Insta-Bulk, Inc. v. Powertex Inc.
Powertex, Inc. sought to hold Insta-Bulk, Inc. in contempt for allegedly violating a 1983 injunction by selling patented products outside of agreed-upon territories. Insta-Bulk moved to dismiss the contempt motion, arguing the injunction was inapplicable due to an existing license agreement, or alternatively, to stay proceedings pending arbitration as per the license agreement. The District Court denied Insta-Bulk's motion to dismiss the contempt application, stating that the applicability of the injunction depended on whether Insta-Bulk's actions were authorized by the license. However, the court granted Insta-Bulk's motion to stay the contempt proceedings pending arbitration, concluding that the dispute over sales authorization fell under the license agreement's arbitration clause. The court also clarified that arbitration obligations can survive contract expiration, citing Supreme Court precedent.