Law360 (April 2, 2019, 4:47 PM EDT) — Align Technology Inc., the maker of Invisalign, and ClearCorrect Inc. have called a truce in a long-running battle over patents on teeth-straightening technology, with ClearCorrect’s parent company agreeing to pay $35 million.
The settlement was announced late last week, just days before the trial was set to kick off in Align’s infringement case in the Southern District of Texas. The agreement also ends patent disputes in the U.K. and Brazil.
Align will receive a $35 million payment from Straumann Holding as part of the deal. Switzerland-based Straumann, which acquired ClearCorrect in August 2017, has also agreed to a five-year deal to distribute thousands of Align dental scanners.
Should the distribution deal fall through, Straumann will pay Align an additional $16 million. The remaining terms of the settlement are confidential.
“This agreement brings an end to a series of patent disputes and allows both Align and Straumann to avoid the expense, uncertainty and distraction of continued litigation,” Align’s senior vice president and general counsel Roger George said in a news release.
Straumann Group said in a statement that the settlement amount was largely accounted for in its $150 million acquisition of ClearCorrect.
“We are very pleased that ClearCorrect has finally been able to settle its dispute and can look forward to growing its international clear-aligner business,’ the company’s general counsel, Andreas Meier, said.
Align and ClearCorrect have been duking it out for more than a decade across various forums.
The Texas lawsuit, which Align filed in 2011, accused ClearCorrect of infringing several patents covering Invisalign, a popular brand of clear braces. The case, which U.S. District Judge Vanessa Gilmore last year called her “oldest and least favorite case,” was set to begin trial Monday afternoon.
The two sides filed papers informing the court of the settlement on Thursday. Judge Gilmore signed an order dismissing the case that same day.
Align had also previously made infringement allegations at the U.S. International Trade Commission. ClearCorrect, for its part, questioned the validity of Align patents in Brazil and during proceedings at the U.S. Patent and Trademark Office.
The dispute cycled up to the Federal Circuit more than once.
In one notable ruling, the appeals court in 2015 reversed the ITC’s decision that the commission had the authority to block ClearCorrect’s importation of digital files. The court concluded the trade body only has the authority to block imports of physical goods.
“Given that the litigation had gone on for 14 years, I think it’s a tribute to both Straumann and Align that the resolution was able to be reached in such a positive manner,” Thomas Counts of Paul Hastings LLP, an attorney for Align, said Tuesday.
Align is represented by Thomas Counts, Danielle Decker, Grant Margeson, Elizabeth Brann and Jeffrey Comeau, Saya Wallace, Gavin Murphy, Cole Malmberg, Ariell Bratton and Matt Lind of Paul Hastings LLP; and by Lee Kaplan of Smyser Kaplan & Veselka LLP.
ClearCorrect is represented by Chanler Ashton Langham of Susman Godfrey LLP; Jennifer Doan, Joshua Thane, Jeffrey Roeser and Kyle Akin of Haltom & Doan; Randy McClanahan, Michael Myers and Robert Espey of McClanahan Myers Espey LLP; and Joseph Callier of Callier Law Group PLLC.
The Texas case is Align Technology Inc. v. ClearCorrect Inc. et al., case number 11-cv-00695, in the U.S. District Court for the Southern District of Texas.
–Editing by John Campbell.