364 F.3d 106 | 3rd Cir. | 2004
CHERTOFF, Circuit Judges Houston, TX 77002
(Filed March 24, 2004) Attorneys for Appellees level of liquid in the fluidizing medium entering the reactor which is in the range
OPINION OF THE COURT of from 17.4 to 50 weight percent based on the total weight of the fluidizing medium” (or in the party’s shorthand, operating reactors “above 17.4 weight percent
AM BRO, Circuit Judge condensed”). [1] For over five years plaintiff- In 1998, SABIC filed a declaratory appellant Saudi Basic Indu stries judgment action in the United States Corporation (“SABIC”) and defendant- District Court for the District of New appellee E xxo nM obil C orpo ration Jersey on behalf of its (and ExxonM obil’s) (“ExxonMobil”) have been litigating the partially-owned subsidiary, Kemya, [2] ownership rights to supercondensed mode alleging that ExxonM obil used technology technology (“SCM-T”), a process for developed for Kemya to obtain the patents manufacturing polyethylene patented by in breach of its service agreement with ExxonM obil. On June 5, 2002, the United Kemya. SABIC sought a declaratory States District Court for the District of judgment that Kemya owns the patents and New Jersey issued an interlocutory order an injunction directing ExxonMobil to turn (the “June 2002 Order”) enforcing a over legal title to Kemya. private stipulation agreement between SABIC and ExxonMobil under which E x x o n M obil f i l e d s e v e r a l SABIC agreed that its affiliates would not counterclaims, and sought, inter alia , a practice the SCM-T process. On appeal, declaratory judgment of its ownership SABIC has requested that we vacate the rights in the ’749 patent. The fourth of June 2002 Order. Because the District these counterclaims, filed derivatively on Court did not require ExxonMobil to Kemya’s behalf, accused SABIC of satisfy the requisites for the injunctive relief it requested, we vacate that order and [1] The second element of the ’749 patent remand to the District Court. is the maintenance of a specific ratio of
I.
fluidized bulk density to settled bulk density (“FBD/SBD ratio”). The second
Facts and Procedural Posture element of the ’304 patent is the In 1994 and 1995, the United States maintenance of a certain bulk density Patent and Trademark Office issued two function (called the “Z function”). patents—No. 5,352,749 and No. 5,436,304 [2] Formed in 1980 as a joint venture (called, for simplicity, the ’749 patent and the ’304 patent)—to Exxon Corporation between SABIC and Exxon Chemical (now ExxonMobil) for SCM-T. Each Arabia, Inc. (then a subsidiary of Exxon patent has two elements, and the first Corporation), Kemya is now a wholly- element of each patent is the same: “a owned subsidiary of ExxonMobil. breaching its fiduciary duty to Kemya by SHARQ had received permission to encouraging SABIC affiliates (including perform them as the third-party beneficiary one called SHARQ) to practice the SCM -T of agreements between ExxonMobil and p r o c e ss ( t h e “ F o u r t h A m e n d e d another party. Counterclaim”).
While SABIC’s Motion to Clarify In February 2000, SABIC moved to was pending, ExxonMobil filed a motion d i s m i s s t h e F o u r t h A m e n d e d to dismiss SABIC’s claims (the “Motion to Counterclaim. ExxonMobil agreed to the Dismiss”), alleging that SABIC violated dismissal in exchange for SABIC’s the April 2000 Order by allowing SHARQ promise that its affiliates would not to practice SCM-T. SABIC opposed the practice the SCM-T process while the Motion to Dismiss by urging the District litigation was pending. On March 10, Court to confirm its interpretation of the 2000, the parties entered into a stipulation March 2000 Stipulation: that a SABIC that “neither SABIC, SHARQ . . . nor any affiliate did not practice SCM-T by other SABIC affiliate (other than Kemya) operating above 17.4 weight percent will use or practice SCM-T Information [3] condensed if it was not also practicing the until the ownership rights thereto are second element of either patent (either by established and the owner expressly maintaining a specific FBD/SBD ratio or a authorizes such use . . . .” (the “March specific Z function). 2000 Stipulation”).
I n a d d i t i o n t o o p p o s i n g The parties tendered the March ExxonMobil’s Motion to Dismiss, SABIC 2000 Stipulation to the District Court on cross-moved under Federal Rule of Civil March 13, 2000. The District Court wrote Procedure 60 to vacate the Court’s “so “so ordered” on the March 10 Stipulation ordered” notation on the March 2000 and later entered it as a court order on Stipulation, in order to convert the April April 3, 2000 (the “April 2000 Order”). 2000 Order into a private agreement (the
“Motion to Vacate”). SABIC argued that In the summer of 2000, SABIC’s the District Court entered the March 2000 affiliate, SHAR Q, began operating Stipulation as a court order mistakenly and reactors above 17.4 weight percent contrary to the parties’ intent. The District condensed. Upon learning of this, SABIC Court agreed and granted SABIC’s Motion moved the District Court to clarify the to Vacate in April 2001. Saudi Basic March 2000 Stipulation (the “M otion to Indus. Corp. v. ExxonMobil Corp ., No. 98- Clarify”) by confirming that it did not 4897 (D.N.J. Apr. 26, 2001) (vacating the prohibit SHARQ’s operations because “so ordered” notation that was appended to the March 2000 Stipulation as entered “inadvertently and without the parties’ [3] SCM-T Information was defined in the express agreement”). But at the same Stipulation as the processes described in hearing, the District Court also noted the ’749 and ’304 patents. SABIC’s representation that it was not SABIC appealed the June 2002 contesting the Court’s right to continue to Order pursuant to 28 U.S.C. § 1292(a)(1). enforce the March 2000 Stipulation. JA at ExxonMobil moved for partial dismissal of 437–38 (Apr. 26, 2001 hearing transcript). the appeal “for want of appellate
jurisdiction, or in the alternative, for A year later, on April 3, 2002, the partial summary affirmance.” That motion District Court denied SABIC’s Motion to was referred to a merits panel and is Clarify after finding no legal justification consolidated with SABIC’s appeal of the (such as mutual mistake) to clarify or June 2002 Order. reform the March 2000 Stipulation. Saudi Basic Indus. Corp. v. ExxonMobil Corp ., II. 194 F. Supp. 2d 378, 389–90 (D.N.J.
Jurisdiction 2002). The District Court further stated that SABIC had been violating the March As threshold matters, ExxonMobil challenges our appellate jurisdiction and 2000 Stipulation since August 1, 2000, by allowing SHARQ to operate its reactors the timeliness of SABIC’s appeal. We above 17.4 weight percent condensed. Id . conclude that our appellate jurisdiction is proper under 28 U.S.C. § 1292(a)(1) at 390. The District Court did not address S A B IC’s arg um ent, advanced in because the June 2002 Order is effectively opposition to ExxonMobil’s Motion to an injunction. And we conclude that SABIC’s appeal was timely because it was Dismiss, that to practice the SCM-T process a reactor has to employ both filed within the 30-day appellate window that began with the issuance of the June elements of either patent, not just operate above 17.4 weight percent condensed. 2002 Order.
A. We have appellate jurisdiction SABIC moved for reconsideration under 28 U.S.C. § 1292(a)(1) . of this decision, while ExxonMobil, As the June 2002 Order is an seizing on the District Court’s statement interlocutory decision of the District Court, that SABIC had violated the March 2000 its appealability is governed by 28 U.S.C. Stipulation, moved for the District Court to § 1292. Section 1292(a)(1) provides enforce that Stipulation. On June 5, 2002, appellate jurisdiction over interlocutory the District Court denied SABIC’s motion orders “granting, continuing, modifying, for recon sid era tion and g ra nte d refusing or dissolving injunctions, or ExxonMobil’s motion to enforce the r ef using to dissolv e or m odif y March 2000 Stipulation. This action—the injunctions.” Thus, our appellate June 2002 Order— did not address jurisdiction is proper under § 1292(a)(1) if SABIC’s argument that only by practicing the June 2002 Order is an injunction. both elements of one of the patents would its affiliate be violating the March 2000 An order need not have the “literal Stipulation’s terms. characterization” of an injunction for § 1292(a)(1) to apply, as long as it has the Order imposes an equitable remedy against same practical effect. Hershey Foods SA BIC , whose noncompliance is Corp. v. Hershey Creamery Co. , 945 F.2d punishable by contempt. See Cohen , 867 1272, 1276 (3d Cir. 1991). We have F.2d at 1465; see also Harley-Davidson, previously defined an injunctive order as Inc. v. Morris , 19 F.3d 142, 146 (3d Cir. one that is “[1] directed to a party, [2] 1994) (“Failure to obey a court judgment enforceable by contempt, and [3] designed is an indirect contempt . . . .” (citing to accord or protect ‘some or all of the Black’s Law Dictionary 319 (6th ed. substantive relief sought by a complaint’ in 1990))). Third, the June 2002 Order was more than a temporary fashion.” Cohen v. “designed to accord or protect some or all Bd. of Trs. of the Univ. of Med. & of the substantive relief sought by a Dentistry of N.J. , 867 F.2d 1455, 1465 n.9 complaint.” In its amended counterclaims, (3d Cir. 1989) (en banc) (quoting W right ExxonM obil sought substantive relief that & Miller, et al., Federal Practice and included a declaration of ownership of the Procedure § 3922 (1977)); see also ’749 patent, one of the patents for the Hershey Foods , 945 F.2d at 1277 (“[I]n SCM-T process. The June 2002 Order order to be an injunction for purposes of § enforced the parties’ stipulated agreement 1292(a)(1), the order must grant part of the that neither SABIC nor its affiliates would relief requested by the claimant and must practice the SCM-T process, as defined by b e i m m e d i a t el y e n f o r c ea b l e b y the ’749 and ’304 patents, until ownership contempt.”). In contrast, “[o]rders that in rights to them are established. In this no way touch on the merits of the claim context, the June 2002 Order was but only relate to pretrial procedures” are “designed to accord or protect some or all not interlocutory injunctions within the of the substantive relief sought” by meaning of § 1292(a)(1). Hershey Foods , ExxonMobil in its amended counterclaims, 945 F.2d at 1277 (citing Switzerland namely, the right, as its purported owner, Cheese Ass’n v. E. Horne’s Market, Inc. , to exclude SABIC and its affiliates from ownership or practice of the ’749 patent. [4] 385 U.S. 23 (1966)).
Thus the June 2002 Order is, in effect, an We conclude that the June 2002 injunction appealable under 28 U.S.C. § Order satisfies the three Cohen factors for 1292(a)(1). an effective injunction appealable under 28 U.S.C. § 1292(a)(1). First, because the June 2002 Order requires that “SABIC [4] We reject as groundless ExxonMobil’s shall fully comply with the terms of the March [2000] Stipulation, which are argument that only the relief sought in the Fourth Amended Counterclaim (which was incorporated herein by reference,” it is expressly directed to a party. Second, by dismissed), as opposed to the amended granting ExxonMobil’s motion to enforce counterclaims as a whole, could have been the substantive relief protected by the June the March 2000 Stipulation, the June 2002
2002 Order. Finally, we reject ExxonM obil’s B. SABIC’s appeal was timely. argument that SABIC must demonstrate Under Federal Rule of Appellate “ s e r i o u s , p e r h a p s i r r e p a r a b l e Procedure 4(a)(1)(a), a party has 30 days consequences” from the June 2002 Order after an order is entered in which to file an in order to sustain an appeal. ExxonM obil appeal. SABIC filed its Notice of Appeal points to Carson v. American Brands, Inc. , on June 21, 2002, within the same month 450 U.S. 79 (1981), in which the Supreme that the District Court entered the June Court stated that “[u]nless a litigant can 2002 Order. But ExxonMobil construes show that an interlocutory order of the the June 2002 Order as a reinstatement of district court might have a ‘serious, the previously-vacated order enforcing the perhaps irreparable, consequence,’ and March 2000 Stipulation, [5] and argues that that the order can be ‘effectually the reinstatement of a previously vacated challenged’ only by immediate appeal, the order cannot revive an expired appeal general congressional policy against period. Thus, ExxonMobil suggests, p i e ce m e a l r e v i e w w i l l p r e c l u de SABIC’s 30-day period in which to appeal interlocutory appeal.” Id . at 84 (citing the enforcement of the March 2000 Baltimore Contractors, Inc. v. Bodinger , Stipulation began to run on April 3, 2000, 348 U.S. 176, 181 (1955)). But we have the day the District Court entered the since recognized that Carson required the March 2000 Stipulation as an order. We showing of a “serious, perhaps irreparable do not agree. consequence” in the context o f determining the appealability of an order ExxonM obil relies on tw o denying injunctive relief. Cohen , 867 F.2d cases— West v. Keve , 721 F.2d 91 (3d Cir. 1983), and Hall v. Commonwealth Mental at 1467. We have consistently refused to require such a showing of an enjoined Health Center , 772 F.2d 42 (3d Cir. party appealing an order granting an 1985)—in support of its argument that the reinstatement of a previously vacated order injunction. See Casey v. Planned Parenthood of S.E. Pa. , 14 F.3d 848, 855 cannot revive an expired appellate period. (3d Cir. 1994) (“Unlike a denial, a grant of Both cases miss the mark here. In West injunctive relief subjects the losing party to and Hall we rejected as untimely appeals contempt, and provides some or all of the from reinstated, previously vacated orders. relief sought by the claimant, two of the But in both of those cases, unlike here, a key features we identified in Cohen as justifying an interlocutory appeal.”); Ross v. Zavarella , 916 F.2d 898, 902 (3d Cir. [5] Recall that the District Court entered 1990); Cohen , 867 F.2d at 1467. Thus, the Stipulation as an order on April 3, because the June 2002 Order granted 2000, but vacated the “so ordered” injunctive relief, SABIC need not show notation a year later. Saudi Basic Indus. “serious, perhaps irreparable consequence” Corp. v. ExxonMobil Corp ., No. 98-4897 to sustain its appeal. (D.N.J. Apr. 26, 2001) (order). party sought reinstatement of an earlier and did so simultaneously. This case judgment for the express purpose of presents circumstances not present in West reviving an appellate window. In West , and Hall , and therefore is not controlled by our holding rejecting the timeliness of their holdings. such an appeal was expressly limited to
I n s u m m a r y , w e r e j e c t that circumstance: ExxonMobil’s argument that SABIC’s We hold, therefore, that appeal period began on April 3, 2000, the because the avowed purpose day the District Court entered the March of the Rule 60(b) motion in 2000 Stipulation as a court order. SABIC this case was to extend the may appeal from the June 2002 Order time for appeal, it had to enforcing a previously vacated stipulation meet the time limitations of order. That appeal, filed within 30 days of Rule 4(a). We expressly do the June 2002 Order, is timely. not decide whether a Rule
III.
60(b) motion must meet the time constraints of Rule 4(a) Application of the Injunction Standard under other circumstances
The District Court’s June 2002 not present here. Order required SABIC to “fully comply 721 F.2d at 97. Similarly, in Hall , we with the terms of the March [2000] Stipulation.” On appeal, SABIC argues affirmed the district court’s denial of an order to vacate and reenter an earlier that the District Court erred in rendering judgment which a party sought “in order to this order without requiring ExxonMobil to satisfy the required elements for permit timely appeal on the merits.” 772
granting an injunction. [6] F.2d at 42. In our case the record clearly In the context of the appellate indicates that the purpose for vacating the jurisdiction question discussed above, we “so ordered” notation was not to revive SABIC’s appeal rights but rather to allow determined that the June 2002 Order was, the second elements of either patent in in effect, an injunction. The fact that it addition to operating above 17.4 weight enforced a contractual settlement did not percent condensed. “Where material facts render it any less of an injunction, as we concerning the existence or terms of an have recognized that “[a] district court agreement to settle are in dispute, the may enter injunctive relief on a party’s parties must be allowed an evidentiary behalf to enforce a settlement agreement hearing.” See Tiernan v. Devoe , 923 F.2d when it determines that one of the parties 1024, 1031 (3d Cir. 1991) (citing Callie v. has failed to perform its obligations.” Near , 829 F.2d 888, 890 (9th Cir. 1987) Wilcher v. City of Wilmington , 139 F.3d (emphasis in original)); see also Hensley v. 366, 372 (3d Cir. 1998). Alcon Labs., Inc. , 277 F.3d 535, 541 (4th
Cir. 2002) (“If there is a factual dispute We review a district court’s grant of over the existence of an agreement, over a preliminary injunction for “whether the the authority of attorneys to enter into an court abused its discretion, committed an agreement, or over the agreement’s terms, obvious error in applying the law, or made the district court may not enforce a a clear mistake in considering the proof.” settlement agre em en t su m m ar ily.” Am. Civil Liberties Union v. Ashcroft , 322 (emphasis omitted)). Thus the District F.3d 240, 250 (3d Cir. 2003) ( citing In re Court should have a hearing to resolve the Assets of Martin , 1 F.3d 1351, 1357 (3d disputed terms of the March 2000 Cir.1993)), cert. granted , 124 S. Ct. 399 Stipulation prior to enforcing it. (2003). Because the June 2002 Order was effectively an injunction, it was a “clear IV. mistake” for the District Court not to have
Conclusion required ExxonMobil, the moving party, to We have jurisdiction over SABIC’s prove the requisites for granting an injunction. We thus remand to the District appeal, which was timely. Because the Court for this consideration. See Rolo v. District Court did not properly apply the i n j u n ct i o n s t a n d a rd i n g rantin g Gen. Dev. Corp. , 949 F.2d 695, 704 (3d Cir. 1991). ExxonMobil’s motion to enforce the
March 2000 Stipulation, we hereby vacate We also agree with SABIC that the its June 2002 Order and remand to the District Court should hold a hearing prior District Court for a hearing to resolve the to enforcing the March 2000 Stipulation. March 2000 Stipulation’s disputed terms In requiring SABIC to comply with the before determining whether injunctive March 2000 Stipulation, the June 2002 relief should issue under the standards Order incorporated its terms. But the long extant for so determining. parties dispute whether, under the terms of the March 2000 Stipulation, “practicing SCM -T Information,” as defined by the ’749 and ’304 patents, means practicing
NOTES
[6] To satisfy the injunction standard, the SABIC to avoid contempt. Nor could the sequence of vacate-then-reinstate possibly moving party must demonstrate the classic have been engineered by SABIC to revive four elements: (1) a reasonable probability of success on the merits; (2) that denial of its appellate window, as it was ExxonM obil, not SABIC, who moved to injunctive relief will result in irreparable enforce the previously vacated stipulation injury; (3) that granting injunctive relief will not result in even greater harm to the order—and did so more than a year after the order to vacate was entered. In West nonmoving party; and (4) that granting and Hall , the same party who moved to injunctive relief will be in the public interest. Allegheny Energy, Inc. v. DQE, vacate the order also moved to reinstate it, Inc. , 171 F.3d 153, 158 (3d Cir. 1999).