Posted On: June 15, 2007 by YCST

Patent-Related Claims Must Proceed with Arbitration of Commercial Claim

Magistrate Judge Thynge issued an interesting decision last week that detailed the intersection of patent litigation and the arbitration of commercial disputes. Plaintiff Digene brought an infringement action against one defendant and later added inducement and tortious interference claims against another, Co-Defendant Beckman. The Court stayed the patent case and ordered "all" of Digene's claims against Beckman to arbitration. Following the arbitrator's favorable interpretation of a prior licensing agreement between the parties, Beckman sought to dismiss the inducement and interference claims on res judicata grounds.

The Court agreed that Digene had the opportunity to litigate its commercial and inducement claims before the arbitrator: "In light of Beckman's license under the [agreements], whether it induced infringement . . . by its relationship with Ventana was dependent upon the interpretation of the [agreements between the parties]. Further, because of Beckman's rights under the [agreements], whether it could tortiously interfere with Digene's potential business opportunities also hinged upon the same agreements . . . ."

As a result, Digene's attempts to continue the litigation following the arbitrator's decision could not proceed: "[Digene's claims] have already been evaluated twice by two different forums between the same parties and Digene, in essence, is asking for a third opportunity."

The Court's rationale highlights the importance of avoiding, when dealing with multiple claims of varying subject matter, the prospect of this type of arbitration estoppel.

Digene v. Ventana Medical Systems, C.A. No. 01-752-MPT (D. Del. June 12, 2007) (Thynge, M.J.).