On April 18, 2019, the Federal Circuit Court of Appeals affirmed a district court’s decision granting an injunction requiring the withdraw of the filing of an inter-partes review and a post grant review, as these filings violated the forum selection clause of a license agreement. These reviews are held before the Patent Trademark and Appeal Board (“PTAB”), which is not state-specific, and are often considered disputes arising under the operative license agreement. That means that if the forum selection clause of the license agreement requires all disputes to be before a particular court’s jurisdiction or exclusive to the laws of a particular state, it is likely that these reviews are not available.
The Federal Circuit delivered this opinion in Dodocase VR, Inc. v. MerchSource, LLC, Case No. 2018-1724. The court commented on the success of the merits of Dodocase’s claim that the forum selection clause would be held violated. The court pointed out that “[t]he forum selection clause of the MLA [master licensing agreement] states that ‘[t]he laws of the State of California shall govern any dispute arising out of or under this Agreement.’” After determining that this language classified these reviews as disputes arising from the license, the court concluded that it was likely that Dodocase would succeed on the merits that the filing of these reviews violated the language of the forum selection clause.
Because this was an affirmation on an injunction and dicta relating to the success on the merits, this decision is by no means binding. However, when the Federal Circuit rules on an issue, it is important to note how the law is trending. This decision makes it apparent that the specificity in a forum selection clause is important. If a party wants to retain the right to raise file reviews before the PTAB or any other administrative body, it is best to explicitly state the reservation in the forum selection clause.
The full opinion can be found here: http://www.cafc.uscourts.gov/sites/default/files/opinions-orders/18-1724.Opinion.4-18-2019.pdf