Equitable Estoppel Defense Cannot be based on Alleged Representation that would be Inadmissible under the Parol Evidence Rule

Alleged "assurances [by plaintiff] made to [defendant] during negotiation of [a license agreement] that [defendant] would have a competitive advantage over those who chose to litigate with [plaintiff], by fulfilling its obligations under the [license agreement]" did not equitably estop plaintiff from seeking infringement damages beyond the royalties payable under the license. "In California . . . under the parol evidence rule, evidence of prior or contemporaneous agreements or understandings between the contract negotiators cannot be used to 'add to, detract from, or vary the terms' of the parties' written agreement. . . . To the extent [defendant] purports to have relied upon its own interpretation of [a section of the license agreement] based on extra-contractual statements made by [plaintiff's] negotiators that were not incorporated into the terms of the [license agreement], such reliance was inherently unreasonable."

District Judge Ronald M. Whyte
Rambus Inc., v. Samsung Electronics Co., Ltd., 5-05-cv-02298
(CAND May 14, 2009, findings of Fact & Conclusions of Law)