No Judicial Eraser

Submitted by patentadmin on Tue, 08/10/2010 - 12:08

What is a patentee to do when, locked in a costly battle to enforce its patent, a court construes its claim terms in an unfavorable manner? Well, the first thing, of course, is to settle the case. This will stop the “bleeding” (clientspeak for “paying the lawyers”).

However, a problem remains: what to do about that adverse claim construction, which will be cited by any accused infringers the patentee may pursue in the future. Clearly, something must be done about that claim construction! One possibility is to simply ask the Court to vacate its pesky claim construction decision. Sometimes this works – but not always. (City of Aurora, Colorado v. PS Systems et al.)

As might be expected from the preceding paragraph, the patentee saw its case go awry as the Court rendered an unfavorable claim construction decision. The parties settled the case and then jointly moved the Court to vacate the claim construction decision. As related by the Court in its decision DENYING the motion, the patentees argued that “they had possibly¹ intended to appeal the claim construction order, but now the settlement agreement precludes that option. The patentees also fear that a future infringer may seek² to use the order regarding claim construction against them in future cases.”

The Court was buying none of this. “The Court disagrees that the overriding public policy [favoring settlement] is in favor of vacating an otherwise valid court order because one or more of the parties, after settlement, finds the order inconvenient. There is a public interest against concealing or obscuring the nature of court proceedings. Had the parties wished to resolve their disputes in a manner that did not involve public proceedings, there were ways to do so. For example, the parties could have submitted to binding arbitration.”

THE LESSON TO BE LEARNED: Hope for the best, but plan for the worst; consider the Court’s sage advice.
¹ “possibly” – who are they kidding?

² “may seek” – see footnote 1

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