Eagle Comtronics v. Pico Products
New York Supreme Court, Appellate Division
705 N.Y.S.2d 758 (2000)
Facts
In 1984, Pico Products, Inc. (Pico) (defendant) issued a patent license to Arcom. In June 1988, Pico issued a patent license to Eagle Comtronics (Eagle) (plaintiff). The Pico-Eagle agreement contained a most-favored-terms (MFT) provision entitling Eagle to elect more favorable terms “subsequently granted to a licensee who was not then holding a written license.” At the time of the Pico-Eagle agreement, Arcom held a written license. In October 1988, Pico and Arcom revised their agreement, and Arcom received more favorable terms than Eagle had received. Eagle sued Pico for breach of contract and fraud, seeking to obtain the more favorable terms that had been granted to Arcom in October 1998. Pico responded that the MFT provision had not been triggered because Arcom held a license before the Pico-Eagle agreement. In contrast, Eagle’s position was that the Pico-Arcom agreement had been terminated due to Arcom’s alleged failure to pay royalties in 1987 and that the revised licensing terms in 1988 triggered the MFT provision. The trial court agreed that Eagle was entitled to a paid-up license on the same terms as Arcom and entered partial summary judgment in Eagle’s favor. Pico appealed.
Rule of Law
Issue
Holding and Reasoning (Per curiam)
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