In In Re Chanbond, LLC Patent Litigation, Judge Andrews denied a request for post-pretrial-order discovery on Friday. The request came after Defendants received an e-mail from attorneys from third-party Deirdre Leane alleging that her consent was required for any settlement between the defendants and plaintiff ChanBond:
On September 2, 2020, Defendants received an email from Ms. Leane’s counsel, informing them of a dispute between Ms. Leane and ChanBond. . . . The email stated, “As we read Section 8.3 of the ISA, Ms. Leane’s written consent is required given that a license is a transfer of an interest in the patents-in-suit, which in turn are material assets of ChanBond.” . . . The email warned, “[P]lease take notice that to the extent that you enter into any settlement with ChanBond that includes a transfer of any interest in the patents-in-suit, without Ms. Leane’s written approval of the settlement terms, you do so at your own risk.” . . . This letter spurred Defendants to file the instant motion.
Based on this letter, the defendants moved for discovery into whether ChanBond had standing to bring suit. The Court denied the motion, finding that even if ChanBond required approval from a third partyto license the patent, ChanBond still had sufficient rights to bring suit. Thus the letter raised no standing issue:
As ChanBond owned the “right, title and interest in and to” the patents-in-suit at the time of filing . . . . It holds “a sufficiently large portion of this bundle of rights” and is thus “permitted to sue for infringement in its own name.” . . . Disputes over ChanBond’s ownership or whether Ms. Leane’s consent is required to license the patents does not impact ChanBond’s standing to sue in its own name. Regardless of the outcome of these suits, ChanBond will be the entity that wins or loses. Any dispute about ChanBond’s ownership is outside the scope of the issues in these cases and will not impact the overall outcome. As ChanBond’s standing is not impacted by Ms. Leane’s allegations regarding ChanBond’s ownership, Defendants have not shown good cause to reopen discovery.
That outcome makes sense when you think about it. But, obviously, it leads to a situation where the parties are headed for trial and may not be able to settle the case, because any settlement could potentially be ineffective absent approval from Ms. Leane.
A jury trial is currently scheduled for May 17th, although it looks like there may be some question as to whether it will go forward, as the Court has scheduled a teleconference for Monday to discuss the trial date.
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