CTDI loses at CAFC on "first to file" issue

The case involves negotiations involving the patentee [Contec] and a declaratory judgment action by the [potential] infringer [CTDI].


The [district] court found that, although CTDI “had
every right, in its business and legal judgment, to break off
negotiations and resort to litigation,” it was not permitted
to “string Contec along just long enough to get the judicial
drop and file this lawsuit in its own backyard.” Id. at 358.
The court noted that CTDI’s communications before and
after its filing reveal its “nefarious motive,” and ultimately
determined that “CTDI’s conduct was inconsistent with the
policy of promoting extrajudicial dispute resolution, not to
mention sound judicial administration and the conservation of judicial resources.” Id. at 357, 358.



The CAFC noted


When one of two competing suits in a first-to-file analysis is a declaratory judgment action, district courts enjoy a
“double dose” of discretion: discretion to decline to exercise
jurisdiction over a declaratory judgment action and discretion when considering and applying the first-to-file rule
and its equitable exceptions. See Kerotest Mfg. Co. v. C-OTwo Fire Equip. Co., 342 U.S. 180, 183–84 (1952) (noting
that, in questions of priority between similar proceedings,
“an ample degree of discretion, appropriate for disciplined
and experienced judges, must be left to the lower courts”).
Although district courts can, in the exercise of that discretion, dispense with the first-to-file rule, there must “be
sound reason that would make it unjust or inefficient to
continue the first-filed action.” Genentech, 998 F.2d at 938.
With this framework in mind, we turn to the district court’s
analysis.
Here, the district court carefully considered the record
of the parties’ dispute, up to and including the competing
filings, and concluded that several factors warranted departure from the first-to-file rule.



Footnote 4 gets into appropriate content for a reply brief:


Although CTDI attempts to challenge the district
court’s characterization of its complaint as anticipatory for
the first time in its reply brief, counsel for CTDI conceded
at oral argument that it failed to raise this argument in the
opening brief. Oral Arg. at 7:07–18, available at
http://oralarguments.cafc.uscourts.gov/default.aspx?fl=
2019-1672.mp3. It is well established that an issue not
raised by an appellant in its opening brief is waived.
Becton Dickinson & Co. v. C.R. Bard, Inc., 922 F.2d 792, 800
(Fed. Cir. 1990); see also Amhil Enters. Ltd. v. Wawa, Inc.,
81 F.3d 1554, 1563 (Fed. Cir. 1996) (“A reply brief, which
should ‘reply to the brief of the appellee,’ see Fed. R. App.
P. 28(c), is not the appropriate place to raise, for the first
time, an issue for appellate review.”).