Unreported / Non-Citable
Background
Resh, Inc. filed suit in March 2022 against Robert Conrad, Inc., d/b/a Skimlite Manufacturing, and James R. Conrad, along with former defendant Barrett Conrad, alleging patent infringement. After the court granted dismissal with leave to amend and two further rounds of motion-to-dismiss briefing, the operative Second Amended Complaint alleged infringement of U.S. Patent No. 11,141,852. The parties filed cross-motions for summary judgment in mid-2024. In its order, the court found that Defendants' two-tube poles infringed claims 2, 11, 16, 18, 19, and 21 and their three-tube poles infringed claim 20, but it also held that claims 1-3, 6-8, 11, 16, 18-19, and 21-24 were invalid as obvious under 35 U.S.C. § 103.
Three days after that order, Resh sought leave to file a motion for reconsideration, arguing the court had failed to consider material facts and arguments; the court denied leave, finding the secondary-considerations arguments did not overcome the obviousness showing. The parties then attended a June 26, 2025 settlement conference with Magistrate Judge DeMarchi but did not settle, and trial preparation continued. Jury selection began November 2, 2026, but with selection only partially complete, the parties spent roughly seven hours that night in further mediation and reached a settlement expressly conditioned on vacatur of the summary judgment order. On November 4, 2026, after oral argument the day before, they jointly moved to vacate the summary judgment order and, to the extent not mooted, the order denying reconsideration.
The Court’s Holding
The court grounded its authority in Federal Rule of Civil Procedure 54(b), which permits revision of interlocutory orders at any time before final judgment, and applied the four factors from Cisco Systems, Inc. v. Telcordia Technologies, Inc.: the public interest in the orderly operation of the federal judicial system, the parties' interest in avoiding preclusive effect, the court's resources if the case continues, and the parties' interest in conserving resources. The first factor weighed against vacatur: the court was not convinced vacatur here was not a mechanism for a party to avoid the binding consequences of an unfavorable ruling after testing its theories. The second factor was neutral, because although vacatur would strip the order of collateral estoppel effect, the well-reasoned opinion would remain publicly available and could still guide future litigants.
The third and fourth factors weighed heavily in favor of vacatur. Completing jury selection and holding the anticipated two-week trial would consume substantial time and resources of the court, the parties, and jurors, and both sides were small, family-owned businesses for whom continued litigation would be a significant drain. The remaining considerations also favored vacatur: the settlement was a negotiated compromise without undue influence, no former party—Barrett Conrad, whose claims had been dismissed—would be adversely affected, and the case raised no public-rights questions. Balancing all factors, the court concluded the beneficial effect of settlement outweighed the other considerations, vacated the summary judgment order and the reconsideration denial to the extent not mooted, and stressed that it abided by the merits reasoning of the vacated order.
Key Takeaways
- District courts have wide latitude under Rule 54(b) to revise interlocutory orders, including partial summary judgment orders, before final judgment.
- Courts in this district weigh the four Cisco factors when deciding whether vacatur to permit settlement is equitable.
- The public-interest factor may weigh against vacatur where parties could use it to avoid binding consequences of an adverse ruling.
- Conservation of judicial and party resources can weigh heavily for vacatur when settlement is reached on the eve of trial by small businesses.
- Vacatur removes preclusive effect but not the persuasive value of a published opinion, which remains available to future courts and litigants.
Why It Matters
This order illustrates the tension between the strong public policy favoring settlement and the systemic interest in preserving district court judgments as guidance for the legal community. Granting vacatur even though the first Cisco factor weighed against it reflects the case-specific circumstances: settlement came only after jury selection had begun, both parties were small family-owned businesses, and the agreement was expressly conditioned on vacatur. The court also emphasized that vacatur does not erase its prior analysis—the summary judgment order remains published on Westlaw and Lexis and on the public docket, and the court encouraged future courts and litigants to consider it for whatever persuasive guidance it offers.