College lawsuit moves to federal court

TEXAS CITY — A nonprofit corporation accused of diverting more than $400,000 of revenue from College of the Mainland has filed to move the college’s lawsuit from state court to federal court.

The Center for the Advancement of Process Technology Inc. said the case belongs in federal court because at its heart are issues of copyright infringement.

While the college claims CAPT Inc. unlawfully sold college property, CAPT Inc. said the college didn’t have rights to the materials, which included textbooks and other items used for teaching petrochemical processes.

The move to federal court effectively prevented a hearing, set for Monday, in which the college sought a temporary injunction against the corporation.

A state district judge was supposed to hear arguments on whether to order CAPT Inc. to stop doing business until the case is resolved. But Friday’s federal court filing by CAPT Inc. rendered that hearing moot.

Kim James, an attorney for the college, said the college is weighing its options, which include asking the federal court to send the case back to state court.

In its lawsuit in state court, College of the Mainland did mention copyrighted materials, but it cited other matters as its causes of action.

Those include claims under the Theft Liability Act, a state law that provides civil remedies for cases in which property is unlawfully taken.

“We have not asserted copyright infringement as a cause of action,” James said. “We have asserted there’s been theft, but not in the context of the federal statute that governs copyright infringement.”

CAPT Inc. attorney Herb Fortson said that doesn’t mean the case should stay in state court. He said that without claiming copyright infringement, there is no basis for the college’s claims.

“The federal court has sufficient jurisdiction for it to handle not only the copyright claims but the state law claims too,” Fortson said. “So it will all be resolved in federal court.”

Asked whether she thought CAPT Inc. was trying to delay or prolong the case to avoid the injunction hearing that had been set for Monday, James said, “I don’t think it was a coincidence that (CAPT Inc.’s move to federal court) was filed the last weekday before the injunction hearing. ... It prevented that hearing.”

The corporation failed to appear when the hearing was previously set for Jan. 16.

The judge heard arguments from the college that day, but later reset the hearing for Monday after CAPT Inc. said it wasn’t properly notified of the hearing.

Fortson said CAPT Inc. has legitimate reasons for moving the case to federal court.

He said it was the college that took something it didn’t own.

“The reason that the Center for the Advancement of Process Technology Inc. removed the case to federal court is because they believe the college does not own the copyrights and that the real owners of the copyrights are either the center ... or all of the hundreds of people that have prepared” the materials, Fortson said.

The college claims the process technology center, developed with the help of more than $3 million in grants from the National Science Foundation, was established as a department of the college in 2002 and was never authorized to operate independently from the college.

It nonetheless incorporated as a nonprofit entity in January 2006, according to state records.

Fortson, however, has said that hundreds of people who work for petrochemical companies and colleges nationwide contributed materials for the products being sold by CAPT Inc.

“It is the very hard work of these many, many people over a number of years that (College of the Mainland) is trying to co-opt and take as its own, without the written approval of these people,” Fortson said.

He has said all of the college’s claims are without merit.

The National Science Foundation, which has the power to subpoena records, is investigating, because the college claims that actions by CAPT Inc. have violated terms of the federal grants, which, according to the college, stipulate that revenues from the sales of products were supposed to remain with the college.

College officials worry the foundation could revoke grants or not award future grants because of the alleged diversion of funds.

If that happens, the process technology program, one of the college’s largest degree programs, could suffer, and employees could lose jobs, they said.

Mainland Editor Mark Collette can be reached at 409-683-5334 or mark.collette(at)galvnews.com.