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Hewlett-Packard Co. v. Acceleron LLC

December 4, 2009

HEWLETT-PACKARD COMPANY, PLAINTIFF-APPELLANT,
v.
ACCELERON LLC, DEFENDANT-APPELLEE.



Appeal from United States District Court for the District of Delaware in case No. 07-CV-650, Judge Sue L. Robinson.

The opinion of the court was delivered by: Michel, Chief Judge.

Before MICHEL, Chief Judge, NEWMAN, and MOORE, Circuit Judges.

Hewlett-Packard Company ("HP") sued Acceleron LLC ("Acceleron"), the owner of U.S. Patent No. 6,948,021 ("'021 patent"), in the United States District Court for the District of Delaware, seeking declaratory judgment of non-infringement and invalidity of the '021 patent. The district court granted Acceleron's motion to dismiss for lack of declaratory judgment jurisdiction. For the reasons set forth below, we reverse.

I. BACKGROUND

Acceleron is a patent holding company. It is incorporated in Delaware and headquartered in Tyler, Texas. Acceleron acquired the '021 patent on May 31, 2007. On September 14, 2007, Thomas B. Ramey, III, President of Acceleron, wrote to Michael J. Holston, HP's "Executive Vice-President, General Counsel/Secretary," regarding "U.S. Patent No. 6,948,021 to Derrico et al. . . ." The letter reads:

I am writing to call your attention to the referenced patent. . . . This patent was recently acquired by Acceleron, and relates to Blade Servers.

We would like an opportunity to discuss this patent with you. In order to provide a productive atmosphere in which we can do so, we ask that you agree that all information exchanged between the parties will not be used for any litigation purposes whatsoever, including but not limited to any claim that Acceleron has asserted any rights against any of your ongoing or planned activities, or otherwise created any actual case or controversy regarding the enclosed patent.

Should you wish to engage in discussions regarding this patent with us, please return an executed copy of this letter to me in the enclosed stamped, self-addressed envelope. When we receive your acknowledgement, we will send you a package of information relating to this patent. I will look for your response by September 28, 2007, and if I do not hear from you by that time, I will assume you have no interest in discussing this patent.

On October 1, 2007, a senior litigation counsel at HP responded, writing: I have been evaluating the patent you sent and am interested to learn any further information you have so that I am able to conduct a complete and accurate assessment. HP shares your interest in creating a productive atmosphere for us to discuss the '021 patent. Accordingly, in response to your request that HP not file a declaratory judgment action, HP would be willing to agree not to file such an action for a period of 120 days if Acceleron similarly will agree not to file an action against HP during the same 120 day period. If such a mutual standstill agreement is acceptable, please let me know and I will send you an agreement to that effect directly.

Four days later, Mr. Ramey replied: I do not believe that HP has any basis for filing a declaratory judgment action, and I think that my letter provides both parties appropriate protections to create a productive atmosphere in which to discuss the '021 patent.

So, if you are interested in discussing this patent with us, please send me a signed copy of my previous letter to you by no later than October 19, 2007. If I do not receive [one] by then, I will understand that you are not interested in discussing this patent, and you do not have anything to say about the merits of this patent, or its relevance to your Blade Server products.

On October 17, 2007, HP filed this declaratory judgment suit in the United States District Court for the District of Delaware. Acceleron moved to dismiss the case for lack of subject matter jurisdiction. On March 11, 2009, the district court granted Acceleron's motion. Hewlett-Packard Co. v. Acceleron, LLC, 601 F. Supp. 2d 581 (D. Del. 2009). The court observes that, on one hand, Acceleron's "failure to specifically request a confidentiality agreement and to accept [HP's] 120-day stand-still proposal weigh[ed] the scale in favor of finding jurisdiction." Id. at 589. On the other hand, however, other circumstances in this case, including the lack of "a statement of infringement, identification of specific claims, claim charts, prior pleadings or litigation history, or the identification of other licensees" in Mr. Ramey's letters to HP, weighed against finding declaratory judgment jurisdiction. Id. After taking Acceleron's business model as a non-competitor patent holding company into consideration, the court held that, under the totality of the circumstances, at the time HP filed the suit, the litigation was "too speculative a prospect to support declaratory judgment jurisdiction." Id.

HP timely appealed. We have jurisdiction pursuant to 28 U.S.C. ...


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