Wednesday, October 23, 2019

CAFC reverses D. Delaware on 12(b)(6) dismissal of Fraunhofer claim against Sirius

The CAFC noted of 12(b)(6):

We review the district court’s dismissal under Federal
Rule of Civil Procedure 12(b)(6) de novo. See Adams Outdoor Advert.
Ltd. P’ship v. Pa. Dep’t of Transp., 930 F.3d
199, 205 (3d Cir. 2019). When conducting this inquiry, “we
accept all factual allegations in the complaint as true and
view them in the light most favorable to the plaintiff.”
Umland v. PLANCO Fin. Servs., 542 F.3d 59, 64 (3d Cir. 2008)
(quoting Buck v. Hampton Twp. Sch. Dist., 452 F.3d 256,
260 (3d Cir. 2006)).
The issues are whether the Master
Agreement was terminated and, if so,
whether that termination had the effect of terminating the sublicense.

Before oral argument, the CAFC explicitly told the parties what issues
would be addressed:

We have jurisdiction over this appeal pursuant to 28
U.S.C. § 1295(a)(1). Before oral argument, we issued an
order advising that parties be prepared to address:

1. Whether the choice of law provision in Section
9.5 of the Master License Agreement requires this
court to interpret the Master License Agreement
according to German law, and to determine the
rights of SXM according to German law.
2. Whether the application of German law would
result in SXM’s sublicense rights surviving contract
termination of the Master License
Agreement. See, e.g., M2Trade, Bundesgerichtshof
[BGH] [Federal Court of Justice] July 19, 2012,
Entscheidungen des Bundesgerichtshofes in Zivilsachen [BGHZ]
194, 136 (Ger.); Take Five, BGH
July 19, 2012, Neue Juristische Wochenschrift
Rechtsprechungs-Report Zivilrecht [NJW-RR]
2012, 1127 (Ger.).
3. Whether this case should be remanded to the
District Court for further proceedings to address
the impact of German law on the issues before this
Dkt. No. 49.

In the end, a 12(b)(6) motion was inappropriate:

Although the district court
should consider extrinsic evidence, we do not preclude its
resolution of this issue on summary judgment if appropriate.

Therefore, we vacate the order dismissing the complaint for
failure to state a claim and remand for further



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