Resh, Inc v. Skimlite Manufacturing Inc et al — District Court Vacates Patent Summary Judgment Rulings on Infringement and Obviousness to Permit Settlement

Background

Resh, Inc. filed suit on March 7, 2022, against Robert Conrad, Inc. (doing business as Skimlite Manufacturing) and James R. Conrad, alleging infringement of U.S. Patent No. 11,141,852. The court dismissed the original complaint with leave to amend on March 31, 2023, and after two further rounds of motion-to-dismiss briefing the Second Amended Complaint became operative. On June 19, 2024, Resh moved for summary judgment of infringement, and Defendants cross-moved on July 17, 2024, for summary judgment of invalidity. After a September 12, 2024 hearing, the court granted in part and denied in part the cross motions: Resh won summary judgment that the two-tube poles infringed claims 2, 11, 16, 18, 19, and 21 and the three-tube poles infringed claim 20, while Defendants won summary judgment that claims 1–3, 6–8, 11, 16, 18–19, and 21–24 were invalid as obvious under 35 U.S.C. § 103.

Resh then sought leave to file a reconsideration motion, arguing the court had manifestly failed to consider long-felt-need and secondary-considerations evidence, but the court denied leave. After an unsuccessful settlement conference with Magistrate Judge DeMarchi on June 26, 2025, the parties prepared for trial, and jury selection began November 2, 2026. With selection only partially complete, the parties spent roughly seven hours in further mediation with Judge DeMarchi and reached a settlement expressly conditioned on vacatur of the summary judgment order. Following oral argument on November 3, 2026, they jointly moved on November 4 to vacate that order and the reconsideration denial.

The Court’s Holding

Judge Edward J. Davila granted the joint motion under Federal Rule of Civil Procedure 54(b), which gives district courts wide latitude to revise interlocutory orders before final judgment. Applying the four factors from Cisco Systems, Inc. v. Telcordia Technologies, Inc., the court found the first factor—the public interest in the orderly operation of the federal judicial system—weighed against vacatur, because vacatur could be abused as a mechanism to obtain a trial run of patent claims without binding consequences. The second factor, potential preclusive effect, was neutral: the order would lose collateral estoppel effect, but the electronically published opinion would remain publicly available for practical guidance while vacatur avoided any chilling effect on the parties' future endeavors.

The third and fourth factors—conservation of court and party resources—weighed heavily in favor of vacatur, given the anticipated two-week jury trial, post-trial motions, and potential appeal, especially because both parties were small, family-owned businesses. The court also found the settlement was a negotiated compromise without undue influence, that no former party would be adversely affected, and that the case raised no public-wide interpretive questions. Balancing the factors, the beneficial effect of settlement outweighed the rest. The court vacated the summary judgment order and, to the extent not mooted, the order denying leave to seek reconsideration, while emphasizing that it abided by the merits ruling, which remains published on Westlaw, Lexis, and PACER for persuasive guidance.

Key Takeaways

• District courts have broad discretion under Rule 54(b) to vacate interlocutory summary judgment orders, but settlement-conditioned vacatur requires weighing the Cisco factors.
• The public interest in orderly judicial administration may weigh against vacatur where it risks letting litigants test patent theories without binding consequences, yet a genuine on-the-eve-of-trial settlement by small parties can overcome that concern.
• A vacated order that remains electronically published retains persuasive value, rendering the preclusive-effect factor neutral.
• Conservation of judicial and party resources can weigh heavily for vacatur when a multi-week trial is imminent and the settlement is expressly conditioned on vacatur.
• Vacatur does not repudiate the court's merits analysis; here the court expressly continued to abide by its infringement and obviousness rulings.

Why It Matters

This order illustrates the tension between the strong policy favoring settlement and the systemic interest in preserving district court judgments as decisional law in patent litigation. Even while remaining convinced of its infringement and obviousness rulings, the court vacated them to let two small businesses avoid a two-week jury trial, noting the published opinion remains available for guidance. The decision also shows how parties condition settlements on vacatur to avoid collateral estoppel, and how courts balance such requests against the risk of abuse, granting them where the compromise is genuine, reached after substantial litigation, and resource-saving.