District Courts Have Broad Discretion To Hear A Declaratory Judgment Action

Heralding the SanDisk and Teva cases (issued shortly after Cellco), the U.S. Court of Appeals for the Federal Circuit affirmed the district court’s decision to dismiss the declaratory judgment action filed by Cellco Partnership, while at the same time concluding that the district court incorrectly held that no actual controversy existed. Cellco Partnership v. Broadcom Corp., Case No. 06-1514 (Fed. Cir., Mar. 19, 2007) (per curiam).

The appellant, Cellco, filed a declaratory judgment action in district court on patents that were the subject of a pending U.S. International Trade Commission (ITC) proceeding instituted by the appellee, Broadcom, against Qualcomm. The district court dismissed the action, holding that no actual controversy existed between the parties, despite the fact that Qualcomm manufactures chips used by Cellco, which was likely to intervene in the parallel district court case filed by Broadcom against Qualcomm, an action that was stayed pending resolution of the ITC