GTE Mobilnet v. Cellexis International (D. Mass, April 20, 2004)
In a 1996 settlement agreement, plaintiff had agreed not to sue GTE or its subsidiaries, joint ventures or affiliates over disputed patent rights. In March 2000, plaintiff sued Bell Atlantic Mobile for infringement. At the time of the suit, Bell Atlantic Mobile was not an affiliate of GTE. However, four months later, through a series of transactions and transformations, Bell Atlantic Mobile became “Cellco” and an affiliate of GTE. After a trial, the Jury decided that Bell Atlantic Mobile (now Cellco) was an affiliate under the settlement agreement. Thus, the plaintiffs case was dismissed.
Commentary: This case simply involved contract interpretation. Drafting the settlement agreement with more clarity up-front could have avoided this litigation and its associated costs.