Case: Cisco Sys., Inc. v. Alberta Telecomm. Research Center, No. 2012-1687 (Fed. Cir. Aug. 29, 2013) (non-precedential). On appeal from N.D. Cal. Before Rader, O’Malley, and Wallach.
Procedural Posture: Defendant TR Labs sued numerous customers of Plaintiff Cisco for infringement of its patents directed to telecommunication networks and methods performed on the networks. In response, Cisco sued for declaratory judgment of non-infringement and invalidity of TR Labs’ patents. District court granted TR Labs’ motion to dismiss for lack of declaratory judgment jurisdiction. CAFC affirmed.
- Subject Matter Jurisdiction: District court found that Cisco could not base subject matter jurisdiction on fears of a direct infringement claim or based on threatened claims of indirect infringement by Cisco. TR Labs conceded that it had “no basis for suing [Cisco] either for direct or indirect infringement,” and the parties did not dispute that Cisco’s products have substantial noninfringing uses. The parties’ inability to agree on a covenant not to sue was also not determinative of justiciable controversy. CAFC agreed with the district court’s findings and distinguished Arkema Inc.v. Honeywell Int’l, Inc., 706 F.3d 1351 (Fed. Cir. 2013), and Arris Group, Inc. v. British Telecom. PLC, 639 F.3d 1368 (Fed. Cir. 2011), cited by Cisco, noting that some of TR Labs’ claim charts did not reference any Cisco products, Cisco and TR Labs did not engage in protracted discussions regarding potential liability prior to the filing of the declaratory judgment action, Cisco failed to identify any indemnity obligation to its customers, and TR Labs was merely unwilling to enter the covenant not to sue because Cisco wanted TR Labs to absolve Cisco’s customers of liabilities.