Waterloo Furniture Components, Ltd. v. Haworth, Inc.

Before FLAUM, Chief Judge, and KANNE and SYKES,
Circuit Judges.
FLAUM, Chief Judge. On October 29, 1992, Haworth, Inc. (“Haworth”) entered into an agreement with Waterloo Furniture Components, Ltd. (“Waterloo”), granting Waterloo a license to Haworth’s Patent No. 4,616,798 (“the ‘798 patent”). The agreement included a “most favored nations” provision that required Haworth to give Waterloo the benefit of any more favorable royalty rates that
Haworth might grant to another licensee under the ‘798 patent. Haworth’s patent expired on October 14, 2003. On March 24, 2004, Haworth executed a settlement agreement with a third party, SoftView Computer Products Corporation (“SoftView”), for past infringement of the ‘798 patent. Waterloo learned of the settlement agreement and brought suit against Haworth alleging breach of contract. The district court stayed discovery in the case and granted Haworth’s motion for summary judgment holding that Waterloo’s rights under the “most favored nations” clause ended on the day the parties’ agreement expired, October 14, 2003. For the following reasons, we affirm the judgment of the district court.

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