The U.S. Court of Appeals for the Federal Circuit has corrected the dismissal of Simon Property Group’s contractual indemnification claim against Blackhawk Network in litigation over prepaid gift-card technology. Its October 5 opinion directs the trial court to dismiss that claim without prejudice under the provision allowing federal courts to decline supplemental jurisdiction. It does not order Blackhawk to pay Simon. [S01]

The dispute grew out of Alexsam’s patent case concerning multifunction cards. Simon alleged that a 2014 gift-card supply agreement required Blackhawk to defend and indemnify it against infringement allegations, including legal fees. After the patent claims ended in a non-infringement judgment, the trial court treated Simon’s separate contractual claim as moot. [S01]

The appeals panel said a live disagreement over indemnification remained. It treated Simon’s request to correct the judgment as a permissible motion for relief from a legal error and vacated the order denying that request. [S01]

Both sides nevertheless accepted dismissal without prejudice under the rule allowing federal courts to decline supplemental jurisdiction over state-law claims. That is the replacement order the panel directed in case 25-1138. The opinion is nonprecedential. [S01] [S02]

For the gift-card partners, the ruling changes the procedural treatment of a dispute over who bears defence costs. It leaves contractual liability unresolved and does not reopen the earlier non-infringement decision. [S01]

A separate district-court order filed on September 17 gives context for the defence costs at stake. In fee motions against AlexSam, Simon requested its entire defence costs, stated as USD1.8 million, while Blackhawk requested USD1,436,238.29. The court granted entitlement to fees but required detailed accounting before fixing amounts. These requests concern recovery from AlexSam, not a ruling that Blackhawk owes Simon either sum under their supply agreement. [S03]

The data behind the story

Defence costs requested in separate fee motions

Amounts requested against AlexSam, recorded in the September 17, 2026 district-court order. Neither amount was fixed as an award in that order.

USD
Source
District-court fee order, page7

Simon is reported by the court as USD 1.8 million, with lower precision than Blackhawk. Both are requested total defence costs, not awarded or paid amounts. These fee motions against AlexSam are separate from the October 5 supplier-indemnity appeal.

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Defence costs requested in separate fee motions (USD)
CategoryRequested defence costs
Simon (source rounded)1,800,000.00 USD
Blackhawk (exact request)1,436,238.29 USD