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Covenant to sue that does not cover future infringement insufficient to defeat DJ jurisdiction

By McKee, Voorhees & Sease, P.L.C.

In a recent decision, the Federal Circuit reversed a district court's dismissal for lack of declaratory judgment jurisdiction over a defendant's counterclaims for non-infringement, invalidity, and unenforceability of a patent.  The plaintiff brought suit against the defendant for infringement in 2003, and on the eve of trial on the issues of invalidity and unenforceability, offered a covenant not to sue for past infringement and filed a motion to dismiss.  The district court granted the motion, holding there was no longer a case or controversy.  The defendant appealed.

The Federal Circuit reversed, noting that the covenant not to sue did not cover future infringement, and the defendant had a large amount of stock of the accused products ready to sell pending the outcome of the case.  The patentee asserted that if the defendant resumed sales, it would once again bring suit for infringement.  Under these facts, the Federal Circuit agreed with the defendant and held that the plaintiff, by retaining its right to sue for future infringement, had preserved the controversy at a level of sufficient immediacy and reality to allow for declaratory judgment jurisdiction.

More detail of Revolution Eyewear, Inc. v. Aspex Eyewear, Inc. after the jump.

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Full post as published by FileWrapper on March 03, 2009 (boomark / email).