## Facts

- Texas Instruments Inc. (TI) and Tessera, Inc. entered a 1996 patent license for Tessera’s chip-scale packaging technology and related patents.
- The agreement included a California choice-of-law clause and a forum-selection clause requiring that any litigation between the parties relating to the agreement be conducted in California.
- A royalty dispute arose, including whether TI owed royalties for certain products made abroad and imported into the United States.
- TI filed a declaratory-judgment action in the Central District of California seeking rulings supporting non-liability for royalties.
- Tessera then filed a complaint at the U.S. International Trade Commission (ITC) under § 337 of the Tariff Act, alleging importation of products infringing Tessera patents; the ITC instituted an investigation.
- TI sought a preliminary injunction in the Central District of California to stop Tessera from continuing the ITC proceeding against TI, arguing the forum-selection clause barred litigation outside California.
- The district court denied the preliminary injunction, and TI appealed.

## Issues

1. Whether a license agreement’s forum-selection clause requiring California litigation for any dispute “relating to” the agreement encompasses ITC § 337 proceedings between the contracting parties.
2. Whether the district court erred in denying preliminary injunctive relief by failing to give proper effect to the forum-selection clause when evaluating the injunction factors.

## Decision

- The Federal Circuit held that the forum-selection clause covered ITC § 337 proceedings between TI and Tessera that related to the licensed patents and the royalty dispute.
- The court vacated the district court’s order denying a preliminary injunction and remanded for reconsideration under the correct interpretation of the agreement.
- The court did not itself order Tessera enjoined; it left application of the equitable factors to the district court on remand.
- A dissent would have treated ITC proceedings as outside the clause and cautioned against restricting access to the ITC given § 337’s public and statutory character.

## Legal Principles

- Broad forum-selection clauses covering “any litigation” relating to a contract may apply to administrative adjudications, including ITC § 337 proceedings, when the dispute concerns the same patents and obligations addressed by the agreement.
- Forum-selection clauses are generally enforceable between sophisticated commercial parties absent recognized grounds for nonenforcement (e.g., fraud or comparable invalidating circumstances).
- Enforcing a forum-selection clause may permit a district court, in appropriate circumstances, to enjoin a contracting party from prosecuting a proceeding in another forum as a matter of contract enforcement, without negating the other forum’s statutory jurisdiction.
- In preliminary-injunction analysis tied to contract enforcement, the court must assess likelihood of success and the remaining equitable factors based on the contract’s correct legal meaning.

## Conclusion

The Federal Circuit concluded that the parties’ California forum-selection clause reached ITC § 337 litigation between them relating to the license, vacated the denial of preliminary injunctive relief, and remanded for the district court to reconsider whether an injunction should issue under the proper contractual interpretation.


Tex. Instruments Inc. v. Tessera, Inc., 231 F.3d 1325 (Fed. Cir. 2000)