UNITED STATES INTERNATIONAL TRADE COMMISSION
`WASHINGTON, D.C.
`
`Before the Honorable Charles E. Bullock
`Administrative Law Judge
`
`In the Matter of
`
`CERTAIN NOISE CANCELLING
`HEADPHONES
`
`Investigation No. 337-TA-626
`
`PUBLIC VERSION OF JOINT MOTION TO TERMINATE INVESTIGATION
`(RE: MOTION NO. 53)
`
`Complainant Bose Corporation ("Bose") and Respondents Phitek Systems Limited
`
`("Phitek"), Audio-Technica U.S., Inc. ("Audio-Technica"), Creative Labs, Inc. ("Creative"), and
`
`Panasonic Corporation of North America ("Panasonic") filed a confidential Joint Motion to
`
`Terminate Investigation on November 18, 2008, Motion No. 53. The parties have met and
`
`conferred and respectfully submit the attached agreed upon public versions of the Joint Motion to
`
`Terminate Investigation and settlement agreements upon which the Joint Motion is based.
`
`Date: December 1, 2008
`
`lsi Autumn 1.S. Hwang
`Ruffin B. Cordell
`Andrew R. Kopsidas
`Jeffrey R. Whieldon
`Autumn J.S. Hwang
`Steven A. Bowers
`FISH & RICHARDSON, P.C.
`1425 K Street, N.W., 11th Floor
`Washington, DC 20005
`
`Jordan T. Fowles
`FISH & RICHARDSON P.C.
`1717 Main Street
`Suite 5000
`Dallas, TX 75201
`
`ATTORNEYS FOR BOSE CORPORATION, INC.
`
`

`
`CERTIFICATE OF SERVICE
`
`I hereby certify that true and correct copies of the foregoing document, PUBLIC
`
`VERSION OF JOINT MOTION TO TERMINATE INVESTIGATION
`
`(RE: MOTION NO. 53>- have been filed and served on this 19th day of September 2008, on
`
`the following:
`
`The Honorable Marilyn R. Abbott
`Secretary
`U.S. International Trade Commission
`500 E Street, S.W., Room 112
`Washington, D.C. 20436
`
`D Via First Class Mail
`D Via Hand Delivery
`D Via Federal Express
`~ Via Electronic Filing
`
`The Honorable Charles E. Bullock
`Administrative Law Judge
`U.S. International Trade Commission
`500 E Street S.W.
`Washington, D.C. 20436
`
`D Via First Class Mail
`~ Via Hand Delivery
`D Via Federal Express
`D Via Electronic Mail
`
`Christopher G. Paulraj, Esq.
`T. Spence Chubb, Esq.
`Office of Unfair Import Investigations
`U.S. International Trade Commission
`500 E Street SW, Room 401-R
`Washington, D.C. 20436
`
`Alan Cope Johnston
`G. Brian Busey
`Cynthia Lopez Beverage
`Morrison & Foerster LLP
`2000 Pennsylvania Avenue, N.W.
`Washington, D.C. 20006
`
`Counsel for Phitek Systems Limited, GN
`Netcom, Inc., Logitech Inc. and Creative
`Labs, Inc.
`
`~ Via First Class Mail
`D Via Hand Delivery
`D Via Federal Express
`~ Via Electronic Mail
`
`D Via First Class Mail
`D Via Hand Delivery
`D Via Federal Express
`~ Via Electronic Mail
`
`

`
`William B. Nash
`Dan Chapman
`Mark Fassold
`Jackson Walker LLP
`112 E. Pecan Street, Suite 2400
`San Antonio, TX 78205
`
`Counsel for Phitek Systems Limited, GN
`Netcom, Inc., Logitech Inc. and Creative
`Labs, Inc.
`
`Arthur Wineburg
`Daniel E. Yonan
`Akin Gump Strauss Hauer & Feld LLP
`1333 New Hampshire Avenue, N.W.
`Washington, D.C. 20036
`
`Counsel for Audio Technica Us., Inc.
`
`James P. White
`Gerald T. Shekleton
`1. Aron Carnahan
`Welsh & Katz, Ltd.
`120 South Riverside Plaza, 22nd Floor
`Chicago, IL 60606
`
`Counsel for Audio Technica Us., Inc.
`
`Daniel Ebenstein
`Abraham Kasdan
`Joseph Casino
`Amster, Rothstein & Ebenstein LLP
`90 Park Avenue
`New York, NY 10016
`
`Counsel for Panasonic Corporation of
`North America
`
`D Via First Class Mail
`D Via Hand Delivery
`D Via Federal Express
`~ Via Electronic Mail
`
`D Via First Class Mail
`D Via Hand Delivery
`D Via Federal Express
`~ Via Electronic Mail
`
`D Via First Class Mail
`D Via Hand Delivery
`D Via Federal Express
`~ Via Electronic Mail
`
`D Via First Class Mail
`D Via Hand Delivery
`D Via Federal Express
`~ Via Electronic Mail
`
`2
`
`

`
`Tom M. Schaumberg
`Jamie D. Underwood
`Adduci, Mastriani & Schaumberg LLP
`1200 Seventeenth Street, N.W., Fifth Floor
`Washington, D.C. 20036
`
`Counsel for Panasonic Corporation of
`North America
`
`D Via First Class Mail
`D Via Hand Delivery
`D Via Federal Express
`[g] Via Electronic Mail
`
`/s/ Autumn IS. Hwang
`Autumn IS. Hwang
`
`3
`
`

`
`CORRECTED CERTIFICATE OF SERVICE
`
`I hereby certify that true and correct copies of the foregoing document, PUBLIC
`
`VERSION OF JOINT MOTION TO TERMINATE INVESTIGATION (RE: MOTION
`NO. 53) have been filed and served on this 2nd day of December 2008, on the following:
`
`
`
`
`
`
`
`
`
`
`
`
` Via First Class Mail
` Via Hand Delivery
` Via Federal Express
` Via Electronic Filing
`
` Via First Class Mail
` Via Hand Delivery
` Via Federal Express
` Via Electronic Mail
`
` Via First Class Mail
` Via Hand Delivery
` Via Federal Express
` Via Electronic Mail
`
` Via First Class Mail
` Via Hand Delivery
` Via Federal Express
` Via Electronic Mail
`
`
`The Honorable Marilyn R. Abbott
`Secretary
`U.S. International Trade Commission
`500 E Street, S.W., Room 112
`Washington, D.C. 20436
`
`
`The Honorable Charles E. Bullock
`Administrative Law Judge
`U.S. International Trade Commission
`500 E Street S.W.
`Washington, D.C. 20436
`
`
`Christopher G. Paulraj, Esq.
`T. Spence Chubb, Esq.
`Office of Unfair Import Investigations
`U.S. International Trade Commission
`500 E Street SW, Room 401-R
`Washington, D.C. 20436
`
`Alan Cope Johnston
`G. Brian Busey
`Cynthia Lopez Beverage
`Morrison & Foerster LLP
`2000 Pennsylvania Avenue, N.W.
`Washington, D.C. 20006
`
`Counsel for Phitek Systems Limited, GN
`Netcom, Inc., Logitech Inc. and Creative
`Labs, Inc.
`
`
`

`
` Via First Class Mail
` Via Hand Delivery
` Via Federal Express
` Via Electronic Mail
`
` Via First Class Mail
` Via Hand Delivery
` Via Federal Express
` Via Electronic Mail
`
` Via First Class Mail
` Via Hand Delivery
` Via Federal Express
` Via Electronic Mail
`
` Via First Class Mail
` Via Hand Delivery
` Via Federal Express
` Via Electronic Mail
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`2
`
`
`William B. Nash
`Dan Chapman
`Mark Fassold
`Jackson Walker LLP
`112 E. Pecan Street, Suite 2400
`San Antonio, TX 78205
`
`Counsel for Phitek Systems Limited, GN
`Netcom, Inc., Logitech Inc. and Creative
`Labs, Inc.
`
`
`Arthur Wineburg
`Daniel E. Yonan
`Akin Gump Strauss Hauer & Feld LLP
`1333 New Hampshire Avenue, N.W.
`Washington, D.C. 20036
`
`Counsel for Audio Technica U.S., Inc.
`
`
`James P. White
`Gerald T. Shekleton
`J. Aron Carnahan
`Welsh & Katz, Ltd.
`120 South Riverside Plaza, 22nd Floor
`Chicago, IL 60606
`
`Counsel for Audio Technica U.S., Inc.
`
`
`Daniel Ebenstein
`Abraham Kasdan
`Joseph Casino
`Amster, Rothstein & Ebenstein LLP
`90 Park Avenue
`New York, NY 10016
`
`Counsel for Panasonic Corporation of
`North America
`
`
`
`
`

`
` Via First Class Mail
` Via Hand Delivery
` Via Federal Express
` Via Electronic Mail
`
`
`
`
`
`
`Tom M. Schaumberg
`Jamie D. Underwood
`Adduci, Mastriani & Schaumberg LLP
`1200 Seventeenth Street, N.W., Fifth Floor
`Washington, D.C. 20036
`
`Counsel for Panasonic Corporation of
`North America
`
`
`/s/ Patrick Edelin, Jr.
`/s/ Patrick Edelin, Jr.
`
`
`
`3
`
`
`
`
`
`

`
`PUBLIC VERSION
`
`UNITED STATES INTERNATIONAL TRADE COMMISSION
`WASHINGTON, D.C.
`
`Before the Honorable Charles E. Bullock
`Administrative Law Judge
`
`In the Matter of
`
`CERTAIN NOISE CANCELLING
`HEADPHONES
`
`Investigation No. 337-TA-626
`
`JOINT MOTION TO TERMINATE INVESTIGATION
`
`Pursuant to the United States International Trade Commission's Rules of Practice and
`
`Procedure, 19 C.F.R. 21 0.21 (b), Complainant Bose Corporation ("Bose") and Respondents
`
`Phitek Systems Limited ("Phitek"), Audio-Technica U.S., Inc. ("Audio-Technica"), Creative
`
`Labs, Inc. ("Creative"), and Panasonic Corporation of North America ("Panasonic") hereby
`
`jointly move to terminate this investigation as to all Respondents. l This motion is based on two
`
`separate settlements: the Settlement Agreement between Complainant Bose and Respondents
`
`Phitek, Audio-Technica, and Creative Labs, attached hereto as Exhibit A; and the Settlement
`
`Agreement between Complainant Bose and Respondent Panasonic, attached hereto as Exhibit B.
`
`There are no other agreements, written or oral, express or implied, between Complainant Bose
`
`and Respondents Phitek, Audio-Technica, Creative, and Panasonic concerning the subject matter
`
`of this investigation.
`
`This investigation was previously terminated as to Respondent GN Netcom, Inc. on the
`
`basis of a consent order (Order No. 13), and as to Respondent Logitech Inc. on the basis of a
`
`Phitek Systems Limited (New Zealand) and Phitek Systems Limited (United States) were
`separately named as Respondents in this investigation. Phitek Systems Limited (United States)
`never entered an appearance in this Investigation. Bose has agreed to terminate the investigation
`as to Phitek Systems Limited (United States) in view of the settlement with Phitek Systems
`Limited (New Zealand) referenced herewith.
`
`

`
`PUBLIC VERSION
`
`separate settlement agreement (Order No.8). Given that the remaining parties have reached a
`
`settlement agreement, the termination of this Investigation as to all Respondents is in the interest
`
`of the public and administrative economy. The parties also request that the current procedural
`
`schedule (Order No. 12) be suspended until the Administrative Law Judge and the Commission
`
`rule on this motion.
`
`Bose has consulted with the Commission Investigative Attorney regarding this motion.
`
`The Commission Investigative Attorney will provide the position of the Office of Unfair Import
`
`Investigations after reviewing the attached papers in more detail. The parties will submit a
`
`public version of the attached agreements within ten (10) days.
`
`Date: November 18,2008 .
`
`Ruffin B. Cordell
`Andrew R. Kopsidas
`Jeffrey R. Whieldon
`Autumn 1.S. Hwang
`Steven A. Bowers
`FISH & RICHARDSON, P.C.
`1425 K Street, N.W., 11th Floor
`Washington, DC 20005
`
`Jordan T. Fowles
`FISH & RICHARDSON P .C.
`1717 Main Street
`Suite 5000
`Dallas, TX 75201
`
`ATTORNEYS FOR BOSE CORPORATION, INC.
`
`2
`
`

`
`PUBLIC VERSION
`
`Date: November 18, 2008
`
`Date: November 18, 2008
`
`William B. Nash
`Daniel Chapman
`Mark A. 1. Fassold
`JACKSON WALKER LLP
`112 E. Pecan, Suite 2400
`San Antonio, Texas 78205
`
`Alan Cope Johnson
`G. Brian Busey
`Cynthia Beverage
`MORRISON & FOERSTER, LLP
`2000 Pennsylvania Avenue, N.W.
`Washington, D.C. 20006
`
`ATTORNEYS FOR PHITEK SYSTEMS LIMITED
`AND CREATIVE LABS, INC.
`
`J. Aton Carnahan
`James P. White
`HUSCH BLACKWELL SANDERS, LLP
`120 South Riverside Plaza, 22nd Floor
`Chicago, Illinois 60606
`(312) 665-1500
`
`Arthur Wineburg
`AKIN GUMP STRAUSS HAUER & FELD LLP
`1333 New Hampshire Avenue, N.W.
`Washington, D.C. 20036
`
`ATTORNEYS FOR AUDIO-TECHNICA U.S.
`
`3
`
`

`
`Date: November 18, 2008
`
`PUBLIC VERSION
`
`~~ J ~/;¥tt
`
`Daniel S. Ebenstein
`Abraham Kasdan
`Joseph M. Casino
`David A. Boag
`AMSTER, ROTHSTEIN & EBENSTEIN, LLP
`90 Park Avenue
`New York, NY 10016
`
`Tom M. Schaumberg
`Jamie D. Underwood
`ADDUCI MASTRIANI & SCHAUMBERG,LLP
`1200 Seventeenth Street, N.W., Fifth Floor
`Washington, D.C. 20036
`
`ATTORNEYS FOR P ANASONIC CORPORATION
`OF NORTH AMERICA
`
`4
`
`

`
`IIIIIIIIIION
`PUBLIC VERSION
`
`EXHIBIT A
`EXHIBIT A
`
`

`
`PUBLIC VERSION
`
`SETTLEMENT AGREEMENT
`
`into and effective as of
`is entered
`This Settlement Agreement ("Agreement")
`November 14, 2008 (the "Effective Date") by and between Bose Corporation ("Bose"), 100 The
`Mountain Road, Framingham, Massachusetts 01701 and Phitek Systems Limited ("Phitek"),
`Level 4, Axon Building, 2 Kingdon Street Newmarket, Auckland, New Zealand and Audio(cid:173)
`Technica U.S., Inc. ("Audio-Technica"), 1221 Commerce Drive, Stow, Ohio 44224, and
`Creative Labs, Inc. ("Creative Labs"), 1901 McCarthy Boulevard, Milpitas, California 95035
`(collectively, "Respondents"). Bose and Respondents may be referred to herein separately as a
`"Party" or together as the "Parties."
`
`RECITALS
`
`WHEREAS, Bose filed a Complaint in the United States District Court for the District of
`Massachusetts against Respondent Phitek and others on or about March 21, 2007, for alleged
`infringement of U.S. Patent Nos. 5,181,252, 6,597,792, and 4,922,542, which resulted in civil
`case no. 1:07-cv-10539-NMG (the "District Court Action"), and Bose has moved to add other
`Respondents to the District Court Action.
`
`WHEREAS, Bose filed a Complaint in the United States International Trade Commission
`against Respondents and others on or about November 29, 2007, for alleged infringement of U.S.
`Patent Nos. 5,181,252 and 6,597,792, which resulted in the Investigation entitled In the Matter of
`Certain Noise Cancelling Headphones, Inv. No. 337-TA-626 (the "ITC Action").
`
`WHEREAS, Bose maintains that Respondents have infringed numerous claims of U.S.
`Patent Nos. 5,181,252, 6,597,792, and 4,922,542.
`
`WHEREAS, Respondents maintain that their noise-cancelling headphones do not infringe
`any of the asserted claims of U.S. Patent Nos. 5,181,252, 6,597,792, and 4,922,542, and that
`those patents are invalid and/or unenforceable.
`
`WHEREAS, the Parties desire to settle the Parties' disputes and, if at all possible, avoid
`future disputes.
`
`TERMS AND COVENANTS
`
`In mutual consideration of the promises and obligations set forth below, the receipt and
`sufficiency of which is hereby acknowledged, the Parties agree as follows:
`
`1.
`
`DEFINITIONS
`
`"Affiliate" means the officers, directors, successors or assigns of a Party, together
`1.1
`with any corporation or other business entity that directly or indirectly Controls, is Controlled by,
`or is under common Control with a Party.
`
`Confidential
`
`SEITLEMENT AGREEMENT
`
`PAGE-lof21
`
`

`
`PUBLIC VERSION
`
`"Control" or "Controlled" means the possession, direct or indirect, of the legal
`1.2
`ability to direct or cause the direction of the management and policies of a person, whether
`through the ownership of voting shares or of other voting rights entitled to elect directors or other
`managing authority, by contract, or otherwise. Ownership of more than 50% of the voting shares
`or of other voting rights entitled to elect directors or other managing authority shall conclusively
`be deemed to constitute "Control" as defined herein.
`
`1.3
`
`"Bose Patent(s)" means those patents listed in Exhibit A.
`
`1.4
`ExhibitA.
`
`"Related Bose Patent Application(s)" means those patent applications listed in
`
`"Noise Reducing Headphones" means headphones which fit on a head having two
`1.5
`earcups that identify and reduce ambient noise with circuitry and components in the earcups
`which actively attenuate the sound perceived at the ear of the user.
`
`"Patented Regions" means only those countries in which the Bose Patents are
`1.6
`enforceable, including but not necessarily limited to, the United States, Japan, the various
`Contracting States of the European Patent Organization ("Europe"), China, and Hong Kong.
`
`"Patent-Pending Regions" means those countries in which Bose has Related Bose
`1.7
`fJU'~ULJlVU"', including but not necessarily limited to
`
`"Products-at-Issue" means the products sold prior to the Effective Date and
`1.8
`commercially known as the "Phitek Black Box M14 Noise Cancelling Headphones," "Audio(cid:173)
`Technica ATH-ANC7 Active Noise Cancelling Headphones," "Creative Labs Aurvana X-Pi
`Noise-Cancelling Headphones," "Jabra C820s Active Noise Cancellation Headphones," and
`"Logitech Noise Cancelling Headphones."
`
`"Other Phitek Headphones" means any Noise Reducing Headphone substantially
`1.9
`identical to the Products-at-Issue, developed by Phitek, and sold to customers listed in Exhibit
`B, also including sales of models listed in Exhibit B to new customers.
`
`Confidential
`
`SETTLEMENT AGREEMENT
`
`PAGE - 2 of21
`
`

`
`PUBLIC VERSION
`
`2.
`
`AGREEMENT TO CEASE AND DESIST
`
`2.1
`
`Representations, Warranties and Acknowledgements.
`
`Respondents, on behalf of themselves and their Affiliates, represent and
`(a)
`acknowledge the following:
`
`Phitek represents that the Products-at-Issue sold as of the Effective
`(v)
`Date are substantially identical to the Products-at-Issue sold as of November 29,
`2007; and
`
`(b)
`the following:
`
`Bose, on behalf of itself and its Affiliates, represents and acknowledges
`
`Confidential
`
`SETILEMENT AGREEMENT
`
`PAGE - 3 of21
`
`

`
`PUBLIC VERSION
`
`Exhibit A represents a complete and accurate list of patents and
`(i)
`patent applications related to U.S. Patent Nos. 5,181,252, 6,597,792, 4,922,542,
`and 7,412,070 worldwide as of the Effective Date; and
`
`All Parties, on behalf of themselves and their Affiliates, represent and
`(c)
`acknowledge that they have read this Agreement and have had the opportunity to solicit
`the advice of counsel before entering into and executing this Agreement.
`
`out as owner, licensee or holder of any interest in any Bose
`not
`intellectual property except as provided for in paragraph 1.10 and Section 3 herein;
`
`2.3
`
`No Assistance.
`
`Respondents, on behalf of themselves and their Affiliates, individually and
`(a)
`collectively, agree that they will not assist, directly or indirectly, any third party in
`defending or otherwise challenging the validity, infringement or enforceability of any
`Bose Patent unless reasonably required to do so by law (e.g., in response to a subpoena),
`or unless reasonably required to do so in connection with a claim for indemnification.
`However, in the event Bose sues a Respondent, Affiliate, or customer for infringement of
`any Bose Patent or breach of this Agreement, this provision shall not operate to deprive
`that Respondent, Affiliate or customer from assisting parties to the suit or deprive that
`Respondent, Affiliate or customer of its rights to assert any defense of validity,
`infringement or enforceability of the Bose Patent being asserted that is available to such
`Respondent, Affiliate or customer.
`
`In addition, Respondents, on behalf of themselves and their Affiliates,
`(b)
`individually and collectively, agree that they will not participate in or directly contribute
`to any reissue or reexamination proceeding before the United States Patent & Trademark
`
`Confidential
`
`SETTLEMENT AGREEMENT
`
`PAGE-40f21
`
`

`
`PUBLIC VERSION
`
`Office or any foreign patent agency regarding any Bose intellectual property covered by
`the releases and covenants of Section 3, below.
`
`2.4
`
`Exclusions and Phase-Outs.
`
`This Agreement and its provisions shall not apply to any Bose Patent that
`(a)
`has expired, or any claim of any Bose Patent that has been declared invalid or
`unenforceable by a court of competent jurisdiction or agency in any final judgment or
`final rejection that is subject to no further review, or to any product which does not
`infringe the Bose Patents.
`
`3.
`
`RELEASES AND COVENANTS
`
`Release for Existing Products. Subject to the provisions of this Agreement, Bose
`3.1
`releases Respondents and their Affiliates and customers from any and all claims known or
`unknown as of the date of this Agreement, including, without limitation, infringement of Bose
`
`Confidential
`
`SETTLEMENT AGREEMENT
`
`PAGE - 5 of21
`
`

`
`PUBLIC VERSION
`
`Patents, trade dress infringement, unfair competition, tort claims, or any other claim based in
`whole or in part on the Respondents' making, using, selling, offering to sell, importing, or
`otherwise commercializing the Products-at-Issue or Other Phitek Headphones.
`
`Covenant for Products-at-Issue. Subject to the provisions of this Agreement,
`3.2
`Bose covenants not to sue Respondents and their Affiliates and customers for infringement of the
`Bose Patents in the Patented Regions for activities pertaining to the Products-at-Issue (and Other
`Phitek Headphones only to the extent the Other Phitek Headphones are substantially identical to
`the Products-at-Issue as of the Effective Date) released by this Agreement.
`
`Covenant for Accepted Re-Designed Products. Subject to the provisions of this
`3.3
`Agreement, Bose covenants not to sue Respondents and their Affiliates and customers for
`making, using, selling, offering to sell, importing, or otherwise commercializing Accepted Re(cid:173)
`Designed Products, including for infringement of Bose Patents, trade dress infringement, unfair
`competition, tort claims, or any other claim based in whole or in part on the Respondents'
`making, using, selling, offering to sell, importing, or otherwise commercializing Accepted Re(cid:173)
`Designed Products. This covenant encompasses all Bose intellectual property, issued and
`pending as of the Effective Date, including divisionals, continuations, and all other applications
`that do or will claim priority to a currently existing or pending Bose patent or patent application.
`However, nothing in this agreement shall be interpreted as prohibiting Bose from
`.
`claims, .
`claims of patent .
`based exclusively upon
`
`Extended Covenant for '792 Patent Re-Designs. Subject to the provisions of this
`3.4
`Agreement, Bose covenants not to sue Respondents and their Affiliates and customers for
`infringement of claims 1 and 2 of the '792 patent, or any substantially similar claims in any
`related or foreign patent, based in whole or in part upon Respondents' making, using, selling,
`offering to sell, importing, or otherwise commercializing a Noise Reducing Headphone
`incorporating Re-Designed Earpads.
`
`Extended.Covenant for '070 Patent Re-Designs. Subject to the provisions of this
`3.5
`Agreement, Bose covenants not to sue Respondents and their Affiliates and customers for
`infringement of any claims of the '070 patent, or any substantially similar claims in any related
`or foreign patent, based in whole or in part upon Respondents' making, using,
`.
`sell, importing, or otherwise commercializing a Noise Reducing Headphone with
`
`The release and covenants specified in paragraphs 3.1 - 3.5 shall apply to Phitek
`3.6
`Systems Limited, Creative Labs, Inc., Audio-Technica U.S., Inc., GN Netcom, Inc., and
`Logitech Inc. The release and covenants specified in paragraphs 3.1 - 3.5 shall also apply to
`their Affiliates and customers to the extent said Affiliates and customers make no modifications
`to the products that would cause the products to infringe any Bose intellectual property.
`
`Confidential
`
`SETTLEMENT AGREEMENT
`
`PAGE - 6 of21
`
`

`
`PUBLIC VERSION
`
`The releases and covenants specified in paragraphs 3.1 - 3.5 extend, but are not
`3.7
`limited to, all Patented Regions and Patent-Pending Regions.
`
`4.
`
`ASSISTANCE WITH ACCEPTED RE-DESIGNED PRODUCTS
`
`Any Respondent may request confirmation from Bose that a
`is protected under this Agreement
`infringement by Bose with respect to the Bose Patents. Bose shall not refuse such a request and
`shall exercise reasonable efforts to provide a timely response, provided Bose is given adequate
`information to evaluate the proposed Re-Designed Earpad or battery door compartment.
`
`5.
`
`DISMISSAL
`
`Upon execution of this Agreement, Bose will, as soon as is practicable, take action to
`have Respondents terminated from the ITC Action and dismissed with prejudice from the
`District Court Action. If terminating the ITC Action or dismissing the District Court Action
`involves the filing of a joint motion, Respondents agree to join such a motion.
`
`6.
`
`CONSIDERATION
`
`Confidential
`
`SETTLEMENT AGREEMENT
`
`PAGE -7 of21
`
`

`
`PUBLIC VERSION
`
`The Parties agree this is a litigation settlement and no representations are made
`6.3
`that the foregoing consideration represents an admission of liability by any Party or a reasonable
`royalty for infringement of the Bose Patents.
`
`7.
`
`TERM AND REMEDIES
`
`Term and Termination. The term of this Agreement will commence on the
`7.1
`Effective Date and will expire on the sooner to occur of (i) the expiration of the last to expire of
`the Bose Patents; or (ii) upon a holding of rejection or invalidity or unenforceability or the
`cancellation of all claims of all of the Bose Patents that are practiced by any Product-at-Issue
`pursuant to a final order or judgment of a court or agency of competent jurisdiction that is
`subject to no further review.
`
`The breach of any provision of this Agreement shall not relieve the breaching
`7.2
`Party of its obligations hereunder. The breach of any provision of this Agreement shall not
`relieve any Party of its obligations with respect to any non-breaching Party. Only a material
`breach will relieve the aggrieved Party of its obligations hereunder.
`
`In the event of termination of this Agreement, ail rights and obligations which by
`7.3
`nature survive the expiration or termination of this Agreement shall remain in effect to the
`degree necessary to permit their complete fulfillment or discharge, including specifically any
`warranty or confidentiality provisions.
`
`Nothing in this Agreement prohibits Respondents from manufacturing, importing,
`7.4
`exporting, distributing, selling or offering for sale, causing to be imported, causing to be
`distributed, causing to be exported, or causing to be offered for sale any product in any country
`where Bose does not own any patent right in that country that would be infringed by such action.
`
`8.
`
`CONFIDENTIALITY AND PUBLICITY
`
`8.1 With respect to the disclosure of information about this Agreement and the terms
`contained herein, the Parties hereby agree that:
`
`After the Effective Date, any Party may inform the press, consistent with
`(a)
`these obligations of confidentiality, that the Parties have settled their patent litigation
`without any admission of infringement or liability, resulting in a mutually acceptable
`compromise for both parties. A press release consistent with the following shall be
`acceptable:
`
`Confidential
`
`SETILEMENT AGREEMENT
`
`PAGE - 8 of21
`
`

`
`PUBLIC VERSION
`
`The parties have successfully settled the litigation, the specific terms of
`which are confidential. As part of this settlement, Phitek has agreed to
`undertake certain modifications of its products. Bose has agreed that the
`modified products are clear of the Bose patents at issue.
`
`Unless otherwise agreed to by the Parties, the terms of this Agreement shall remain
`confidential.
`
`No Party or any of its Affiliates or its or their employees, agents or
`(b)
`representatives shall disclose the terms of this Agreement, except that each Party and any
`of its Affiliates (directly, or through its employees, agents or representatives) may
`disclose: (i) that it has settled with the other; (ii) any other information that is included
`within the press statements released by a Party, in compliance with Section 8.1(a); (iii)
`any information already in the public domain; and (iv) any other information that the
`Parties agree in writing may be disclosed.
`
`Notwithstanding any provision to the contrary herein, either Party and any
`(c)
`of its Affiliates are permitted to disclose the terms of this Agreement and information
`relating to this Agreement or any information covered by the limitations of this Section 8
`if required to do so by law, legal process or court order. Such Party or Mfiliate shall
`exercise reasonable efforts to maintain the confidentiality of this Agreement (e.g., by
`designating the Agreement confidential under an appropriate protective order). Nothing
`in this paragraph should be understood as obligating a Party to not comply with any duly
`issued subpoena, court order, or discovery obligation.
`
`Notwithstanding any provision to the contrary herein, any Party is
`(d)
`permitted to file this Agreement under seal with or otherwise disclose this Agreement
`(consistent with this Section 8), to a court, tribunal or government agency of competent
`jurisdiction in an action or proceeding brought by or against a Party when reasonably
`necessary for any claim, defense, or issue in such action or proceeding.
`
`9. MISCELLANEOUS
`
`Successors and Assigns. This Agreement benefits and is binding upon each Party
`9.1
`hereto and each Party's heirs and assigns. Each Party represents and warrants that the person
`signing this Agreement has the authority to bind the Party to the terms of this Agreement. Each
`Party further represents and warrants that it has no commitments or obligations that would in any
`way impede its ability and right to enter into this Agreement and comply with the terms of this
`Agreement, and that it has not assigned to another party any cause of action covered by this
`Agreement.
`
`No Waiver. Except for those rights which are expressly waived in this
`9.2
`Agreement, the Parties agree that no Party waives any rights it may have, including intervening
`rights or other statutory or common law rights, by virtue of having entered into this Agreement.
`
`Confidential
`
`SETILEMENT AGREEMENT
`
`PAGE - 9 of21
`
`

`
`PUBLIC VERSION
`
`Counterparts. This Agreement may be executed by the Parties in counterparts,
`9.3
`but will not be effective until each Party has executed a counterpart. Each counterpart will be
`deemed an original, but the counterparts will together constitute one Agreement. A facsimile of
`or scanned copy of a signature shall be deemed an original signature.
`
`Notices. All notices pertaining to this Agreement shall be in writing and shall be
`9.4
`delivered by hand, or if dispatched by prepaid air courier with package tracing capabilities or by
`registered or certified airmail, postage prepaid, and shall be addressed as follows:
`
`If to Bose:
`
`Bose Corporation
`Attn: Steve Romine, Intellectual Property Counsel
`The Mountain
`Framingham, MA. 01701-9168
`Telephone: (508) 766-6177
`Facsimile: (508) 879-3049
`
`Copy to:
`Andrew R. Kopsidas
`Fish & Richardson P.e.
`1425 K Street, N.W.
`Washington, DC 20005
`Telephone: (202) 626-6407
`Facsimile: (202) 783-2331
`
`If to Phitek:
`
`Phitek Systems Limited
`Attn: Mark Donaldson
`Level 4, Axon Building, 2 Kingdon Street
`Newmarket, Auckland, New Zealand
`Telephone: 64-9-524-2984
`Facsimile: 6-9-524-2985
`
`Copy to:
`William B. Nash
`Jackson Walker, LLP
`112 E. Pecan Street, Suite 2400
`San Antonio, Texas 78205
`Telephone: (210) 978-7764
`Facsimile: (210) 978-7790
`
`Confidential
`
`SETILEMENT AGREEMENT
`
`PAGE - 10 of21
`
`

`
`PUBLIC VERSION
`
`If to Audio-Technica:
`
`Audio Technica U.S., Inc.
`Attn: Philip J. Cajka
`1221 Commerce Drive
`Stowe, Ohio 44224
`
`Copy to:
`J. Aron Carnahan
`Husch Blackwell Sanders, LLP
`120 South Riverside Plaza, 22nd Floor
`Chicago, IL 60606
`Telephone: (312) 526-1612
`Facsimile: (312) 655-1501
`
`If to Creative Labs:
`
`Director of Legal Affairs
`Creative Labs, Inc.
`1901 McCarthy Boulevard
`Milpitas, California 95035
`Telephone: (408) 428-6600
`Facsimile: (408) 428-6699
`
`Copy to:
`Vice President of Legal Services
`Creative Technology, Ltd.
`31 International Business Park
`Creative Resource
`Singapore 609921
`Telephone: +65-6895-4000
`Facsimile: +65-6895-4999
`
`Copy to:
`William B. Nash
`Jackson Walker, LLP
`112 E. Pecan Street, Suite 2400
`San Antonio, Texas 78205
`Telephone: (210) 978-7764
`Facsimile: (210) 978-7790
`
`Choice of Law. The Agreement shall be interpreted under and in accordance with
`9.5
`the laws of the State of New York, U.S.A., and all questions with respect to the Agreement and
`the rights and liabilities of the Parties will be governed by the laws of the State of New Yark,
`regardless of the choice of law provisions of the State of New York or any other jurisdiction.
`
`Confidential
`
`SETTLEMENT AGREEMENT
`
`PAGE - 11 of 21
`
`

`
`PUBLIC VERSION
`
`Phitek agrees to accept service of process by certified mail consistent with paragraph 9.4 for any
`claim related to this Agreement.
`
`Dispute Resolution. The Parties agree that they will use good faith efforts to
`9.6
`resolve any disputes that may arise regarding the provisions of this Agreement. Such good faith
`efforts should include at least communication between the affected Parties identifying the
`specific issue(s) and good faith attempts to meet-and-confer to discuss and resolve the issues(s)
`prior to initiating any legal action. Failure to attempt such good faith efforts shall constitute a
`breach of this Agreement.
`
`Entire Agreement. The Bose Patents and Related Bose Patent Applications (and
`9.8
`other documents relevant to the scope, enforceability, and validity of the claims of the Bose
`Patents and Related Bose Patent Applications) may be used if necessary in construing this
`Agreement. No other document, agreement, understanding, or representation not contained in
`this Agreement may be used to construe or vary the terms of this Agreement. This Agreement
`incorporates the entire understanding of the Parties with respect to the subject matter of this
`Agreement and cancels and supersedes all prior agreements between the Parties, whether oral or
`written, with respect to this subject matter. This Agreement may only be modified or amended
`by an instrument in writing signed by duly authorized representatives of the Parties.
`
`Should any partes) of this Agreement be held invalid or
`Severability.
`9.9
`unenforceable, the remainder of this Agreement shall continue in force, and the Parti