Acceleron, LLC owns patent No. 6,948,021 for a hot-swappable server blade. Acceleron did not invent the patented material — it is a patent holding company. It purchased that patent on May 31, 2007 and then, just a few months later, on September 14, 2007, Acceleron’s president wrote to Hewlett-Packard’s (HP) General Counsel stating that Acceleron wanted to “call your attention to the referenced patent” and agreeing “that all information exchanged between the parties will not be used for any litigation purposes whatsoever, including but not limited to any claim that Acceleron has asserted any rights against any of your ongoing or planned activities, or otherwise created an actual case or controversey regarding the enclosed patent.” HP responded that it would be willing to forestall filing a declaratoy judgment action for a period of 120 days if Acceleron would agree not to file an action against HP during that same 120 day period. But Acceleron did not accept the offer for mutal standstill, instead claiming “I do not believe that HP has any basis for filing a declatory judgment action” and then requiring HP to accept the terms of the first letter within a two-week deadline. Instead of responding to Acceleron’s demand, HP filed a declartory judgment action.
The district court granted Acceleron’s motion to dismiss for lack of subject matter jurisdiction, holding that the litigation was “too speculative” for a declaratory judgment action — but the Federal Circuit reversed on appeal. While the Federal Circuit admited that its holding “undoubtedly marks a shift from past declaratory judgment cases,”it nevertheless found that Acceleron’s actions viewed in their “totality” created at least the implicit assertion of Acceleron’s patent rights. This can be seen from Acceleron’s letter, which stated that its patent was “relevent” to HP’s overall product line, the two-week abitrary deadline and the fact that Acceleron asked HP not to file a declaratory judgment action. Another factor, although not the primary one, is the fact that Acceleron is a patent holding company which “without enforcement receives no benefits from its patents.” Thus, the possibility of litigation was arguably greater to HP because the only mechanism through which Acceleron receives compensation for a patent is the threat of actual litigation. We invite you to read the full text of the opinion.