Tuesday, August 14, 2007

N.D. Cal.: Litigation History Alone is Proper Basis for DJ Jurisdiction

Monolithic Power Systems, Inc. v. O2 Micro Int'l, N.D. Cal. (07-2363 CW), Aug. 13, 2007

Monolithic (MPS) and O2 have had a long history of suing each other for patent infringement. In an earlier litigation, where O2 sued MPS for patent infringement, the Court dismissed with prejudice O2 Micro's claim against MPS, pursuant to a stipulated dismissal signed by the parties.

The stipulation, signed by the Court, provides:

O2 Micro covenants not to assert or reassert its ‘129 patent against named defendants for infringement by MPS full bridge inverter controllers (and products incorporating said controllers) made, used, imported, offered for sale or sold previously or currently having product designations [list of products accused of infringing O2's patents].
After the Court signed this stipulation, however, MPS designed and marketed new power inverter controller products, not previously accused of infringing the '129 patent. MPS did not believe that these products infringe. But, it believed that, because O2 takes a narrow view of the stipulated dismissal, the covenant not to sue does not cover these new products and, therefore, it is laboring under the shadow of threatened infringement litigation.

O2 argued that it had not even accused MPS's new products of infringing the '129 patent and that, therefore, MPS has no basis for filing the declaratory judgment action and the Court does not have subject matter jurisdiction over it.

The Court disagreed, noting that "[w]hether O2 Micro has publicly accused MPS's new products, which are not covered by the Stipulated Dismissal, is not dispositive to determining whether an actual controversy exists."

In the opinion, the Court concluded that the litigious history between O2 and MPS was sufficient to confer jurisdiction:

In Bridgelux, Inc. v. Cree, Inc., 2007 WL 2022024, at *9 (N.D. Cal.), the court did not, as O2 Micro suggests, find that there was no actual controversy merely because the defendants had never accused the plaintiff of infringing their patents. Rather, in concluding that, under all of the circumstances, there was no actual controversy, the court pointed out that the plaintiff provided no evidence that the defendants "had ever sued anyone" on their patents. Further, in SanDisk Corp., the Federal Circuit declined to hold that the patentee's statement that it had "absolutely no plan whatsoever to sue" the plaintiff eliminated the justiciable controversy created by patentee's actions; rather, the court concluded that the patentee "engaged in a course of conduct that shows a preparedness and willingness to enforce its patent rights" despite that statement. 480 F.3d at 1383.

O2 Micro has sued numerous parties, including MPS, accusing them of infringing the '129 patent. O2 Micro has accused MPS of infringing its '722 and '615 patents as well. Such suits indicate "an assertion of rights and a willingness to pursue litigation" regarding the patent-in-suit. Cingular Wireless v. Freedom Wireless, Inc., 2007 WL 1876377, at *3 (D. Ariz.). The Federal Circuit explains that "related litigation involving the same technology and the same parties is relevant in determining whether a justiciable declaratory judgment controversy exists on other related patents." Teva Pharms., 482 F.3d at 1344-45. And, in Cingular Wireless, the court concluded that "the assertion of rights, evidenced through a prior lawsuit between the same parties regarding the same technology, coupled with Defendant's knowledge of the relationship between Plaintiffs, and solidified through the express press release statement indicating an intent to sue alleged patent infringers, presents enough evidence to establish the case or controversy required for declaratory judgment jurisdiction." 2007 WL 1876377 at *9.

Read/download the opinion here (link)

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