Tuesday, October 9, 2012

Manufacturer’s Indemnity of Retailers Does Not Obviate Plaintiff’s Right to Proceed Against Retailers

The court denied a group of retailer-defendants' motion to stay plaintiff's infringement action against them pending the outcome of plaintiff's claims against a manufacturer who agreed to indemnify those defendants. "[The manufacturer-defendant's] agreement to indemnify the Retailers does not obviate the need for a final judgment against the Retailers, if the jury returns a verdict in [plaintiff's] favor regarding patent validity and damages. . . . [Plaintiff] has no standing to enforce the indemnity agreement between [the manufacturer-defendant] and the Retailers and is not required to rely on that agreement rather than its right to proceed directly against the Retailers. Consequently, the Court rejects the Retailers’ argument that their participation at the trial is 'peripheral.'"

Innovention Toys, LLC v. MGA Entertainment, Inc., et. al., 2-07-cv-06510 (LAED October 4, 2012, Order) (Morgan, J.).

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