Intermec IP Corp. v. TransCore, LP

Citation: Not availableDocket: N20C-03-254 PRW CCLD

Court: Superior Court of Delaware; October 18, 2021; Delaware; State Appellate Court

Original Court Document: View Document

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The Superior Court of Delaware addressed the Motion for Leave to File an Amended Complaint submitted by Intermec IP Corp. and Intermec Technologies Corp., granting it in part and denying it in part. The case involves a dispute between Intermec and TransCore regarding a cross-license agreement, wherein Intermec claims TransCore underpaid royalties and TransCore counters that it overpaid. Intermec's initial complaint, filed in March 2020, included a declaratory judgment claim and a breach-of-contract claim. A prior court order had granted TransCore judgment on Intermec’s declaratory judgment claim, as its requests were either duplicative of the breach-of-contract claim or moot due to TransCore’s concessions.

Intermec's motion to amend aims to incorporate facts occurring after the original complaint, specifically regarding its intention to terminate the License for breach, and TransCore's assertion that the License remains valid. The proposed amendments include updated factual allegations, citations from the License, and correspondence between the parties. Intermec seeks to declare that it properly terminated the License, has no further obligations under it, and that TransCore must fulfill its obligations following termination, including those specified in the License Agreement's provisions.

Intermec seeks to amend its complaint to include a request for a declaration that TransCore's final accounting, as per Section 5.10(iii), sufficiently details the calculation of royalties from July 1, 2016, to the present. Intermec also requests a declaration confirming TransCore's obligation to pay all owed royalties and provide quarterly updates if the court finds Intermec's termination ineffective. Additionally, a new breach-of-contract claim is introduced, alleging that TransCore violated Section 3.1 by using an “adjusted price” for royalty calculations on “multiprotocol products” since June 30, 2016, contrary to the requirement that payments be based on Net Sales Value.

Civil Rule 15(a) allows for amendments to pleadings unless there is evidence of undue delay, bad faith, or futility. While mere delay is insufficient for denial, inexcusable delays and repeated attempts may justify it. Declaratory judgments can be entertained but the court may refuse them if they do not advance the litigation or if they address moot issues. TransCore opposes the amendments, arguing they are unnecessary and already covered by existing claims, and requests the denial of Intermec’s motion. The court agrees with TransCore regarding the futility of the declaratory judgment claim amendments but views the breach-of-contract claim as a clarification of an existing claim. Consequently, the court partially grants and partially denies Intermec’s motion, allowing it to maintain either formulation of the breach-of-contract claim while dismissing the amendments to the declaratory judgment claim as unnecessary.

Intermec seeks three declarations regarding its License with TransCore: 

1. A declaration confirming Intermec's proper termination of the License, its lack of further obligations, and TransCore's duty to honor post-termination obligations. The court previously stated that any breach by TransCore will be resolved in the context of Intermec's breach-of-contract claim, and TransCore has conceded the right to terminate under those circumstances. Thus, the requested declarations are seen as unnecessary affirmations of existing obligations.

2. Intermec requests a declaration about the adequacy of the final accounting provided by TransCore to assess whether royalties were properly calculated. This request mirrors Intermec's original breach-of-contract claim regarding unpaid royalties, and the court notes that resolving this claim will inherently determine the royalties owed.

3. A declaration asserting that if the License remains effective, TransCore has an ongoing obligation to pay royalties and provide updates, a point already acknowledged by both parties and not in dispute.

The court finds that the proposed declarations are largely duplicative or moot and denies Intermec's motion regarding them. Additionally, Intermec proposes a new breach-of-contract claim based on TransCore's alleged improper calculation of royalties using an "adjusted price" rather than "Net Sales Value." This claim parallels an existing claim about unpaid royalties and focuses on Section 3.1 of the License, which governs payment obligations. The court notes that the new claim essentially duplicates the existing one and allows Intermec to choose which claim to maintain without prejudice to TransCore. 

The motion to amend is partially denied and partially granted, with Intermec required to select its preferred breach-of-contract claim formulation by November 3, 2021. The court emphasizes that mere delay does not warrant denial of the amendment, although inexcusable delay in repeated amendments could justify it.