Callaway Golf Co. v. Acushnet Co.

585 F. Supp. 2d 592, 2008 U.S. Dist. LEXIS 91254, 2008 WL 4850741
CourtDistrict Court, D. Delaware
DecidedNovember 10, 2008
DocketCiv. No. 06-091-SLR
StatusPublished
Cited by2 cases

This text of 585 F. Supp. 2d 592 (Callaway Golf Co. v. Acushnet Co.) is published on Counsel Stack Legal Research, covering District Court, D. Delaware primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Callaway Golf Co. v. Acushnet Co., 585 F. Supp. 2d 592, 2008 U.S. Dist. LEXIS 91254, 2008 WL 4850741 (D. Del. 2008).

Opinion

MEMORANDUM OPINION

SUE L. ROBINSON, District Judge.

I. INTRODUCTION

Callaway Golf Company (“plaintiff’) filed this action against Acushnet Company (“defendant”) on February 9, 2006, alleging infringement of U.S. Patent Nos. 6,506,130 (“the '130 patent”), 6,503,156 (“the '156 patent”), 6,210,293 (“the '293 patent”), and 6,595,873 (“the '873 patent”) (collectively, “the Sullivan patents”). (D.I. 1) Plaintiff alleged that defendant’s Titleist® Pro VI® brand golf balls embody the technology claimed in one or more claims of the asserted patents. (Id. at ¶¶ 17-21) The parties filed motions for summary judgment. (D.I. 197, 200, 201, 213, 215) On November 20, 2007, the court issued its claim construction decision (D.I. 345) and issued its memorandum opinion on the summary judgment motions (D.I. 347), in which it granted plaintiffs motions for summary judgment of no anticipation and for breach of contract, denied defendant’s motions for summary judgment of invalidity and no breach of contract, and denied defendant’s motion for partial summary judgment that U.S. Patent No. 4,274,637 to Molitor (“Molitor '637”) was incorporated by reference into a particular piece of prior art. Prior to trial, defendant stipulated that its Pro VI® golf balls infringe claims 1, 4 and 5 of the '293 patent, claims 1-3 of the '156 patent, claim 5 of the '130 patent, and claims 1 and 3 of the '873 patent, and that its Titleist® Pro Vlx® and Pro VI*® golf balls infringe all of the foregoing claims, with the exception of claim 1 of the '293 patent. (D.I. 367) A jury trial was held between December 5 and 14, 2007 on the issue of validity of each of the asserted claims, due to obviousness. The jury returned a verdict that each asserted claim was valid but one—claim 5 of the '293 patent—which it found invalid. (D.I. 399) Currently before the court is defendant’s motion to dismiss plaintiffs breach of contract claim and to vacate the court’s November 20, 2007 opinion and order based on lack of subject matter jurisdiction (D.I. 471).

II. BACKGROUND

In 1996, defendant entered into a settlement agreement (the “Agreement”) with [594]*594Spalding and Evenflo Companies, Inc. (“Spalding”), plaintiffs predecessor-in-interest, and Lisco, Inc., a wholly owned subsidiary of Spalding, to resolve patent-related claims in two actions brought in the District of Delaware: (1) Civ. No. 96-73-MMS, filed by Spalding and Lisco against defendant and American Brands, Inc.; and (2) Civ. No. 96-78-MMS, filed by defendant against Spalding and Lisco. (D.I. 199, ex. 1) The Agreement contained a “Dispute Resolution” clause, providing that

[a]ny dispute arising out of or relating to patents, including the above mentioned patents, other intellectual property owned or controlled by the parties, or claims relating to advertising shall be resolved in accordance with the procedures specified in this [s]ection, which shall be the sole and exclusive procedure for the resolution of any such disputes.

(Id. at 15, ¶ 19.1) The Agreement continues to detail a procedure involving negotiations and mediation. (Id. at 16-17, ¶¶ 19.2-6) If mediation fails to resolve a dispute, the Agreement provides that,

[a]t the conclusion of a referral to the Magistrate or other judge as set forth in 19.6, should the dispute remain unresolved, either party may initiate legal proceedings but only in the United States District Court for the District of Delaware, and no other. Said court retains jurisdiction of the parties for such purposes.

(Id. at 18, ¶ 19.7) (emphasis added)

When the Agreement was executed, the parties dismissed the pending litigations by filing stipulations of dismissal pursuant to Rule 41(a)(1)(h) with the court. (D.I. 472, exs. C, D) The stipulations contain the following identical language.

Pursuant to 41(a)(l)(ii) of the Federal Rules of Civil Procedure and a Settlement Agreement of August 5, 1996, the terms of which are incorporated herein by reference, the parties to the above action stipulate and agree that all claims in the action, including both the complaint and all counterclaims, be, and hereby are, dismissed with prejudice, and that each party shall bear its own costs and attorneys’ fees.
The parties also stipulate and agree that the court shall retain jurisdiction to resolve any and all disputes arising out of the Settlement Agreement in accordance with the terms of the Settlement Agreement.

(Id.) (emphasis added) Neither stipulation of dismissal included a “So ordered” line for the court’s approval. The stipulations were filed with the court on August 9, 1996, and both cases were closed the same day. (Id., exs. D, E)

Pursuant to the Agreement, the parties engaged in two unsuccessful mediations in 2005 regarding Spalding’s rights under the Sullivan patents. Thereafter, defendant filed inter partes reexamination requests for each patent with the United States Patent and Trademark Office (“PTO”) on January 17, 2006. (D.I. 199, exs. 5-8) Plaintiff filed the present infringement action shortly thereafter on February 9, 2006. (D.I. 1) Plaintiff attempted to stop the PTO’s consideration of the reexamination based on the Agreement; when it became apparent that the PTO would proceed, plaintiff filed for leave to amend its complaint to file a breach of contract claim in June 2006. (D.I. 33; D.I. 30, 31) The court granted plaintiffs motion. In November 2006, defendant filed an answer to plaintiffs amended complaint, in which it asserted that plaintiff lacked standing to bring its breach of contract claim because plaintiff was not a party to the Agreement. (D.I. 60 at ¶ 77 (Eighth Affirmative Defense)) In August 2007, the parties each moved for summary judgment on plaintiffs breach of contract claim.

[595]*595While those motions were pending, on November 14, 2007, the parties jointly submitted a proposed pretrial order that included a statement that “plaintiff claims that this court has jurisdiction over [its] breach of contract claim pursuant to 28 U.S.C. § 1367 ... [and that] the court has retained jurisdiction to enforce that settlement agreement based on its jurisdiction over the underlying case.” (D.I. 334 at 3) Defendant did not oppose or challenge this portion of the order.

By its memorandum opinion dated November 20, 2007, 523 F.Supp.2d 388, the court found section 19.7 akin to a forum selection clause, and held that defendant violated the Agreement by filing the reexaminations to contest the validity of the Sullivan patents.1 (D.I. 347) In so holding, the court rejected defendant’s claim that plaintiff was not a party to the Agreement. (Id. at 25) The court granted plaintiffs motion for summary judgment of breach of contract and denied defendant’s motion for breach of contract. (D.I. 348) The case proceeded to trial on defendant’s invalidity claims, and the jury returned a verdict for plaintiff.

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Cite This Page — Counsel Stack

Bluebook (online)
585 F. Supp. 2d 592, 2008 U.S. Dist. LEXIS 91254, 2008 WL 4850741, Counsel Stack Legal Research, https://law.counselstack.com/opinion/callaway-golf-co-v-acushnet-co-ded-2008.