Opinion ID: 211143
Heading Depth: 2
Heading Rank: 2

Heading: Perfect Fit Litigation

Text: 7 In 1998, soon after the Pillowtex matter was settled, Louisville filed suit against Perfect Fit for infringement of the '322 patent. The Perfect Fit action was filed in the same district court as the Pillowtex action was, and the court determined that it would give the claim construction from the earlier Pillowtex action collateral estoppel effect. As in the Pillowtex case, Perfect Fit and Louisville settled their suit by having Perfect Fit take a license to the '322 patent and agreeing to mark Perfect Fit's mattress pads accused of infringement as licensed under the '322 patent. The settlement also contained a provision requiring Louisville and Perfect Fit to resolve future disputes involving potential infringement of the '322 patent through alternative dispute resolution (ADR) means. 8 In 2003, Perfect Fit contacted Louisville to activate the ADR provision for determining possible infringement by its new mattress pad materials. Once Pillowtex went out of business, Xymid's exclusive supply arrangement with Pillowtex for the 4059 mattress pad skirt material was effectively terminated. Xymid then began supplying Perfect Fit with the 4059 mattress pad skirt material. Pursuant to the ADR provision, the parties selected an arbitrator to determine whether Xymid's 4059 skirt material would infringe the '322 patent if it were used in Perfect Fit's mattress pads. The arbitrator concluded that it would literally infringe the patent. In reaching his decision, the arbitrator determined that he was not bound by the claim construction from the earlier Pillowtex and Perfect Fit litigations, and instead construed the claims independently. In February 2005, the district court, on Louisville's motion, entered judgment on the arbitrator's award precluding Perfect Fit from manufacturing mattress pads using Xymid's 4059 skirt material.