General Protecht Group, Inc. v. Leviton Manufacturing Co.
651 F.3d 1355
| Fed. Cir. | 2011Background
- Levitón and GPG are manufacturers of GFCIs; they settled a 2007 lawsuit under a confidential Settlement Agreement.
- Settlement Agreement includes a covenant not to sue and a clause exposing forum and venue in the District of New Mexico for disputes relating to the agreement.
- Levitón later asserted new patent infringements (the '124 and '151 patents) in ITC and California actions, triggering GPG’s argument that the forum clause compels NM litigation.
- GPG sought to enforce the forum clause via declaratory-judgment action in NM and sought a preliminary injunction; NM court granted the injunction.
- The district court found likelihood of success on the merits, irreparable harm, and favorable balance of hardships and public interest, supporting the injunction.
- On appeal, Levitón argued (i) the clause does not apply to defense-based disputes, (ii) no implied license defense should be inferred, and (iii) error in applying the injunction factors.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does the forum clause apply to disputes arising from an implied license defense? | Levitón argues clause covers only direct contract disputes, not implied-license defenses. | GPG contends clause extends to disputes that relate to or arise out of the Settlement Agreement via implied license defenses. | Yes; clause applies to implied-license disputes. |
| Does TransCore control whether an implied license is present here? | Levitón asserts TransCore is distinguishable or inapplicable because continuations may be narrower. | GPG argues TransCore governs and supports implied licensing when continuations flow from licensed patents. | TransCore controls; implied license exists. |
| Does Jacobs v. Nintendo contradict TransCore or control this case? | Levitón claims Jacobs forecloses implication of a broad license in this context. | GPG asserts Jacobs does not conflict with TransCore and is not controlling here. | Jacobs does not conflict with TransCore; no controlling conflict. |
| Were the preliminary injunction factors correctly applied (irreparable harm, balance, public interest)? | Levitón argues no irreparable harm and forum loss is not irreparable; hardship on NM litigation is overstated. | GPG contends irreparable harm, forum deprivation, and public interest favor enforcement of the clause. | District court did not abuse discretion; factors favor injunction. |
Key Cases Cited
- Trans-Core v. Electronic Transaction Consultants Corp., 563 F.3d 1271 (Fed.Cir. 2009) (implied license excludes derogation after settlement; the covenant can grant implied license rights)
- Jacobs v. Nintendo of America, 370 F.3d 1097 (Fed.Cir. 2004) (covenant-not-to-sue and license interplay; does not control in this case)
- Texas Instruments Inc. v. Tessera Inc., 231 F.3d 1325 (Fed.Cir. 2000) (patent license clauses extend to patent issues; forum selection dependent on license scope)
- M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1 (Supreme Court 1972) (forum selection clauses are prima facie valid and enforceable)
- Laboratory Corporation of America Holdings v. Chiron Corp., 384 F.3d 1326 (Fed.Cir. 2004) (national uniformity; injunctions against copending actions in different courts are appropriate)
- Camping Construction Co. v. District Council of Iron Workers, 915 F.2d 1333 (9th Cir. 1990) (irreparable harm concept in ITC/arbitration context; distinguishable from patent injunctions)
- Hospah Coal Co. v. Chaco Energy Co., 673 F.2d 1161 (10th Cir. 1982) (forum non conveniens considerations; not controlling here but cited in hardship discussion)