Did I Settle the Case Even Though I Didn’t Sign a Settlement Agreement?

Apr 6, 2017

In a patent infringement case filed in February 2016 in the Eastern District of Texas by Neurovision Medical Products, Inc. against Medtronic, Inc., the parties attended a mediation in December 2016 in an unsuccessful effort to settle the case. The parties continued their settlement discussions and in February 2017, Neurovision’s owner and a Medtronic director exchanged offers and counteroffers by email. After various back and forth, Neurovision’s owner accepted an offer from Medtronic summarizing the deal as including a payment, patent license and withdrawal of inter parties proceedings from the Patent Trial and Appeal Board (PTAB). The parties’ attorneys exchanged drafts of a settlement agreement, which resulted in a finished unsigned agreement on March 23, 2017.

Later that same day, the PTAB released a decision regarding one of the patents, which caused Medtronic to have a change of heart regarding the terms of settlement. Neurovision filed a motion asking United States District Court Magistrate Judge Roy Payne to enforce the “settlement agreement” and to force Medtronic to sign the March 23 agreement.

Judge Payne granted the motion in part (deferring a ruling on the request to enforce the March 23 agreement), finding that the email exchange constitutes a valid settlement agreement between Medtronic and Neurovision because the material terms of the settlement agreement are evident from the email exchange.

Moral of the story: You may be bound to a settlement reached in email communications even if you do not have a formal, fully-executed settlement agreement.

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Did I Settle the Case Even Though I Didn’t Sign a Settlement Agreement?

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