Microchip Technology v. U.S. Philips and Philips Electronics N.A. (Fed. Cir. May 13, 2004)

Philips owns patents relating to a two-wire bus for communicating between integrated circuits (I2C). Microchip asserted that it did not infringe and that it was a licensee (by succession). The question before the Court was who determines whether there is an obligation to arbitrate.

Although the Federal Circuit generally follows local circuit law regarding non-patent issues, in this case the Court disagreed with prior 9th Circuit holdings. Instead, the Court held that under Supreme Court case law obligation to arbitrate is a threshold matter for the district court to determine. Thus, the Federal Circuit remanded for the District Court to determine whether Microchip was a successor party to the 1983 agreement before any issues may be referred to arbitration.

The appellate panel also found that the arbitration clause was not expired:

It is clear on the face of the 1983 agreement’s arbitration clause that the obligation to arbitrate survives expiration of the agreement’s other provisions. The arbitration clause specifically provides that “[a]ll disputes arising out of or in connection with the interpretation or execution of this Agreement during its life or thereafter” are subject to arbitration.

Appellate Jurisdiction: The Court also held that an order compelling arbitration is appealable:

An order compelling arbitration is in effect a mandatory injunction. Denial of a mandatory injunction is ordinarily appealable under section 1292(a)(1). (Citations omitted)

More info about the I2C technology is here:

Philips was the inventor of the Inter-IC or I²C-bus nearly 20 years ago, and it is now firmly established as the worldwide de-facto solution for embedded applications. It is used extensively in a variety of microcontroller-based professional, consumer and telecommunications applications as a control, diagnostic and power management bus. As a two-wire serial bus, its inherently simple operation was crucial to its emergence as the worldwide de-facto standard.

Medtronic Vascular, Inc. v. CORDIS Corp. (3rd Cir. April 30, 2004)

Medtronic AVE alleged that Cordis infringed its coronary stent patents. In response, Cordis asserted that it held a license to the patents under a Settlement and License Agreement that it entered into with the parent corporation of Medtronic AVE to settle prior litigation.

Although the Agreement included an arbitration provision, the District Court held that the dispute was not arbitrable, and enjoined arbitration.

The 3rd Circuit panel vacated and remanded, finding that the the arbitration clause was applicable under New York law.

Elan Corp. v. Andrx Pharmaceuticals, Inc. (Fed. Cir. May 5, 2004)

In this case, the Federal Circuit determined that there was no on-sale-bar, thus reversing the district court’s finding of invalidity.

More than one year before filing for a patent, Elan made several offers to enter into a license under a patent for future sales of their invention “when and if it had been developed.”

The court found that this was not an offer to sell but rather a permissible offer to license because the communication was not a definite offer including material terms.

The letter . . . lacked any mention of quantities, time of delivery, place of delivery, or product specifications beyond the general statement that the potential product would be a 500 mg once-daily tablet containing naproxen. Moreover, the dollar amounts recited . . . are clearly not price terms for the sale of tablets, but rather the amount that Elan was requesting to form and continue a partnership with Lederle. Indeed, the letter explicitly refers to the total as a “licensing fee.”