ‘751 Patent is attached as Exhibit B

hereto.

16. Defendant Krummey, as a member of Green Power and eventually the Chief

Technology Officer (CTO), wrote software that is installed in the Bert Plug to facilitate its

operation. At least a portion of this software was considered to be confidential and a trade secret

by Green Power, and was accessible to both Defendants Puschnigg and Krummey during their

respective affiliations with Green Power.

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17. Defendant Puschnigg was originally a member, manager, and Chief Executive

Officer (CEO) of Green Power, although by February 2012 he was still a member and a manager

but no longer the CEO.

18. In or about February 2012, Green Power had engaged in discussions with QVC to

sell Green Power’s Bert Plug through QVC to the consumer market.

19. On or about February 27, 2012, a decision was made not to pursue the sales

opportunity with QVC.

20. Upon information and belief, on or about March 6, 2012, Defendant Puschnigg,

while still a manager of Green Power, formed Defendant Boss.

21. Shortly thereafter, Defendant Puschnigg presented a proposed agreement to Green

Power involving, inter alia, the licensing of the ‘989 and ‘751 patents to Defendant Boss for the

purpose of developing a consumer market for the Bert Plug.

22. Defendant Puschnigg did not inform Green Power that he was the founder of

Defendant Boss.

23. Green Power declined to enter into the proposed license agreement, and in or

about May 2012, Defendant Puschnigg left Green Power.

24. Some time after the departure of Defendant Puschnigg, Defendant Krummey also

resigned from Green Power. In order to facilitate an orderly transition, Defendant Krummey

agreed to temporarily act as a consultant to Green Power through an entity called “Giant Oak

Engineering LLC,” and on November 3, 2012, Defendant Krummey executed a consulting

agreement (“Consulting Agreement”, attached hereto as Exhibit C).

25. The Consulting Agreement contained a clause restricting Defendant Krummey’s

use of “Confidential Information,” as defined in the Consulting Agreement.

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26. During Defendant Krummey’s consultation with Green Power, Defendant

Krummey had access to certain confidential information, including the software utilized in the

Bert Plug. In particular, Defendant Krummey was permitted to keep copies of the software,

including source code, in case support help was required.

27. Upon information and belief, and unbeknownst to Green Power at the time,

Defendant Krummey was an ownership member and the CTO of Defendant Boss while

Defendant Krummey was consulting for Green Power.

28. Defendant Boss has made, used, sold, offered for sale, and/or imported at least a

device called the “Smart Plug” (see e.g., Exhibit D), which is a device for controlling power to

an electrically powered apparatus.

29. Upon information and belief, Defendant Boss has sourced hardware for the Smart

Plug from a company known as “PowerTech” in Taiwan.

30. Upon information and belief, the hardware from PowerTech does not include

software necessary for the Smart Plug to operate as described by Defendant Boss.

31. Upon information and belief, Defendant Boss loads its own software into the

sourced hardware from PowerTech to render the Smart Plug operable.

32. Upon information and belief, at least a portion of the software in the Smart Plug is

a substantial copy and/or a derivative work of the software utilized by Plaintiff BERT in its Bert

Plug.

33. The ‘751 Patent is valid and enforceable. The term of the ‘751 Patent is set to

expire on September 9, 2030.

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34. Plaintiff BERT is the assignee of all right, title, and interest in and to the ‘751

Patent and possesses all rights of recovery under the ‘751 Patent, including the right to sue for

infringement and recourse for damages.

35. Defendant Boss has not obtained a license under the ‘751 Patent and is not

authorized or permitted to market, manufacture, use, offer for sale, or sell the invention claimed

in the ‘751 Patent.

COUNT I DIRECT INFRINGEMENT OF THE ‘751 PATENT

against Defendant Boss

36. Plaintiff BERT realleges and incorporates by reference paragraphs 1 through 35

of this Complaint as though fully set forth herein.

37. The claims of the ‘751 Patent are presumed valid pursuant to 35 U.S.C. § 282.

38. Defendant Boss, in violation of 35 U.S.C. § 271, has been and is currently directly

infringing one or more claims of the ‘751 Patent, either literally or under the doctrine of

equivalents, by making, causing to be made, using, offering for sale, selling, and/or importing

into the United States, without license or authority, at least the Smart Plug.

39. Defendant Boss has willfully infringed and, upon information and belief, will

continue to willfully infringe upon claims of the ‘751 Patent by the use, manufacture, offer for

sale, sale, and/or importation of the Smart Plug unless this Court enjoins Defendant Boss’

infringing activities.

40. As a result of Defendant Boss’ willful infringement of the ‘751 Patent, Plaintiff

BERT has been damaged to an extent not yet determined.

41. Plaintiff BERT is entitled to monetary damages adequate to compensate Plaintiff

BERT for the infringement by Defendant Boss and is entitled to increased damages under 35

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U.S.C. § 284, together with interest, costs, and attorneys fees, and is entitled to enjoin Defendant

Boss from further infringement of the ‘751 Patent.

COUNT II INDIRECT INFRINGEMENT OF THE ‘751 PATENT

against Defendants Boss and Puschnigg



43. Defendants Boss and Puschnigg, in violation of 35 U.S.C. § 271, have been and

are currently engaging in acts which constitute inducement of infringement of one or more

claims of the ‘751 Patent, either literally or under the doctrine of equivalents.

44. As the first named inventor, Defendant Puschnigg had knowledge of the ‘751

Patent at all relevant times.

45. Defendant Puschnigg, as CEO of Defendant Boss, nevertheless directed

Defendant Boss to use, manufacture, offer for sale, sell, and/or import the Smart Plug, knowing

the same to be infringing at least one claim of the ‘751 Patent, as evidenced by his previous

attempt to obtain a license to the ‘751 Patent on Defendant Boss’ behalf.

46. As CEO, Defendant Puschnigg’s knowledge of the ‘751 Patent is imputed to

Defendant Boss.

47. Defendant Boss subsequently engaged and instructed its customers to use the

Smart Plug, knowing that the use by its customers would infringe one or more claims of the ‘751

Patent.

48. Defendants Boss and Puschnigg have willfully infringed via inducement and,

upon information and belief, will continue to willfully infringe via inducement claims of the ‘751

Patent by the use, manufacture, offer for sale, sale, and/or importation of the Smart Plug unless

this Court enjoins Defendants Boss and Puschnigg’s infringing activities.

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49. As a result of Defendants Boss and Puschnigg’s willful infringement of the ‘751

Patent, Plaintiff BERT has been damaged to an extent not yet determined.

50. Plaintiff BERT is entitled to monetary damages adequate to compensate Plaintiff

BERT for the infringement by Defendants Boss and Puschnigg and is entitled to increased

damages under 35 U.S.C. § 284, together with interest, costs, and attorneys fees, and is entitled

to enjoin Defendants Boss and Puschnigg from further infringement of the ‘751 Patent.

COUNT III MISAPPROPRIATION OF TRADE SECRETS

against Defendants Boss, Puschnigg, and Krummey



52. Plaintiff BERT maintains at least a portion of the software used in its Bert Plug in

confidence, and considers same to be a trade secret.

53. Defendants Puschnigg and Krummey had access to the confidential software

during their respective tenures as members, managers, and/or officers of Green Power.

Defendant Krummey further had access to the confidential software under the terms of the

Consulting Agreement.

54. Upon information and belief, Defendants Puschnigg and Krummey have utilized

at least portions of Plaintiff BERT’s confidential software at Defendant Boss for the

manufacturing and selling of the Smart Plug product to compete with Plaintiff BERT’s Bert

Plug.

55. Plaintiff BERT has been harmed by Defendants’ actions in that sales have been

lost to Defendant Boss’ competing product, which makes use of Plaintiff BERT’s proprietary

information.

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COUNT IV BREACH OF CONTRACT

against Defendants Puschnigg and Krummey



57. The Assignment Agreement is a valid and enforceable contract as between

Plaintiff BERT, previously known as Green Power, and Defendants Puschnigg and Krummey.

58. As part of the Assignment Agreement, Defendants Puschnigg and Krummey were

obligated to hold “Confidential Information” in the strictest confidence, and to only use the

Confidential Information for the benefit of Green Power.

59. At least a portion of the software utilized in Plaintiff BERT’s Bert Plug was

considered by Plaintiff BERT to be Confidential Information within the definition provided by

the Assignment Agreement.

60. Upon information and belief, Defendants Puschnigg and Krummey breached their

respective duties with respect to the Confidential Information by creating and/or directing the

creation of software for the Boss Smart Plug using at least a portion of the software from

Plaintiff BERT’s Bert Plug.

61. Plaintiff BERT has been damaged by Defendant Puschnigg and Defendant

Krummey’s breach in that Defendant Boss has sold its Smart Plug to current and potential

customers of Plaintiff BERT using at least a portion of the previously confidential software.

Thus, Plaintiff BERT has lost sales as a direct result of the breach by Defendants Puschnigg and

Krummey.

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COUNT V BREACH OF CONTRACT against Defendant Krummey



63. The Consulting Agreement is a valid and enforceable contract as between

Plaintiff BERT, previously known as Green Power, and Defendant Krummey.

64. As part of the Consulting Agreement, Defendant Krummey was obligated to hold

“Confidential Information” in the strictest confidence, and to only use the Confidential

Information for the benefit of Green Power.

65. At least a portion of the software utilized in Plaintiff BERT’s Bert Plug was, at

least during the term of the Consulting Agreement, considered to be Confidential Information

within the definition provided by the Consulting Agreement.

66. Upon information and belief, Defendant Krummey was employed by Defendant

Boss during the term of the Consulting Agreement.

67. Upon information and belief, Defendant Krummey breached his duty with respect

to the Confidential Information by creating software for the Boss Smart Plug using at least a

portion of the software from Plaintiff BERT’s Bert Plug during and/or shortly after the term of

the Consulting Agreement.

68. Plaintiff BERT has been damaged by Defendant Krummey’s breach in that

Defendant Boss has sold its Smart Plug to current and potential customers of Plaintiff BERT

using at least a portion of the previously confidential software. Thus, Plaintiff BERT has lost

sales as a direct result of the breach by Defendant Krummey.

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PRAYER FOR RELIEF

WHEREFORE, Plaintiff BERT respectfully requests all legal and equitable relief as may

be recoverable for the foregoing offenses, including:

(a) a judgment that Defendant Boss directly infringes the claims of the ‘751 Patent;

(b) a judgment that Defendants Boss and Puschnigg have induced others to infringe

the claims of the ‘751 Patent;

(c) a permanent injunction enjoining Defendants Boss and Puschnigg and those in

active concert or participation therewith, from infringing the ‘751 Patent;

(d) an accounting for damages arising from the infringement of the ‘751 Patent by

Defendants Boss and Puschnigg and those in privity therewith;

(e) an award of damages adequate to compensate for the infringement of the ‘751

Patent, together with prejudgment and post-judgment interest thereon, and costs

fixed by the Court, as provided by 35 U.S.C. § 284;

(f) a judgment that the infringement of the ‘751 Patent by Defendants Boss and

Puschnigg was and is willful, and an award to Plaintiff BERT of increased

damages in accordance with 35 U.S.C. § 284;

(g) a judgment that Defendants Boss, Puschnigg, and Krummey misappropriated the

trade secrets of Plaintiff BERT;

(h) an award of damages adequate to compensate for the misappropriation by

Defendants Boss, Puschnigg, and Krummey;

(i) a judgment that Defendants Puschnigg and Krummey breached one or more

provisions of the Assignment Agreement;

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(j) an award of damages adequate to compensate Plaintiff BERT for the breach by

Defendants Puschnigg and Krummey;

(k) a judgment that Defendant Krummey breached one or more provisions of the

Consulting Agreement;

(l) an award of damages adequate to compensate Plaintiff BERT for the breach by

Defendant Krummey; and

(m) a grant to Plaintiff BERT of any such other relief as the Court may deem just,

equitable, or proper.

DEMAND FOR JURY TRIAL

Pursuant to Fed. R. Civ. P. 38, Plaintiff BERT hereby demands a trial by jury on all

issues so triable.

Dated: April 3, 2014 PANITCH SCHWARZE BELISARIO & NADEL, LLP

By:/s/ John D. Simmons_____________________________

John D. Simmons (PA Bar No: 202,405) Martin G. Belisario (PA Bar No. 62,641) Stephen E. Murray (PA Bar No. 203,683) One Commerce Square 2005 Market Street, Suite 2200 Philadelphia, PA 19103 Telephone: (215) 965-1330 Facsimile: (215) 965-1331 Email: [email protected] Email: [email protected] Email: [email protected]

Attorneys for Plaintiff, Best Energy Reduction Technologies, LLC

Best Energy Reduction Technologies v. Boss Controls et. al.

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