Court Opinion

ID: 9484378
Source: CourtListenerOpinion
Date Created: 2023-08-05 09:51:06.443436+00
Date Added: 2024-06-11T17:50:12.346787
License: Public Domain

PLAGER, Circuit Judge,
with whom NEWMAN and RADER, Circuit Judges, join,
dissenting from the denial of rehearing in banc.
I respectfully dissent from the denial by the full court of Intel’s Suggestion for Rehearing In Banc. The panel in this case held that a broad cross-license between companies — permitting them to compete rather than litigate — had the effect of immunizing third parties whose products otherwise infringe the patents which were the subject of the cross-license. To reach this result, the panel applied an old rule in a new way, imposing on the cross-license certain contractual effects not provided for in the agreement, not agreed to by the parties to the cross-license (by their own testimony), and directly contrary to the trial judge’s findings on the point.
The result frustrates the contracting parties’ reasonable commercial expectations, and destroys important property rights they had under the patent laws. No effort was made to justify this result on the grounds of public policy. For the reasons stated in my dissent to the panel opinion, in my view neither precedent nor policy is shown to be furthered by this new rule.
It can be expected that American industry, facing a worldwide competitive environment, will seek new and innovative arrangements for sharing emerging technology. The question raised by the case is whether the law permits American industry to freely share creative assets — patented inventions — by cross-licensing without running the risk of being held to have inadvertently lost the benefits of the patent system. The type of cross-license involved here apparently is not that uncommon, and likely presages a variety of new contractual arrangements among and between industry partners and competitors. Absent a showing of illegality or compelling public policy, it is not the place of courts to limit or expand these arrangements beyond the bounds of the agreements, and in a manner that is avowedly inconsistent with what the parties intended. Particularly is this so when the consequences of doing so, no matter how well-intentioned, are economically far-reaching and likely to be harmful.
It cannot be denied that in banc cases add more to the court’s burden. Nevertheless we have demonstrated a willingness to take cases in banc to ensure that important principles of law are honored. The rule imposed on this type of cross-license by this case is of sufficient moment to principles of contract law and competitiveness to deserve the attention of, and decision by, the full court. Whether the result is changed or not, I would take the case in banc in order to give our decision the benefit of the views of the full court.