In the five years after a U.S. helicopter manufacturing company sued the Iranian government for patent infringement, Iran never entered an appearance in the case. But shortly after Iran was given notice in 2011 of a $22 million judgment in the helicopter company’s favor, they launched a defense.
In a September 25 opinion, U.S. District Judge Amy Berman Jackson in Washington vacated the judgment, finding that because Iran hadn’t waived its sovereign immunity, the court didn’t have jurisdiction to consider the case. Iran could be subject to litigation if the alleged infringement had a “direct effect” on the United States, but Jackson found that it did not.
Bell Helicopter Textron Inc., a Fort Worth, Texas-based company, and its Canadian counterpart sued the Iranian government and two Iranian helicopter manufacturing companies in 2006. Bell accused the Iranian defendants of selling helicopters that ripped off Bell’s patented designs.
In February 2011, now-retired U.S. District Judge Ricardo Urbina found that Iran was liable and entered a judgment of more than $22 million. Several months after Iran officially received notice of the judgment that summer, lawyers for the defendants began entering appearances. In February 2012, the defendants moved to vacate the judgment, arguing that the court lacked jurisdiction to hear the case.
In her ruling, Jackson found that even if Bell was affected by the alleged infringement, that wasn’t the same as Iran’s actions having a “direct effect” on the United States, as required under the federal Foreign Sovereign Immunities Act. She noted that there wasn’t evidence that the helicopters at issue were marketed in the United States, for instance, and held that Bell’s financial losses didn’t meet the standard for a “direct effect” on the United States.
“In this case, nothing in the record from the evidentiary hearing suggests that plaintiffs remain involved in Iran, that there were any contractual obligations due in the United States, or that there was any back-and-forth transmittal of materials, persons, capital, or ideas,” Jackson wrote.
A lead counsel for Bell, Williams & Connolly partner Charles Davant IV, said the firm does not comment on pending litigation. Attorneys for the Iranian defendants with Washington’s Wiltshire & Grannis and Berliner, Corcoran & Rowe could not immediately be reached for comment.
Contact Zoe Tillman at firstname.lastname@example.org.