Dali Wireless, Inc. v. Corning Optical Communications LLC

Background

Dali Wireless, Inc. sued Corning Optical Communications LLC for patent infringement. The court issued a claim-construction order, which interprets the meaning and scope of patent claims. The court later granted summary judgment in Corning’s favor, and Dali appealed to the Federal Circuit.

While the appeal was pending, the parties settled the case. As part of the settlement, they agreed that Dali could seek vacatur—the cancellation of the court’s prior order—of the July 18, 2021 claim-construction order. Dali said that order might be relevant to its pending patent-infringement suits against AT&T and CommScope in the Eastern District of Texas. Dali filed an unopposed motion asking the court to issue an indicative ruling about vacatur, meaning a statement of what the court would do if the appellate court sent the matter back for that purpose.

Court’s Analysis

The court stated that Federal Rule of Civil Procedure 62.1(a)(3) allowed it to consider the motion even though the appeal was pending. It analyzed the request under Rule 60(b)(6), which permits relief from a final judgment for another reason that justifies relief. The court applied an equitable balancing test, weighing factors such as hardship, the importance of finality, the parties’ reasons for settling, and the public interest in preventing a losing party from effectively buying an erasure of the public record.

The court concluded that these factors favored denying vacatur. The parties had provided no persuasive reason they would suffer hardship if the claim-construction order remained in place. Although Dali pointed to the public interest in encouraging settlements, conserving judicial and party resources, and avoiding possible preclusive effects from the order, the court found a strong countervailing interest in preserving prior judicial determinations. It relied on the principle that judicial decisions are valuable to the legal community and are not merely the private property of the litigants.

The court also reasoned that Dali had lost in the district court and voluntarily gave up the ordinary opportunity for appellate review by settling. It rejected Dali’s reliance on a Federal Circuit decision because that decision had left the question of vacatur to the district court’s application of the governing principles.

Disposition

The court denied Dali’s Motion for Indicative Ruling Concerning Vacatur. It stated that it did not intend to vacate its claim-construction order. The order disposed of Docket No. 283. Judge Edward M. Chen signed the order.