Opinion ID: 211222
Heading Depth: 3
Heading Rank: 1

Heading: Agreement 1(b)(i)

Text: 27 The district court found that because ¶ 1(b)(i) of the Agreement clearly and unambiguously defines Subject Product as one, specific product (Part No. MCR-SEB), and because Panduit does not dispute that the Accused Product is not physically the same product as [Part No. MCR-SEB], HellermannTyton was entitled to summary judgment that it did not breach ¶ 1(b)(i). 28 Panduit points first to Foster v. Hallco Manufacturing Co., 947 F.2d 469 (Fed.Cir. 1991) and KSM Fastening Systems, Inc. v. H.A. Jones Co., 776 F.2d 1522 (Fed.Cir. 1985), to argue that the district court should have read ¶ 1(b)(i) to encompass the Part No. MCR-SEB product and any accused product having only colorable changes or changes unrelated to the patent claim. Panduit asserts that the accused product is only colorably different from Part No. MCR-SEB, and that according to Foster and KSM, it is covered by ¶ 1(b)(i). Alternatively, Panduit argues that the agreement is ambiguous and that to effectuate the parties' intent to settle the litigation, we must interpret ¶ 1(b)(i) to encompass the accused product. HellermannTyton counters that because the Agreement did not follow an adjudication on the merits, because no injunction issued, and because no consent judgment was entered, Foster and KSM are distinguishable, the patent doctrine of insubstantial differences does not apply, and there should be no comparison between the Part No. MCR-SEB product and the accused device. HellermannTyton also counters that there is no dispute that the accused device is not Part No. MCR-SEB and that the district court's ruling was correct. 29 We disagree with Panduit's contention that Foster and KSM apply to the Agreement, and conclude that these cases are distinguishable. In KSM, an injunction barred products of the type and nature identified by the Plaintiff in its Complaint, and the parties did not dispute that the injunction is enforceable against devices other than the specific [ ] device of the original suit. 776 F.2d at 1527. We held that it would not be appropriate to bring contempt proceedings for violating such an injunction if there was more than a colorable difference between an accused and adjudged device. Id. at 1530-32. Similarly, the parties in Foster agreed to a consent judgment that found infringement, but made no reference to a specific product or device. 947 F.2d at 472. In that case, we noted that a new cause of action was not presented if an accused device and an adjudged device were essentially the same. Id. at 479-80. Here, unlike in KSM and Foster, the parties entered into a settlement agreement that expressly addressed a specific product, Part No. MCR-SEB, in ¶ 1(b)(i) of the Agreement. Our inquiry is not a comparison between an accused and an adjudged device, but rather the interpretation of that express provision. 30 Under Illinois law, the plain language of the Agreement governs. Lumpkin, 933 F.2d at 456. If contract terms are unambiguous, then the inquiry is over. Id. However, if the language of the contract is ambiguous, then the court may consider extrinsic evidence to determine the intent of the parties. Id. 31 In this case, ¶ 1(b)(i) of the Agreement states that HellermannTyton must cease marketing Subject Products, which includes the HellermannTyton Multi-Channel Raceway Side Electric Box (HellermannTyton Part No. MCR-SEB). The question is what is meant by reference in the agreement to Part No. MCR-SEB. Panduit asserts that the contract contemplates that Part No. MCR-SEB includes not only that exact product, but also devices with merely colorable differences from Part No. MCR-SEB. HellermannTyton interprets ¶ 1(b)(i) as including only the specific device identified as Part No. MCR-SEB. 32 We agree with the district court and HellermannTyton that ¶ 1(b)(i) covers only the specific device identified as Part No. MCR-SEB. The language of the Agreement is unambiguous. By its express terms, ¶ 1(b)(i) does not include colorable changes, modifications, or variations, but mentions only Part No. MCR-SEB. Settlement agreements, like consent judgments, reflect an agreement by hostile litigants on more than just contract terms; they reflect a compromise of contested legal positions in matters that are the subject of litigation. See United States v. Armour & Co., 402 U.S. 673, 681-82, 91 S.Ct. 1752, 29 L.Ed.2d 256 (1971) (Consent decrees are entered into by parties to a case after careful negotiation has produced agreement on their precise terms.); Thatcher v. Kohl's Dep't Stores, Inc., 397 F.3d 1370, 1373-75 (Fed.Cir.2005) (applying Illinois law, [t]he consent judgment serves as a carefully crafted settlement agreement between the parties). Because the language of the Agreement is not ambiguous, we do not look to the parties' intent to include terms that are absent. 33 [T]he parties have purposes, generally opposed to each other, and the resultant [settlement agreement] embodies as much of those opposing purposes as the respective parties have the bargaining power and skill to achieve. For these reasons, the scope of a [settlement agreement] must be discerned within its four corners, and not by reference to what might satisfy the purposes of one of the parties to it. 34 Armour, 402 U.S. at 681-82, 91 S.Ct. 1752 (settlement agreement substituted for consent decree); see also Thatcher, 397 F.3d at 1375 ([S]ilence [on assignment] is the functional equivalent of the parties' express intent to exclude language of assignment.). The precise and unambiguous terms of ¶ 1(b)(i) include only Part No. MCR-SEB; the district court therefore did not err in interpreting that provision. 35 We also agree with the district court that there is no genuine issue of material fact that the accused device is not Part No. MCR-SEB. Panduit does not dispute that the accused device is not physically the same product as Part No. MCR-SEB. HellermannTyton made the wall abutting the trunking duct in the accused device solid with no cutaway. Even viewed in a light most favorable to Panduit, there is no question that the accused product is not Part No. MCR-SEB. The district court therefore did not err in granting summary judgment that the accused device is not a Subject Product as defined by ¶ 1(b)(i) of the Agreement.