REPORT AND RECOMMENDATION
SHERRY R. FALLON UNITED STATES MAGISTRATE JUDGE
Presently before the court in this patent infringement action are the following motions: (1) a motion to dismiss the amended complaint for lack of subject matter jurisdiction, filed by defendants Cellco Partnership (d/b/a Verizon Wireless) ("Cellco"), AT&T Mobility LLC ("AT&T"), T-Mobile USA, Inc. ("T-Mobile"), and Sprint Nextel Corporation ("Sprint") (collectively, "Defendants") on November 14, 2011 (D.I. 17); and (2) plaintiff Mayfair Wireless, LLC's ("Mayfair" or "Plaintiff) motion for leave to file a sur-reply in opposition to Defendants' motion to dismiss (D.I. 30). For the following reasons, I recommend that Defendants' motion be granted, and that Mayfair's motion be denied as moot.
United States Patent No. 6, 587, 441 ("the '441 patent"), which was published by the United States Patent and Trademark Office (the "PTO") on July 3, 2003, is directed to a method and apparatus for data transfer over various wireless networks. ('441 patent, Abstract) The '441 patent claims priority to a provisional application filed on January 2, 1999, which named six inventors: Jeffrey Urban, Jeffrey Barhorst, Christopher C. Solomon, Herbert Edwards, Chris Oltrogge, and Adam Albert (collectively, the "Named Inventors"). ('441 patent) The '441 patent identifies Technology Alternatives, Inc. ("Technology Alternatives") as the assignee. (Id.) The Named Inventors allegedly assigned the '441 patent application to their employer, Gooitech, Inc. ("Gooitech"). (D.I. 19, Exs. D & E) James Solomon acted as CEO of Gooitech. (Id, Ex. G)
Before the application for the '441 patent was filed, Hinsdale Bank & Trust Company ("Hinsdale") extended financing to Gooitech and took a security interest in Gooitech's assets pursuant to a security agreement dated May 20, 1998. (D.I. 19, Ex. N) The security agreement, which purportedly covered all existing and after-acquired assets, includes as collateral "general intangibles" that may be "hereafter acquired, " but does not specifically refer to the application for the '441 patent, which had not yet been filed. (Id.) Gooitech subsequently defaulted on its loan, and the company dissolved. (Id., Exs. G, O, P) Hinsdale foreclosed on Gooitech's assets, including the application for the '441 patent. (Id, Ex. G) Hinsdale then purchased Gooitech's assets at an Illinois UCC sale. (D.I. 28, Ex. 1) The August 30, 2000 bill of sale was not recorded with the PTO and was not produced as an exhibit to the briefing of this motion. (D.I. 19, Ex. C)
Pursuant to a March 31, 2001 bill of sale, Hinsdale sold its rights to the '441 patent application to Sierra Strategic Consulting, Inc. ("Sierra"). (D.I. 19, Ex. Q) The March 31, 2001 bill of sale does not reference the application for the '441 patent specifically, but refers generally to the intellectual property rights that Hinsdale acquired from Gooitech pursuant to the missing August 30, 2000 bill of sale. (Id.) On August 10, 2001, Sierra assigned its rights to the application for the '441 patent to 3P Networks, Inc. ("3P Networks"), which was owned and run by James Solomon. (Id., Ex. R)
On April 2, 2003, 3P Networks allegedly transferred its rights, title, and interest in the '441 patent application to Technology Alternatives, Inc. ("Technology Alternatives"), which was owned by James Solomon and Paul Masanek ("Masanek"). (Id., Ex. S) James Solomon filed a document entitled "Notice of Assignment and Assumption of Right" (the "Notice of Assignment") with the PTO, which acknowledged the transfer from 3P Networks to Technology Alternatives. (Id.) The underlying assignment was not filed with the PTO.
The PTO issued the '441 patent on July 1, 2003 to Technology Alternatives as the assignee. ('441 patent) After the '441 patent issued, Technology Alternatives entered into a business relationship with Services by Designwise, Ltd. ("SBD") and TechAlt, Inc. ("TechAlt"). A dispute arose between the entities, and SBD and Masanek sued Technology Alternatives, TechAlt, and James Solomon. The parties entered into a settlement agreement on November 19, 2004, pursuant to which Technology Alternatives became a wholly owned subsidiary of TechAlt. (D.I. 19, Ex. Vat §21.7)
On the same date, TechAlt and SBD entered into a security agreement, in which TechAlt granted SBD a security interest in all of TechAlt's assets, including its purported interest in the '441 patent. (D.I. 19, Ex. T) SBD prepared a UCC financing statement documenting the security interest and filed it with the PTO. (Id., Ex. U)
TechAlt subsequently defaulted on its obligations under the security agreement, and SBD filed an action for replevin to foreclose on the collateral. On September 29, 2005, the parties executed a settlement agreement in which TechAlt and James Solomon allowed SBD to take immediate possession of the collateral described in the November 19, 2004 security agreement. (Id, Ex. W) The Circuit Court for Cook County, Illinois entered an order of replevin and allowed SBD to take possession of the collateral. SBD conducted a UCC sale and purchased TechAlt's assets at the sale. (Id, Ex. CC)
SBD then assigned its purported rights in the '441 patent to Commonwealth Research Group LLC ("CRG") on July 7, 2009. (Id., Ex. DD) Pursuant to the assignment agreement, CRG offered to pay SBD $150, 000 in exchange for the '441 patent, and promised to pay SBD 40% of any licensing or enforcement revenues from the '441 patent. (Id., Ex. DD at § 2.2)
The agreement granted CRG a 60-day window to cancel the agreement, which expired without cancellation. (Id., Ex. DD at §§ 1.2, 1.3) On November 16, 2010, CRG purported to assign its rights in the '441 patent to Mayfair, effective as of October 20, 2010. (Id, Ex. EE) The agreement was executed by the same person on behalf of both CRG and Mayfair, and Mayfair agreed to be bound by all of CRG's obligations to SBD. (Id.)
Mayfair entered into agreements with the six Named Inventors in the summer of 2011 regarding their assignment of rights in the '441 patent to Mayfair, to the extent that those rights were not previously assigned. (Id., Exs. H-M) In August 2011, Mayfair also entered into an agreement with Masanek and James Solomon, in which Masanek and James Solomon purported to assign to Mayfair any rights they had acquired in the '441 patent in their capacities as prior owner of SBD, Technology Alternatives, and TechAlt, and prior owner of Gooitech, Sierra, 3P Networks, Technology Alternatives, and TechAlt, respectively. (Id., Exs. FF & GG) Mayfair initiated the present action on September 1, 2011. (D.I. 1)
III. LEGAL STANDARD
Federal Rule of Civil Procedure 12(b)(1) authorizes dismissal of a complaint for lack of jurisdiction over the subject matter, or if the plaintiff lacks standing to bring its claim. Motions brought under Rule 12(b)(1) may present either a facial or factual challenge to the court's subject matter jurisdiction. In reviewing a facial challenge under Rule 12(b)(1), the standards relevant to Rule 12(b)(6) apply. In this regard, the court must accept all factual allegations in the complaint as true, and the court may only consider the complaint and documents referenced in or attached to the complaint. See Gould Elec, Inc. v. United States, 220 F.3d 169, 176 (3d Cir. 2000). In reviewing a factual challenge to the court's subject matter jurisdiction, the court is not confined to the allegations in the complaint. See Mortensen v. First Fed. Sav. & Loan Ass 'n, 549 F.2d 884, 891 (3d Cir. 1977). Instead, the court may consider evidence outside the pleadings, including affidavits, depositions and testimony, to resolve any factual issues bearing on jurisdiction. Gotha v. United States, 115 F.3d 176, 179 (3d Cir. 1997). Once the court's subject matter jurisdiction over a complaint is challenged, the plaintiff bears the burden of proving that jurisdiction exists. See Mortensen, 549 F.2d at 891.
A. Consideration of Pre-Issuance Gaps in the Chain of Title
In support of their motion to dismiss, Defendants allege three breaks in the chain of title of the '441 patent. Before reaching the parties' contentions regarding each individual break in the chain of title, the court will consider Mayfair's contentions that any alleged breaks in the chain of title occurring prior to the issuance of the '441 patent are irrelevant.
According to Mayfair, the statute conferring the right to sue focuses on the patentee. The patentee in this case is Technology Alternatives. Mayfair argues that nothing in the statutory framework allows a challenge to standing based upon alleged deficiencies in the chain of title prior to the patent's issuance to the patentee. (D.I. 28 at 6-7) Mayfair contends that every transfer of ownership interest before the '441 patent's issuance to Technology Alternatives involved an exchange of equitable title, which is irrelevant to a determination of whether breaks in the legal chain of title occurred. (Id. at 7) Mayfair further alleges that Technology Alternatives, as the named assignee, was the presumptive owner at ...