Microsoft Corporation v. Motorola, Inc, et al

Filing 50

Filed (ECF) Appellants General Instrument Corporation and Motorola Mobility, Inc. petition for panel rehearing and petition for rehearing en banc (from 09/28/2012 opinion). Date of service: 10/12/2012. [8359438] (KMS)

No. 12-35352
IN THE

FOR THE NINTH CIRCUIT

MICROSOFT CORPORATION, a Washington Corporation,
Plaintiff-Appellee,
v.
MOTOROLA, INC., MOTOROLA MOBILITY, INC., and GENERAL
INSTRUMENT CORPORATION,
Defendants-Appellants.
On Appeal From The United States District Court
For The Western District Of Washington At Seattle

PETITION FOR REHEARING AND REHEARING EN BANC
Date of Decision: September 28, 2012
Judges: Wallace, Thomas, and Berzon
Derek L. Shaffer
QUINN EMANUEL URQUHART
& SULLIVAN, LLP
1299 Pennsylvania Avenue, NW
Suite 825
Washington, DC 20004
[phone]

Kathleen M. Sullivan
QUINN EMANUEL URQUHART
& SULLIVAN LLP
51 Madison Avenue
22nd Floor
New York, NY 10010
[phone]
continued on following page

Ralph H. Palumbo
Philip S. McCune
Lynn M. Engel
SUMMIT LAW GROUP PLLC
315 Fifth Avenue South
Suite 1000
Seattle, WA 98104-2682
[phone] (Telephone)
[phone] (Facsimile)

Steven Pepe
Jesse J. Jenner
Stuart W. Yothers
ROPES & GRAY LLP
1211 Avenue of the Americas
New York, NY 10036-8704
[phone] (Telephone)

Douglas Hallward-Driemeier
Paul M. Schoenhard
Kevin J. Post
ROPES & GRAY LLP
One Metro Center
700 12th Street NW, Suite 900
Washington, DC 20005-3948
[phone] (Telephone)

October 12, 2012

Attorneys for Defendants-Appellants

TABLE OF CONTENTS
Page
RULE 35(B) STATEMENT ...................................................................................... 1
FACTUAL STATEMENT ........................................................................................ 3
A.

Background ........................................................................................... 3

B.

The District Court Decision .................................................................. 5

C.

The Panel Decision................................................................................ 7

ARGUMENT ........................................................................................................... 10
I.

EN BANC REVIEW IS WARRANTED BECAUSE THE PANEL
DECISION CONFLICTS WITH THIS COURT‟S PRECEDENTS
GOVERNING ISSUANCE OF ANTI-SUIT INJUNCTIONS AS
WELL AS WITH THOSE OF SISTER CIRCUITS ..................................... 10
A.
B.

II.

The Panel Decision Alters The Standards Applicable To AntiSuit Injunctions In This Circuit ........................................................... 11
The Panel Decision Conflicts With Other Circuits‟ Standards
For Reviewing Anti-Suit Injunctions .................................................. 16

IN THE ALTERNATIVE, THE PANEL SHOULD GRANT
REHEARING ................................................................................................ 18

CONCLUSION ........................................................................................................ 19
CERTIFICATE OF COMPLIANCE ....................................................................... 22
CERTIFICATE OF SERVICE ................................................................................ 23

i

TABLE OF AUTHORITIES
Page
Cases
Applied Med. Distrib. Corp. v. Surgical Co. BV,
587 F.3d 909 (9th Cir. 2009) ......................................................................1, 7, 13
Canadian Filters (Harwich) Ltd. v. Lear-Siegler, Inc.,
412 F.2d 577 (1st Cir. 1969) ............................................................................... 17
China Trade & Dev. Corp. v. M.V. Choong Yong,
837 F.2d 33 (2d Cir. 1987) ................................................................................. 16
E. & J. Gallo Winery v. Andina Licores S.A.,
446 F.3d 984 (9th Cir. 2006) ......................................................... 1, 7, 12, 13, 15
Gau Shan Co., Ltd. v. Bankers Trust Co.,
956 F.2d 1349 (6th Cir. 1992) ............................................................................ 16
Laker Airways Ltd. v. Sabena, Belgian World Airlines,
731 F.2d 909 (D.C. Cir. 1984) ......................................................................16, 17
Microsoft Corp. v. AT&T Corp.,
550 U.S. 437 (2007) ......................................................................................14, 15
M/S Bremen v. Zapata Off-Shore Co.,
407 U.S. 1 (1972) .................................................................................................. 8
Neuchatel Swiss General Ins. Co. v. Lufthansa Airlines,
925 F.2d 1193 (9th Cir. 1991) ............................................................................ 14
Quaak v. Klynveld Peat Marwick Goerdeler Bedrijfsrevisoren,
361 F.3d 11 (1st Cir. 2004) ............................................................................. 2, 17
Seattle Totems Hockey Club, Inc. v. Nat’l Hockey League,
652 F.2d 852 (9th Cir. 1981) ................................................................1, 7, 13, 14
Stonington Partners, Inc. v. Lernout & Hauspie Speech Products, N.V.,
310 F.3d 118 (3d Cir. 2002) .....................................................................2, 16, 17
Subafilms, Ltd. v. MGM-Pathe Commc’ns Co.,
24 F.3d 1088 (9th Cir. 1994) .............................................................................. 14
In re Unterweser Reederei GMBH, 428 F.2d 888 (5th Cir. 1970),
aff’d on reh’g, 446 F.2d 907 (5th Cir. 1971) ....................................................... 8
Zynga, Inc. v. Vostu USA, Inc.,
816 F. Supp. 2d 824 (N.D. Cal. 2011) ................................................................ 15

ii

Statutes and Rules
Fed. R. App. P. 32(a) ............................................................................................... 22
Fed. R. App. P. 35(b) ................................................................................................ 1
Ninth Cir. R. 40-1(a) ............................................................................................... 22
Other Authorities
Daniel Tan, Anti-Suit Injunctions and the Vexing Problem of Comity,
45 VA. J. INT‟L L. 283, 337 (2005) .................................................................... 15

iii

RULE 35(b) STATEMENT
The panel decision in Microsoft Corp. v. Motorola, Inc., --F.3d--, 2012 WL
4477215 (9th Cir. Sept. 28 2012) (Berzon, J., joined by Wallace and Thomas, JJ.)
(Appendix A), warrants en banc review because its approval of the anti-suit
injunction in this case conflicts with decisions of this Court and of other circuits,
and also raises a question of exceptional importance regarding the ability of U.S.
courts to interfere with the orderly progression of parallel legal proceedings in
other countries, particularly as concerns enforcement of their own patents within
their own sovereign borders.
The panel held that the United States District Court for the Western District
of Washington (Robart, J.) did not abuse its discretion in issuing the first-ever antisuit injunction barring enforcement of a foreign nation‟s judgment awarding an
injunction against patent infringement within that nation‟s borders under that
nation‟s laws.

This decision conflicts with the framework established in the

Court‟s prior anti-suit injunction decisions, namely, Applied Medical Distribution
Corp. v. Surgical Co. BV, 587 F.3d 909 (9th Cir. 2009); E. & J. Gallo Winery v.
Andina Licores S.A., 446 F.3d 984 (9th Cir. 2006); and Seattle Totems Hockey
Club, Inc. v. National Hockey League, 652 F.2d 852 (9th Cir. 1981). First, rather
than relying upon the factors this Court has long said replace the likelihood of
success inquiry in the context of anti-suit injunctions, the panel undertook a

1

“ballpark, tentative assessment” of the merits, endorsing the view that a patent
holder‟s obligation to license standard-essential patents on “reasonable and nondiscriminatory” (“RAND”) terms precludes injunctive relief for patent
infringement anywhere in the world, even in other nations that regard such
injunctions as lawful and appropriate.

Second, the panel found the anti-suit

injunction here serves U.S. interests even though the parties had not contracted for
any forum-selection clause requiring decision in any U.S. court, much less in the
Western District of Washington. Third, the panel treated concerns of comity for a
foreign judicial system with unprecedented disregard, despite the fact that patents
and patent enforcement are singularly territorial.
The decision also places this Circuit in conflict with sister circuits. In
contrast to other courts of appeals that require anti-suit injunctions to issue only
sparingly, this Court‟s four primary decisions now favor liberal issuance of antisuit injunctions: in Gallo and Applied Medical, this Court reversed district courts
for failing to issue one; in Seattle Totems and this case, it affirmed courts for
issuing one.

The panel‟s decision expands upon an approach to anti-suit

injunctions that other circuits have deemed “liberal,” see, e.g., Quaak v. Klynveld
Peat Marwick Goerdeler Bedrijfsrevisoren, 361 F.3d 11, 17 (1st Cir. 2004);
Stonington Partners, Inc. v. Lernout & Hauspie Speech Products, N.V., 310 F.3d
118, 126 n.5 (3d Cir. 2002), allowing anti-suit injunctions to issue in the normal

2

course instead of letting parallel proceedings continue in different countries.
Under the panel‟s newly elevated deference, nearly every decision issuing an antisuit injunction seems destined to withstand abuse of discretion review; only where
a district court does not issue an anti-suit injunction do this Court‟s precedents
point to meaningful review and reversal. En banc review in this case would permit
the Circuit to examine whether its courts should become a magnet for parties
seeking anti-suit injunctions they could obtain in no other circuit.
For these reasons, Appellants Motorola Mobility, Inc. and General
Instrument, Corp. (“Motorola”) respectfully request rehearing en banc. See infra
Part I. In the alternative, Motorola respectfully requests rehearing by the panel.
See infra Part II.
FACTUAL STATEMENT
A.

Background

Microsoft and Motorola are engaged in ongoing litigation over licensing of
Motorola‟s “standard-essential patents,” which are patents that facilitate
compatibility between products manufactured by different companies.

Non-

governmental standards-setting organizations establish technical standards and
members of these organizations that hold essential patents generally must agree to
license them on RAND terms. The actual RAND terms are left to negotiations
between the parties.

3

The dispute here concerns two essential patents that Motorola holds and
Microsoft uses. Motorola sent Microsoft letters in October 2010, offering to
license two of its patent portfolios (ER 375-96, 398-421) 1 on standard terms.
Three weeks later, without making any counteroffer or engaging in good-faith
negotiations, Microsoft sued Motorola, asserting breach of contract and related
claims for Motorola‟s alleged breach of a commitment to license at RAND rates.
Microsoft‟s complaint seeks a declaration that it was entitled to licensing of
Motorola‟s essential patents and that Motorola‟s opening offer was not RAND.
ER 457-58, 492.
As Microsoft continued to sell products infringing Motorola‟s patents absent
any license, Motorola sued Microsoft in July 2011 in Germany—its second largest
market after the United States—for infringing certain of Motorola‟s German
patents. ER 335 (Redacted Declaration of Dr. Marcus Grosch, No. 10-1823, ECF
No. 245, at ¶ 14 (W.D. Wash. Apr. 6, 2012) (“Grosch Decl.”)). Motorola‟s
German suit pertains only to the German versions of its patents and seeks relief
only in the German market. No cause of action would be available for Motorola to
enforce its German patents in the United States.

1

Citations to “ER” refer to the Excerpts of Record filed in connection with
the merits briefing.
4

Germany has its own “Orange Book” procedures for resolving RAND
disputes, whereby an infringer can avoid an injunction by making a binding offer
on RAND terms and paying the RAND royalty into an escrow account. ER 330-35
(Grosch Decl. ¶¶ 3-13). If a German court determines the patent holder could not
reject the infringer‟s offer without violating RAND assurances, the patent holder‟s
action for injunctive relief is dismissed. If the patent holder accepts the offer, a
license agreement is established, again precluding injunctive relief.

ER 332-33

(Grosch Decl. ¶¶ 7-8). German law also allows the infringer to commit to a
licensing rate to be set by the patent holder, subject to review by the German court.
ER 332-33 (Grosch Decl. ¶ 8).
Microsoft declined to avail itself of the latter procedure, instead proposing a
licensing rate for Motorola‟s German patents, and the German court determined
Motorola was within its rights in rejecting the rate as too low. ER 336-39 (Grosch
Decl. ¶¶ 20, 26); ER 259, 261 (translation of German decision). The German
injunction issued on May 2, 2012, leaving Motorola to take additional steps to
enforce it.
B.

The District Court Decision

On March 28, 2012, eight months into proceedings in Germany and in
anticipation of the German court‟s impending unfavorable ruling, Microsoft moved
in the Seattle district court to block Motorola from enforcing any injunction in

5

Germany against Microsoft‟s continuing infringement of Motorola‟s German
patents. Mot. for TRO and Prelim. Inj., No. 10-1823, ECF No. 210 (W.D. Wash.
Mar. 28, 2012). Microsoft argued that the German court‟s anticipated injunction
would be “inconsistent with what will ultimately be Microsoft‟s worldwide
license.” Id. at 13.
On April 11, 2012, the district court granted a temporary restraining order
prohibiting Motorola from enforcing any German injunction. ER 29-44. On May
14, 2012, the district court converted its TRO into a preliminary injunction,
enjoining Motorola from enforcing the German injunction “until th[e district] court
is able to determine whether injunctive relief is an appropriate remedy.” ER 25.
In the May 14 opinion, the district court found that the parties are the same
in each action (as conceded), ER 13, and that the U.S. litigation would be
dispositive of the German litigation, ER 17. The district court next found that
allowing the German litigation to proceed would frustrate a “policy” of “avoiding
inconsistent judgments,” and expressed concern that Motorola was “forum
shopping,” stating that Motorola‟s German suit “heightened” its concerns over
“duplicative and vexatious litigation.” ER 18. Last, the district court found that
the impact of the proposed anti-suit injunction on international comity would be
tolerable. ER 19-20.

6

C.

The Panel Decision

Motorola appealed from the anti-suit injunction.

Following expedited

briefing and oral argument, the panel (Wallace, Thomas, and Berzon, JJ.) on
September 28, 2012 issued a 36-page opinion (Berzon, J.) for publication. App. A.
It affirmed the issuance of the anti-suit injunction, emphasizing its heavy deference
to the district court at each turn.
The panel decision first set out the standard for analyzing issuance of an
anti-suit injunction. This standard had been established, modified, and clarified in
three Ninth Circuit opinions over the past three decades, all of which came out in
favor of anti-suit injunctions, affirming where one had issued and reversing where
two had not: Applied Medical, 587 F.3d at 911 (reversing for failure to issue antisuit injunction); Gallo, 446 F.3d at 986-87 (same); Seattle Totems, 652 F.2d at 856
(affirming issuance of anti-suit injunction).

The panel determined that these

decisions set forth the following test for whether an anti-suit injunction may issue:
First, we determine whether or not the parties and the issues are the
same in both the domestic and foreign actions, and whether or not the
first action is dispositive of the action to be enjoined. Second, we
determine whether at least one of the so-called “Unterweser factors”
applies. Finally, we assess whether the injunction‟s impact on comity
is tolerable.

7

App. A at 16-17 (citations and quotations omitted). 2 The panel found that the
district court, in applying this test, applied the correct legal standard. Id. at 18.
In reviewing the district court‟s analysis of these factors, the panel first
examined whether the parties are the same (which was not disputed) and whether
the issues are the same such that the Washington action would be dispositive of the
German action. But the panel made new law in determining whether the issues are
“the same,” undertaking what it termed “a ballpark, tentative assessment of the
merits of the contract dispute,” which it perceived as “intrinsically bound up with
the threshold anti-suit injunction inquiry.” Id. at 22. The panel acknowledged the
lack of precedent for this approach: “Ordinarily, we do not assess at all the
likelihood of success on the merits in a case like this, because when a preliminary
injunction is also a foreign anti-suit injunction, the likelihood-of-success aspect of
the traditional preliminary injunction test is replaced by the Gallo test.” Id. at 22.
In nonetheless making its “ballpark, tentative assessment” of the merits, and
determining that Motorola‟s RAND licensing obligations “at least arguably”
preclude it from seeking any injunctions worldwide, id. at 23, the panel assumed
conclusions not yet reached in the district court, namely that Motorola‟s

2

The Unterweser factors refer to In re Unterweser Reederei GMBH, 428
F.2d 888 (5th Cir. 1970), aff’d on reh’g, 446 F.2d 907 (5th Cir. 1971) (en banc)
(per curiam), rev’d on other grounds sub nom. M/S Bremen v. Zapata Off-Shore
Co., 407 U.S. 1 (1972).
8

essentiality declaration creates a contract that “governs in some way what actions
Motorola may take to enforce its ITU standard-essential patents,” id. at 23, and
that “it could well be that retrospective payment … not an injunction … is the only
remedy consistent with the contractual commitment to license users of ITU
standard-essential patents,” id. at 26.
Turning to the second step in the anti-suit injunction inquiry, the panel found
the district court did not abuse its discretion in concluding that Motorola‟s German
litigation was vexatious and compromised the court‟s ability to fashion appropriate
relief. Id. at 27-28.
The panel finally turned to the impact of the injunction on comity,
emphasizing that the panel need only “estimate whether any such interference is so
great as to be intolerable.” Id. at 29. Again, it found that the district court did not
abuse its discretion in issuing the injunction because it raises no public
international dispute and is “no broader than necessary.” Id. at 32 (quotation
omitted). The panel concluded that “the mere fact that different jurisdictions
answer the same legal question differently does not, without more, generate an
intolerable comity problem.” Id. at 33. Turning on its head the presumption that
parallel proceedings may continue in the ordinary course, the panel determined that
deference to Germany‟s enforcement of its own patents in its own territory was not
due because, otherwise, “[p]arallel proceedings in different jurisdictions would

9

have to be permitted to proceed any time the two jurisdictions had different rules
of law, which is almost always the case.” Id. at 33. Thus, the panel rejected
Motorola‟s argument that the anti-suit injunction bars it from enforcing its German
patents in the only forum possible, noting that, “depending on the outcome of the
district court litigation, Motorola may well ultimately be able to enforce the
German injunction.” Id. at 34-35.
ARGUMENT
I.

EN BANC REVIEW IS WARRANTED BECAUSE THE PANEL
DECISION CONFLICTS WITH THIS COURT’S PRECEDENTS
GOVERNING ISSUANCE OF ANTI-SUIT INJUNCTIONS AS WELL
AS WITH THOSE OF SISTER CIRCUITS
In upholding an unprecedented anti-suit injunction that prevents Motorola

from enforcing an injunction awarded by a German court concerning German
patents within Germany, the panel decision departed from this Court‟s precedents
and those of other circuits. The panel decision recites in theory yet abdicates in
practice the principle that such injunctions should issue only sparingly. Unless
reviewed by this Court en banc, the panel‟s decision will make this Circuit an
outlier in the law of anti-suit injunctions, signaling that such injunctions will issue
freely, whether by reversing district courts that declined to issue one (in Gallo and
Applied Medical) or by affirming courts that did (in Seattle Totems and here).
Moreover, the panel has for the first time endorsed an anti-suit injunction that
blocks a foreign court‟s judgment governing enforcement of its own patents within

10

its own borders. The panel has held that a U.S. court‟s view that an injunction
cannot issue on a standard-essential patent properly trumps the contrary view of a
foreign court as to foreign patents. By paving a new path favoring issuance of
anti-suit injunctions in the important and unsettled area of RAND licensing of
standard-essential patents, the panel has invited litigants to bring global licensing
disputes in U.S. courts to shut down efforts to enforce foreign standard-essential
patents in foreign courts. En banc review is warranted.
A.

The Panel Decision Alters The Standards Applicable To Anti-Suit
Injunctions In This Circuit

The panel decision conflicts in three important respects with prior holdings
of this Court applying the established factors. First, rather than relying upon the
factors that this Court has long said replace the likelihood of success inquiry for
anti-suit injunctions, the panel undertook a “ballpark, tentative assessment” of the
merits, endorsing the view—as yet to be adopted by any federal circuit—that
RAND obligations preclude worldwide injunctive relief for patent infringement,
even in other nations that deem such injunctions lawful and appropriate in
circumstances like those here. Second, the panel found that special U.S. interests
justified issuance of an anti-suit injunction even though the parties had not
contracted for any forum-selection clause. Third, the panel treated concerns of
comity for a foreign judicial system with unprecedented disregard, despite the fact
that patents and patent enforcement are singularly territorial and that Microsoft
11

never availed itself of the German Orange Book procedure that would have
avoided the German injunction.
1. Noting that “[t]he suitability of an anti-suit injunction involves different
considerations from the suitability of other preliminary injunctions,” Gallo, 446
F.3d at 990, this Court hitherto substituted a three-step test for the likelihood of
success inquiry. Here, however, the panel deemed the merits “intrinsically bound
up with the threshold anti-suit injunction inquiry.” App. A at 22. Yet the panel‟s
unprecedented “ballpark, tentative assessment of the merits” threatens the worst of
all worlds, falling short of the traditional merits inquiry while creating the risk of
predetermining issues that remain undecided in the district court.

Here, for

example, the panel decided that enforcing a German injunction against Microsoft‟s
infringement would impede the district court‟s ability to adjudicate global RAND
terms, even though it remains to be decided whether a single offer letter can breach
RAND obligations or whether injunctive relief remains unavailable even if a
recalcitrant infringer refuses to take a license on any terms.
The panel‟s sui generis approach to merits review at this preliminary stage
fortifies the district court‟s controversial approach to adjudicating standardessential patent disputes without benefit of appropriate appellate review on a full
record. It also sows confusion going forward as to whether and how this new
merits standard might apply. If a panel reaches the legal merits in this context, it

12

should either squarely decide the merits or else apply the traditional “likelihood of
success” test as readily understood and applied; the new standard fashioned by this
panel warrants en banc review.
2. In addition, the panel decision disregards this Court‟s precedents holding
that a U.S. court should avoid interfering with parallel proceedings abroad unless
strong U.S. interests are at stake, as they are when a foreign suit thwarts the
parties‟ express agreement to litigate in a U.S. forum. Such limitation comports
with the principle that “„the power [to issue anti-suit injunctions] should be used
sparingly.‟” Gallo, 446 F.3d at 989 (quoting Seattle Totems, 652 F.2d at 855); see
also Applied Medical, 587 F.3d at 920. Where parties have negotiated a U.S.
forum in their contract, “[a]n anti-suit injunction is the only way [a party] can
effectively enforce the forum selection clause.” Gallo, 446 F.3d at 993.
The mere fact that U.S. law differs from foreign law is no license for a U.S.
court to play trump via an anti-suit injunction; rather, such differences are routine
in parallel litigation, particularly in the intellectual property context. The panel
nonetheless reasoned that differences in U.S. law warrant elevating the U.S. forum
over foreign tribunals, effectively inviting any party preferring U.S. law to invoke,
on that basis alone, a special U.S. interest supporting an anti-suit injunction. Such
an approach is misconceived. Even assuming U.S. law were properly understood
to preclude injunctions for standard-essential patents, no reason exists for the U.S.

13

rule to prevail over Germany‟s contrary rule permitting injunctions. Unlike other
cases in which this Court endorsed anti-suit injunctions, there is neither a forumselection clause specifying a U.S. forum nor any particular reason why the claimed
interests of the U.S. court should trump those of a German court in enforcing
German patents declared essential to worldwide standards.
3. Finally, the panel‟s decision lowers this Court‟s previous bar against
offense to international comity, which has long assumed that parallel proceedings
should be the norm. See Neuchatel Swiss General Ins. Co. v. Lufthansa Airlines,
925 F.2d 1193, 1995 (9th Cir. 1991) (reversing district court stay of proceedings in
favor of Swiss proceedings because both actions should proceed in parallel). A
U.S. court should not disturb proceedings in a foreign court absent some special
justification, lest international comity be harmed. Whereas this Court‟s opinion in
Gallo calls for “detailed analysis of international comity,” 446 F.3d at 990, the
panel‟s decision relaxes this standard considerably.
The offense to comity is especially great here because patent law is
singularly national; the laws of each country do not have extraterritorial effect.
See, e.g., Subafilms, Ltd. v. MGM-Pathe Commc’ns Co., 24 F.3d 1088, 1093 (9th
Cir. 1994) (en banc) (explaining that intellectual property rights are not
extraterritorial); see also Microsoft Corp. v. AT&T Corp., 550 U.S. 437, 455
(2007) (“Foreign conduct is [generally] the domain of foreign law, [which] … may

14

embody different policy judgments about the relative rights of inventors,
competitors, and the public in patented inventions.”) (quotation omitted). Anti-suit
injunctions have routinely been rejected as improper in the intellectual property
context given these particular comity concerns. See Zynga, Inc. v. Vostu USA, Inc.,
816 F. Supp. 2d 824, 829 (N.D. Cal. 2011) (“[F]ederal courts around the country
have considered anti-suit injunctions of parallel proceedings in a variety [of]
intellectual property contexts and have uniformly concluded that such injunctions
are improper.”); Daniel Tan, Anti-Suit Injunctions and the Vexing Problem of
Comity, 45 VA. J. INT‟L L. 283, 337 (2005) (“In such cases, the United States
courts should be slow to issue anti-suit injunctions to enjoin foreign
proceedings.”).
The affront to international comity is likewise especially remarkable here
because the panel‟s decision endorses flagrant disregard for German law and
German court procedures that Microsoft could have pursued to prevent the
enforcement of the German injunction. Microsoft could have sought a stay from
the German court of its judgment, but chose not to. Nor did Microsoft avail itself
of the German court‟s Orange Book procedures by which it could have obtained
licensing on RAND terms and avoided entry of an injunction. Any “detailed
analysis of international comity” would have required consideration of these
strategic choices on Microsoft‟s part before affronting the courts and law of a

15

foreign sovereign. Cf. Gau Shan Co., Ltd. v. Bankers Trust Co., 956 F.2d 1349,
1354 (6th Cir. 1992) (anti-suit injunction risks “convey[ing] the message, intended
or not, that the [U.S.] court has so little confidence in the [German] court‟s ability
to adjudicate a given dispute fairly and efficiently that it is unwilling even to allow
the possibility”).
Rehearing en banc is needed to clarify this Court‟s framework for allowing
anti-suit injunctions.
B.

The Panel Decision Conflicts With Other Circuits’ Standards For
Reviewing Anti-Suit Injunctions

The panel decision also conflicts with prior holdings of other circuits,
deepening an inter-circuit conflict. Other circuits give comity considerations far
more careful attention than did the panel, reserving anti-suit injunctions for truly
rare instances and presuming that foreign courts may proceed in parallel with U.S.
courts, notwithstanding overlapping interests and issues. Thus, they consistently
hold that such injunctions should be confined to “the rare occasions when needed
to protect jurisdiction or an important public policy.” Stonington Partners, Inc.,
310 F.3d at 127 (quotation omitted); see Gau Shan Co., 956 F.2d at 1354 (“Comity
dictates that foreign antisuit injunctions be issued sparingly and only in the rarest
of cases.”); China Trade & Dev. Corp. v. M.V. Choong Yong, 837 F.2d 33, 36 (2d
Cir. 1987) (similar); Laker Airways Ltd. v. Sabena, Belgian World Airlines, 731

16

F.2d 909, 927 (D.C. Cir. 1984) (similar); Canadian Filters (Harwich) Ltd. v. LearSiegler, Inc., 412 F.2d 577, 578 (1st Cir. 1969) (similar).
The panel decision brings into sharp relief that this Court will deem resulting
offenses to comity tolerable where other circuits would not. Quaak, 361 F.3d at 17
(noting that the Ninth Circuit is in the minority in championing a liberal approach
that gives little weight to comity concerns); Stonington Partners, Inc., 310 F.3d at
126 n.5 (same). Sister circuits often point to comity concerns as grounds for
denying an anti-suit injunction. See, e.g., Quaak, 361 F.3d at 17 (“deem[ing]
international comity an important integer”); Laker Airways, 731 F.2d at 927 (antisuit injunctions should issue “only in the most compelling circumstances”).
Other circuits also agree on the well-established principle that “duplication
of parties and issues alone is not sufficient to justify issuance of an anti-suit
injunction.” Laker Airways Ltd., 731 F.2d at 928. “Since parallel proceedings are
ordinarily tolerable, the initiation before a foreign court of a suit concerning the
same parties and issues as a suit already pending in a United States court does not,
without more, justify enjoining a party from proceeding in the foreign forum.”
China Trade, 837 F.2d at 36.
Rehearing en banc would enable this Court to decide whether to harmonize
its precedents with those of sister circuits.

17

II.

IN THE ALTERNATIVE,
REHEARING

THE

PANEL

SHOULD

GRANT

If rehearing en banc is denied, the panel should grant rehearing because the
panel misconstrued the scope of Motorola‟s RAND commitment. In making its
“ballpark, tentative assessment” of the merits, the panel concluded that the
essentiality declaration “at least arguably” precludes patent holders from seeking
injunctions, App. A at 23, and that “injunctive relief against infringement is
arguably a remedy inconsistent with the licensing commitment,” id. at 25.
These determinations that Motorola gave up its rights to enforce standardessential patents are erroneous but in any event premature. A declaration of
essentiality includes “no waiver of claims for injunctive relief,”

ER 221

(translation of German decision), and the district court has not ruled otherwise.
See ER 25 (extending injunction “until th[e district] court is able to determine
whether injunctive relief is an appropriate remedy”). The declaration contains the
disclaimer that it “does not represent an actual grant of a license,” and that
“[n]egotiations of licenses are left to the parties concerned.” ER 353-54 (ITU
declaration).
In this light, the panel‟s statement that “Motorola made promises to the ITU
to license its standard-essential patents worldwide to all comers,” App. A at 24,
overstates matters. Motorola agreed to license its patents only to those “comers”
willing to negotiate and pay a RAND rate. To disallow injunctive relief against a
18

would-be licensee that has yet to negotiate and pay in good faith, as the panel
seemingly commends, “would be handing the patent owner over to every dishonest
licensee for whom there would no longer be any incentive to conduct licensing
negotiations.” ER 232 (translation of German decision).
The law on this point is unsettled and controversial, and no court of appeals
has yet to tackle it. If this Court is to do so—and at the expense of German law—it
should have the benefit of full merits briefing and analysis. The panel should grant
rehearing to amend its opinion accordingly.
CONCLUSION
Motorola respectfully requests that its petition be granted.

19

Dated: October 12, 2012

Respectfully submitted,

s/ Kathleen M. Sullivan_________
Kathleen M. Sullivan
QUINN EMANUEL URQUHART
& SULLIVAN, LLP
51 Madison Avenue, 22nd Floor
New York, NY 10010
[phone] (Telephone)
[phone] (Facsimile)
[e-mail]
Derek L. Shaffer
QUINN EMANUEL URQUHART
& SULLIVAN, LLP
1299 Pennsylvania Avenue, NW
Suite 825
Washington, DC 20004
[phone] (Telephone)
[phone] (Facsimile)
[e-mail]
Ralph H. Palumbo
Philip S. McCune
Lynn M. Engel
SUMMIT LAW GROUP PLLC
315 Fifth Avenue South
Suite 1000
Seattle, WA 98104-2682
[phone] (Telephone)
[phone] (Facsimile)
Steven Pepe
Jesse J. Jenner
Stuart W. Yothers
ROPES & GRAY LLP
1211 Avenue of the Americas
New York, NY 10036-8704
[phone] (Telephone)
20

Douglas Hallward-Driemeier
Paul M. Schoenhard
Kevin J. Post
ROPES & GRAY LLP
One Metro Center
700 12th Street NW, Suite 900
Washington, DC 20005-3948
[phone] (Telephone)

21

CERTIFICATE OF COMPLIANCE
I certify that pursuant to Fed. R. App. P. 32(a)(c)(2) and Ninth Circuit Rule
40-1(a), the foregoing Petition For Rehearing And Rehearing En Banc is
proportionately spaced, has a typeface of 14 points and contains 4,193 words,
which is fewer than the 4,200 words permitted.

s/ Kathleen M. Sullivan
Kathleen M. Sullivan

22

CERTIFICATE OF SERVICE
I, Kathleen M. Sullivan, a member of the Bar of this Court, hereby certify
that on October 12, 2012, I electronically filed the foregoing Petition For
Rehearing And Rehearing En Banc with the Clerk of the Court for the United
States Court of Appeals for the Ninth Circuit by using the appellate CM/ECF
system.
I certify that all participants are registered CM/ECF users and that service
will be accomplished by the appellate CM/ECF system.

s/ Kathleen M. Sullivan
Kathleen M. Sullivan

23