One of the interesting things about a docket that includes repeated assertions of the same patent claims where the case law continues to evolve is that you can sometimes see the same judges applying changed legal standards to the same claim language and see the real – world effects of changes in standards.
I was reminded of that this morning when reading a recent order with the court's claim construction rulings and rulings on the defendant's indefiniteness arguments. In that case, the parties agreed on three terms, submitted 10 terms to the court is disputed, and the defendant asserted that five more terms were impermissibly indefinite under the new Nautilus standard.
The court concluded that three of the five were not indefinite, and a fourth would be given its ordinary meaning, but that the fifth was impermissibly indefinite. Interestingly, the same judge had ruled the same term not to be indefinite under the prior standard just a few years ago, but concluded that under the new standard it now was. The net effect was that three claims from two of the 11 patents in suit were invalidated as indefinite.
If you haven't voted already in the State Bar president – elect race, or for your local bar director or TYLA director, if there is a race in your district this year, remember to do so before the end of the Month. Both candidates are well-qualified and would do a good job, but don't let that stop you from voting - figure out which you think would do a better one, and vote.
In addition to information on the ongoing election, this month's bar journal has an article I wanted to call to readers' attention. Technology: Start Up - Going solo without breaking the bank by Nerino J. Petro Jr. and Bryan M. Sims is a helpful summary of office technology for new solos with suggestions at different levels of spend. I speak on the subject of technology for the small law firm fairly frequently, and am glad to see the TBJ provide some input on this subject as well.
Well that didn't take long. Newly minted Eastern District Judge Robert W. Schroeder III (shown at left during his investiture last month) brought his first patent trial to a close last week when a Tyler jury in his court found for the patent holder.
At 3:53pm Friday afternoon (just before 4pm is the sweet spot for a lot of Tyler juries - don't know why, but it just is) the jury found both claims literally infringed, and willfully infringed. No invalidity issues were submitted, and the jury awarded $1,541,333.
One of my favorite bar activities these days is working on planning committees for seminars for lawyers. I think I get recruited because I come up with the weirdest ideas for how to do something differently – at least I certainly did yesterday when I participated in one for the upcoming 39th Annual Page Keeton Civil Litigation Conference put on by UT Law CLE in Austin. (Last year's agenda is here). Last year I was unable to attend the conference since it was set at the same time as the Eastern District's bench/bar but I made the best of it by stealing one of its speakers for the bench/bar. (Well, not exactly stole – but we did have one of the speakers from the Austin event fly up the next day to present a similar topic for us after I reported back that this seminar had some great topics on legal writing and writing for reading on computer screens that I thought attendees might be interested in).
This year's event is scheduled for October 29 – 30, 2015 at the Four Seasons Hotel in Austin, and I highly recommend it for practitioners interested in useful updates on a variety of topics dealing with civil litigation. The agenda is not finalized yet obviously (we just met yesterday) but I can already tell they're going to be some very interesting topics and speakers. Not that you need an excuse to visit Austin in the fall, of course, but your accountant might feel differently.
Not sure yet if I will be presenting on a topic – I volunteered for one pressure (peer pressure, okay?), and then argued persuasively (at least for a few minutes) that that topic was not important enough to be included, but the committee later put it back on the tentative agenda as an alternative. So not sure whether you'll be hearing from me or not, but as the topic is a subset of one I will be doing for a different seminar this summer, there will be a paper one way or the other.
Had a great time presenting "Technology and Productivity for the Practicing Attorney " for the Smith County Bar Association in Tyler last Friday. Covered the paperless office, equipment and useful apps for a law office, law office disaster plans, and personal productivity tips.
And just to reiterate, the one really killer app that I forgot to update the presentation with is Scannable, the new scanning program for smart phones by Evernote. You could see the lawyers who deal with documents in the real property records get excited when I told them they didn't need to make photocopies of pages they were interested in anymore.
It's a quiet Good Friday at the office catching up on reading (both legal and nonlegal) and looking over some old Easter photos while the boys are sleeping late at home before we head out for an abbreviated spring break.
I particularly like this one where I'm already expressing an interest in plaid sportcoats, my grandfather is looking appropriately dignified amid the chaos that was fashion in 1970, and what the hell is that on my mother's head?
Jillian Centanni has a good article 11 Lessons From A Year Of Post-Octane Atty Fee Decisions on Law360, in which she provides some useful guidance from the recent district court cases concerning whether a case is "exceptional" under section 285 for purposes of recovery of attorney's fees. To summarize, Vince Lombardi once said that “winning is not everything, it is the only thing” but he can't have been talking about section 285, because the courts are holding that winning is, well not much at all, actually. It takes something more, and the article provides a useful checklist of what that something might or might not be. It is a shame that she didn't cite any of the opinions by Federal Circuit judges Bryson and Dyk sitting by designation in the Eastern District of Texas on this point, since they might provide some useful guidance into how the new standard might be perceived on appeal since that is, you know, their day job. They are not inconsistent with the cases that she did cite, but in my experience, you are wasting a good opportunity to mooch off someone else's very good work if you don't check for cases by Judge Bryson first...
And as I have posted recently, I have been speaking on the topic of productivity, the paperless office and office technology a lot lately, and am getting ready for yet another presentation on the topics to the Smith County Bar Association in Tyler next Friday. In the process of updating my presentation, I ran across a good article by Professor Naomi Baron on a topic I like to cover, which is the difference between handling reading on paper and on a computer screen. In Why Reading On A Screen Is Bad For Critical Thinking, Professor Baron points out some issues that I have seen come up repeatedly in discussing how we read and process information. Specifically, studies are consistently showing that people concentrate better when reading on paper, and remember what they have read better. Unfortunately, studies also show that we significantly overestimate what we remember and learned when it was on a computer screen. I cite and discuss some of those studies in my paper on the subject, and will talk about that in Tyler next week.
Speaking of personal productivity, I am always glad to see a good article explaining the Getting Things Done (GTD) system by David Allen, and ran across a new good summary of it a couple of weeks back, GTD 101: The Beginner’s Guide To Getting Things Done by Michael Schmitz (who almost has a really good name) on the www.asianefficiency.com website. If you aren't familiar with the system, and don't want to take the time to read the book to find out what it is about – in the article does note that the book is a little lengthy and repetitive - it is one of the best summaries I have seen, and should help you decide if the system is for you.
Finally, Matt Mcfarland (who apparently has some issues with capitalization - the "f" is not a typo) and has an interesting article in the Washington Post Why shades of Asperger’s Syndrome are the secret to building a great tech company, that points up the potential benefits of not having the conventional attachment to social norms that is a characteristic of some forms of autism, including Asperger's. No particular reason I'm interested in this.
Let's see - what else? A few venue orders, a raft of Twiqbal orders (one of which I posted on yesterday), a long list of miscellaneous commercial and criminal cases from Sherman and Plano, and last but not least, an interesting order on a Daubert motion excluding a plaintiff's damages expert for running afoul of the entire market value rule (more or less) on a damages expert in a patent case, and also suggesting that some revisions in light of a marking issue might be in order. As my college roommate used to say, "Good stuff, Maynard."
Well, that's enough work for a day we're closed - off to Gucci's for a light (ha!) lunch, then time to hit the road. Hope everyone has a good holiday weekend. Happy Easter, and may all the eggs you find be golden.
Content Guard Holdings, Inc. v. Amazon.com, Inc., 2:13-CV-1112-JRG (E.D. Tex. 3/30/15) (Gilstrap, J.)
Judge: William C. Bryson
Holding: Motion for Exceptional Case Status & Attorney's Fees Denied
This case represents another data point under 35 U.S.C. § 285, in which a prevailing party sought an award of attorneys fees and costs. After reviewing the current state of the law following the U.S. Supreme Court's decision in Octane Fitness, LLC v. ICON Health & Fitness, Inc., 134 S. Ct. 1749, 1756 (2014), Judge Bryson denied the request, finding that the defendant's claims that the case was exceptional because the plaintiff had allegedly (1) asserted a clearly invalid patent, (2) litigated an infringement position that the court expressly forbade; (3) asserted a baseless damages theory; and (4) engaged in bad faith litigation (which the Court found was a repackaging of the three prior grounds) did not support such a finding.
A famous historian once observed of the southern part of the United States that in it the past is not forgotten - in fact it really isn't even past.
Ready to be stickered as an aditional exhibit in support of that proposition is the 20th Annual Sam B. Hall Jr. Lecture and Banquet, which will be held at 6:30 p.m. this evening in the Phillips Great Room on the ground floor of the Bennett Student Commons at East Texas Baptist University in Marshall.
The lecture series program commemorates the late congressman and Eastern District of Texas judge Sam B. Hall, Jr., who was a Marshall native and an alumnus of the College of Marshall, which is now ETBU. (He also took in strays as law clerks from time to time, including yours truly, hence his location in my office peering down at me when I'm at my desk. I get in trouble if I'm not watched, so he and Pam are keeping a careful eye out).
Phillip B. Meyer, Houston businessman and ETBU trustee, will speak on his life experiences and growth in faith as a business leader. Currently a partner and vice-president with Oilfield Precision Products, Inc., of Houston, Meyer is the former president of Core International, LLC, and has more than twenty-five years of experience in various facets of the petrochemical industry, including finance, sales, engineering, operations, customer service, and capital equipment sourcing.
The program will also include the announcement of the sixth annual Sam B. Hall Jr. Civic Service Award recipient.
Whatever is Right: Sam B. Hall, Jr., the biography of Judge Hall, will be offered for sale, with proceeds going to benefit the endowment in Judge Hall's name.
Interesting article about the local patent docket by reporter Dylan Baddour in Thursday's Houston Chronicle. The article focused on some of the recent litigation involcing Apple, and has commentary by Prof. Paul Janicke and me on the whys and wherefores of the docket.
In today's news, my oldest Grayson took this picture of a chicken crossing the road on his way to school in Shreveport (he did not think to ask it why), and we learned that last night a Tyler jury in Judge Rodney Gilstrap's court found for defendant Apple in Core Wireless v. Apple. The jury found none of the five wireless patents infringed after deliberating for about five hours. The plaintiff sought $100 million while Apple pegged the damages if infringement was found at $1 million.
I am avoiding the temptation to point out that the plaintiff laid an egg. (Unsuccessfully, obviously).
Just a reminder of the upcoming USC Gould School of Law 2015 Intellectual Property Institute next Tuesday, March 24, 2015 - 7:15 a.m. to 5:35 p.m. at the JW Marriott Los Angeles at L.A. Live, in Los Angeles, CA
Speakers on cutting edge patent, copyright and trademark issues will include:
Additional highlights include:
Judge: Ron Clark
Holding: Order Approving Proposed Settlement Agreement Affirmed
Following more than three years of bankruptcy proceedings, the bankruptcy court approved a proposed settlement agreement between the bankruptcy trustee on behalf of the bankruptcy estate with two claimants against the estate. Another claimant appealed the order to district court, asserting that the bankruptcy court erred in approving the trustee's proposed settlement when the trustee offered no evidence in support of the settlement at the hearing (there was alleged to be evidence in the record from previous proceedings, and to be fair - they did hand up a notebook) and in approving the settlement under the applicable factors.
Judge Clark began by noting that the bankruptcy court's findings of fact were reviewed under the clearly erroneous standard and its conclusions of law de novo, with its decision to approve the settlement reviewed under an abuse of discretion standard.
After reviewing the underlying facts, the Court concluded that the bankruptcy court did not abuse its discretion in approving the settlement despite the fact that evidence was not offered at the hearing, noting that the case already had more than 1,200 entries on its docket sheet, and the bankruptcy court had already held a lengthy trial on contested claims in the case. At the hearing on the settlement agreement, the trustee requested that the Court take notice of the record, and no party objected to the Court relying on that prior evidence presented to it as the basis for its determination of the settlement agreement – in fact counsel for the objecting claimant was the only counsel to appear by phone rather than in person, and did not offer any evidence or witnesses in opposition to the settlement agreement.
With respect to whether the bankruptcy court abused its discretion in approving the settlement under the relevant factors, the Court concluded that after reviewing the lengthy record, considering the bankruptcy court's wealth of experience with the parties to the appeal and to the settlement agreement, the Court could not say that the bankruptcy court abused its discretion in approving the settlement agreement under the applicable factors.
Last Friday a jury in U.S. District Judge Richard Schell's court in Plano (back when he was an active judge) rendered a verdict in favor of the plaintiff in a complex intellectual property case, Texas Advanced Optoelectronic Solutions v. Intersil.
Breach of Contract
After being instructed as a matter of law that the defendant retained confidential information in breach of a confidentiality agreement, the jury found one dollar in nominal damages attributable to the retention of that information, and that the defendant had failed to comply with the confidentiality agreement. It assessed damages at $12 million as a reasonable royalty arising from this failure to comply.
Trade Secret Misappropriation
The jury then found that the plaintiff had proven that the defendant misappropriated its trade secrets, and assessed $48,783,007 in damages, choosing to place the damages under disgorgement as opposed to reasonable royalty. It further found that the misappropriation resulted from fraud, malice or gross negligence, and assessed an additional $10 million as exemplary damages for that trade secret misappropriation.
(For those of you keep track, we're up to $70,783,007 in damages, and we're not even to the patent claims yet. You might want to resharpen your pencils now. This was a long verdict form).
The jury was then asked whether the defendant had proven that the plaintiff must have known or must have reasonably been able to discover that the defendant had use the plaintiff’s proprietary information to compete products before November 25, 2005, and answered no. It did find, however, that the plaintiff had proven that the defendant fraudulently concealed the facts upon which the plaintiff’s misappropriation of trade secrets claim was based.
The jury found that the defendant intentionally interfered with the plaintiff’s prospective business relations with Apple, and assessed as damages $8 million as the amount that would reasonably and fairly compensate the plaintiff for its lost profit damages arising from the defendant's intentional interference with its prospective relations with Apple.
The jury also found that the plaintiff proved by clear and convincing evidence that the defendant's tortious interference was, again, the result of fraud, malice or gross negligence, and assessed another $10 million in exemplary damages for that tortious interference.
The jury found that all four of the accused products infringed all six asserted claims of the patent in suit, and that the defendant had not proven by clear and convincing evidence that any of the claims were invalid due to obviousness, for failure to satisfy the written description requirement, or for failing to contain a sufficiently full and clear description of how to make and use the full scope of the claimed invention. (In an charming note, the jury not only checked the box for “no”, but added a handwritten “No” for each of the 18 boxes where it was asked and invalidity question).
As far as damages, the jury assessed $73,653.51 in patent infringement damages, and found that the infringement of the patent was willful
($88,783,007 + $73,653.51 = uh, $88 million and some change)
The jury found that the defendant had not proved that its conduct was excused because of laches or unclean hands.
Calypso Wireless, Inc. v. T-Mobile USA Inc., E.D.Tex., March 05, 2015 (NO. 2:08-CV-441-JRG-RSP)
Judge: Roy Payne
Holding: Motion for Sanctions Denied
Last March, Judge Payne denied the defendant's motion for sanctions under 35 USC section 285. Following the Supreme Court's issuance of two new cases, familiar to readers, the Court sua sponte issued this amended order supplementing the prior opinion to reflect the change in the standard of proof and legal standards.
At issue in this motion was the defendants claim that the plaintiffs conduct in the case was exceptional because (1) the plaintiffs conduct allegedly amounted to litigation misconduct, and (2) it pursued a theory of infringement based on a construction of a term that it contended meant that the case was either objectively baseless, or brought in subjective bad faith.
With respect to the claim of litigation misconduct, the defendant identified several facts that it contended supported its claim that the plaintiff pursued the case in a vexatious manner. The Court concluded that the defendant had not demonstrated by a preponderance of the evidence that the case "stands out from others" with respect to the substantive strength of the plaintiffs litigating position or the manner in which the case was litigated, and accordingly was not exceptional on this ground.
With respect to what it characterized as the defendant's primary theory – that the plaintiff knew or should have known that it was pursuing an objectively baseless claim construction theory and thereby an objectively baseless theory of infringement - the Court concluded that while the plaintiff's theory of construction ultimately proved incorrect, considering the totality of the circumstances, it found that the claim construction position was "simply not one that would make this case stand out from others" on this ground either. "The Court ultimately concluded that T-Mobile had the better argument in its Markman ruling," Judge Payne wrote, "but the Court only did so after 15 pages of analysis." It went on to observe the following:
It is the Court's experience that parties in patent litigation suits almost always have conflicting (often substantially conflicting) interpretations of patent claims–and theories of infringement, non-infringement, and validity based upon their interpretation of the patent claims. Accordingly, the Court does not consider a case “exceptional” simply because there is dispute over the construction of patent claims and that a defendant or plaintiff's construction proved to be incorrect–there must be more.
Judges: Wallach, Taranto, Chen
Holding: Grant of Motion for Summary Judgment of Invalidity Reversed
I don't usually post on Federal Circuit cases, but this one I thought deserved a quick shout - and after a sharp-eyed reader pointed out that I was referring to a different grant of a SJ of indefiniteness to AU Optronics by Judge Davis, and not the one the Federal Circuit was passing on - a quick correction.
Almost three years ago, I posted on Judge Davis' grant of summary judgment of invalidity in a different case, Advanced Display Technologies of Texas v. AU Optronics, 6:11cv011 (7/5/12). Never at a loss for an obscure and bizarre analogy, I observed that "[t]his is how you know that Fast Times At Ridgemont High's Jeff Spicoli could not have been a patent lawyer - because this ruling would have broken his heart."
Why? Because Judge Davis' grant of the defendant's motion for summary judgment of indefiniteness in this case following claim construction proceedings, held that the patent didn't provide a way to distinguish between a modulated surface and a highly modulated surface because it provided no objective means "to determine whether a bump was 'smooth'". "I can't help but picture Spicoli trying to reason his way through this logical conundrum," I wrote. "Of course you could distinguish between modulated and highly modulated, dude, whoaaa," I could picture him saying, certain that to see it any differently would be bogus. Totally.
And remember - this wasn't the indefiniteness standard you kids have today where all you have to show is that the patent doesn't inform a person skilled in the art about the scope of an invention "with reasonable certainty." Pah! No, this was old-school, uphill-both-ways-through-the-snow "it's definite unless it's 'insolubly ambiguous'" indefiniteness. And the court still found it indefinite.
Interestingly, it turns out Advanced Display Technologies wasn't the only such case - a year and a half later Judge Davis similarly granted summary judgment in favor of AU Optronics in a different case brought by plaintiff Eidos Display, affirming a report and recommendation by Judge Love, but on the same ground - invalidity due to indefiniteness. And still under the same exacting - yet now obsolete - standard,
Yesterday the Federal Circuit reversed the summary judgment of indefiniteness in Eidos Display v. AU Optronics, et al,, holding that even under the relaxed standard (and this case is interesting in that it may be the paradoxical result that it is because of the relaxed standard for indefiniteness), the patent was not indefinite. Let that one sink in for a while.
Now I know what you're all thinking - what would Spicoli think about this? Well, remember that the Federal Circuit opinion discloses that the issue was no longer "what the hell does 'a contact hole for source wiring and gate wiring connection terminals' mean?" under pre-Nautilus law. Is it one hole or multiple holes? How could we possibly know?
Instead, the post-Nautilus question was instead what would this limitation suggest to someone knowledgeable about LCD manufacturing? Informed by such a person (such as his history teacher Mr. Hand, shown at right), I think Spicoli would agree with the Federal Circuit that the limitation would clearly, clearly indicate that separate holes would be required, and the idea that it would require only one hole would be deeply, deeply bogus.
So while Spicoli might remain baffled at the outcome in Advanced Display Technologies because obviously he could distinguish between modulated and highly modulated, I think Eidos Display would make some sense to him, (although the Court would have totally lost him on the steering wheels analogy).
Pursuant to his announcement in January 2014, U.S. District Judge Richard Schell of Plano took senior status yesterday, following more than 25 years of service on the Eastern District bench, ending the district's brief ten week honeymoon of having all eight judgeships filled.
Judge: Don Bush
Holding: Petition for Habeas Corpus Relief Denied
This opinion by Judge Bush in Plano provides a good overview of the contours of habeas petitions, which make up a substantial portion of the cases filed in federal courts. The writ of habeas corpus, also referred to as the Great Writ, is used to determine if the detention of a prisoner is valid. A writ of habeas corpus, i.e. "you have the the body" from Latin, is used to bring a prisoner or other person before the court to determine if the person's imprisonment or detention is lawful.
Essentially, an inmate, usually proceeding pro se, files a motion to vacate, set aside, or correct sentence pursuant to 28 USC section 2255, challenging constitutional violations concerning his conviction. Such motions are typically referred to magistrate judges for findings of fact, conclusions of law, and recommendations for the disposition of the case by the district judge pursuant to 28 USC section 636 and the Amended Order for the Adoption of Local Rules for the Assignment of Duties to the United States Magistrate Judge in the Eastern District.
The first step in a habeas petition is a conviction of the movant, followed by a sentence of imprisonment. In some cases, the conviction is followed by a direct appeal to the Fifth Circuit, which is unsuccessful or, as in this case, dismissed as frivolous.
What happens next is that the movant files a motion pursuant to section 2255, asserting that he is entitled to relief because of alleged errors in the conduct of his case. Typically there are complaints regarding the performance of trial counsel or appellate counsel, usually that there was ineffective assistance of counsel at each critical stage of sentencing of and appeal. Or the alleged error may be by the trial court or the Government.
In any event, as Judge Bush noted here at the outset of his discussion "a section 2255 motion is 'fundamentally different from a direct appeal'" and only a limited range of claims may be raised, compared to a direct appeal. Errors of law are not enough – the error must be of constitutional or jurisdictional magnitude.
In this case, movant Smith (no relation) actually was not convicted of a crime - he signed a plea agreement which included a waiver of proceedings under section 2255, which the Court noted was permissible. Thus this case does not have the usual recitation of alleged errors during the trial or appellate process (I know - I'm disappointed as well). Instead, the core of the ruling was the Court's review the terms of the plea agreement, including all of the actions that took place at the plea hearing, during which the Court questioned the movant and explained his rights and what he was giving up as a result of his plea of guilty. After an extensive recitation of the facts surrounding the plea, Judge Bush concluded that the plea was in fact voluntary and knowing, thus the waiver must be enforced. The court also noted that the claims of ineffective assistance of counsel did not affect the plea or waiver it self, thus they did not provide relief either. Out of an an abundance of caution, the Court also discussed the movant's claim that the government breached the plea agreement, and concluded that this was not the case. Finally, the court reviewed the standards for a certificate of appealability of a final order in a section 2255 proceeding, and concluded that the movant had not met the standards for such relief
To wrap everything up, Judge Bush recommended that the movant's motion for relief under section 2255 be denied, the case be dismissed with prejudice, and the request for a certificate of appealability denied. He concluded by setting forth the timing and substantive requirements for objections to the findings and recommendations he had just made, and explained the consequences of failure to file objections.
I am a little behind on this post since much of last week was either weather days or seminar, but I wanted to note that last Tuesday a Tyler jury returned a verdict in favor of plaintiff Smartflash against defendant Apple. The jury in Judge Rodney Gilstrap's court found that all three patents were infringed, infringed willfully, were not shown by clear and convincing evidence to be invalid, and set damages at $532.9 million.
Judge: Michael Schneider
Holding: Motion for Application of Collateral Estoppel Granted
Sometimes a verdict doesn't even get to the appellate stage before it is reversed.
In 2009, the plaintiff in this case filed a patent infringement action against multiple defendants in the Eastern District of Texas. The cases were subsequently transferred to the Northern District of California. While that litigation proceeded, the plaintiff filed a subsequent case against defendant Texas Instruments.
Last spring, the Court conducted two jury trials in this case. The first found that the asserted claims (the "Early Transmit Patents") were not shown to be invalid by clear and convincing evidence, and the second found that the asserted claims were infringed and assessed damages of $3 million. While the Court entered a final judgment after rejecting the defendant's equitable defense of laches, the court specifically noted that it was still considering the issues raised in the parties' postverdict briefing, including the validity of the Early Transmit Patents.
While the post verdict briefing was pending, the Northern District of California invalidated the early transmit patents. After TI notified the Court of this action, Judge Schneider ordered the parties to brief the applicability of collateral estoppel in this case, and concluded that it did apply. Accordingly, the court held that the plaintiff was precluded from recovering on the damages awarded for infringement in this case because the patent have now been declared invalid.
I was privileged to participate in the 12th annual Dr. Kenneth Street Law Symposium at Austin College in Sherman last Friday, which was themed as "Emerging Trends in the Federal Courts." The symposium began with a luncheon address by Fifth Circuit Judge Patrick Higginbotham, which was then followed by three panels on trends in (1) appellate courts; (2) criminal cases; and (3) intellectual property and commerical innovation.
Accompanying Judge Mitchell on the third panel was moderator Robert Greeson, myself (hmm, three Baylor lawyers - this could get interesting) and technology entrepreneur Mike "Norden" Pisterzi, so called because he was the designated bomb-thrower for the panel, a role he excelled at, using his experience in intellectual property investment to shed light as well as heat throughout the discussion.
It is a bold statement to claim that a 75 minute panel is entertaining to anyone but the people on it, but we sure tested that, with a thoroughly enjoyable (at least for me) discussion on patent litigation in general, the effect of recent Supreme Court cases on practice, commercial innovation and investment, and when advisory opinions are and are not forthcoming. The discussion was forthright, candid, impassioned, and even tearful at times (and that was just Mike). I had a great time, and hope that the attendees did as well.
Thanks to Austin College for inviting us - it's always good to get to talk to students and practitioners about the interesting fields we practice in.
Judge: Richard Schell
Holding: Motion to Strike Granted in Part As to Economist
In a prior ruling in this case, Judge Schell addressed the issue of pre-– suit damages, and defendants' argument that the plaintiff's failure to mark its product with the asserted patent precluded it from obtaining damages that predate the filing of the lawsuit. The Court determined that genuine issues of material fact existed regarding the plaintiff's compliance with the marking statute, and denied the motion for summary judgment on this issue. For the same reason, the Court denied the request to exclude the plaintiff's damages expert.
However, having previously determined that the plaintiff had failed to create a genuine issue of material fact with respect to whether the defendant sold or offered to sell the plaintiff's patented invention, except for the percentage of sales of the accused devices discussed in a specified declaration, the Court granted the defendants' request to exclude the expert's opinion regarding damages outside this percentage.
The Court noted that the parties were also in something of a snit over the weight to be given the experts conclusions. It observed that the expert could use evidence that was "reasonably relied upon by experts in the particular field in forming opinions or inferences on the subject" even if the evidence was not otherwise admissible, as provided for in FRE 703. However, it found that the remainder of the parties' arguments went either to the nature of the evidence relied upon, which was covered by Rule 703, or to the expert's resolution of the available evidence, which was sufficiently reliable, the court concluded, to support its admission. "Sorting through the competing conclusions drawn from the available evidence is a task best left to the jury," it wrote.
Judge: Don Bush
Holding: Motion to Dismiss Granted in Part
Judge: Amos Mazzant
Holding: Motions for Partial Summary Judgment Granted
This is a construction bond case in which plaintiff sought relief on several payment and performance bonds, asserting that the defendants failed to indemnify them when the plaintiffs received claims and incurred losses on each of the bonds.
After reviewing the applicable standards, the Court granted the partial summary judgment in the plaintiff's favor (the "partial" was because the plaintiff did not seek summary judgment on one of the bonds), finding that it had established both liability and damages in its motion. The defendant won partial summary judgment on its argument that the homestead waiver language in the indemnity agreement was void under Texas law. As a result of the rulings, the Court found that the defendants had breached their indemnity obligations, and were jointly and severally liable to indemnify the plaintiffs in the amount of $1,262,596.69.
Immediately preceding the trial were multiple rulings by Magistrate Judge Nicole Mitchell on various pretrial motions, and orders by Judge Gilstrap on appeals of those rulings. The orders denied motions for summary judgment on invalidity, indefiniteness, noninfringement, patentable subject matter, willful infringement and indirect infringement.
A Marshall jury in Judge Rodney Gilstrap's court returned a verdict for plaintiff in Rembrandt v. Samsung last Friday. The jury found all three claims infringed, none shown to be invalid by clear and convincing evidence, and split the difference on damages between the two parties' experts at $15.7 million.
Professor Matt Dawson, affectionately known by generations of Baylor Law graduates as "Mad Dog", a towering figure in the Texas legal profession and a cherished member of the Baylor Law School family, passed away yesterday, February 17, 2015. He was 98 years of age.
A Baylor University and Baylor Law graduate, Matt was the director of Baylor Law’s top-ranked Practice Court program for 13 years.
Baylor Law School Dean Brad Toben had this to say about Matt to the Baylor Law community earlier today:
"Matt was one of the giants of our profession . . . and one of the greats of life. He was so proud of, and an inveterate cheerleader for, Baylor Law and all that Baylor Lawyers represent. He counted his years as Practice Court Professor as an apex in his long career as a trial lawyer.
Prof. Dawson was one of the early shining lights of the trial bar in Texas and was on everyone's list of greats in the bar. His practice in the courtroom was for decades a testimony to the extraordinary gifts of advocacy with which Matt was blessed. His career in the courtroom also was a testimony to the brilliance of our jury system when a talented lawyer is the steward and protector of it as an advocate.
Matt used his gifts throughout his life to serve others and was a zealous advocate for his clients, so often among the marginalized. I admired him deeply for who he was, how he lived his life, and for the example he set for all of us in the profession. This is a great loss for his family, for his friends, for our profession and for the legions who were touched by his life. The likes of him will not pass this way again.
Born in Waco on March 20, 1916, Matt's life was linked to Baylor University since birth. His father, J.M. Dawson, was the pastor of First Baptist Church in Waco for 32 years, a Baylor alumnus, distinguished author, and ardent advocate of religious liberty and the separation of church and state. In 1957, Baylor University established the J. M. Dawson Institute of Church-State Studies. Matt’s mother, Willy Turner Dawson, was a much sought after speaker across the country and worked to make sure young women attending Baylor had a suitable place to live. Dawson Residence Hall is named after her.
For a time, Matt and his siblings lived on Fifth Street in an area that became part of the Baylor University campus where Waco Hall stands today.
"I grew up on a corner of the campus, along with people like (former Watergate prosecutor) Leon Jaworski, and (famed attorneys) Gib Gayle (of Houston), and Clarence Guittard (of Dallas), all of whom lived within a few blocks," Prof. Dawson said in a 2006 interview. "What great people to share a home like Baylor."
J.M. Dawson and other community leaders initiated a movement to build Waco Hall as part of a successful attempt to keep the university in Waco. As a result, the Dawson family moved to the corner of Eighth Street and Speight Avenue. Matt and his four other siblings — brothers, Leighton and Joe, and sisters, Alice and Donna — grew up among the children of Baylor professors and the workers of a nearby cotton mill.
In an oral history conducted in 2010 for the Baylor University Institute for Oral History, Matt recalled his childhood in the 1920s. Matt said he would mow lawns for 10 cents each to earn money to go to the movies. He also described a raucous childhood that included frequent schoolyard brawls with classmates and hitchhiking with a group of friends to Galveston when he was just 15.
Life was much different in the Dawson household with his loving and endearingly eclectic parents.
"Let me portray them this way," Matt said in his oral history, "both my father and mother were not only dearly loved, but dearly respected; very, very much so. And on the other hand, they were unlike any other parents that you may have known in that they were very liberal with their children."
"It was a rather happy-go-lucky family all around, if I’d have to describe it," he added.
His parents were often away as they traveled the state and country speaking and preaching. When at home, however, Matt recalled the dinnertime debates in which the whole family would participate. Matt's father would choose the topic and assign sides. The future lawyer called those family debates his first introduction to advocacy. Matt always wanted to be a lawyer, even attending local trials when he was a boy.
Matt graduated from Waco High School in 1933 and promptly enrolled in Baylor University, where he was involved in debate and theater in preparation for becoming a trial lawyer. In 1938, he graduated from Baylor University with a Bachelor of Arts in English and Speech, and from Baylor Law School. He was 22. Matt also completed post-graduate work at what is now the University of Wisconsin-Madison. Matt’s older brother, Leighton, also graduated from Baylor Law School.
At Baylor, Matt met the man who would become his lifelong friend, Abner V. McCall. It was a friendship nurtured by their differences: the man with the lively family and sharp tongue complemented the orphan with the agile mind.
Before the two graduated from Baylor Law School, they were chosen by Baylor Law professor and Chief Justice of the Texas Supreme Court James P. Alexander to clerk for him.
After graduating from Baylor Law, the formidable duo literally hit the road, hitchhiking to Houston to look for work. The pair turned down two job offers because they would get little time in the courtroom, so they headed to Longview, a prosperous oil city in East Texas with a desperate need for lawyers.
"The lawyers there were overwhelmed and referred to us every old dog of a lawsuit that we were willing to take on, and which we later tried the fool out of, gaining invaluable experience even though we lost," Matt said. "We lost a hell of a lot of them!"
Matt’s law practice with McCall started dissolving when the latter returned to Baylor Law to begin teaching. It finally ended when Baylor Law School was closed for the duration of World War II and McCall joined the FBI when the military did not allow him to enlist due to physical reasons.
Matt continued practicing in Gregg County until he was persuaded to run for the county judgeship there in 1942. The young lawyer defeated a field of 12 more-seasoned candidates to win the Democratic primary, ensuring a win in the general election. His tenure as Gregg County Judge was tumultuous as he set about cleaning up corruption in county government and encountering the expected resistance.
Matt served as Gregg County Judge for almost two years until he joined the Navy in 1944 and was stationed in San Diego. By that time, Matt, now 28, had been married to his beloved wife, Princess Louise, for five years and had two children.
Because he was comparatively older than most of the recruits around him, Matt was made a company commander. During basic training he was assigned lifeguard duties and would spend hours hauling struggling fellow "boots" out of a training pool. After basic training, Matt was assigned hospital duties where he helped to care for men who were wounded in battle or injured in training exercises.
"A bad assignment that I had at times, that was really pitiful, were those boys who had broken their necks and backs — quadriplegics," Matt said. "And they would cry and their mothers would come. They knew they were going to die because there was no healing of that at that time, like there is today. They knew full well they didn’t have long."
Toward the end of the war, Matt was assigned to the Marine Corps to interview and to help transition men who had been fighting for years as they were released from service and going home.
"They entered the war as youngsters, because that’s what most of them were." Matt said. "Eighteen, 19-year-old boys right out of high school or in high school, and growing up in three or four years of their life in the military in a war. Their lives were not normal."
In 1946, Matt received an early discharge and was back home in Texas by Christmas. But life for him also had changed dramatically.
"I had no job. I had a wife with another child on the way and they replaced my position as judge (in Gregg County)," Matt said. "I was invited to join the law firm that my brother (Leighton) was in, and so I accepted the position."
The young family then started a new life in Corsicana, with Matt now working at the firm of Davis, Jester, Tyson & Dawson. Matt would stay at the firm working as a trial attorney from 1946 to 1971, when he joined the Baylor Law School faculty.
In those 25 years, Matt became renowned in Texas legal circles as a trial lawyer who was fierce, tenacious, and effective. He learned early that "getting" the jury was the key to winning a case and he excelled in that pursuit.
"Fortunately, I started practicing law at a time when there were still a lot of the old legendary, great trial lawyers still around," said Noley Bice (LLB '62), retired Senior General Counsel at Baylor University. "All of us who aspired to be litigators sought out their names and took every opportunity to watch them in action when we had the chance. These ‘greats’ were generally up in years and had become progressively better with the experience of numerous courtroom battles.
"Early on, I was alerted to this fellow from Corsicana who had a reputation for kicking the opposition around in several venues around the state," Bice continued. "With his reputation, I looked upon Mr. Dawson as one of the ‘elder’ statesmen. It was quite a surprise to me to learn that when I reached that conclusion, Matt was only about 45 years old. His approach to trials put him on the ‘Litigation Honor Roll’ earlier than most."
The tough-as-nails litigator who "left no stone unturned," Matt also was remarkably generous, Bice said. "He was quick to give credit to his co-counsel, claiming none for himself," Bice said. "Just as he could in stern fashion destroy his opposing counsel in court, he could be the most gracious person that one ever met. I know that a lot of folks from his PC class might not believe that, but working with him was a joy."
In 1971, after 35 years of trying lawsuits and learning lessons from his adversaries, legendary trial lawyer Matt assumed the mantle of law professor and director of the Practice Court program at Baylor Law School. His demand for excellence earned him the affectionate nickname "Mad Dog" among his students. Matt also was nationally renowned for the success of his mock trial teams, and held close the axiom, "[t]he true mark of a teacher is the students who surpass him." The success of his mock trial teams, which won two national competitions and nearly every regional competition in a period of 10 years, is a testament to his teaching.
Under Matt, the PC program added "mini-trials" that consisted of opening statements, examination of witnesses, and final arguments. The mini-trials became the model for the mock trials at the National Trial Competition, sponsored by the American College of Trial Lawyers. The mini-trials lasted up to six hours with as many as eight witnesses permitted.
"To this day, I have a vivid recollection of him coming into our mini-trial in the old law school (Morrison Hall), in the middle of the trial, to watch us try a case he had never seen before," said current Baylor Law Practice Court Director Jerry Powell (JD '77). "He listened for about two minutes, grasped immediately the nature of the case and the issues that were important, and began to school us on how to try the case. He took over the cross examination of the witness that I was struggling to examine, and I sat in wonder and awe. How did he know to do what he did? He was masterful. He truly inspired me to want to become a great cross-examiner like him."
As a result of Matt’s mini-trial competition innovation, Baylor Law awards the "Mad Dog" — an 18-inch bronze statuette of Matt — to the student winner of the Bob and Karen Wortham "Mad Dog" Practice Court competition, Judge Wortham being among the legion of admirers of Matt.
During his tenure as PC director, Matt also had every student create an appellate record following the trials and required the preparation of appellate briefs for the appeal.
Along with Powell, Baylor Law Prof. Jim Wren (JD '80), also a PC instructor, studied under Matt and was a member of the 1980 National Trial Competition team that brought home the championship.
"I grew up knowing Matt Dawson, and I specifically came to Baylor Law because I wanted to be trained by him," Wren said. "He was a hard-driving mentor. Once I survived Practice Court, I came to understand that he pushed hard because he cared deeply.
"Matt believed in winning, and he believed in relentless preparation to make that happen," Wren added. "I had the good fortune to work on cases with him after graduating from Baylor Law, and he definitely modeled what he taught."
Years after graduating from Baylor Law, Powell also worked side-by-side with Matt in the courtroom. "I remember being co-counsel with him on a case in El Paso," Powell said. "I watched him take the lead on a venue hearing, arguing the law to the court with great facility and a style that made you trust everything he said. They say that you may not remember what a great speaker says, but you never forget how he made you feel. I don’t remember a single argument that he made. But as I watched him in action that day I was so proud of him — proud that he had been my teacher."
After Matt retired from teaching in 1983, he resumed his profession as trial lawyer for another two decades. His long list of professional honors include such distinctions as Fellow of the American College of Trial Lawyers — the first inductee from a small Texas city; Outstanding 50-Year Lawyer, as named by the Texas Bar Foundation; one of Texas Lawyer's 100 Lawyer Legends of the 20th Century; and Texas Monthly's oldest Super Lawyer for 2005, 2006 and 2007.
With all he accomplished over the more than 65 years of his practice as a trial lawyer, Matt always has held that his greatest achievement and honor was as a teacher of law at his beloved Baylor Law School. Matt repeatedly talked about how important scholarship endowment is to the Law School because he saw a Baylor Law education as an opportunity that had to be available to those deserving the privilege even if they could not otherwise afford it.
In 2009, a life-sized bronze statue of Matt was unveiled at the Sheila and Walter Umphrey Law Center and stands watch outside a Practice Court classroom.
Matt was preceded in death by his wife of 60 years, Princess Louise. He is survived by five children and their spouses, Donna and Dr. Robert Fisher of Phoenix, Ariz.; Rebecca and Jon Brumley of Fort Worth; Mark Dawson of Waco; Carol Dawson of Austin; and John and Allie Dawson of Henderson. He also is survived by numerous grandchildren, great-grandchildren, relatives and dear friends.
I had Mad Dog for Practice Court. I will never forget that daunting experience. I can still remember . . . Yet, I believe I speak for all who had the privilege of learning from Matt in saying that we would not trade that opportunity . . . or the memories . . . for anything. Whether you’re in the courtroom or not, we all owe a debt of gratitude to this great man and great lawyer."
Sanctions orders are traditionally relatively rare in the Eastern District of Texas, in part because so many lawyers in the district are repeat players, and have a clear understanding what conduct Eastern District courts believe is and is not appropriate.
However, from time to time there are factual situations that generate sanctions orders that provide us all with some useful data points on what conduct is not proper.
How Not to Read a Calendar
For example, in a recent patent case in Marshall in which the defendant was represented solely by an out-of-state attorney, the court addressed a motion to compel on emails. The parties had agreed on search terms, but were not able to come to agreement on a date for production. The court declined to accept the representation that the party was "trying to get it as quickly as they possibly can," and pressed for a date certain. The party's counsel then offered two weeks, with a representation that it would try to get it before then if it could. Unfortunately the party didn't make that date, but instead produced several hundred thousand pages of documents approximately a month after the deadline.
"The most troubling aspect of this record," the Court observed was that counsel "continue to maintain that his clients complied with the court's order. When asked, point blank, 'and you still contend that you complied with this order?' he responded 'I do, Your Honor.' The court finds this lack of candor to be below the standard expected from officers of this court." (Emphasis mine). The order went on to state that the court believed that the party had a "fundamental misconception" about what it means to comply with an order to produce by documents by a certain date and to clear this up specifically rejected the position that a party can withhold from production any documents that hit a "privilege screen" composed of certain keywords designed to indicate which documents might be privileged, and then produce those documents after the deadline. Such privilege screens can be used to assist their review of documents, the Court observed, "but the law requires this review to be accomplished in time to produce all non-privileged documents by the deadline, and provide a privilege log listing the documents withheld by that deadline as well." Again, keep in mind that this was a case where the Court set an outer limit deadline - which was one that the producing party proposed, and never sought to have modified.
With respect to a remedy, the court declined to strike witnesses, and concluded that there did not appear to be a deliberate attempt to delay the production, but instead a failure to devote the additional resources necessary to comply or to properly confer with opposing counsel and seek leave of court to adjust the schedule for document production when it potentially became necessary. The court did, however, assess as a sanction all expenses, including reasonable attorneys fees, incurred by the plaintiff as a result of the need to file and argue the underlying motion to compel and motion for sanctions. The parties subsequently met and conferred on the relevant amount and reached agreement on $30,000.
"Complete good faith compliance with protective orders is essential to modern discovery practices"
In another patent case, the defendant asserted that plaintiff's counsel disclosed information protected by the amended protective order entered in the case three times in an unrecorded hearing at the Patent Trial and Appeal Board (PTAB). The court disagreed with respect to two of the three asserted improper disclosures, but did agree that there had been disclosure of information regarding the defendant's litigation budget and revenues, both of which were designated as confidential under the protective order entered by the court in the case. The Court found the disclosing that information to the PTAB panel violated its protective order, and was conduct subject to sanction.
With respect to the appropriate sanction, while the Court directed the plaintiff to join in a motion with the defendant to the PTA be requesting that the information be sealed, it did not consider that requirement to be a sanction, let alone one sufficient for deterrent purposes.
In determining an appropriate sanction, the Court found that plaintiff's counsel's conduct was far less egregious than conduct referenced in cases cited to the court, and concluded that defendant's counsel had failed to mitigate the breach. Accordingly, it denied the defendant's request for attorneys fees. However, the Court noted "the need to promote respect for, and meticulous observance of protective orders, to deter plaintiff from repeat offense, and to deter others from similar conduct" as important objectives, in addition to the factors that look to the actual injury to the aggrieved party and that party's efforts to mitigate damage.
"Complete good faith compliance with protective orders is essential to modern discovery practices," the Court wrote, "and counsel must temper their zeal and representing their clients with their overreaching duty as officers of the court. Given the amount at issue in this case, and the importance of scrupulous adherence to protective orders in intellectual property cases to promote the exchange of confidential and proprietary technical information, the court finds that a sanction of $2,500 is the least onerous sanction that is sufficient to remind counsel of this duty, deter future violations in the suit, and serve as an adequate general deterrent for similar conduct. A lesser sanction would not be sufficient to achieve these objectives."
Every so often it's appropriate to acknowledge the greatness of the late Jackie Gleason as Sheriff Buford T. Justice in the 1977 classic Smokey and the Bandit. (Even if they did get the law wrong on where geographically in relation to Texarkana beer can be purchased. Or so I've heard). If you haven't watched it lately, you need to. It's one for the ages.
Now that that's out of the way, I wanted to put in a plug for this year's TexasBarCLE 2015 Federal Court Practice seminar, which will be held in Dallas this year, at the usual location at Cityplace Events on May 15, 2015.
The course is good for approximately 6.75 hours, including 1.75 ethics hours expected. To register go here.
I will be speaking on trial procedure in federal court again this year, and am really looking forward to it. It is always a good day finding out about recent developments in practice in federal court, including new case law, practice pointers, and information you need to know about electronic filing.
Judge: Roy Payne
Holding: Defendants Motion for Partial Summary Judgment and Objection to the Admissibility of Expert Testimony Denied; Motions to Exclude Evidence of Testing Denied
Defendant Ford sought summary judgment as to the plaintiffs remaining claim for design defect, asserting that the plaintiff had no admissible expert testimony on the required element that there have been a "safer alternative design", because the plaintiff's expert purportedly left and "analytical gap" that is only bridged by the "ipse dixit" of the expert. (I miss products cases like this - I really do. These were fun motions to write and respond to). Finding that the issue of whether the plaintiff's expert's testing was sufficient was a disputed issue of fact the must be decided by the jury, or by the Courtafter trial, Judge Payne denied the motion.
Ford also sought to exclude the testimony of the plaintiff's forensic pathologist on the issue of whether a safer alternative design existed. Again, the court found that this issue went to the sufficiency of the expert's data, and not his methodology, and denied the motion.
The court's order also addressed two additional matters raised by defendant Ford's motions in limine.
The first sought to exclude all evidence of Insurance Institute for Highway safety crash testing of a 2001 Ford F-150 pickup truck as insufficiently similar to the vehicle at issue. "The critical issue on this motion," Judge Payne wrote, "is whether the admitted differences between the different vehicle platforms would so affect the test results as to make them impossible to reliably compare. Plaintiff has presented well-qualified experts who have employed seemingly appropriate methodology. This is a question of fact that cannot be resolved on this record. The issue will be put to the jury in the form of the question as to whether [plaintiff] has carried the burden of proof on the design defect." Accordingly, the motion was denied.
The second issue involved a similar question of whether the testing of a successor vehicle platform should be admitted. Ford challenged its admissibility as impermissible evidence of a subsequent remedial measure, despite the fact that the injury occurred seven years after the successor platform was introduced. The Court denied the motion, finding that Texas law required the plaintiff to show that a safer alternative design existed, and that the evidence was relevant to prove that the design at issue would have avoided or lessened the injury.
"Serious Skepticism" - what a court has about a party's position immediately before overruling it. Example: "The Court displayed serious skepticism when the party claimed it just had 'a couple more questions.'"
For more patent litigation dictionary entries, see here.
Judge Rodney Gilstrap
Holding: Motion to Transfer Venue Granted
Judge Gilstrap noted early in this opinion that the central issue regarding this transfer motion was a patent license agreement entered into between defendant Canon and a third-party, which was the plaintiff's predecessor in interest. Because the license agreement contained a forum selection clause, the court was required to answer a series of threshold questions regarding its validity and application, including whether the defendant had waived application of the forum selection clause.
The Court concluded that the clause had not been waived, and that under the framework set forth in the U. S. Supreme Court's recent Atlantic Marine case, Canon had shown that the transfer was warranted, and the plaintiff had not met its burden of establishing the transfer to the forum for which the parties bargained was unwarranted.
In so doing, the Court noted that the result that it reached was unique to the current case because the plaintiff both opposed the forum selection clause and raised the dispute that called into question the very essence of the contract, thus putting the facts of the dispute squarely within the scope of the license agreement. The result might have been very different, the Court observed, if it perceived that the party who asserted the forum selection clause was attempting to manufacture a contract dispute simply as a means to import a favorable form selection clause into the venue analysis. "The Court will look with serious skepticism on parties that assert that a forum-selection clause of an (otherwise ancillary) contract when the real dispute is clearly not wedded to the contract containing the forum-selection clause." Accordingly the defendant's motion to transfer venue was granted.
I realized last Friday that one indication you have been away from home too long is when you can't remember the security code for your own house. I did eventually figure it out, but it reminded me that I need to go back and start catching up on weblog posts. Being home two days out of 11 will do that to you.
The first one I wanted to make, before it gets away fro it's what m me, was that I presented a paper on technology in a trial practice at the State Bar of Texas litigation update seminar in San Antonio last Thursday. It was an interesting topic, in which I covered some of the changes to law offices in recent years, developments in technology, and the latest pointers on the paper–less office, as well as insights into personal productivity as it applies to the practice of law. For the first time, I was able to present to a group of lawyers some recent research on the benefits of reviewing documents on paper as opposed to electronically, as well as the benefits of taking notes on paper. The topics are always fun to present on, but especially when you can present some counterintuitive results.
I really enjoyed watching faces in the audience brighten up when I started giving them information regarding studies that indicated that they were already doing things the right way for them. Audiences seem to expect that they are going to get a lecture that continuing to use paper in any form verges on either the unethical or the immoral, and it is nice to be able to tell them some of the good uses the paper can be put to. (This advertisement for paper paid for by the East Texas Association For Cutting Down Lots of Pine Trees for Pulpwood).
A Marshall jury in Judge Rodney Gilstrap's court returned a verdict Friday mid afternoon in Droplets v. Overstock.com and Sears. The jury found that the asserted claims were infringed, were not shown by clear and convincing evidence to be invalid under any of the at theories asserted, and awarded a total of $15 million, apportioned $4 million against Overstock and $11 million against Sears.
For comparison purposes, the plaintiff had sought $32 million against the defendants combined, and the defendants' damages expert proposed $250,000.
The January issue of the Texas Bar Journal means another "Year in Review" where commentators around the state describe the important developments in numerous fields of practice during the previous year. The articles can be found here, and my summary of the year in patent litigation in Texas can be found at page 39. All of the issue's articles can be found here.
A few days ago I noted that until last week, over the last two years the Eastern District of Texas was tied at ten plaintiff verdicts and ten defense verdicts, with each side also having one win in the two invalidity-only trials. Then last week Uniloc broke the tie in plaintiff's favor last with a verdict in the plaintiff's favor.
But yesterday a Marshall jury in Judge Roy Payne's court rendered a verdict in favor of defendant Samsung in MTC v. Samsung, bringing us even again. (Plaintiff was seeking $132 million). The verdict is of interest for another reason. This was the second MTC case to go to trial in Marshall - last month MTC prevailed against defendant Apple on nine of the twelve asserted claims, winning damages of $23.575 million.
So we end the year with the verdicts evenly split between plaintiff and defendant in infringement cases, in invalidity-only cases - and even in cases involving the same patents by the same plaintiff in the same court with the same judge - but involving products by two different defendants.
Judge: Ron Clark; Amos Mazzant
Holding: Defendants' Motion for Summary Judgment Granted in Part and Denied in Part
Judge Clark adopted Judge Mazzant's report and recommendation on the Defendant's motion for summary judgment, which had recommended granting the motion as to one defendant, but not the other.
Judge: Rodney Gilstrap
Holding: Motions for Sanctions Denied; $10,000 Assessed for "Sanctions First" Approach
Two months after the filing of the plaintiffs complaint, defendant notified the plaintiff that it intended to file for sanctions under Rule 11, alleging that the plaintiff's complaint was so frivolous that it constituted sanctionable conduct because a particular element was allegedly absent from the accused product. Plaintiff responded by asserting that a Rule 11 motion would itself be sanctionable in light of the support for the plaintiffs claims.
Judge Gilstrap addressed the two motions together, following a hearing on December 4, 2014. His order denying both motions noted that the parties had filed over 1700 pages of briefs, supporting declarations and documents, and that the ten accompanying briefs contain arguments that are traditionally dealt with during summary judgment or claim construction briefing.
In order to rule on the motions, the Court was required to determine whether the plaintiff's pre-suit infringement analysis and application of its allegedly nonfrivolous construction to the facts was reasonable. It did not finally construe the claims at this stage, but did use guiding principles of claim interpretation to determine what is and is not frivolous.
After doing so, it concluded that the defendant's arguments did not overcome the plaintiff's suggested construction to the degree necessary to place the plaintiffs construction beyond the showing that "no reasonable litigant could believe it would succeed" necessary for sanctions. It similarly concluded that the plaintiff's pre-suit infringement analysis was reasonable. For the same reason, it denied the plaintiff's motion asking it to sanction the defendant for the filing of its sanctions motion, finding that the motion was not so frivolous that no reasonable litigant could have believed it would succeed.
You may be asking yourself why didn't the defendant seek a "mini Markman" on the single term instead of moving for sanctions first? Judge Gilstrap did in fact ask defendant's counsel why it had not sought early claim construction and summary judgment as to the single dispute regarding the claim term, rather than immediately seeking Rule 11 sanctions, noting that it preferred these alternatives to the sanctions motions that were filed. (Note: I typically don't note when parties do and don't use local counsel, but in this case it bears mention - Defendants' three counsel filing the motion for sanctions had, on average, two cases in the Eastern District prior to this case, and they did not have counsel from the Eastern District, where the "mini-Markman" process Judge Gilstrap referred to has been part of the courts' toolbox for several years, and there is a well-established local culture when it comes to when and how sanctions motions are asserted. Hint: this isn't it).
In conclusion, the Court noted that following the cross–motions for sanctions, both parties found themselves left with heightened emotions and a tainted environment at a relatively early stage in the litigation process." It then went on to address the "sanctions-first" strategy used in this case for future litigants:
The Court looks with disfavor on both parties’ motion practice for these reasons, but especially on that of the Defendant who started what became a 10-brief, 1,700 page escapade. Furthermore, in nearly all the cases cited by both parties, the Rule 11 motions were brought after the Court made a determination on the merits of the case; not as a first option. The Court looks with particular skepticism on sanctions motions brought immediately after joining issue and well before any type of discovery has taken place. While perhaps unwise (for the reasons stated above) and often premature, it is not patently improper to bring a Rule 11 motion for sanctions at this very early point in the litigation. The Supreme Court has made clear that “Rule 11 is aimed at curbing abuses of the judicial system,” Bus. Guides, Inc. v. Chromatic Commc'ns Enters., Inc., 498 U.S. 533, 540 (1991) (internal quotation marks omitted), and the Federal Circuit has suggested the same. However, under the guise of being an abused party, the Defendant ultimately abused the Court through the excessive filing of 10 briefs and 1,700 pages through which the Court had to wade, only to conclude that neither motion was well-founded. For this reason, and as a means of cautioning future litigants against ill-conceived decisions to immediately move for sanctions as a “first option,” the Court uses its inherent authority to tax a portion of the costs of responding to and defending Viora’s motion against the Defendants. It is ORDERED that Defendants jointly pay to Syneron its costs of defending against Viora’s motion for sanctions up to but not more than $10,000.00. Such payment shall be made within seven (7) days hereof.
Judge: Amos Mazzant
Holding: Defendant's Motion for Summary Judgment of No Wrongful Termination of Benefits Granted
Plaintiff claimed that the defendant insurance company wrongfully terminated his disability benefits. After reviewing the underlying facts and the standard of review for summary judgments and review of determinations by employee benefit plans under ERISA, the Court determined that the plan's decision was not an abuse of discretion, and that substantial evidence supported its decision to terminate the plaintiff's benefits. Accordingly, the defendant's motion for summary judgment was granted.
Judge: Richard Schell
Holding: Defendants' Motion for Judgment on the Pleadings Granted
This is an insurance coverage case. The parties filed cross – motions for judgment on the pleadings under Rule 12(c) asserting that coverage exists/does not exist in the plaintiff's breach of contract action against the defendant insurers.
Finding that the policy unambiguously indicated that it did not cover claims made before the inception of the policy, and finding that the claim in the underlying lawsuit was asserted prior to the inception of the policy, Judge Schell concluded that the plaintiff's declaratory judgment and breach of contract action could not survive the defendants motion for judgment on the pleadings.
Judge: Richard Schell
Holding: Defendants Motion to Dissolve Corrective Action Granted
The factual background for this litigation can be find in earlier opinions, including Frew v. Gilbert, 109 F.Supp.2d 579 (E.D.Tex.2000) ; Frazar v. Gilbert, 300 F.3d 530 (5th Cir.2002) ; Frew v. Hawkins, 540 U.S. 431, 124 S.Ct. 899, 157 L.Ed.2d 855 (2004) ; Frew v. Hawkins, 401 F.Supp.2d 619 (E.D.Tex.2005); and Frew v. Suehs, 775 F.Supp.2d 930 (E.D.Tex.2011). But to oversimplify, plaintiffs allege that the Texas Health and Human Services Commission and the Texas Department of Health did not adequately provide early periodic screening, diagnosis and treatment (EPSDT) services to Medicaid recipients under the age of 21 as required by the Medicaid Act.
The Court originally approved a consent decree in 1996 which set forth the compliance plan for the state's EPSDT program. The parties subsequently filed numerous motions either seeking to modify or terminate the decree. One such agreement - the "corrective action" at issue was approved in 2007 by the late Judge William Wayne Justice (shown at right in his chambers), who was overseeing the litigation at that time. In 2009, the case was transferred by Judge Justice to Judge Schell.
The defendants now sought an order confirming that they had complied with the obligations of the corrective order relating to training for pharmacists. Plaintiffs opposed. Judge Schell declined to require further action, and concluded that the relevant paragraphs had been satisfied, and no further action was required by defendants. The remaining provisions of the decree continued in force, unmodified by the Court's order
Judge: John Love
Holding: Motion for Judgment As a Matter of Law Denied
At trial, the Court granted the plaintiff's JMOL on validity as to five claims, after which the remaining claims were found not invalid by the jury, which also found five of the asserted claims infringed. The jury then assessed damages at $18.8 million.
Judge Love denied the plaintiff's motion for JMOL of validity as moot, then proceeded to the defendant's motions. He found that there was sufficient evidence to support the verdict of noninfringement as to all but one of the asserted claims, and that any complaint with respect to closing argument (and there were a few) were waived because it was not raised before the case was submitted to the jury. He further rejected the claim that there was an irreconcilable conflict in the jury's verdict for the similar reason that no objection was made.
With respect to damages, Judge Love denied the request for a new trial on damages, but did remit the damages from $18.8 million to $12.9 million based on the facts of the case.
Judge: Rodney Gilstrap
Holding: Motion for Judgment As a Matter of Law on Damages Denied
As readers will recall, this case was initially tried in January of this year, with the jury reaching a verdict that the accused services infringed each of the asserted claims, and that the asserted claims were not invalid. However, the jury was not able to reach a unanimous verdict with respect to the amount of damages. Accordingly, the court entered judgment with respect to the issues of validity and infringement and ordered a new trial on damages. On March 19, 2014, a second jury returned a verdict awarding $85 million to the plaintiff.
The defendant sought judgment as matter of law under Rule50, raising the question of whether the plaintiff had introduced substantial evidence under the plaintiffs two proffered analyses – the first based on its prior settlement agreements, and the second based on the traditional Georgia–Pacific analysis. Judge Gilstrap concluded that they had as to both.
It's Sweden/Thailand day at EDTexweblog.com as we celebrate my 12 year olds' presentations at World Bazaar to their sixth grade classmates here in Marshall. (Last year they were Greece and Turkey - weren't they cute?)
We are celebrating with a couple of JMOL rulings, one from Judge Gilstrap in the damages side of the SimpleAir litigation, and one from Judge Love in EON.
Earlier this year, in "Who're You Calling Plaintiff Friendly?" in Texas Lawyer Jeff Saltman and I analyzed the verdicts in patent cases in 2013 in the Eastern District of Texas. Well, 2014 isn't done with just yet, but I was checking my list and reading it twice in preparation for the holidays, and wanted to pass along what I have found so far for the two years combined.
Taking the two years together, we were tied at ten plaintiff verdicts and ten defense verdicts, with each side also having one win in the two invalidity-only trials, until last week. Uniloc broke the tie in plaintiff's favor, assuming no more verdicts before year's end.
A Tyler jury in Chief Judge Leonard Davis court rendered a verdict in Uniloc v. Electronic Arts, et al., 6:13cv259 last week. The jury found that the accused product infringed the asserted claim of the single patent in suit, and that the plaintiff had proven that it marked substantially all of the products it made under the patent and that it made reasonable efforts to ensure that all of its licensees did the same. With the second question providing an additional seven months for the damages, the jury assessed damages of $4,863,925.
Judge: Amos Mazzant
Holding: Defendants Motion for Summary Judgment on Affirmative Defenses of Statutes of Limitations Granted in Part
As you might guess, somebody is unhappy with their roof.
The plaintiff homeowner association brought an action against its roofing contractor almost 8 years after the new roof was installed. The roofing contractor, in turn, asserted as an affirmative defense the statute of limitations. The court concluded that there was a material fact issue on when the plaintiffs claim accrued and whether the plaintiff exercised diligence in its efforts to discover the injury, and this factual dispute should be decided by a jury, and accordingly denied the claim for summary judgment as to the claims, with the exception of the claim for implied warranty of merchantability, which was barred by the four-year statute of limitations in Texas.