Yesterday Apple filed its opposition to Motorola’s motion to dismiss or transfer for lack of jurisdiction in Federal Circuit appeal No. 2013-1150. This is Apple’s appeal of Judge Crabb’s dismissal of the Apple-Motorola FRAND/antitrust action (W.D. Wis. No. 3:10-cv-00178)). Apple contends that the Federal Circuit has jurisdiction over Apple’s appeal of the dismissal of its declaratory judgment claims because (1) the hypothetical Motorola complaint at which Apple’s declaratory judgment claim was directed would be for patent infringement, and (2) the district’s court’s decision to dismiss the patent-specific DJ claims without prejudice does not deprive the Federal Circuit of jurisdiction. As we anticipated in our post on Motorola’s motion to dismiss/transfer, some of Apple’s arguments in its opposition raise some interesting questions about whether jurisdiction over this appeal will be consistent with past and potential future appeals of orders in the Microsoft-Motorola RAND case.
Apple asserts in its motion that in evaluating jurisdiction over declaratory judgment actions, the Federal Circuit looks to the declaratory defendant’s hypothetical complaint, not the declaratory plaintiff’s complaint. Apple notes that its complaint sought declarations that Motorola’s offers to license its SEPs were not FRAND compliant, that Motorola was not entitled to seek injunctive relief for infringement of any of its SEPs, and that certain Motorola SEPs are unenforceable due to patent misuse. Therefore, according to Apple, any hypothetical Motorola complaint would have been for patent infringement. Furthermore, Apple notes that Motorola actually did file a complaint for patent infringement against Apple in the ITC (although this complaint was not for infringement of all of Motorola’s SEPs that were the subject of the declaratory judgment claims in Apple’s W.D. Wis. complaint).
Apple additionally disputes Motorola’s contention that the district court’s decision to deny the patent-related declaratory judgment claims (breach of contract, FRAND rate, no injunctive relief, misuse) without prejudice means that the Federal Circuit does not have jurisdiction over any appeal. It takes issue with Motorola’s contention that Apple is merely now in the “same legal position” that it was in before filing the suit, arguing that it could not simply re-file its claims in the district court — according to Apple, appeal at this point is necessary to resolve these claims. Lastly, in a footnote, Apple asserts that should the Federal Circuit decline to exercise jurisdiction, it should not dismiss the case, but instead transfer it to the Seventh Circuit Court of Appeals to be decided on the merits.
Now for the potential effect on the Microsoft-Motorola case — there, Microsoft has asserted declaratory claims of breach of contract and promissory estoppel based on Motorola’s RAND assurances, and has successfully pursued and obtained an order enjoining Motorola from pursuing injunctive relief for its SEPs. Some of Motorola’s claims for infringement of its H.264-essential patents have been consolidated with the case (although those claims remained stayed pending decision on the RAND claims), and Microsoft was recently successful in invalidating some of those claims. Motorola also filed other infringement claims on 802.11 and H.264-essential patents against Microsoft in the International Trade Commission (although these claims have now been dropped).
Yet last year, when Judge Robart enjoined Motorola from enforcing an injunction in Europe over two H.264-essential patents, Motorola appealed not to the Federal Circuit, but to the Ninth Circuit. In its order affirming Judge Robart, the Ninth Circuit agreed it was the proper court to hear the appeal:
The Federal Circuit has jurisdiction over an interlocutory appeal only if it would have jurisdiction over a final appeal in the case under 28 U.S.C. § 1295. 28 U.S.C. § 1292(c)(1). Microsoft’s complaint sounds in contract and invokes the district court’s diversity jurisdiction under 28 U.S.C. § 1332. We therefore have jurisdiction over this interlocutory appeal under 28 U.S.C. § 1292(a)(1).
Like Microsoft’s complaint, Apple’s complaint in W.D. Wis. invoked diversity jurisdiction under Section 1332. Apple and Microsoft each sought declaratory judgments of breach of contract, bans on injunctive relief, and setting of (F)RAND rates for essential patents. But Apple contends its complaint (which also includes an additional claim of patent misuse) gives rise to exclusive Federal Circuit jurisdiction, while Microsoft apparently does not believe this is the case, at least at this stage. It will be interesting to see whether the Federal Circuit’s decision in the Apple-Motorola appeal provides any guidance to the parties in the Microsoft-Motorola going forward.