No-Tilt: Nintendo Had Implied License From Its Supplier

The U.S. Court of Appeals for the Federal Circuit affirmed the district court’s summary judgment decision that a settlement agreement between the patent owner Jacobs and a supplier permitted the supplier to sell infringing devices for use by its manufacturing customers, including the defendant Nintendo. Jacobs v. Nintendo of Am., Inc., Case Nos. 03-1297, 2004 U.S. App. LEXIS 10515 (Fed. Cir. May 28, 2004).

Prior to bringing the underlying lawsuit against Nintendo, Jacobs brought a patent infringement action against Analog Devices, Inc. (Analog) for selling accelerometers for use in tilt-sensitive control boxes. Jacobs charged that the accelerometers infringed upon its U.S. Patent No. 5,059,958 (the `958 patent), and thereafter entered into a settlement and licensing agreement with Analog. In the agreement, Jacobs granted Analog two critical rights: the right to be free from suit based on the `958 patent and the right to sell micromachined accelerometers for use in tilt-sensitive