Eastern District of Texas Federal Court Practice

Motion to Reduce Damages Award in Judgment Following Appeal Denied

Retractable Technologies v. Becton, Dickinson & Co., 2:07cv250 (5/13/13)

Judge: Roy Payne

Holding: Motion to Conform Judgment to Federal Circuit Mandate DENIED

Interesting procedural situation here.  Verdict of infringement by two products with one consolidated damages award of $5 million in a patent/antitrust case.  On appeal, the parties didn’t address, nor did the Federal Circuit, the damages award.  That court affirmed the jury finding of infringement as to one of defendant’s products, affirmed the finding of no invalidity, and reversed the infringement finding as to the second product accused. The judgment of the Federal Circuit, issued as mandate, reads: “Reversed in part and affirmed in part.” The damage award was not ever vacated.  There is no remand, nor did the opinion discuss any further proceedings in the district court.

Defendant filed a motion to “conform the judgment to the Federal Circuit mandate” citing FRCP 60(b)(5), a hole that Judge Payne found to be a questionable location for defendant’s peg.  The order does not set out what the defendant was seeking in the motion, but indicates that it was some sort of reduction of the damages award to allocate damages between the products and reduce the amount of the judgment to what the defendant claimed was the portion of the damages award attributable to the product as to which infringement was affirmed.  Judge Payne declined to do so, holding that Fifth Circuit caselaw known as the “mandate rule” precluded further adjudication as to unappealed-from portions of the judgment, here the amount of the damages award.  Nor was revising the judgment as simple as the defendant claimed:

Determination of the effect of the reversal of the infringement finding as to the 3 mL Integra (but not the 1 mL Integra) syringes is not a simple matter of arithmetic as BD argues. RTI points out numerous issues that would have been presented to the Federal Circuit on the initial appeal if BD had decided to appeal the damage award. Since neither expert suggested the numbers awarded by the jury, the court would have to weigh the expert testimony and other damage evidence to redetermine the damages for each accused product. These are matters that should have been presented to the Federal Circuit on appeal and not raised for the first time in this court.

The injunction had, however, been appealed, so the Court did modify the judgment to exclude the 3 mL Integra from the injunction.

Motion to Compel Granted; Court Observations on How 30(b)(6) Depositions Work

Collins v. Nissan N.A., 2:11cv428 (5/9/13)

Judge: Rodney Gilstrap

Holding:  Motion to Compel GRANTED

I remember when  Collins v. Nissan meant a product liability case.  Not anymore.  

Plaintiff sought an order in this patent case: (1) preventing defendant Nissan from presenting evidence and testimony at trial concerning certain topics (which were the subject of deposition of Nissan corporate reps); (2) ordering Nissan to provide substantive interrogatory responses; and (3) providing translations and a narrative response to one interrogatory.  Judge Gilstrap heard arguments from both sides at an oral hearing, and issued this order, being "of the opinion that Nissan has failed to comply with its discovery obligations in good faith and that Plaintiffs are entitled to appropriate relief under Fed. R. Civ. P. 37."

“It is well settled,” Judge Gilstrap continued, “that the rules of discovery in the Eastern District of Texas are accorded a broad and liberal treatment to affect their stated purpose of adequately informing litigants in civil trials,” citing DDR Holdings, LLC v. Hotels.com, L.P., et al., 2012 WL 2935172, at *2 (E.D. Tex. July 18, 2012).  As in DDR, the primary issue dealt with deposition notices.

Nissan may not ignore certain topics in a 30(b)(6) deposition notice simply because it believes the topics noted are ambiguous or otherwise addressed by its document production. The Court finds that Nissan did just that in this case. If Nissan’s true concern was ambiguity, procedural devices are available and known to Nissan to seek clarification of the noticed topics. Nissan never sought clarification from Plaintiffs or from the Court. This District’s local discovery rules are clear, and they do not excuse a failure to provide 30(b)(6) testimony simply because Nissan believes that its document production “speak for themselves.”

Here, Nissan unilaterally decided to block discovery into topics clearly identified in a 30(b)(6) deposition notice. This is not permitted under the Federal Rules of Civil Procedure or this Court’s Local Rules. Such unilateral action blatantly usurps the Court’s function as the gatekeeper in matters of discovery. Having been put on notice of Plaintiffs’ 30(b)(6) topics, Nissan was required to either (1) tender a witness on each topic; (2) confer with Plaintiffs’ counsel to discuss the scope of the deposition and resolve any disputes among themselves; or (3) seek relief from the Court once a meet-and-confer between the parties did not resolve the dispute. Instead, Nissan acted unilaterally, purposefully and with knowing disregard for these established steps by refusing to present a knowledgeable witness at all on these topics. Such conduct is precisely that for which Fed. R. Civ. P. 37 provides a remedy.

The Court also found that Nissan failed to act in good faith by objecting to Plaintiffs’ Second Set of Interrogatories as untimely and refusing to provide substantive responses just because its response deadline, with the three days added pursuant to L.R. cv-6(a), (oh no, they didn’t…) “would fall three days after the close of fact discovery.”  (Yep, they did). 

The Court believes that it should not have to remind the parties that a deadline does not prohibit or discourage a response prior to the last possible moment; rather, a deadline sets the outer limit for a timely response. Here, where the response deadline falls three days after the close of discovery (and only after Nissan chooses to take advantage of the additional three days offered by the Local Rules), the proper course of action for the responding party is to either meet and confer seeking to extend the discovery cutoff by three days, endeavor to respond in a timely manner, or seek direction from the Court. The Court cannot help but be persuaded that Nissan’s refusal to pursue none of the above options reveals a strategic but improper decision to consciously impede Plaintiffs’ discovery efforts. Again, Fed. R. Civ. P. 37 provides a remedy.

Accordingly, the Court granted Plaintiffs’ Motion to Compel and ordered that Nissan, within fourteen (14) days, provide to Plaintiffs at Nissan’s cost:

(1) substantive responses to Plaintiffs’ Second Set of Interrogatories,

(2) a narrative response to Plaintiffs’ Interrogatory No. 5, and

(3) certified English translations of Japanese documents (presently existing in whole or part in Japanese) referenced in Nissan’s Response to Interrogatory No. 5.

The Court found that Plaintiffs’ request to exclude Nissan from presenting evidence and testimony at trial from fact witnesses (and expert witnesses to the extent they rely on the testimony of fact witnesses) concerning the noticed 30(b)(6) topics 15 and 17 “has merit, but finds that now is not the most appropriate time to administer such relief. The Court believes that when it considers the various pretrial motions that the parties will present that it can then better consider extending such relief as justified by Nissan’s conduct at that time. Accordingly, the Court reserves the application of appropriate relief in this regard until such future date before the start of trial as the Court may determine.

As my dad used to say, the more things change, the more they stay the same…

 

State Bar of Texas President-elect Runoff - Please Support Trey Apffel

I don't know whether weblog readers in Texas vote in State Bar elections - but if you don't, you need to make a big exception this year and get out and vote.  Here's how and why::

How to Vote

First the how - Attorneys who are active and in good standing are eligible to vote regardless of whether they voted in the election that concluded on April 30. Today, ballots will be distributed electronically and via mail and voting will take place until May 23 at 5:00 p.m. CST. Or, you can vote now by clicking here.

Why Your Vote Matters 

Now the why: the bar president we elect this month will be president during the legislative session prior to when the Bar is set for sunset review - which is when we have to make the case to the Texas Legislature to continue to let lawyers govern ourselves via an elected board of directors and an independent bar, rather than creating a state agency headed by a gubernatorial appointee and reporting to the Legislature.  To preserve the level of autonomy we currently have, we have to show ourselves to be responsible, mature custodians of our profession and of the public interest that we serve.  This election could show that we are all of these things - or none of these things.  

The State Bar president-elect process

The State Bar has a committee (which I served on in 2008 when I was director for the northeast Texas counties of district 1) that interviews candidates for president-elect, picks two, and then those two run in a general election.  Virtually every year the state's lawyers can't lose because the two lawyers running have survived an intense selection process that generates two candidates with long distinguished records of service to the bar and to their communities.  What is left is two people that know the issues facing the bar, who have the respect of their colleagues, and who their colleagues trust to have the judgment to speak out on behalf of our profession. The Bar also expects - and gets - a dogged advocate for our profession who can work as part of a team with Bar staff, the Bar board and the larger legal and political community to advocate for our profession when called upon.

The State Bar president's job

That last is important because speaking out appropriately and effectively is largely what a State Bar president does.  They cannot hire and fire Bar staff, set Bar policy, or administer or even oversee what the Bar does on a day to day basis.  They appoint members of committees and support the many things the Bar does, and when called on they represent us before the Texas Supreme Court and the Legislature.  They have the respect of their peers not because of the office they hold, but because of the kind of lawyer they have shown themselves to be.  They lead because they have served.

This year's election

This year is different.  Of course, the Bar interviewed and eventually submitted two experienced Bar leaders, Trey Apffel of League City and Larry Hicks of El Paso to the members.  Both are distinguished members of the Bar with long records of service to their community.  Either would be a Bar president we could be proud of, and the Bar membership has selected Trey as one of the candidates for the runoff this month.

What makes this year different is that there was a third candidate, Steve Fischer of Rockport , who utilized the process whereby a candidate could collect enough signatures to be placed on the ballot, and who is now in a runoff with Trey.  And it is that runoff that I want to write about today.

I have known Steve for a little over a year now, since he has served on the Texas Bar Journal board of editors that I chair, and I have appreciated his input and his desire try to make the Bar better.  He is sincere about wanting to do what he believes are positive things for the Bar.  But the reason I am taking the unprecedented (for me) step of recommending in the strongest possible terms that you vote for Trey and not Steve is that it is my strong belief that we do not - we cannot - have Steve representing the lawyers of Texas as president of the State Bar, especially during a legislative session that will lay the groundwork for our next fight for survival as an institutional bar.

The reason why I feel as strongly about this as I do is not just that in my experience Steve has shown an inability to learn how the Bar works and how to promote the changes he believes are necessary.  Many, if not most of us, are not as skilled at working within organizations as we would like.  And after all, since Bar presidents do not exercise command or control over the organization, and no president can make the changes Steve has indicated he wants to make, his inability to make them if he were elected is really is not a concern to me.  Bar presidents learn - in fact they all already know - that the State Bar's elected board of directors exercises the real authority within the organization, and it is they that will decide what changes are made, and when.  A president may persuade or work effectively within the organization to promote desired change, but, candidly, they are in office too short a time, and are typically too busy with their selected project to play a substantial role in the governing of the organization. 

The Importance of Judgment in What a Bar Presidents Says

The reason I am concerned is that Steve has shown a recurring lack of judgment at the one thing a state bar has to do, and do right - communicate effectively on behalf of the Bar.  Not all of us are good front men for an organization, but it goes beyond that.  A State Bar president has to be able to effectively convey the Bar's message to policymakers at the Court and the Legislature, not to mention the larger public.  Steve is not only not on the same page as most of the bar leadership - his judgment in what he says publicly makes placing him in a role representing the Bar I believe could be seriously damaging to the future of the organized bar in Texas.

Want specifics?  In recent years Steve has been a prolific poster on the website of the Corpus Christi Caller-Times.  He is vocal in his opinions, which is certainly his right, but the judgment he has shown raises serious questions about whether this is someone we want representing our profession.  Here are some examples (a complete list can be found here) that I think will get across why I have the concerns I do:

• February 21, 2013: "Give it up liberals- Its not just Mexicans who may be illiterate look at your own posts. Hilarious. At least Mexicans are literate in one language."  
• October 14, 2012: "People dumb enough to believe in organized religion will get scammed all the time- scammers need dumb targets."
• June 28, 2012: "Catholics do have somewhat lower educational attainment than several other religions, but for people to eat this stuff up is outrageous."

Want more?  Just go to the link above and scroll down Steve's posts.  Do we really want this as the face of the organized Bar going into Sunset?  Would you trust an organization led by people who make statements like this to govern itself?  News flash: lawyers are not popular - and there are all too many people that would like to eliminate our ability to govern ourselves, and will seize on the stated beliefs of the Bar's leader regarding religious or ethnic groups to show why it's time to do exactly that.  We should not destroy the good will that generations of bar leaders have built with our state's elected leaders, and we cannot give the Legislature an excuse to head down the path of eliminating the bar's ability to govern itself.  It would be bad not just for us as lawyers, but for our clients and for the public.

Again, I like Steve and I appreciate his input, his hard work, and his motivation - which is to try to make the State Bar better.  He is sincere in his beliefs, and loves the profession no less than any of us.  But as all lawyers know - good intentions are not enough.  Hard work, even coupled with skill is often still not enough.  What this job needs above all else is good judgment in knowing what to say when you open your mouth, because a bar president does not have the luxury of staying silent.  We elect them to speak for us.  And we expect them to speak well.

Trey Apffel is the leader the Bar needs as we head into Sunset review.  I urge you to support him this month with your vote, and to urge as many of your colleagues as you can to join you.  

 

Once and Future Willful Infringement Claims

Touchscreen v. RIM, 6:12cv263 (3/27/13)

Judge: Michael Schneider

Holding: Motion to Dismiss Willful Infringement Claims GRANTED

Defendant RIM contended that Plaintiff Touchscreen’s willfulness claims should be dismissed.  Judge Schneider agreed, and addressed both Touchscreen's pre-filing and post-filing allegations of willful infringement.

First, with respect to the allegations of pre-suit willful infringement, the Court noted that the original complaint did not allege any pre-filing knowledge of the patents. "Rather," the Court wrote, "the complaint merely states as to each patent that “[t]o the extent that facts learned in discovery show that RIM’s infringement of the [asserted patents] is or has been willful, Touchscreen Gestures, LLC reserves the right to request such a finding at time of trial."  This "reserves the right" allegation, absent any supporting facts, Judge Schneider concluded, was insufficient to establish a willful infringement claim.

Judge Schneider concluded that the complaint presented no facts supporting that Touchscreen had a good faith basis for alleging willful infringement. The absence of any allegation of pre-filing knowledge of the patents was held fatal to Touchscreen’s willful infringement claims, as was the fact that the plaintiff made no allegation that RIM acted despite an objectively high likelihood that that its actions constituted infringement of a valid patent.

Moving on to post-filing will infringement (or at least attempting to) Touchscreen next argued that the filing of the suit itself was sufficient to support post-filing willful infringement claims.  Judge Schneider disagreed, finding that the allegations were not sufficient, and that post-filing conduct could be remedied by seeking a preliminary injunction, which Touchscreen had not done.  

To maintain willful infringement claims, Touchscreen must demonstrate that RIM knew about the patents and acted despite an objectively high likelihood that its actions constituted infringement of a valid patent. Touchscreen’s complaint is completely void of any allegations or facts pertaining to willful infringement. See Realtime Data, LLC v. Stanley, 721 F. Supp. 2d 538, 545 (E.D. Tex. 2010) (finding that based on pleading language nearly identical to the instant case, that “Seagate clearly requires a patentee to do more than suggest that more definite allegations are to follow once discovery is underway”).

 

Motion for Summary Judgment of Indefiniteness Denied

Mosaid v. Freescale, 6:11cv173 (4/29/13)

Judge: Keith Giblin

Holding: Motion for Summary Judgment of Indefiniteness Recommended DENIED

Judge Schneider referred the Markman in this case to Judge Giblin, who produced a report and recommendation last week on the defendants' motion for summary judgment of indefiniteness.

Judge Giblin wrote that Defendants' argument essentially boiled down to the contention that the permissive wording of one of the claims rendered it indefinite because a PHOSITA couldn't figure out whether the claim could be satisified by an apparatus that was something, something else, or something completely different entirely.  (Actually those are my words, not the Court's - kind of tells you where I fall on the PHOSITA continuum, doesn't it?)

The Court concluded that the claim was not indefinite, noting that he could not find, nor could the defendants, any authority for the proposition that words of permission in a claim render it automatically indefinite.  In other words, he decided that a PHOSITA could, in fact, figure it out.

Social Media Update Webinar

No lunch plans tomorrow?

Well you have them now because I will be presenting Social Media Update via webinar tomorrow for the State Bar of Texas Paralegal Division.  The cost is $40 for Paralegal Division members and $50 for nonmembers, and registration is here.  

As the procedure is explained to me, I sit at my desk and talk on the phone for an hour while clicking through the slides for my presentation, which attendees can review my bio, my slides, and take notes.  The audience is expected to be mostly certified paralegals, who are gaining credit in civil, criminal, family and personal injury law.  The presentation will then be warehoused in the Paralegal Division's online CLE databank.

The presentation will be similar to the one I did in January at the State Bar Litigation Update seminar, but will contain a couple of sections I deleted this year for time reasons and because another speaker was handling them.  So I am optimistic I can use most of the time before going to questions from the audience, which are sent by email during the presentation.

 

Trial Procedure in Federal Court - 2013 Federal Court Practice seminar

Week after next I will be presenting a paper Trial Procedure in Federal Court at the annual State Bar Federal Court Practice seminar.  The seminar will be in its traditional home in Dallas, Cityplace Events Center on May 24, 2013.  As readers know, I have presented on motion practice for several years now, but I ask to fleet up to trial procedure after running into some interesting issues with the trials we have had in recent years.  

Also at the table with me will be U.S. Magistrate Judge Roy S. Payne of Marshall, who will be providing attendees with his insights from almost 20 years on the federal bench, as well his his experiences trying cases as a practitioner.

The program will have numerous panels and individual presentations of interest to practitioners in federal court, including by Judge Reed O'Connor of the Northern District of Texas on pleadings, and will feature a lunch judges panel with Judge Payne and district judges Kathleen Cardone from El Paso, Diana Saldana of Laredo, and Jorge Solis of Dallas.  More information on the seminar is available here, and you can register here or by calling the State Bar up directly at 800-204-222, extension 1574.

Plaintiff Win in Invalidity-only Trial in Marshall; Patent Trials Year-to-Date

A Marshall jury in Judge Michael Schneider's court in Marshall (sitting in the old courthouse) rendered a verdict for the plaintiff today in Alexsam v. Best Buy, et al., finding that the twelve claims asserted in the related infringement actions were not shown by clear and convincing evidence to be invalid as anticipated by two prior art references, or for improper inventorship.  The case is set for an imequitable conduct bench trial before Judge Schneider later this month, followed by the first of the multiple infringement trials against the defendants.

This is the second invaldity-only case of the year.  In the prior one, Oasis v. Carbonite/EMC, a Sherman jury in Judge Mazzant's court found the asserted claims invalid for improper inventorship.  In the other four trials this year, the plaintiff won infringement and defeated invalidity in one (Patent Harbor v. Funai), the defendant won a noninfringement verdict but did not win on invalidity in another (VirnetX v. Cisco), and in the remaining two (Hitachi v. Top Victory; Realtime v. T-Mobile)  the defendants won both noninfringement and invalidity.  At least those are the verdicts I am aware of - if I have missed any readers please let me know.  

So the win rate thus far this year for plaintiffs is 1-1 on invalidity-only cases, and 1-4 in infringement and invalidity cases.

Shades of 2007...

Post-trial motions resolved in SSL v. Citrix; Everything The Jury Did Affirmed

SSL Services v. Citrix Systems, Inc., 2:08cv158 (4/17/13)

Judge: Rodney Gilstrap

Holding: Everything The Jury Did AFFIRMED

I thought I'd recognize the second patent trial in the old courthouse this week with Judge Schneider by noting the final outcome at the district court level of the first, last year's SSL v. Citrix case, which just came out a couple of weeks ago. 

As I posted last year, SSL Services, LLC v. Citrix Systems, Inc, et al., 2:08cv158, was tried before Judge Rodney Gilstrap with a Marshall jury in the historic 1901 county courthouse - the first trial in the historic district courtroom in almost half a century.  The case marked the first application by a district court the Federal Circuit opinion in Bard Peripheral v. W.L.Gore (Fed. Cir. 2012) that the "objective prong" of the test for willful patent infringement is a separate question of law, and that henceforth it will be the trial court's duty to determine whether the defendant's actions were objectively reckless.  The opinion came out during the trial, and was applied by the Court is figuring out how to submit the issue in the case.

In SSL, there were two patents asserted.  The jury found one patent (the one with the lion's share of the $63 million in damages sought) not infringed, and found that only one of the three claims on a second patent was infringed.  It found that all three of the second patent's claims were also contributorily and induced-edly infringed.  It found that the infringement of the second claim was willful, and Judge Gilstrap, following the new Federal Circuit caselaw in Bard, determined the objective prong of willful as a matter of law and submitted the subjective prong to the jury with the appropriate instructions for that prong.  

Two weeks ago Judge Gilstrap ruled on the multiple pending motions for judgment as a matter of law and new trial following the jury's verdict.  Here are the subjects and the rulings with somewhat abbreviated analysis:

Defendant's JMOL and MNT on Damages - Denied

Defendant Citrix wanted JMOL and in the alternative a do-over on damages, asserting that the plaintiff was not entitled to pre-suit damages because it had not marked, because the damages verdict lacked substantial evidence because jury relied on an allegedly noncomparable license, and because it was, well, just generally unsupported for other reasons.  Judge Gilstrap's opinion:

• discusses the marking requirement and concluded that substantial evidence supported the jury's conclusion that the marking statute was complied with;
• discusses the law on comparability of license agreements and concluded that substantial evidence supported the jury's damages award and that the licensing agreement was in fact sufficiently comparable; and
• concluded that there was substantial evidence to support the jury's conclusion as to damages.

Plaintiff's JMOL/MNT that the Patent It Lost on is Infringed as a Matter of Law - Denied

Uh, no.  Judge Gilstrap's opinion:

• noted that the plaintiff did not object to the testimony it now complained of at trial (noting that a ruling on a limine did not preserve error on the point) and that the testimony was proper anyway;
• concluded that other objected-to testimony was proper; and 
• concluded that there was substantial evidence supporting the jury's verdict of noninfringement.

Defendant's JMOL/MNT of noninfringement/invaldity - Denied

Substantial evidence, yada yada - denied.

Defendant's JMOL/MNT as to Willfulness - Denied

First the objective.  Judge Gilstrap observed:

In sum, Citrix’s invalidity defenses based on prior art have been rejected: (1) by the Court as being objectively unreasonable; (2) by the jury as not being shown by clear and convincing evidence; and (3) by the USPTO in the Action mailed November 29, 2012. The Court is of the continuing opinion that the mere fact that claims have entered reexamination cannot be an absolute bar to willfulness with regard to the “objectively reckless” inquiry. In this case, Citrix’s invalidity defenses have been rejected three times. The cited references simply do not invalidate the claims, and it was objectively unreasonable for Citrix to believe otherwise.

Next, the Court found that the evidence presented at trial was (drum roll please) "more than substantial evidence to support the jury's verdict regarding willful infringement."

As I mentioned to the jury in that courtroom yesterday during voir dire - the jury box is in the center of the courtroom for a reason.

 

 

 

 

 

 

 

 

My Favorite Kind of Day in Downtown Marshall

To paraphrase my old trombone professor Dr. Neill H. Humfeld, it's a beautiful day in Marshall.  On North Washington they're closing off the street to set up for another weekend of music in Telegraph Park across from the old courthouse (this weekend it's a motorcycle rally), while in the old courthouse itself people are setting the historic district courtroom up for our upcoming trial with Judge Schneider Monday (consolidated invalidity).  

Meanwhile, across the street the sweet smells of Blue Frog catering are wafting from the Hub's kitchen as lunch rolls in for the trial team that's set up on the 113 side of the building, complete with boxes of papers, crates of electronics, and bowls of sweets close at hand.  

Just the other side of the square an eloquence of lawyers (or maybe it's a litigation of attorneys) is beginning to congeal for the afternoon's Markman hearing in Judge Gilstrap's court.

And to put a cherry on the top, tonight we have the East Texas ABOTA (American Board of Trial Advocates) spring dinner in Longview where we can tell war stories about all of it.  

Some days this job is just too much fun.