XITRONIX CORPORATION v. KLA-TENCOR CORPORATION

Federal Circuit Summary

Before Moore, Mayer, and Hughes. Appeal from U.S. District Court for the Western District of Texas.
                                                          
Summary: The Federal Circuit lacked jurisdiction over a Walker-Process antitrust claim because patent law was not a necessary element of one of the well-pleaded claims.

Xitronix sued KLA-Tencor (“KLA”), asserting a Wal ker Process monopolization claim, based on alleged fraudulent prosecution of a patent. The Federal Circuit asked the parties to show cause why the case should not be transferred to the regional Circuit for lack of jurisdiction, particularly in view of the Supreme Court’s decision in Gunn v. Minton.  Under the well-pleaded complaint rule, the Federal Circuit’s jurisdiction extends to cases in which patent law is a necessary element of one of the well-pleaded claims.  In Gunn, the Supreme Court held that a state law claim alleging legal malpractice in the handling of a patent case did not arise under federal patent for purposes of exclusive federal jurisdiction.  The Supreme Court found that the federal issue in that case was not substantial when analyzed with respect to the federal system as a whole.

Applying the well-pleaded complaint rule, in light of the guidance provided by Gunn, the Federal Circuit found that the monopolization claim did not necessarily depend on resolution of a substantial question of federal patent law.  In reaching this conclusion, the Federal Circuit determined that the allegations of false statements were not unique to patent law and that the underlying patent issue did not present a substantial issue of patent law—there was no dispute over the validity of the patent claims, the patent claims would not be invalidated or revived based on the result of the case, the outcome of the case would not undermine the uniform body of patent law, and the result is limited to the parties and the patent in this matter.  Accordingly, the Federal Circuit transferred the case to the U.S. Court of Appeals for the Fifth Circuit.

This case is: XITRONIX CORPORATION v. KLA-TENCOR CORPORATION

Written By: Karen M. Cassidy and Vicki Y. Nee

Edited By: Paul Stewart