T hi s di s pos i t i on i s notappr opr i a t e f orpubl i c a t i on a nd i s notpr e c e de nt * e xc e pta s pr ovi de d by 9th C i r . R . 36- 3.

T he pa ne l una ni m ous l y c onc l ude s thi s c a s e i s s ui t abl e f orde c i s i on ** w ith o u t o r a l a r g u m e n t. See F ed. R . A pp . P . 34 (a )( 2). NOT F OR P UB L I CAT I ON UN I TE D STATE S C OU RT OF APPE ALS FOR T HE NI NTH CI RC UI T I n r e : R E AD - R I T E C OR P OR AT I ON , D ebt or. HI T AC HI GL OB AL S T OR AG E T E C HN OL OG I E S NE T HE R L AN DS B .V .; H I T A C H I , L T D ., A p p el l an t s, v. R E AD - R I T E C OR P OR AT I ON ; WE S T E RN D I GI T AL C OR P OR AT I ON ; W ESTERN D I G I TA L ( FREM O N T) , LLC, A p p el l ees. N o. 07- 16677 D . C. N o . CV - 0 6 - 0 4 1 7 3 - SC ME MOR AN DU M *

A pp ea l fr om the U ni t ed S t at es D i stri ctC ou rt f o rth e N o r th e rn D is tr ic t o f C a lif o rn ia S a m ue l C ont i , D i s tr i c tJ udge , P r e s i di ng S ubm i tt e d A ugus t9, 2010 ** S a n F r a n c is c o , C a lif

o rn ia 

# FI LED AU G 31 2010 M OLLY C. DW Y ER, CLERK U . S. C O U R T OF APPE ALS07- 16677 2 B efo re: G R A B E R , C A L L A H A N , an d B E A , C i rcu i tJu d g es. H i t a c hi G l oba l S t or a ge T e c hnol ogi e s N e the r l a nds B . V . a nd H i t a c hi , L t d. ( c ol l e c t i ve l y , “ H i t a c hi ” ) appe a l f r om the di s tr i c tc our t ’ s a f f i rm a nc e of

the ba nkrupt c y c our t ’ s j udgm e nt . W e ha ve j ur i s di c t i on unde r28 U . S . C . § 158( d) . T he is s u e s o n ap p e a l a r e w h e th e rH ita c h i e n te r e d in to ap a te n t lic e n s in g a g r e e m e n t w ith the debt or, R ea d-R i t e C orpo ra t i on (“ R ea d-R i t e” ), and, i f s o, w hether i tpres erved its r ig h ts u n d e rth e a g r e e m e n t b y its b e la te d e le c tio n u n d e r1 1 U .S .C . § 3 6 5 ( n ) . W e a f f i rm. H i t a c hi ’ s c l a i m s a r i s e f

r om al i c e ns i ng a gr e e m e ntbe tw e e n I B M a nd R e a dR i t e . T he a gr e e m e nta l l ow e d f orm utua l us e of

pa t e nt s a nd pr ovi de d tha ti f one com pany tra nsfe rr ed or sol d a prod uctl i ne covered by the agree m ent , the other c o mp a n y w o u l d e n t e ri n t o as i mi l a rl i c e n s i n g a g r e e me n tw i th th e tr a n s f e r e e . I BM s ol d i t s ha r d di s k dr i ve pr oduc tl i ne t o H i t a c hi , obl i ga t i ng R e a d- R i t e t o e nt e ri nt o a n e w a g r e e m e n t. I B M d r a f te d aH ita c h i– R e a d - R ite a g r e e m e n t a n d n e g o tia te d to have i tapprov ed and execut ed. H ow ever , by the t i m e the agree m entw as ne got i a t e d, R e a d- R i t e w a s on the ve r ge of ba nkrupt c y a nd de c l i ne d t o appr ove a nd e x e c u te th e a g r e e m e n t. D ur i ng the ba nkrupt c y , H i t a c hi be c a m e abi dde rf orR e a d- R i t e ’ s a s s e t s a nd w as ad d ed t o th e serv i ce l i stfo r al l p ro ceed i n g s. T h e b an k ru p t cy tru st ee fi l ed a l i st07- 16677 3 of R e a d- R i t e ’ s l i c e ns i ng a gr e e m e nt s tha ti tw a s s e e ki ng t o r e j e c t , i nc l udi ng the I B M

– R e a d - R ite a g r e e m e n t, b u t n o t th e d is p u te d H ita c h i– R e a d - R ite a g r e e m e n t. T he bank rupt cycourtse ta dea dl i ne for part i es t o the re j ec t ed agree m ent s t o el ec t t o r e t a i n the i rr i ght s unde r§ 365( n) . M or e tha n ay e a ra f t e rthe de a dl i ne , I B M a nd H ita c h i s o u g h t to r e ta in th e irr ig h ts . T he ba nkrupt c y c our the l d abe nc h tr i a l a nd de t e rm i ne d tha tH i t a c hi a nd R ea d-R i t e di d n otent eri nt o a bi nd i ng agre em ent . F urther, the bank rupt cycourt he l d tha t , e ve n i f

the a gr e e m e ntw e r e bi ndi ng, H i t a c hi r e l i nqui s he d i t s r i ght s by f a ilin g to m a k e atim e ly e le c tio n u n d e r§ 3 6 5 ( n ) . T h e d is tr ic t c o u r t a f f irm e d . “In an ap p ea l fro m a b an k ru p tcy c o u rt, w e r ev iew th e b an k ru p tcy c o u rt’s deci si on i nd ependent l y, w i tho utdefe re nce t o the di stri ctcourt . ” Zu ri ch A m . In s. C o . v . I n t’ l F ib e r c o m , I

n c . ( I n r e I n t’ l F ib e r c o m , I

n c .) , 50 3 F . 3d 93 3, 94 0 (9th C i r. 2 0 0 7 ) . W e r e v ie w th e b a n k ru p tc y c o u r t’s c o n c lu s io n s o f la w d e n o v o a n d its f a c tu a l f in d in g s f o rc le a re rr o r . Id . T he f i r s ti s s ue i s w he the rthe r e w a s abi ndi ng a gr e e m e ntbe tw e e n H i t a c hi and R ea d-R i t e. T he evi dence s up po rt s the bank rupt cycourt ’ s det erm i nat i on that the pa r t i e s i nt e nde d t o r e qui r e e xe c ut i on be f or e the H i t a c hi –R e a d- R i t e a gr e e m e nt w oul d be c om e bi ndi ng, a nd tha tthe pa r t i e s ne ve re xe c ut e d the a gr e e m e nt ; thus , theT h e p art i es ag ree th atN ew Y o rk l aw g o v ern s. 1 07- 16677 4 a g r e e m e n tn e v e rb e c a m e b i n d i n g u n d e rNe w Y o rk l a w. See R . G . G roup , Inc. v. 1 H orn & H ardar t C o. , 7 5 1 F .2 d 6 9 , 7 4 ( 2 d C ir . 1 9 8 4 ) ( “[ I ]f p a r tie s d o n o t in te n d to be bo un d b y a n agreement unt i l i ti s i n w ri t i ng and si gn ed, then there i s no con tra ct un t i l thateventoccurs 

### . ”) . Thea gree ment e xpl ic itly r equired e xe cutio n, and the a c t i ons of

the pa r t i e s ’ c ouns e l i ndi c a t e d the i runde r s t a ndi ng tha tthe a gr e e m e nt needed t o b e autho ri ze d and si gn ed by com pany execut i ves. N ei ther party a ct ed un der the t erm s of the agree m entand, contra ryt o H i t ac hi ’ s c on t ent i on , there w er e i ss ues thatR ea d-R i t e c ou l d n egot i at e pri or t o si gn i ng the agree m ent . M oreover, p a te n t lic e n s in g a g r e e m e n ts a r e o r d in a r ily w r itte n a n d e x e c u te d . See W i nston v. Me di af ar e E ntm ’ t

C or p. , 77 7 F . 2d 78 , 80 (2d C i r. 19 86 ) ( l i st i ng fa ct ors use d u nd er N e w Y ork l a w t o de t e rm i ne w he the rpa r t i e s i nt e nde d t o be bound abs e nte xe c ut i on o f a n a g r e e m e n t) . 

### H ita ch i’ s c ont entio n th at th e s ig n in g r e q u ir e m e n t w a s am e r e f o rm a lity f

a ils be c a us e the pa r t i e s a c t e d a s i f s i gni ng m a tt e r e d, a nd the c a s e s H i t a c hi r e l i e s upon i nvol ve a gr e e m e nt s w he r e the pa r t i e s s pe c i f i c a l l y di d not in te n d to r e q u ir e s ig n in g . Se e , e . g. , Mun. C ons ul tant s & P ubl is he rs , I

nc . v . T ow n of R am apo , 390 N . E . 2d 1143, 1145 ( N . Y . 1979) ( “ T he r e w a s no unde r s t a ndi ng ora gr e e m e nttha tthe contra ctw ou l d n otbe bi nd i ng un t i l bo th p art i es si gn ed i t. . . . ”) . M oreover,H ita c h i d o e s n o t c o n te n d , a t le a s t n o t “s p e c if ic a lly a n d d is tin c tly ,” th a t it 2 w as an i n t en d ed th i rd -p arty b en efi ci ary o f th e IB M

– R ead -R i t e ag reem en t ; th u s, th is a r g u m e n t is w a iv e d . L aboa v . C alde r on , 22 4 F . 3d 97 2, 98 1 n . 6 (9th C i r. 2000) . I n a ny e ve nt , thi s a r gum e ntw oul d be t o no a va i l be c a us e H i t a c hi r e l i n q u i s h e d a n y r i g h t s i th a d i n th e I B M– R e a d - R i t e a g r e e m e n t , a s s e tf o r th b e l o w. 07- 16677 5 H i t a c hi f a i l s t o pr ovi de a uthor i ty f orf i ndi ng a n 

### im

plied license or optio n contract i ni t s f av o r f ro m th eI B M

–Re a d - Ri t ea gr e e ment , t o wh i c hi twa s n o tap arty. 2 

### Alter natively , e ven if there w ere a bindin g agreement, the bankruptcy court properly concluded that Hitachi relinquish ed its rights b y waitingmore than a year af te r the§ 36 5(n) de adlin e to a ssert it s rights. H ita ch i w as on n oti cethat the bankrupt cy

trustee w as rej ecting the I B M –R e a d- R i t e a gr e e m e nta nd tha tthe trus t e e di d notbe l i e ve the r e w a s a n e xi s t i ng H i t a c hi –R e a d- R i t e a gr e e m e nt . H i t a c hi h a s n o t s h o w n th a t its f

a ilu r e to a c t w a s d u e to e x c u s ab le n e g le c t. C f. Ba n k r . R. 90 06 (b)( 1) (a l l ow i ng the bank rupt cycourtt o enl ar ge the t i m e f or a party t o act af t era dea dl i ne “ w here the fa i l ure t o actw as the re sul tof excusabl e negl ec t ”) . 

### For the fore goin g reasons, the bankruptcy court properly

concluded that there w as no bind ing agreement between Read-Rite and Hitachi, and even if there were, Hi ta ch i fa il edto pre se rv e it s ri ghts un de r § 3 65 (n ). A FFI R M ED .