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MLR, LLC v. Hewlett Packard Co.

United States District Court, N.D. Illinois, Eastern Division

November 5, 2014

MLR, LLC, Plaintiff,
v.
HEWLETT PACKARD COMPANY, Defendant.

MEMORANDUM OPINION AND ORDER

JAMES F. HOLDERMAN, Senior District Judge.

On February 10, 2014, MLR, LLC ("MLR"), a technology development and licensing company, filed its complaint alleging infringement of certain of its United States patents by Hewlett Packard Company ("HP") (Dkt. No. 1). The MLR's patents cover portable wireless devices, such as cellular handsets and portable computers, which can access different or wireless networks to facilitate wireless voice and data communications. Id. The case was reassigned to this court pursuant to the Patent Case Pilot Program (Dkt No. 8) in which this district voluntarily is participating.

HP denied infringement in its Answer (Dkt. No. 15) and asserted in its "Second Affirmative Defense" ( Id. at 5) and in its "First Counterclaim" ( Id. at 9) that "The Products accused by MLR are covered by a "royalty-free, fully paid-up license" (the "[MLR/Handspring] License") entered by and between Handspring, Inc., inter alia, for the benefit of Palm, Inc., HP's wholly owned subsidiary."

The parties have filed cross motions seeking summary judgment on HP's license affirmative defense and counterclaim of license. MLR's motion was filed on July 8, 2014 (Dkt. No. 25) and HP's on August 5, 2014 (Dkt. No. 39). Those motions have been fully briefed with some of the supporting factual information filed under seal, pursuant to the parties Stipulated Protective Order entered on August 27, 2014 (Dkt. No. 53). For the reasons stated in this opinion, HP's motion is granted and MLR's is denied.

I. Uncontested Material Facts

Plaintiff MLR, LLC is a Virginia limited liability company with offices at 6190 Hardy Drive, McLean Virginia 22101. Defendant HP is a corporation organized and existing under the laws of the state of Delaware with a principal place of business at 3000 Hanover Street, Palo Alto, California 94304.

On July 15, 2003, Handspring obtained a license from MLR ("The MLR/Handspring License") of all patents-in-suit. On October 29, 2003, Palm acquired Handspring. In 2010, Palm, Inc. merged with HP and became HP's wholly-owned subsidiary. HP was a successor in interest under the MLR/Handspring License. (Dkt. No. 51).

II. Summary Judgment Legal Standard

A grant of summary judgment is proper "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a). The movant bears the initial responsibility of informing the court of the basis for its motion and identifying the evidence it believes demonstrates the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). "There is no genuine issue of material fact when no reasonable jury could find in favor of the nonmoving party." Brewer v. Bd. of Trs. of the Univ. of Ill., 479 F.3d 908, 915 (7th Cir. 2007). When ruling on a motion for summary judgment, the court must consider the facts in the light most favorable to the nonmoving party, drawing all reasonable inferences in the nonmoving party's favor. Woodruff v. Mason, 542 F.3d 545, 550 (7th Cir. 2008). The court does not make credibility determinations or weigh conflicting evidence. McCann v. Iroquois Mem'l Hosp., 622 F.3d 745, 752 (7th Cir. 2010).

III. Discussion

The parties by pursuing this litigation in federal district court have sought a public adjudication of their dispute. Their redactions from their public filings, such as redacting all the provisions of the MLR/Handspring License (Dkt. No. 29-1, Exhibit A) on which their dispute is premised, make it very difficult for this court to articulate the reasoning of the court's determination in an opinion filed in the public record. Consequently, the court will do its best to accommodate the parties' desires for confidentiality, but to the extent information that was filed under seal is stated in this opinion, the court is vacating the Stipulated Protective Order regarding that information and requiring by this order that the information be disclosed as contemplated by paragraph 10 of the MLR/Handspring License.

The primary issue the parties present by their respective filings turns in large part on the clear language of the MLR/Handspring License. "[I]f a contract is clear on its face and the text contains no clue that the contract might mean something different from what it says, then the inquiry is over - no evidence outside of the contract may be considered." Home Ins. Co. v. Chi. & Nw. Transp. Co., 56 F.3d 763, 767 (7th Cir. 1995); see also, Curia v. Nelson, 587 F.3d 824, 829 (7th Cir. 2009).

MLR admits: "All of the patents-in-suit are subject to the MLR License." (Dkt. No. 51 at 2). The MLR/Handspring License contains the following pertinent provisions at its outset regarding the parties:

This Agreement ("Agreement"), effective as of July 15, 2003, is entered into between MLR, LLC, a Virginia limited liability corporation ("MLR"), on the one hand, and Handspring, Inc., a Delaware corporation, together with Palm, Inc. and PalmSource, Inc. upon the completion of the acquisition of Handspring, Inc. by Palm, Inc. (the "Merger"), and as it or they may be reorganized or renamed (collectively, "Handspring"), on the other hand. The parties acknowledge that Palm, Inc. may change its corporate name following the Merger. "Handspring" shall also include all "Affiliates" of Handspring, Inc., and, upon the closing of the Merger, all Affiliates of Palm, Inc. and PalmSource, Inc.
Regarding the definition of "Affiliate, " the MLR/Handspring License states:
For purposes of this Agreement, "Affiliate" means any entity that directly or indirectly controls, is controlled by, or is under common control with Handspring, Inc. or Palm, Inc. For purposes of this definition, "control" shall mean direct or indirect ownership of at least fifty percent (50%) of the voting ...

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