ARCONIC INC. v. NOVELIS INC. et al

Filing 1118

MEMORANDUM OPINION re DECLARATORY JUDGMENT CLAIMS. Details more fully stated in Opinion. An appropriate order follows. Signed by Judge Joy Flowers Conti on 4/20/2023. (lyk)

Case 2:17-cv-01434-JFC Document 1118 Filed 04/20/23 Page 1 of 15

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF PENNSYLVANIA
ARCONIC CORPORATION AND
HOWMET AEROSPACE INC.,
Plaintiffs and Counterclaim Defendants,

v.
NOVELIS INC. and NOVELIS CORP,
Defendants and Counterclaim Plaintiffs.

) CIVIL ACTION NO. 17-1434
)
) JUDGE JOY FLOWERS CONTI
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MEMORANDUM OPINION re DECLARATORY JUDGMENT CLAIMS
I.

Introduction

This hard-fought litigation between business competitors Arconic Corporation and
Howmet Aerospace, Inc. (collectively, “Arconic”) and Novelis Inc. and Novelis Corporation
(collectively, “Novelis”) has spanned 7 years and resulted in 1109 entries on the docket (and
counting). Cross-motions for summary judgment are pending (ECF Nos. 988, 1003). 1 This
opinion and order addresses only the requests for declaratory relief asserted by the parties.
Both parties sought summary judgment with respect to their claims for relief under the
Declaratory Judgment Act (“DJA”), 28 U.S.C. § 2201, as follows:

The court referred certain parts of the summary judgment motions to the special master for report and
recommendation (“R&R”), specifically, Arconic’s claims with respect to the “7 CI” and Novelis’ Sherman Act and
Robinson Patman Act (“RPA”) counterclaims (Counterclaims XI and XII) (ECF No. 1065). In an opinion and order
dated March 8, 2023 (ECF No. 1087, 1088), the court granted Arconic’s motion for summary judgment (ECF No.
1003) in part, and denied Novelis’ motion for summary judgment (ECF No. 988) in part, in that Novelis cannot
recover treble damages for the alleged RPA violation in counterclaim XII. The court noted that Novelis’ ability to
obtain injunctive relief on the RPA counterclaim would be the subject of an R&R by the special master. On March
8, 2023, pursuant to Rule 56(f), the court directed Novelis to show cause why partial summary judgment should not
be granted on counterclaims II and III, for alleged breach of the 2012 License. Those issues will be resolved in
separate opinions and orders.
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1. Arconic’s Count VII sought declaratory judgment that the 2012 Technology Access &
License Agreement dated August 15, 2012, between Arconic and Novelis (the “2012
License”) (ECF No. 1-3) does not include the “ion exchange patent”;
2. Novelis’ Counterclaim X sought a parallel declaratory judgment that the ion exchange
patent is included in the 2012 License;
3. Novelis’ Counterclaim I sought a declaration that Arconic wrongfully terminated the
2012 License and must continue to supply the A951 chemical composition and process to
Novelis; and
4. Novelis’ Counterclaim XIII sought a declaration that Arconic committed patent misuse,
i.e., a Brulotte violation, by failing to step down its royalty after the last patent expired.
Although many of the related filings are sealed, this opinion will not be filed under seal.

II.

Standard of review

The DJA provides that, “[i]n a case of actual controversy within its jurisdiction ... any
court of the United States ... may declare the rights and other legal relations of any interested
party seeking such declaration, whether or not further relief is or could be sought.” 28 U.S.C. §
2201(a) (emphasis added). Relief under the DJA is discretionary:
Where an actual controversy exists, the DJA “place[s] a remedial arrow in the
district court's quiver and confers a unique and substantial discretion on federal
courts to determine whether to declare litigants’ rights.” Reifer v. Westport Ins.
Corp., 751 F.3d 129, 139 (3d Cir. 2014) (quoting Wilton v. Seven Falls Co., 515
U.S. 277, 288 (1995)) (internal quotation marks omitted); see also Lilac Dev. Grp.,
LLC v. Hess Corp., No. 15-7547, 2016 WL 3267325, at *2 (D.N.J. June 7, 2016).
Great Lakes Ins. SE v. Ross, No. 121CV17308, 2023 WL 372788, at *3 (D.N.J. Jan. 24, 2023).
Declaratory relief is only prospective. The DJA cannot be used to correct past violations
of law. As the court explained in Doris Behr 2012 Irrevocable Trust v. Johnson, No. CV198828,
2021 WL 2722569 (D.N.J. June 30, 2021):
[D]eclaratory relief cannot be obtained for alleged past wrongs, given that ‘[t]he
remedy is ... by definition prospective in nature.’ ” McDonald v. Thomas, No. 131471, 2015 WL 5032379, at *6 (M.D. Pa. Apr. 25, 2015) (quoting CMR D.N. Corp.
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v. City of Phila., 703 F.3d 612, 628 (3d Cir. 2013)); Gochin v. Markowtiz, 791 F.
App'x 342, 346 (3d Cir. 2019) (“Declaratory relief is ‘by definition prospective in
nature,’ and [the appellant] was therefore not entitled to a declaration that Judge
Branca previously violated her rights in the forfeiture action.” (citations omitted) );
Parkell v. Senato, 704 F. App'x 122, 125 (3d Cir. 2017) (affirming district court's
conclusion that the plaintiff “could not seek declaratory relief—which is ‘by
definition prospective in nature,’ ... and cannot be issued to address past wrongs”)
(quoting CMR D.N., 703 F.3d at 628)).
Id. at *3.
Declaratory relief must be of practical help or utility. Pic–A–State Pa. Inc. v. Reno, 76
F.3d 1294, 1298 (3d Cir. 1996). As the Supreme Court explained: “If a district court, in the
sound exercise of its judgment, determines after a complaint is filed that a declaratory judgment
will serve no useful purpose, it cannot be incumbent upon that court to proceed to the merits
before staying or dismissing the action.” Wilton v. Seven Falls Co., 515 U.S. 277, 288 (1995);
Step-Saver Data Sys., Inc. v. Wyse Tech., 912 F.2d 643, 647 (3d Cir. 1990) (the most important
principles to weigh in deciding whether to exercise jurisdiction under the DJA “are the adversity
of the interest of the parties, the conclusiveness of the judicial judgment and the practical help, or
utility, of that judgment”).

III.

First three DJA claims (Arconic’s Count VII, Novelis’ Counterclaims X and I)

With respect to three of the four DJA claims, the parties agree that declaratory relief is no
longer necessary.
First, with respect to the parallel requests about ion exchange, both parties acknowledged
in the summary judgment briefing that their affirmative request for a declaration was
unnecessary if the opponent’s request was denied. (ECF No. 990 at 19 n.11; ECF No. 1029 at
20). Counsel confirmed at the oral argument on February 7, 2023, that “the competing claims on
the ion exchange should be dismissed.” Tr. at 17. These claims will be dismissed.
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Second, on February 9, 2023, pursuant to Federal Rule of Civil Procedure 56(f), the court
gave notice for Novelis to show cause why summary judgment should not be granted on
Counterclaim I (on which no party sought summary judgment) (ECF No. 1065). In its response,
Novelis agreed that declaratory relief on Counterclaim I would no longer be of practical use or
utility in light of Arconic’s assurances that it would continue to permit the supply of the A951
chemical composition to Novelis. (ECF No. 1081). Novelis sought leave to withdraw
Counterclaim I without prejudice. Arconic filed a response opposing withdrawal without
prejudice and contending that summary judgment should be granted on Counterclaim I (ECF No.
1089). Novelis filed a reply (ECF No. 1098) reiterating its position that Counterclaim I should
be dismissed without prejudice for lack of jurisdiction or ripeness.
After considering the parties’ arguments, Counterclaim I will be dismissed without
prejudice. The dismissal is not based upon the merits; rather, the dismissal is based upon
representations made by Arconic. Under those circumstances, a dismissal without prejudice is
appropriate. In the event Arconic does not comply with its representations, Novelis will be able
to reassert this claim, subject to Arconic being able to reassert its defenses.

IV.

Novelis’ Counterclaim XIII
A. The dispute

The only remaining DJA claim involves an alleged patent misuse violation. In Brulotte v.
Thys Co., 379 U.S. 29 (1964), the Supreme Court held that a holder of a patent cannot charge
royalties for that patent after the patent’s term has expired. Novelis argues that Brulotte creates a
bright-line rule that a royalty must be stepped down to reflect the expiration of patent rights and
that Arconic failed to do so in the Amended and Restated Technology Access & License

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Agreement between Arconic and Chemetall US, Inc. (“Chemetall”), executed in December 2018,
but with an effective date of November 1, 2017 (“2018 Arconic-Chemetall Agreement”) (ECF
No. 1002-15). See Kimble v. Marvel Ent., LLC, 576 U.S. 446, 459 (2015) (“The decision [in
Brulotte] is simplicity itself to apply. A court need only ask whether a licensing agreement
provides royalties for post-expiration use of a patent. If not, no problem; if so, no dice.”);
Meehan v. PPG Indus., Inc., 802 F.2d 881, 886 (7th Cir. 1986) (“Although it is true [ ] that
parties can contract for trade secret payments to extend beyond the life of a patent, there must be
some provision that distinguishes between patent royalties and trade secret royalties. . . . [I]t is
the lack of clarity that is dispositive in this case. Under Brulotte when royalty payments extend
unchanged beyond the life of a patent, patent leverage has been abused and the agreement is
unlawful per se.”).
Arconic disputes that it committed a Brulotte violation, but argues that the court need not
reach the merits of patent misuse because declaratory relief is not appropriate under the
circumstances of this case. Arconic contends: (1) patent misuse is an affirmative defense that
will never be implicated because Arconic will not assert a patent infringement claim; (2) Novelis
lacks standing to challenge a contract to which it is not a party; (3) any relief would be illusory
because Chemetall – which is a party to the contract -- is not a party to this litigation and could
not be forced to abide by any declaration the court may issue; (4) a stepdown was not required
because the royalties were tied to non-patent knowhow, i.e., the secret formula for the A951
chemical composition; and (5) the 2018 Arconic-Chemetall Agreement is not a product of patent
misuse (and cures any violation) because it was executed after all relevant patents expired.

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B. Factual background
Arconic and Chemetall entered into an agreement to commercialize the A951 process on
October 29, 2012 (the “2012 Arconic-Chemetall Agreement”). Arconic Combined Concise
Statement of Material Facts (“Arconic CCSMF”) ¶ 10 (ECF No. 1052). There were revisions to
the financial terms in 2014 and 2015. Novelis Supplemental Facts ¶¶ 84, 85 (ECF No. 1052). In
December 2018, Arconic and Chemetall renegotiated and executed the 2018 Arconic-Chemetall
Agreement, which was backdated to November 1, 2017. Arconic CCSMF ¶¶ 17, 50.
Both contracting parties (Arconic and Chemetall) were well-aware that all applicable
patents had expired when they executed the 2018 Arconic-Chemetall Agreement. Tr. 104. The
2018 Arconic-Chemetall Agreement § 1.3 provided that the term “Arconic Patents” meant only
the ‘609 patent. The ‘609 patent expired on December 26, 2017. Arconic CCSMF ¶ 51 (ECF
No. 1052). Section 1.3 specified that the ‘030 patent (i.e., ion exchange) was not included in the
2018 Arconic-Chemetall Agreement. The 2018 Arconic-Chemetall Agreement recognized that
the ‘804 patent “is now expired.” Id. § 1.3.
Attachment B to the 2018 Arconic-Chemetall Agreement set prices for various categories
of customers of the A951 chemical composition from Chemetall. Novelis pays a rate (i.e., the
“Target Price”) higher than the rate paid by Arconic. Arconic CCSMF ¶¶ 19, 20.
After Arconic and Chemetall entered into the 2012 Arconic-Chemetall Agreement,
Novelis no longer had a contractual relationship with Arconic with respect to the purchase of the
A951 chemical composition. Arconic CCSMF ¶ 49. Novelis buys the A951 chemical
composition directly from Chemetall by purchase order. Arconic CCSMF ¶¶ 44, 45. Novelis
has paid the same price since 2014, despite other revisions in the revenue-sharing terms between
Arconic and Chemetall. Arconic CCSMF ¶¶ 15, 16.

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There is no specific royalty payment paid by Novelis to Arconic. Chemetall remits
royalties (defined in the 2018 Arconic-Chemetall Agreement as “Technology Access Fees”) to
Arconic as part of their split of total proceeds from Chemetall’s sale of the A951 chemical
composition to third parties, including to Novelis and others. Novelis CCSMF ¶ 20 (ECF No.
1049); Tr. 45. The 2018 Arconic-Chemetall Agreement modified the financial terms by which
Arconic and Chemetall shared the proceeds from a split of profits to a split of gross sales
revenues. It appears that this modification was not a stepdown because it increased Arconic’s
share of the net proceeds. Novelis Supplemental Facts ¶ 86 (ECF No. 1052); Novelis CCSMF ¶¶
21, 22 (ECF No. 1049).
The 2018 Arconic-Chemetall Agreement does not expressly include a stepdown in
royalties to reflect expiration of Arconic’s patents and does not apportion royalties between
patent and non-patent rights. Novelis CCSMF ¶ 24 (ECF No. 1049). Arconic and Novelis
acknowledge that the real value in what was being sold by Chemetall to Novelis resulted from
the formula for the A951 chemical composition, which is one of Arconic’s trade secrets.
Arconic CCSMF ¶ 1 (ECF No. 1052); see Fudge Deposition at 450 (“we [Chemetall] were
assured that there was sufficient IP that allowed [Arconic] to continue to charge royalties.”).

C. The declaratory relief sought by Novelis
As pled, Novelis sought a declaration that: (1) the Technology Access fees in the 2012
License and the 2012 and 2018 Arconic-Chemetall Agreements are unenforceable; (2) the Target
Price to Novelis in Attachment B to the 2018 Arconic-Chemetall Agreement is unenforceable;
and (3) any price set for the A951 chemical composition and know-how cannot include any

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consideration for the expired ‘804, ‘609 and ‘030 patents. 2 (ECF No. 721 ¶ 407). From the
summary judgment briefing, the court understood Novelis to be seeking a declaration requiring
Arconic and Chemetall to renegotiate their agreement. (See ECF No. 1056 at 3) (directing
counsel to address the question: “If the requested relief is to have Arconic and Chemetall
renegotiate, why is the 2018 renegotiation (after the last patent expired) not the best evidence of
the deal they would reach?”); Tr. at 125-126.
At the oral argument on February 7, 2023, Novelis made several inconsistent requests for
relief. It sought, alternatively, a declaration that the 2018 Arconic-Chemetall Agreement (or the
Novelis price term in Attachment B) was illegal (Tr. at 109-110); or an injunction that Arconic
be prohibited from enforcing the royalty provision (Tr. at 128).

Novelis’ counsel argued that

possibly Arconic should be required to provide the use of the A951 chemical formula to
Chemetall for free. (Tr. 125) (“So the royalty would be void. Chemetall wouldn’t have to pay
[anything].”). Novelis’ counsel argued that the price Chemetall charged to Novelis would fall
with the illegal royalty provision and should be invalidated as well. (Tr. at 128-129).

D. Conclusive nature or practical help or utility of the relief requested
There are at least three problems with Novelis’ request for a declaration about patent
misuse. First, there will be no claim of patent infringement asserted by Arconic. Second, the
patent misuse defense does not allow Novelis to recover economic relief. Third, there are
practical problems: Novelis is not a party to the contract on which it seeks a declaration while
Chemetall, which is a contracting party, is not part of this litigation.

As described above, the text of the 2018 Arconic-Chemetall Agreement provides that the ‘030 patent was not
included and recognizes that the ‘804 patent expired. The only patent at issue is the ‘609 patent, which expired on
December 26, 2017 (approximately two months after the backdated effective date of November 1, 2017 and one
year before the execution of the 2018 Arconic-Chemetall Agreement).
2

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1. Patent misuse defense
Patent misuse is typically an affirmative defense to a patent infringement claim. If a
patentee uses conditions on licenses to broaden the scope of a patent grant, “an accused infringer
may invoke the doctrine of patent misuse to defeat the patentee's claim.” Princo Corp. v. Int'l
Trade Comm'n, 616 F.3d 1318, 1328 (Fed. Cir. 2010); B. Braun Med., Inc. v. Abbott Lab'ys, 124
F.3d 1419, 1427 (Fed. Cir. 1997) (“Patent misuse arose [ ] as an equitable defense . . . . When
used successfully, this defense results in rendering the patent unenforceable until the misuse is
purged. It does not, however, result in an award of damages to the accused infringer.”).
Novelis is not an accused infringer of the ‘609 patent. Arconic never filed a patent
infringement claim against Novelis or Chemetall. The court, therefore, does not need to decide
the merits of a patent misuse defense. Princeton Digital Image Corp. v. Off. Depot Inc., No. CV
13-239, 2016 WL 1533697, at *8 (D. Del. Mar. 31, 2016) (declining DJA claim based on patent
misuse where there was no threat that patent infringement claim would be asserted); Internet
Pipeline, Inc. v. Aplifi, Inc., No. CIV.A. 10-6089, 2011 WL 4528340, at *3 (E.D. Pa. Sept. 29,
2011) (patent misuse DJA counterclaim falls because patent holder covenanted not to proceed
with patent infringement claim); Nationwide Sales & Servs. Inc. v. Steel City Vacuum Co., No.
16CV06223, 2021 WL 982867, at *4 (E.D.N.Y. Feb. 16, 2021), report and recommendation
adopted, 2021 WL 980872 (E.D.N.Y. Mar. 16, 2021) (any alleged patent misuse purged where
court dismissed patent infringement claims).
Even if patent misuse is asserted proactively, it is Chemetall that pays the royalty, not
Novelis. Any patent misuse violation by Arconic would not invalidate the price that Novelis
pays to Chemetall. Chemetall is not directly accused of a Brulotte violation. Instead, the patent
misuse doctrine impacts only the amount of royalties Arconic could recover from Chemetall. In

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Zila, Inc. v. Tinnell, 502 F.3d 1014 (9th Cir. 2007), the court explained:
Brulotte does not render an entire contract void and unenforceable merely because
it includes an invalid licensing agreement. Rather, Brulotte renders unenforceable
only that portion of a license agreement that demands royalty payments beyond the
expiration of the patent for which the royalties are paid.
Id. at 1023.
Novelis is not a party to the 2018 Arconic-Chemetall Agreement and does not pay
royalties (patent or non-patent) to Arconic. Novelis buys the A951 chemical composition from
Chemetall by purchase order. Any relief the court could impose for improper royalties in the
2018 Arconic-Chemetall Agreement would go to Chemetall, not Novelis. The evidence in the
record shows the the price charged by Chemetall to Novelis has remained unchanged since 2014,
despite several modifications to the financial terms between Arconic and Chemetall and the
recognition by Arconic and Chemetall that various patents originally covered by their agreement
expired. In short, any declaration about patent misuse would not directly help Novelis. See
Stradley, Ronon, Stevens & Young, LLP v. Sovereign Bank, N.A., No. CIV.A. 12-2466, 2013 WL
173022, at *8 (E.D. Pa. Jan. 15, 2013) (declining DJA jurisdiction) (“Stradley has not cited a
single case where a court has interpreted a contract through the Declaratory Judgment Act in
favor of a non-party to the contract”).
2. No recovery of damages
Novelis cannot recover damages for patent misuse. The court in B. Braun explained that
a party cannot avoid the limitation on recovery of damages for patent misuse by using the DJA:
“monetary damages may not be awarded under a declaratory judgment counterclaim based on
patent misuse, because patent misuse simply renders the patent unenforceable.” B. Braun, 124
F.3d at 1428.
“The Federal Circuit [ ] has determined that there can be a counterclaim for patent misuse
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in the appropriate case.” Internet Pipeline, 2011 WL 4528340, at *3 (citing Glitsch, Inc. v.
Koch Eng'g Co., 216 F.3d 1382, 1386 (Fed.Cir.2000) (emphasis added). 3 The court in Internet
Pipeline continued: “That said, a counterclaim of patent misuse may only seek declaratory
relief, not monetary damages, because patent misuse only renders the patent unenforceable.” Id.
(citing B. Braun, 124 F.3d at 1427). One district court permitted limited declaratory relief
“solely to enjoin defendant from asserting a patent infringement claim against plaintiff.” Cont'l
Auto. GmbH v. iBiquity Digital Corp., No. 14 C 1799, 2015 WL 859569, at *7 (N.D. Ill. Feb. 26,
2015) (citing Rosenthal Collins Grp., LLC v. Trading Techs. Int'l, Inc., No. 05 C 4088, 2005 WL
3557947, at *6 (N.D. Ill. Dec. 26, 2005)). All courts agree that the “patent misuse doctrine
cannot be asserted for monetary relief.” Id. Novelis’ creative effort to use the patent misuse
defense and the DJA to reduce (or eliminate) the price it pays for the A951 chemical composition
from Chemetall is not a situation which this court finds warrants discretionary relief under the
DJA.
3. Chemetall’s Due Process rights
The court cannot order Chemetall to reduce its price to Novelis when Chemetall is not a
party to this litigation.4 See Massachusetts Delivery Ass'n v. Coakley, 671 F.3d 33, 48 n.12 (1st
Cir. 2012) (DJA “does not contain any provisions indicating that declaratory judgments are
authoritative vis-à-vis nonparties to the litigation. In fact, the Act indicates it may only declare
the rights of “interested part[ies] seeking [the] declaration.”).
Chemetall is not before the court and did not have notice or an opportunity to be heard

3
For example, if a party “cannot obtain a just adjudication of its rights in the first action, [then] declaratory relief is
necessary to preserve important rights that otherwise would be unjustifiably lost.” Glitsch, 216 F.3d at 1384. Here,
there is no first action because Arconic will not sue Novelis or Chemetall for patent infringement. No other decision
was cited to show what circumstances would be appropriate for a patent misuse counterclaim.
4
The parties did not brief whether the court could exercise subject-matter jurisdiction and personal jurisdiction to
enter such an order.

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about the validity of the 2018 Arconic-Chemetall Agreement. Under the general rule that parties
have a due process right to notice and the opportunity to be heard, “any declaratory judgment
issued by this Court would not be binding on the [non-parties] because they are not parties to the
current suit.” In re G-I Holdings, Inc., No. BR 01-30135, 2008 WL 11513187, at *8 (D.N.J.
May 30, 2008).
Novelis did not establish any exception to this general rule, id., and did not explain why it
did not join Chemetall. See Fed. R. Civ. P. 19(c)(2) (the party asserting the claim for relief must
state the reasons for nonjoinder). In exercising its discretion under the DJA, the court recognizes
that Chemetall has a significant interest in the 2018 Arconic-Chemetall Agreement and should
have notice and the opportunity to be heard before its corporate interests are affected. Even the
most limited relief sought by Novelis would require Chemetall to renegotiate the 2018 ArconicChemetall Agreement and the court cannot impose that duty on Chemetall without Chemetall
having notice and an opportunity to be heard. See Hearing Lab Tech., Inc. v. Hearing
Instruments, Inc., No. CV 16-221, 2017 WL 3208676, at *3 (W.D. Pa. July 27, 2017) (“Parties to
a contract at the heart of a dispute are considered necessary parties.”); Amwest Sur. Ins. Co. v.
Concord Bank, No. 4:00CV1988, 2003 WL 553229, at *5 (E.D. Mo. Feb. 4, 2003) (declining to
resolve DJA counterclaim that would require the court to review contractual relationships among
entities who were not parties to the lawsuit); Dombrovskis v. Esperdy, 185 F. Supp. 478, 482
(S.D.N.Y. 1960) (declining to exercise DJA discretion where the requested relief would be “a
useless thing” since it could not bind nonparty). Under these circumstances, the court will
decline to exercise DJA jurisdiction over Novelis’ patent misuse DJA counterclaim.

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4. Review of Novelis’ arguments
Novelis makes a series of creative legal arguments about what the court could do – i.e.,
the court could enter declaratory relief on a counterclaim that would not directly confer a
monetary benefit on Novelis; the court could ignore that a price reduction to Novelis would not
flow mechanically from a declaration; the court could consider Novelis to be a third-party
beneficiary of the 2018 Arconic-Chemetall Agreement (even though Novelis argues in
Counterclaim XI that it is the victim of an antitrust conspiracy between Arconic and Chemetall
stemming from that same agreement); Novelis can seek declaratory relief about a contract to
which it is not a party to promote the public interest in patent rights and fair competition; and
Chemetall need not be a party because it will benefit from the proposed relief. The court is
unable to discern why it should exercise its discretion to engage in any of these creative exercises
under the DJA.
Novelis’ arguments in this case about the proper scope of the DJA, when defending
against Arconic’s DJA claim, are enlightening. Novelis argues that the court lacks jurisdiction
over Arconic’s attempt to obtain declaratory relief on an affirmative defense to a patent
infringement claim:
Arconic’s declaratory judgment claim (Count 7) attempts to litigate a potential
affirmative defense to a patent infringement claim that Arconic has never brought.
The “conclusiveness” and “utility” requirements bar this use of declaratory
judgments and require dismissal for lack of jurisdiction.
ECF No. 990 at 19 (quoting MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118, 127 (2007)) (“a
litigant may not use a declaratory-judgment action to obtain piecemeal adjudication of defenses
that would not finally and conclusively resolve the underlying controversy.”).
Novelis’ attempt to obtain declaratory relief on what is essentially an affirmative defense
to a patent infringement claim Arconic never brought and will not bring (and when a party to the
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agreement in issue is not before the court) does not warrant the exercise of this court’s
discretionary authority under the DJA. A declaration about patent misuse would not be
conclusive or of practical help or utility under the circumstances of this case.

E. Summary about patent misuse
For the reasons set forth above, the court declines to exercise its discretion under the DJA
to award declaratory relief for counterclaim XIII. Declaratory relief on patent misuse would not
be conclusive of any dispute between Arconic and Novelis in this case and would not be of
practical help or utility. At most, it would affect Arconic’s ability to recover patent royalties
from Chemetall, who is not a party to this litigation. The patent misuse doctrine cannot provide
monetary relief to Novelis. Any declaration that Arconic obtained improper royalties would not
directly affect the price Novelis pays to Chemetall: Chemetall is not a party and has not had
notice or the opportunity to be heard. Arconic’s motion for summary judgment on counterclaim
XIII will be granted to the extent the counterclaim is dismissed because the court declines to
exercise discretion over that counterclaim and denied in all other respects. Novelis’ motion for
summary judgment on counterclaim XIII will be denied.

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V. Conclusion
In summary, the parties consented to the dismissal of three of the DJA claims (Arconic’s
Count VII and Novelis’ Counterclaims I and X) and the court declines to exercise its discretion
to award declaratory relief with respect to the fourth DJA claim in this case (Novelis’
Counterclaim XIII). The parties’ summary judgment motions with respect to Arconic’s Count
VII and Novelis’ Counterclaims I and X will be denied as moot in light of the parties’
acknowledgement that those claims should be dismissed.
With respect to Novelis’ Counterclaim XIII: (a) the court will grant Arconic’s motion for
summary judgment to the extent that Novelis’ Counterclaim XIII will be dismissed because the
court declines to exercise its discretion under the DJA over that counterclaim; and (b) Novelis’
motion for summary judgment will be denied.
An appropriate order follows.

Dated: April 20, 2023

By the Court:
/s/ Joy Flowers Conti
Joy Flowers Conti
Senior United States District Judge

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