Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Motorola Mobility, Inc v. Myriad France Sas and Myriad Group Ag

February 2, 2012

MOTOROLA MOBILITY, INC., PLAINTIFF,
v.
MYRIAD FRANCE SAS AND MYRIAD GROUP AG, DEFENDANTS.



The opinion of the court was delivered by: Matthew F. Kennelly, District Judge:

MEMORANDUM OPINION AND ORDER

Motorola Mobility, Inc. has sued Myriad France SAS and Myriad Group AG for breach of contract, alleging that they failed to comply with their contractual obligations to indemnify Motorola Mobility for damages it sustained as a result of defective software they produced. Myriad France has moved to dismiss the claims against it under Federal Rule of Civil Procedure 12(b)(6). Myriad Group has moved to dismiss the claims against it for lack of personal jurisdiction under Federal Rule of Civil Procedure 12(b)(2). For the reasons stated below, the Court grants Myriad France's motion in part and denies Myriad Group's motion.

Background

The Court draws the following facts from the allegations in plaintiff's complaint, which it accepts as true for purposes of the motions to dismiss. Hallinan v. Fraternal Order of Police of Chi. Lodge No. 7, 570 F.3d 811, 820 (7th Cir. 2009). On a Rule 12(b)(2) motion, the Court may also consider facts set forth in affidavits, resolving any factual disputes in favor of the plaintiff. Tamburo v. Dworkin, 601 F.3d 693, 700 (7th Cir. 2010).

In October 1999, Motorola, Inc., and Phone.com, Inc. entered into a Master License and Services Agreement (MSA) under which Phone.com agreed to license messaging and browser software for use in Motorola phones. The MSA has been amended multiple times since it was signed, including amendments substituting Motorola Mobility ("Motorola") for Motorola, Inc. and Openwave Systems for Phone.com. Myriad France was later substituted for Openwave. Myriad France does not dispute that it is bound to Phone.com's or Openwave's obligations under the MSA and amendments. Rather, it disputes only what those obligations entail. Myriad Group, which is Myriad France's parent corporation, disputes that it has any obligations under the MSA.

The MSA contains two provisions that are particularly relevant to the allegations made by the parties in this case. Section 14.1, which appears in an amendment to the original MSA, states:

[Myriad France] agrees to defend, indemnify, and hold harmless Motorola from and against any claim, suit, or proceeding and any damages, liability, or other expenses (including, but not limited to, reasonable attorneys' fees and court costs) which arise out of or result from: (i) gross negligence or wrongful acts of employees of [Myriad France] while performing [Myriad France's] obligations hereunder . . . .

Myriad France Ex. 2 at 3. Section 16.2, which is entitled "Licensed Software Warranties," states:

[Myriad France] warrants to Motorola, and solely for the benefit of Motorola, that for a period of ninety (90) days after delivery of each commercially released version of the . . . Software to Motorola, such version . . . will perform in accordance with the applicable . . . Software Specification . . . . During the above noted warranty period, [Myriad France's] obligation for any breach of the warranty shall be to remedy the breach without additional charge to Motorola. Myriad France Ex. 1 at 3-4.

Motorola alleges that defendants have breached several terms of the MSA. In count one of its complaint, Motorola claims that Openwave designed, developed, and delivered a defective mobile phone browser that Motorola included in a mobile phone it sold to Verizon. The software failed to promptly terminate browser sessions. This resulted in the overcharging of Verizon customers, who later sued Verizon in a class action. Motorola was contractually obligated to defend and indemnify Verizon for the damages arising out of this action, and Motorola in turn sought defense and indemnification from Openwave, which refused Motorola's request. Motorola ultimately paid a portion of the costs of settling the Verizon class action and alleges that it was thereby damaged "in excess of $500,000." Id. ¶ 27. Motorola now seeks indemnification from defendants for this amount.

In counts two and three, Motorola alleges that Openwave delivered two additional defective software products, the first in late 2008 and early 2009 and the second in 2010. Both of these products were included in phones that Motorola was developing for Tracfone, which discovered both defects during pre-release testing. Motorola alleges that the first piece of defective software caused Tracfone to cancel its purchase, damaging Motorola "in an amount exceeding $5 million." Id. ¶ 34. Motorola alleges that the second piece of defective software delayed release of the product, damaging Motorola "in an amount exceeding $1.7 million." Id. ¶ 42. Motorola claims that its requests for indemnification for both amounts were rejected. It argues that defendants breached the MSA in two ways: via their gross negligence in design and development of the defective software, and by refusing to indemnify Motorola for the consequences.

On December 21, 2010, Motorola filed suit in Cook County Circuit Court against Myriad France, Myriad Group, and Openwave. Motorola later agreed to dismiss Openwave from the case, and the circuit judge entered an order to that effect on October 6, 2011. On October 18, 2011, defendants removed the case to federal court.

I. Myriad France's motion to dismiss

A. Count one

1. Illinois Supreme Court Rule 103(b)

Myriad France argues that the Court should dismiss count one under Illinois Supreme Court Rule 103(b), which states, If the plaintiff fails to exercise reasonable diligence to obtain service on a defendant prior to the expiration of the applicable statute of limitations, the action as to that defendant may be dismissed without prejudice. If the failure to exercise reasonable diligence to obtain service on a defendant occurs after the expiration of the applicable statute of limitations, the dismissal shall be with prejudice as to that defendant only and shall not bar any claim against any other party based on vicarious liability for that dismissed defendant's conduct.

Ill. S. Ct. R. 103(b). Although Rule 103(b) is a state procedural rule, "federal courts may apply state procedural rules to pre-removal conduct." Romo v. Gulf Stream ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.