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Federal Courts -
U. S. Supreme Court - January 9 - January 12, 2007
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MedImmune, Inc. v. Genentech, Inc., No. 05-608,
SUPREME COURT OF THE UNITED STATES, January 9, 2007, Decided
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Overview: The licensors contended that the licensee paid the royalties demanded by the licensors and thus there was no constitutional case or controversy to support federal jurisdiction under the Declaratory Judgment Act,. The licensee argued that it paid the royalties under protest to avoid the serious potential consequences of the licensors' threatened infringement action, and that the licensee was not required to actually suffer those consequences as a precursor to seeking judicial relief. The U.S. Supreme Court held that the licensee was not required, insofar as U.S. Const. art. III was concerned, to break or terminate its license agreement before seeking a declaratory judgment in federal court that the underlying patent was invalid, unenforceable, or not infringed. The licensee's self-avoidance of imminent injury by paying the royalties was coerced by the threatened enforcement action of the licensors, and the coercive nature of the exaction of royalties preserved the licensee's right to recover the royalties paid or to challenge the legality of the licensors' demand for royalties.
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