MICHELLE D. CONNELL and HI-TECH BEDS SYSTEMS, CORPORATION v. KLN STEEL PRODUCTS COMPANY, LTD. (doing business as KLN Steel Products Company)

NOTE: This disposition is nonprecedential.
United States Court of Appeals for the Federal Circuit
2007-1083
MICHELLE D. CONNELL
and HI-TECH BEDS SYSTEMS, CORPORATION,
Plaintiffs-Appellants,
v.
KLN STEEL PRODUCTS COMPANY, LTD.
(doing business as KLN Steel Products Company),
and CLARK/BLINDERMAN/KNIGHT, LLC,
Defendants-Appellees.
Philip A. Nicholas, Anthony, Nicholas, & Tangeman, LLC, of Laramie, Wyoming,
argued for plaintiffs-appellants. With him on the brief was Mitchell H. Edwards. Of
counsel on the brief was James K. Borcia, Tressler Soderstrom Maloney & Priess, LLP,
of Chicago, Illinois.
Kevin M. O’Hagan, O’Hagan Spencer LLC, of Chicago, Illinois, argued for
defendants-appellees. With him on the brief were James J. O’Hagan, Elizabeth M.
Dillon, and Leena Soni. Of counsel on the brief was Robert A. Auchter, Robins, Kaplan,
Miller & Ciresi, LLP, of Washington, DC.
Eric Fleisig-Greene, Attorney, Appellate Staff, Civil Division, United States
Department of Justice, of Washington, DC, argued for amicus curiae. With him on the
brief were Peter D. Keisler, Acting Attorney General, and Scott R. McIntosh, Attorney.
Appealed from: United States District Court for the Northern District of Illinois
Judge Virginia M. Kendall

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Note: This disposition is nonprecedential.
United States Court of Appeals for the Federal Circuit
2007-1083
MICHELLE D. CONNELL
and HI-TECH BEDS SYSTEMS, CORPORATION,
Plaintiffs-Appellants,
v.
KLN STEEL PRODUCTS COMPANY, LTD.
(doing business as KLN Steel Products Company)
and CLARK/BLINDERMAN/KNIGHT, LLC,
Defendants-Appellees.
_______________________
DECIDED: November 15, 2007
_______________________
Before MICHEL, Chief Judge, RADER and MOORE, Circuit Judges.
MOORE, Circuit Judge.
Michelle D. Connell and Hi-Tech Bed Systems, Corporation (collectively
“Connell”) appeal from an order by the United States District Court for the Northern
District of Illinois transferring appellee’s affirmative defense under 28 U.S.C. § 1498(a)
to the Court of Federal Claims. Connell v. KLN Steel Prods. Co., No. 04-CV-0194, 2006
WL 2661011 (N.D. Ill. Sept. 13, 2006). We vacate the transfer order and remand for
proceedings consistent with this opinion.
BACKGROUND
Connell filed suit against KLN Steel Products Company and
Clark/Blinderman/Knight, LLC (collectively “KLN”) in the Northern District of Illinois,

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alleging KLN committed various tortious acts under Illinois state law and that military
bunk beds provided by KLN to the government under certain contracts infringe claims of
United States Patent No. 6,611,973. KLN contended that the United States had
authorized and consented to the alleged infringement, exculpating KLN from any
liability. See 28 U.S.C. § 1498(a). KLN moved for summary judgment on this defense,
and the district court denied that motion. Connell, 2006 WL 2661011, at *1.
After concluding that summary judgment was inappropriate, the district court
ordered that the case be transferred to the Court of Federal Claims, purportedly under
28 U.S.C. § 1404(a), for resolution of the question of whether the government had
authorized and consented to the allegedly infringing activities. Id. at *7. The district
court’s order was based on its conclusion that “it lack[ed] jurisdiction over the Navy in a
suit for patent infringement pursuant to 28 U.S.C. § 1498.” Id. The district court also
concluded that the government was an indispensable party to the litigation. Id.
Connell moved for reconsideration of the district court’s sua sponte order on
September 29, 2006. That motion was denied on October 23, 2006. Connell filed a
notice of appeal in the district court on November 20, 2006.
DISCUSSION
A. Jurisdiction
As a preliminary matter, KLN questions both the timeliness of Connell’s appeal
and whether we have jurisdiction under 28 U.S.C. § 1292(d)(4)(A), reasoning that the
district court only expressly relied on 28 U.S.C. § 1404(a) as the authority for
transferring the case to the Court of Federal Claims and § 1292(d)(4)(A) only permits
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jurisdiction over transfers made pursuant to 28 U.S.C. § 1631. We conclude that we
have jurisdiction.
KLN argues that § 1292(d)(4)(B)’s 60-day stay of proceedings in the district court
following issuance of an order transferring a case to the Court of Federal Claims under
28 U.S.C. § 1631 inherently includes a 60-day deadline for filing a notice of appeal. We
disagree. Section 1292(d)(4)(B) does not, by its terms, provide a time period for filing
an appeal. In this case, the applicable requirements for appealing the district court’s
transfer order, including the time for filing a notice of appeal, are governed by the
Federal Rules of Civil and Appellate Procedure. We conclude that Connell complied
with the applicable rules by filing its notice of appeal within 30 days of the district court’s
denial of its motion for reconsideration. See FED. R. A PP. P. 4(a)(1)(A) (notice of appeal
must be filed within 30 days of the order); see also Maxus Energy Corp. v. United
States, 31 F.3d 1135, 1139 (Fed. Cir. 1994) (noting that a motion for reconsideration
stays the time for filing an appeal). Thus, this appeal was timely.1
We also reject KLN’s argument that we lack jurisdiction under 28 U.S.C.
§ 1292(d)(4)(A), based on our recent decision in Fisherman’s Harvest, Inc. v. PBS & J,
490 F.3d 1371 (Fed. Cir. 2007). In that case, the district court cited only 28 U.S.C.
§ 1404(a) as providing the basis to transfer the case to the Court of Federal Claims.
See Fisherman’s Harvest, Inc. v. PBS & J, 401 F. Supp. 2d 745 (S.D. Tex. 2005). The
same is true here. In this case, the district court expressly concluded that it lacked
jurisdiction over KLN’s § 1498(a) affirmative defense and transferred it to the Court of
Federal Claims, citing only § 1404(a). See Connell, 2006 WL 2661011, at *7. Like we
1 We deny KLN’s pending motion to dismiss the appeal as untimely.
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concluded in Fisherman’s Harvest, we conclude that the district court was, in fact,
transferring the case under 28 U.S.C. § 1631 to cure what it perceived to be its “want of
jurisdiction.” See Fisherman’s Harvest, 490 F.3d at 1374; 28 U.S.C. § 1631. Therefore,
we reject KLN’s challenge to our appellate jurisdiction.
B. Transfer Under 28 U.S.C. § 1404(a)
The district court did not have the benefit of our recent decision in Fisherman’s
Harvest in which we concluded that the Court of Federal Claims is not a “district or
division” under 28 U.S.C. § 1404(a). That decision—issued while this appeal was
pending—renders transfers to the Court of Federal Claims under § 1404(a) improper.
In light of Fisherman’s Harvest, § 1404(a) cannot provide a basis for the transfer order
in this case.
C. Transfer Under 28 U.S.C. § 1631 to Cure “Want of Jurisdiction”
For transfer pursuant to § 1631, the transferor court must determine that it lacks
jurisdiction over the action and that the transferee court possesses jurisdiction over the
action. Fisherman’s Harvest, 490 F.3d at 1374. The district court, however clearly had
jurisdiction over Connell’s various claims under 28 U.S.C. §§ 1331, 1332, and 1338.
Section 1498(a) merely provides an affirmative defense to a patent infringement suit
brought against private party contractors; it is not a bar to a district court’s jurisdiction
over disputes between private parties. See, e.g., Sperry Gyroscope Co. v. Arma Eng’g
Co., 271 U.S. 232, 235-36 (1926) (“It became the duty of the court below to consider
and determine whether, in the circumstances stated, appellee was relieved of liability
and permitted by statute to do what otherwise would have constituted a violation of
appellant’s rights.”); Manville Sales Corp. v. Paramount Sys., Inc., 917 F.2d 544, 554
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(Fed. Cir. 1990) (“The Supreme Court has established that section 1498(a) is to be
applied, at least with respect to suits to which the United States is not a party, as a
codification of a defense and not as a jurisdictional statute.”). Therefore, we conclude
that § 1631 cannot form the basis for the district court’s transfer to the Court of Federal
Claims because it did not lack jurisdiction over KLN’s § 1498(a) defense. Cf.
Fisherman’s Harvest, 490 F.3d at 1375 (“Because there is no ‘want of jurisdiction’ over
the oyster growers’ claims against the private contractors, a transfer under section 1631
is not proper.”).
D. The United States as an Indispensable Party
The district court concluded that the United States was indispensable to the
resolution of Connell’s various state law and patent claims. Although we conclude the
United States may be in possession of information relevant to Connell’s claims and
KLN’s defenses, and certain witnesses may be government employees, the United
States is not an indispensable party to this dispute between private parties. Cf. Salton,
Inc. v. Phillips Domestic Appliances & Personal Care B.V., 391 F.3d 871, 880 (7th Cir.
2004) (“When a plaintiff is harmed by the acts of several persons, all may be essential
sources of evidence in a suit against any. But if this possibility automatically requires
that all be joined, the rule that joint tortfeasors are not by virtue of their jointness
indispensable parties . . . would be overthrown.”).
We conclude that neither § 1404(a) nor § 1631 provides a proper basis for the
district court’s transfer to the Court of Federal Claims. We also conclude that the United
States is not an indispensable party to Connell’s suit against KLN. Therefore, we
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2007-1083 6
vacate the district court’s order transferring this case to the Court of Federal Claims and
remand for further proceedings consistent with this opinion.

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