Judge Andrews grants motion to enforce patent litigation settlement agreement

In Callwave Communications, LLC v. Verizon Services Corp., et al., C.A. No. 12-1704-RGA (D. Del. Feb. 13, 2017), Judge Richard G. Andrews granted Plaintiff’s motion to enforce the settlement agreement between Plaintiff and intervenor Telecommunication System Inc. (“TCS”) who had indemnified Defendants. The parties disagreed as to whether an agreement had been reached in principle, where TCS had agreed to Plaintiff’s terms via email, the parties had filed a stipulation to stay the case pending finalization of the agreement, and where “drafts, comments, and edits were exchanged.” Id. at 2. In the intervening period, the Court had granted another party’s Section 101 motion to invalidate one of the patents-in-suit.

Applying Delaware law, the Court observed that “[o]bjective indicators demonstrate that a contract was made. First, the August 8th email clearly demonstrates that TCS believed an agreement had been reached. The August 8th agreement set out the payment terms and a July 21st email set out the boundaries of the license Callwave would offer TCS. Intermediate emails demonstrated that the terms from the July 21st email carried through and were part of the agreement struck on August 8th. For example, a July 22nd email thanked Callwave for ‘agreeing to the terms, other than payment’ and confirming that the covenant not to sue would allow damages to accrue. These emails used the language of contract – ‘this formal offer’ – and the language of resolution -‘my client accepts.’ Second, the stipulation filed with this court clearly indicates an agreement had been reached.” Id. at 3 (internal citations omitted). Additionally, “the tenor of the comments in the drafts reflect an effort to memorialize an agreement already reached.” Id. The fact that some open terms remained regarding, for example, assignability, notice, choice of law, and confidentiality did not mean that the contract did not contain “all essential terms” and was thus enforceable under Delaware law. Id. at 4.

Having found an enforceable contract existed, the Court ordered specific performance, including all terms “either explicitly agreed to or included in responding drafts without comment or suggested revision.” Id. at 4.

Callwave Communications, LLC v. Verizon Services Corp., et al., C.A. No. 12-1704-RGA (D. Del. Feb. 13, 2017)

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