A federal judge tossed the charges against four former Best Medical International Inc. executives accusing them of stealing trade secrets, but let stand patent infringement charges against Accuray Corp. (NSDQ:ARAY).
The lawsuit, filed in the U.S. District Court for Western Pennsylvania, alleges that Sunnyvale, Calif.-based Accuray’s CyberKnife VSI system, which delivers controlled, focused doses of radiation to eradicate tumors, infringes a patent it owns for intensity modulated radiation therapy. Springfield, Va.-based Best Medical claimed that Robert Hill, a former employee who quit to work for Accuray, “downloaded confidential, proprietary, intellectual property and trade secrets” from Best Medical before he left its employ, according to court documents.
That information allegedly formed the basis of Accuray’s latest iteration of the CyberKnife, which incorporates IMRT technology Best Medical alleges was stolen by Hill and three other former employees — David Spellman, John David Scherch and Marcus Bittman — who also decamped for Accuray, according to the lawsuit.
The spat began when Hill sued Best Medical for allegedly failing to fully pay the benefits it owed him when he quit. Best Medical counter-sued, saying Hill violated a non-compete agreement in moving to Accuray, and in October 2008 sued the company and its four former workers, claiming that they colluded with Accuray to pilfer trade secrets. Hill, Spellman, Scherch and Bittman surrendered their computer hard drives as part of a court-ordered injunction, which barred them from divulging any proprietary information considered confidential by Best Medical.
For their parts, Accuray and the four men denied that Accuray competes with Best Medical and that the men did not reveal any trade secrets when they switched companies, according to court documents.
Judge Terrence McVerry granted a motion to dismiss the charges against the four individual defendants, ruling that Best Medical failed to “allege facts regarding each defendant’s alleged improper conduct,” according to the documents.
“[Best Medical] is silent as to the alleged conduct undertaken by each specific individual defendant,” McVerry wrote. “The only distinction the court can discern … is that Hill apparently resigned from his employment with BMI earlier than the other individual defendants.”
But McVerry let stand a patent infringement charge against Accuray, writing tht Best Medical has presented a plausible case thus far and that it’s too early to say whether it will be able to prove the charge.
