IP News

In MedImmune, Inc. v. Genentech, Inc., 549 U.S. __ (2007), the U.S. Supreme Court, in an 8-1 decision, held that Article III jurisdiction existed over a threatened patent licensee's suit seeking a declaration that no royalties were due under the license agreement, even though the licensee continued to make royalty payments under that agreement.

In 1997, petitioner MedImmune entered into a patent license agreement with respondent Genentech, which covered an existing patent and a then-pending patent application. After the pending application issued, Genentech sent MedImmune a letter expressing its belief that MedImmune's Synagis product, a drug used to prevent respiratory tract disease in children, was covered by the patent (the 'Cabilly II patent') and that royalties would soon be due. Even though it believed the Cabilly II patent was invalid and not infringed, MedImmune paid royalties under protest rather than risk trebled damages and filed an action for declaratory judgment. Based upon prior Federal Circuit precedent ' namely the 'reasonable apprehension of imminent suit' test ' the district court dismissed Med-Immune's suit for lack of subject matter jurisdiction. The Federal Circuit affirmed that decision.