SanDisk v. STMicroelectronics: The Federal Circuit Announces a New Test for Declaratory Judgment Jurisdiction

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On January 9, 2007, the Supreme Court decided MedImmune, Inc. v. Genentech, Inc.,127 S. Ct. 764(2007), holding that a patent licensee need not breach its license agreement in order to file a declaratory judgment action regarding the licensed patent. In addition to resolving the issue directly

presented, the Court broadly called the Federal Circuit’s entire declaratory judgment jurisprudence into question, stating that the Federal Circuit’s “reasonable-apprehension-of-suit test” conflicted with several Supreme Court precedents.[1]

On March 26, 2007, the Federal Circuit concluded that the Supreme Court had effectively rejected the “reasonable-apprehension-of-suit test.” The Federal Circuit then articulated a new legal test. The effect of this significant change in the law is that the threshold “case or controversy” necessary for declaratory judgment jurisdiction in cases of alleged patent infringement has been substantially lowered, making it possible for parties receiving license offers from patent holders to file actions in circumstances where previously they could not.

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