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Law of the Case Cannot Be Relitigated

June 08, 2001

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Last Month at the Federal Circuit - July 2001

Judges: Newman (author), Rader, and Gajarsa

In Intergraph Corp. v. Intel Corp., No. 00-1368 (Fed. Cir. June 8, 2001) (“Intergraph II”), the Federal Circuit affirmed the district court’s decision not to relitigate antitrust issues decided in Intergraph Corp. v. Intel Corp., 195 F.3d 1346 (“Intergraph I”), and affirmed the district court’s entry of judgment under Fed. R. Civ. P. 54(b).

In 1997, Intergraph Corporation (“Intergraph”) sued Intel Corporation (“Intel”) for infringement of Intergraph’s patented “Clipper” microprocessor technology, prompting Intel to withdraw special benefits provided to Intergraph under several nondisclosure agreements. Intergraph argued that Intel’s withdrawal of the benefits amounted to an antitrust violation under sections 1 and 2 of the Sherman Act. In agreeing with Intergraph, the district court had branded Intel a “monopolist,” had held that Intergraph had a substantial likelihood of success on the merits in proving that the withdrawal of the benefits constituted a violation of the Sherman Act, and, thus, granted a preliminary injunction.

The Federal Circuit had reversed that judgment, stating that the prohibited conduct must be directed toward competitors and must be intended to injure competition. The Court went on to provide that Intergraph had not established grounds on which to litigate whether Intel was a “monopolist,” since Intergraph’s asserted injury did not derive from anticompetitive actions by Intel.

On remand, Intergraph sought to relitigate its charges of antitrust violation by Intel, together with several contract and tort claims remaining before the district court. Intergraph’s rationale was that new evidence compiled by the Federal Trade Commission (“FTC”) in its investigation of Intel or discovered by Intergraph shows the company’s anticompetitive behavior. In denying Intergraph’s request, the district court had held that the resolution of the antitrust issues in Intergraph I is the law of the case and entered judgment to that effect under Fed. R. Civ. P. 54(b). Prior to reaching its decision, the district court had reviewed the additional information provided by Intergraph and noted that while Intergraph may have obtained more information related to the FTC’s action, the Federal Circuit was already aware of the actions.

In affirming the district court on this appeal, the Federal Circuit determined that while the information was dated well before the decision in Intergraph I, it was not brought to any court’s attention either before the decision or by petition after the decision was rendered. The Court further observed that Intergraph had failed to explain how its new evidence provided a basis for reevaluating the Court’s previous conclusion that Intel’s conduct with respect to Intergraph did not constitute the offense of monopolization or the threat thereof in any market relevant to competition with Intergraph.

With regard to the district court’s entry of judgment under Fed. R. Civ. P. 54(b), Intergraph argued that it was an abuse of discretion, and that the district court was required to litigate the antitrust claims along with the contract and tort claims because all of the claims arose out of the same core facts. In sustaining the district court’s action, the Federal Circuit ruled that even for claims that arise out of the same transaction or occurrence, sound case management may warrant entry of partial final judgment. In any event, the Court ruled that the trial court’s decision whether to certify a judgment under Rule 54(b) should not be disturbed unless it is clearly unreasonable.