The DeLorean fictional time machine stands parked for a photograph in Tokyo, Japan, on Wednesday, Jan. 18, 2017. Photographer: Akio Kon/Bloomberg

The U.S. Court of Appeals for the Third Circuit upheld a ruling that a settlement between the DeLorean Motor Co. and its founder's estate precluded a suit seeking back royalties from products using the company's images and logo.

"The question presented is whether the Settlement Agreement precludes the Estate's claims in this action," wrote Third Circuit Judge Joseph Greenaway Jr. in the Dec. 5 opinion. "The District Court found that it did, and the Estate appealed. … We will affirm."

The settlement was entered into by Sally DeLorean, on behalf of the estate of her late husband, John DeLorean, and DeLorean Motor Co. (Texas), or DMC Texas. DMC Texas sells hats, key chains and other merchandise bearing the image of the iconic DeLorean vehicle. The suit arose from the question of whether DMC Texas had authority to enforce an agreement with Universal Pictures that the late DeLorean entered into in 1989.

R. Scott Thompson of Wollmuth Maher & Deutsch in New York, who represents Sally DeLorean, could not be reached for comment.

William Mead Jr. of Litchfield Cavo in Cherry Hill, who is representing the automaker, also did not return a call.

The case centers around claims by the estate that the original DeLorean Motor Co., founded by DeLorean in the 1970s, owed royalties and commissions to the estate. DMC designed, manufactured, and sold an automobile named the DMC 12 with gull-wing doors that became iconic after being featured in the popular film series "Back to the Future." DeLorean died in 2005.

The Universal agreement came a decade after DMC went bankrupt. It granted Universal certain exclusive "rights in and to the name and appearance of the famous DeLorean automobile" to allow Universal to merchandise the "Back to the Future" films. Universal agreed to pay DeLorean 5% of net receipts from merchandising and commercial tie-ups in connection with the film trilogy, according to the decision.

In February 2018, the estate contacted Universal claiming overdue royalties. That April, Sally DeLorean alleged in a lawsuit that the estate was entitled to proceeds of the Universal agreement. She claimed she retained all rights stemming from the 1989 Universal agreement, and that she did not sign over any of those rights to DMC Texas.

DMC Texas moved for dismissal. The estate opposed that motion and filed a cross-motion for summary judgment.

On Oct. 12, 2018, U.S. District Judge Jose Linares of the District of New Jersey granted dismissal. He declared Sally DeLorean signed over her rights when she settled a prior lawsuit relating to licensing of the DeLorean car's name, design and trademarks.

That previous suit filed by the widow in the District of New Jersey in 2014 sought to prevent licensing of the car's name and logo by DMC Texas. It ended with a September 2015 settlement in which she released her claims in exchange for payment in an amount that was not made public. It provided in part that DMC Texas would pay the estate the full amount of any claims asserted in the 2014 action and that the estate, in exchange, would release and discharge all claims "that were sought, or could have been sought, in the [2014 action]."

The agreement also acknowledged DMC Texas' "worldwide rights … to use, register, and enforce any of [sic] DeLorean Marks for any and all goods and services," according to documents.

Linares noted that both the settlement and the Universal agreement pertain to the use of those names and trademarks in the context of manufacturing and merchandising of products displaying the DeLorean automobile's image and brand.

The Third Circuit in its Dec. 5 opinion affirmed Linares' ruling, applying New Jersey contract law and rejecting the estate's arguments "because the Settlement Agreement barred the Estate from suing DMC Texas for the conduct it engaged in here."

Greenaway, siding with Linares, said both agreements overlapped. He rejected the estate's claims that DMC Texas' interference with the estate's contract with Universal only occurred after the 2014 action and therefore could not be contemplated by the settlement.

"Accordingly, we find that the Settlement Agreement shields DMC Texas from suit brought by the Estate for the conduct at issue here," the judge wrote. "For the foregoing reasons, we will affirm the judgment of the District Court."