Nomadix, Inc. v. Guest-Tek Interactive Entm't
20-55439
| 9th Cir. | Sep 3, 2021Background
- Nomadix, Inc. and Guest‑Tek entered a License Agreement containing a forum‑selection clause requiring “all disputes … in connection with this Agreement” to be brought in the U.S. District Court for the Central District of California.
- Guest‑Tek filed petitions at the USPTO PTAB challenging the validity of Nomadix’s patents; Nomadix sued for breach of the forum‑selection clause.
- The district court granted summary judgment to Nomadix and entered a permanent injunction (citing Cal. Civ. Code § 3422) enjoining Guest‑Tek from pursuing certain PTAB petitions.
- Guest‑Tek appealed, arguing the clause did not reach PTAB proceedings, that the clause was limited to court actions, that the PTAB did not exist when the contract was signed, and that the injunction should be evaluated under federal law.
- The Ninth Circuit reviewed de novo the interpretation of the forum‑selection clause and summary judgment, reviewed the injunction for abuse of discretion (legal questions de novo), and affirmed the district court.
Issues
| Issue | Plaintiff's Argument (Nomadix) | Defendant's Argument (Guest‑Tek) | Held |
|---|---|---|---|
| Whether the forum‑selection clause covers PTAB inter partes review petitions | Clause covers “all disputes … in connection with” the Agreement; patent validity affects royalty obligations, so PTAB challenges are within clause | PTAB only decides patent validity and does not interpret contracts; PTAB/ IPR not contemplated at signing | Clause covers PTAB proceedings because patent validity has a logical/causal connection to the License Agreement; Guest‑Tek breached clause by filing at PTAB |
| Whether “disputes” is limited to court proceedings | “Disputes” in ordinary meaning includes administrative controversies; parties could have limited to court but did not | The term should be read to mean court proceedings only | “Disputes” is not limited to lawsuits; administrative fora (like PTAB) fall within its ordinary meaning |
| Whether the clause should be read to exclude new fora created after contracting (PTAB/IPR) | The clause requires “all disputes” with no carve‑out; similar PTO processes (inter partes reexamination) existed at signing | PTAB/IPR did not exist when Agreement was executed, so clause should not reach them | No implied exception for new fora; parties could have carved out PTO challenges but did not; clause applies |
| Whether judicial estoppel or forfeiture prevents Nomadix from enforcing the clause | Nomadix may enforce the forum clause | Guest‑Tek asserts judicial estoppel and forfeiture | Judicial estoppel was forfeited below and is meritless; forfeiture argument unsupported; Nomadix not barred |
| Whether a permanent injunction was appropriate and whether state or federal standard applies | Permanent injunction warranted; injunction prevents irreparable loss of bargained‑for forum rights | District court should have applied federal eBay test rather than California §3422 | Ninth Circuit need not resolve choice‑of‑law; injunction proper under either federal (five‑factor) or California §3422 standards — all federal factors met and California test mirrored by record |
Key Cases Cited
- Sun v. Advanced China Healthcare, Inc., 901 F.3d 1081 (9th Cir. 2018) (interpreting broad forum‑selection language to cover disputes that reference or have logical/causal connection to the contract)
- Curley v. City of North Las Vegas, 772 F.3d 629 (9th Cir. 2014) (standard of review for forum‑selection clause interpretation on summary judgment)
- Indep. Training & Apprenticeship Program v. Cal. Dep’t of Indus. Rels., 730 F.3d 1024 (9th Cir. 2013) (federal permanent injunction five‑factor test)
- eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388 (2006) (conjunctive test for permanent injunctions in patent cases)
- Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct. 2131 (2016) (background on establishment of PTAB and inter partes review)
- Klamath Water Users Protective Ass’n v. Patterson, 204 F.3d 1206 (9th Cir. 1999) (use ordinary meaning to interpret contract terms)
- Lear, Inc. v. Adkins, 395 U.S. 653 (1969) (public interest in allowing licensees to challenge invalid patents)
- New Hampshire v. Maine, 532 U.S. 742 (2001) (elements of judicial estoppel)
- Gilder v. PGA Tour, Inc., 936 F.2d 417 (9th Cir. 1991) (irreparable harm where monetary relief inadequate)