United States District Court, D. Massachusetts
MEMORANDUM AND ORDER
Talwani United States District Judge
Arvest Bank (“Arvest”) entered into a software
license agreement with Defendants RSA Security, Inc., RSA
Security LLC, and EMC Corporation's (collectively,
“RSA”) granting Arvest a license to use RSA's
software as part of Arvest's online banking business.
This action was commenced after Arvest settled a patent
infringement lawsuit brought against Arvest by non-party
Secure Axcess, LLC (the “Secure Axcess
litigation”). In the first three claims for relief,
Arvest contends that RSA breached its contractual duties to
defend and to indemnify Arvest, as well as the implied
covenant of good faith and fair dealing. Compl. [#1]. Arvest
also claims unjust enrichment. Id. Now before the
court is RSA's Motion for Summary
Judgment [#73], which argues that Arvest's three
contract-based claims are time-barred by the Agreement's
two-year limitation of actions, and that Arvest's unjust
enrichment claim is barred under Massachusetts law because
the Agreement governs the relationship between the parties.
cross-moved for partial summary judgment as to RSA's
affirmative limitations defense to Arvest's
indemnification claim. Mot. Partial Summ. J.
following reasons, RSA's Motion [#73] is ALLOWED
IN PART as to the contractual duty to defend and unjust
enrichment, and DENIED as to the contractual duty to
indemnify. Arvest's Motion [#89] is ALLOWED IN
PART as to the duty to indemnify.
December 2006, the parties executed the Agreement, by which
RSA granted Arvest a license to run and use “Licensed
Software, ” described at Exhibit A to the Agreement.
Agreement ¶ 3(a). The Agreement includes an
“Intellectual Property Indemnity” provision
(“Indemnity Provision”), which provides in
relevant part that:
RSA shall defend, indemnify and hold Licensee . . . harmless
from and against all claims, actions, judgments, awards,
expenses (including reasonable attorneys' fees) and
awarded damages assessed against Licensee or agreed to be
paid by RSA in settlement that arise from a claim that the
current, unaltered release of the Licensed Software used in
accordance with the terms of this Agreement infringes a third
party copyright, trademark or U.S. patent, as long as
Licensee gives RSA (1) prompt written notice of such claim or
action; (2) the right to control and direct the
investigation, preparation, defense, and settlement of the
action; and (3) reasonable assistance and information with
respect to the claim or action.
Id. ¶ 11(d)(1). The Agreement contains the
following limitation of liability:
Neither party shall bring any action, whether in contract or
tort, including negligence, arising out of or in connection
with this Agreement, more than two years after the cause of
action has accrued.
Id. ¶ 13(d).
March 3, 2011, Arvest's counsel notified RSA that Arvest
had been sued by Secure Axcess, stating that:
[RSA] has an obligation to defend, indemnify and hold Arvest
harmless against any and all claims that arise from a claim
that the licensed software infringes a U.S. patent. This
letter constitutes written notice of the claims against
Arvest. Please confirm that you received this letter and that
RSA will comply . . . .
next day, March 4, 2011, RSA's counsel responded,
We have studied the patent-in-suit, and have concluded that
RSA's “site-to-user” authentication feature
clearly does not infringe, nor does any system that utilizes
it in its intended manner. . . . [F]urther, our product is
only one piece of the system implementation, so it's not
clear that the claim is against RSA's product.
However, we do confirm that if it becomes clear that the
claim is against RSA's product, RSA will live up to and
fulfill its indemnity obligations under applicable
agreements. Further, we will not just stand by, but ...