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Digital Equipment Corp. v. Desktop Direct, Inc.

United States Supreme Court
511 U.S. 863 (1994)


Facts

Digital Equipment (defendant), a company in the business of selling computer equipment, began marketing a new service called “Desktop Direct from Digital” in late 1991. Desktop Direct, Inc. (plaintiff), a company also in the business of selling computer equipment, sued Digital in the United States District Court for the District of Utah, alleging unlawful use of Desktop’s name. After negotiations, the two companies reached a settlement in March 1992. The agreement allowed Digital to continue to use the “Desktop Direct” name in exchange for a payment to Desktop. Desktop voluntarily dismissed the suit following the agreement. Months later, Desktop moved to vacate the dismissal, alleging that Digital misrepresented material facts while negotiating the dismissal. The district court granted the motion. Digital appealed the order to the United States Court of Appeals for the Tenth Circuit, which dismissed the appeal for lack of jurisdiction. The court of appeals held that the order neither ended the litigation nor constituted a collateral order. Digital appealed.

Rule of Law

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Issue

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Holding and Reasoning (Souter, J.)

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  • A “yes” or “no” answer to the question framed in the issue section;
  • A summary of the majority or plurality opinion, using the CREAC method; and
  • The procedural disposition (e.g. reversed and remanded, affirmed, etc.).

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