The American system of jurisprudence relies on two important concepts in order to promote the finality of judicial decisions and to ensure that litigation does not run on as infinitum. The first doctrine, known as res judicata, prohibits the relitigation of a certain case –after all permissible appeals have run their course – between the same parties. The second doctrine, referred to as collateral estoppel, prevents a legal issue or set of issues from being relitigated after all allowable appeals have been exhausted. The United Supreme Court is now facing whether to take a case which would clarify the manner in which the doctrine of collateral estoppel applies to legal issues previously disposed of between a set of litigants.
The case arises from a dispute between TecSec, Inc. which owns a group of patents relating to encryption and several technology companies. TecSec, Inc. sued these companies, including IBM, for violating a set (or “family”) of 4 patents which pertain to “multi-level multimedia security”. After filing the patent infringement action against these multiple companies, the federal district court severed the case involving IBM. IBM moved for summary judgment on the grounds that (1) their software does not provide “multi-level multimedia security” and (2) that TecSec, Inc. failed to present any evidence that substantiated their patent violation claim. The decision of the District Court granting the summary judgment on those specific 2 grounds was affirmed with a terse summary order by the Federal Circuit Court of Appeals which reviews decisions involving patent infringement actions.
After this severed portion of the original patent case was adjudicated, the remaining defendants presented arguments similar to those advanced by IBM; i.e., that their software did not contain “multilevel multimedia security” which could be construed as relying on TecSec’s patents and that TecSec failed to present evidence that any of the companies infringed on their patents. Unlike the part of the case relating strictly to IBM’s conduct, TecSec stipulated it could not prove that any of the remaining defendants infringed the DCOM patents based on the district court’s construction of “multimedia. Similarly, however, to the first case, the District Court granted the Defendants’ motions for summary judgments. But when the case came up for appeal by TecSec of that decision, it only affirmed the order to the extent that TecSec failed to present evidence by any of these companies that they infringed. It failed to rely on that part of their previous decision which established that the software in question does not provide “multi-level multimedia security”.
On appeal to the Supreme Court ten technology companies, which were parties to this action, contend that the Federal Circuit Court of Appeals mistakenly failed to apply the doctrine of collateral estoppel when confronted again by this second appeal. These petitioners in Cisco Systems, Inc, et.al.. v Tec Sec, Inc. claim that the Federal Circuit, as well as a minority of other federal appellate circuits have erroneously decided that when a case is resolved by more than one alternate legal issue, that decision cannot be given the issue preclusion effect accorded decisions relying strictly on one issue. These companies are asking that the Supreme Court accept their petition for writ of certiorari to hear this case as they do not believe the issue of whether their software possesses multi-level multimedia security should be subject to further litigation.
In opposition to these companies, TecSec, Inc. does not view this as a case of collateral estoppel because the original decision by the Federal Circuit just summarily affirmed the District Court’s decision and because “there was some ambiguity as to whether the… affirmance rested “on that second ground. As the Supreme Court conducted a conference to discuss whether the case warrants review, it is expected that the high court will decide in the near future to hear it or not.
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