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Judge Makes Lawyers Pay For Frivolous Patent Suit

ScuttleMonkey posted more than 5 years ago | from the not-making-partner-anytime-soon dept.

Patents 263

Gallenod writes "The Denver Post is reporting that the U.S. 10th Circuit Court of Appeals has upheld the decision of a Federal judge who threw out and reversed a jury decision in favor of a patent infringement claim and ordered the plaintiff's lawyers to pay the defendants' court costs. U.S. District Senior Judge Richard P. Matsch sanctioned the plaintiff's attorneys for 'cavalier and abusive' misconduct and for having a 'what can I get away with?' attitude during a 13-day patent infringement trial in Denver. With the Appeals Court in agreement, could this case be the 'shot heard round the world' in the revolution against patent trolls?"

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263 comments

And now... (0)

downix (84795) | more than 5 years ago | (#22550016)

If this is held up through appeals, will radically change the very nature of lawsuits, and not necessarily for the better. Imagine the little record label suing Sony for re-listing their catelog without permission, and Sony simply out-spends them, then forces them out of business by having them pay for the legal costs?

Re:And now... (5, Insightful)

pheared (446683) | more than 5 years ago | (#22550114)

How is that the same? The small label wouldn't be "patent trolling" since they would have a legitimate claim. They also wouldn't be displaying a let's see what we can get away with attitude. The judge made the kind of impartial corrective action they are supposed to make. If anything, this sets precedent for less frivolous lawsuits.

Re:And now... (0)

Anonymous Coward | more than 5 years ago | (#22550134)

pay for the legal costs
I am pretty sure there will be reasonable limits on qualified expenses.

Re:And now... (3, Interesting)

sm62704 (957197) | more than 5 years ago | (#22550196)

You commented kind of on what I was thinking. When is someone going to get hit with a suit for abusing copyright? After all, we can outwait patents, which only last 20 years. Copyrights are forever, or as close to forever as can matter to anyone still breathing.

Re:And now... (1, Insightful)

AmaDaden (794446) | more than 5 years ago | (#22550998)

After all, we can outwait patents, which only last 20 years.
That's part of the problem. With the way things are now people are getting patents to last for nearly a hundred years. Until people like this judge and others start fighting back it's only gonna get worse. I'm not saying all patents are bad but I am personally afraid that if I started to generate my own content that my little start up would be patent trolled out of existence. There needs to be a balance to prevent both patent trolls and pirates. Currently the patent trolls have all the power.

Re:And now... (5, Interesting)

milsoRgen (1016505) | more than 5 years ago | (#22550216)

If this is held up through appeals,
That is exactly what worries me, as FTA:

"Judge Matsch does some things that are out there, but he's usually right. Very infrequently is he reversed on appeal."
It says he is rarely revesred... But the "out there" part certainly gives me pause for thought.
However this guy has done some cool things, like halting clean dvd edits [findlaw.com] , he was involved in the McViegh trail [cnn.com] and even the Kobe Bryant trial among other things [nytimes.com] .

Re:And now... (3, Insightful)

pizzutz (1175903) | more than 5 years ago | (#22550468)

If this is held up through appeals,
That is exactly what worries me, as FTA:
Also from TFA:

"The U.S. 10th Circuit Court of Appeals saw it differently and affirmed Matsch's decision to overturn the verdict."

This has already gone through the appeals court. While they could go to the supreme court, I suspect it's done and over.

out is i? (1)

loid_void (740416) | more than 5 years ago | (#22550472)

Yes, so it is who used the words, "out there?" Qualitatively speaking. And out there may be "in there," as far as we are concerned, and on many other occasion, "right on."

Re:out is i? (3, Interesting)

hedwards (940851) | more than 5 years ago | (#22551056)

Unfortunately, right now, "Out there" could very well mean exercising some degree of intelligence and common sense.

With over 200 years of laws stacking on top of each other, stacked upon a constitution which was written vaguely in places and ammended nearly 30 times, which borrows some concepts from completely outside of those sources, it is definitely possible to justify most positions with enough technicalities.

The 2nd ammendment is a good example.

A well regulated Militia, being necessary to the security of a free State, the right of the people to keep and bear Arms, shall not be infringed.
That is taken by many people to mean that it is unconstitutional to regulate firearms. But the word firearm doesn't appear anywhere in it, nor does a word which logically extends there unambiguously. One could easily say that rights from individuals owning muskets to hydrogen bombs and mutated anthrax for duck hunting and right to form up a militia to overthrow the federal government are protected there. Almost, if not all, people will find at least one thing in that list which they don't think people should be allowed to own or possess. But those are all things which could be inferred to be protected if one wasn't utilizing enough common sense.

In this case, it sounds to me like the judge got tired of the plaintiff's attorneys disregarding courtroom procedure and tainting the results. I've often felt that judges weren't going anywhere near far enough to enforce profesional conduct in the courtroom. I'm a little bit surprised that he didn't bother to reference rule 13, IIRC.

&Standard IANAL clause;

Re:And now... (4, Insightful)

HeronBlademaster (1079477) | more than 5 years ago | (#22550746)

What's so cool about halting clean dvd edits? Do you find it morally objectionable to remove morally objectionable content from movies?

For example, I like the Matrix trilogy, but there is a completely unnecessary sex scene in the second movie. Is it your intent to force all who would wish to watch the movie to view that scene? Even "fast forwarding" still gives you glimpses, interrupts the flow of the movie, and requires either good timing or a quick backtrack-rewind to resume the movie after the scene.

Many movies are like this. If I want to see a movie without what many consider objectionable material, why are movie studios fighting this? Wouldn't they be better off releasing a clean version of the movie themselves, and keep the profit? But since they refuse to do this, then I do not think that there is anything wrong with editing a movie to clean it up.

More to the point, networks and cable stations do this regularly to air movies on TV. Rather than prohibit *other* people from editing movies, movie studios should do what they do for networks - provide a license to edit the movie.

Prohibiting things like this does nothing but reduce movie studios' monetary gains. I, for one, won't see movies that have objectionable material unless I can either buy an edited version or see it on TV (where it is edited anyway).

I'm not saying that someone should be able to buy one copy of a DVD, edit it, and sell dozens or hundreds of burned copies. I propose that every edited copy be sold attached to an original - that way the studios get their sales money. The price could be somewhat higher than the price of the original alone, to compensate the editors for their work. Additionally, whoever does the editing should need a license (or some other form of permission) from the movie studio for each movie they edit.

Prohibiting the editing of movies altogether is not the answer.

Re:And now... (3, Insightful)

milsoRgen (1016505) | more than 5 years ago | (#22550890)

What's so cool about halting clean dvd edits? Do you find it morally objectionable to remove morally objectionable content from movies?
Yes I do find that objectionable. I find intolerance of natural human functions in the media objectionable. If you can't handle it, don't watch it.

Prohibiting the editing of movies altogether is not the answer.
Yes it is the answer. Get over yourself.

Re:And now... (4, Insightful)

zmooc (33175) | more than 5 years ago | (#22550958)

So half the movie is about killing various people, people that are locked up in a slimy bath for their entire life and people's life being controlled by robots and you actually dare complaining that the sex scene is "unneccessary" while all those other disgusting parts aren't?

What is wrong with you? Do you hate to be distracted by love while watching violence? To me you appear like a very, very sick person.

Re:And now... (1)

milsoRgen (1016505) | more than 5 years ago | (#22550972)

Do you hate to be distracted by love while watching violence?
You hit that nail on the head far squarer then I ever could. Kudos to you sir!

Re:And now... (5, Interesting)

hedwards (940851) | more than 5 years ago | (#22550964)

What's so cool about halting clean dvd edits? Do you find it morally objectionable to remove morally objectionable content from movies?

For example, I like the Matrix trilogy, but there is a completely unnecessary sex scene in the second movie. Is it your intent to force all who would wish to watch the movie to view that scene? Even "fast forwarding" still gives you glimpses, interrupts the flow of the movie, and requires either good timing or a quick backtrack-rewind to resume the movie after the scene.
This sort of things is one of the things that I wanted the Blu-ray and HD-DVDs to provide. Basically the content would still be there, but people that didn't want to view it could change a setting and those things would be skipped. Kind of like a V-Chip, but far less likely to make mistakes. Bonus points if there were a way for individuals to create their own cut points to avoid things they're uncomfortable with. I've got a few things myself that I don't want to see in movies.

It really does seem like a fair compromise, people that don't want to view the material would have an easy way of avoiding it, and the people that do could do so. It would also make it quite a bit easier to separate out the "please, won't somebody, think of the children" crowd from the people that just don't want their own kids watching it.

If they really wanted to buff up the bottom line, they could probably make a feature which would do the opposite, skip all the wholesome stuff and get straight to the T&A and B&G.

Re:And now... (4, Insightful)

orgelspieler (865795) | more than 5 years ago | (#22551046)

I don't care whether you find the sex scene objectionable or not. Copyright law does not have an exception to the "derivative works" clause that allows for such modifications. Modified versions reduce the marketability of officially edited versions released for other purposes. Take Sex and the City, for instance. There are several scenes that were critical to the plot of an episode, but were "objectionable" to certain puritanical people (who apparently wield an inordinate amount of power over the FCC). Consequently, they shot several scenes twice, basically anything with breasts or a lot of cursing. One shot was for DVD and HBO, and the alternative version was for the whiners. Though, if you ask me, anybody old enough to watch Sex and the City is old enough to see the sex scenes and the occasional tit. Anyway, it allowed the writers and directors some flexibility over how the episodes were sliced and diced.

Returning to the Matrix: did you see how the original Matrix was edited for TV? Instead of "give you the finger" it was "Why don't I give you the flipper." WTF does that even mean? If I were the W bros. I'd have been a bit ticked. Also the sex scene in th sequel was tastefully done, and I thought it added a bit of gravity and beauty to what would have otherwise been a ridiculous rave scene.

Re:And now... (5, Interesting)

SatanicPuppy (611928) | more than 5 years ago | (#22550250)

The exact opposite is what happened here; a bunch of slick, highly paid lawyers smooth-talked the jury, and then the judge tossed the jury verdict and stuck the plaintiff with the costs for their litigation.

This kind of thing is most common when the lawyers get out of control...If the judge decides that the lawyers are running amok, they can throw the whole thing out and charge them with contempt or whatever. There is some precedent in also tossing cases where the juries decision contravenes the material facts of the case, but that's a much greyer area, though it has been upheld more often than not.

Re:And now... (0)

Anonymous Coward | more than 5 years ago | (#22550770)

then the judge tossed the jury verdict and stuck the plaintiff with the costs for their litigation.

Stuck the -*-plaintiff's lawyers-*- with the litigation costs. Big difference. The only downside for the plaintiff is they lost the case.

Re:And now... (2, Informative)

Hyram Graff (962405) | more than 5 years ago | (#22550470)

If you read the article, or at least the summary, you would have seen that this was held up by a court of appeals. There are only two more possible challenges left 1) an En banc [wikipedia.org] rehearing by the 10th circuit, and 2) The Supreme Court of the United States.

Re:And now... (3, Informative)

julesh (229690) | more than 5 years ago | (#22550506)

Imagine the little record label suing Sony for re-listing their catelog without permission, and Sony simply out-spends them, then forces them out of business by having them pay for the legal costs?

Funnily enough, you don't hear about this happening very often in the UK, which has a loser-normally-pays system (rather than loser occasionally pays, as in the US). Now this could be because UK law has a substantially different culture to the US (although I'm far from convinced that this is true) or it could be because the threat is blown up out of all proportion by those who have a vested interest in maintaining the status quo. Here's a suggestion: google tort reform astroturf [google.co.uk] . I highly recommend the first link that comes up, and some of the others are good too.

Re:And now... (4, Informative)

MacDork (560499) | more than 5 years ago | (#22550658)

then forces them out of business by having them pay for the legal costs?

The plaintiff's lawyers are being ordered to pay, not the plaintiff.

Re:And now... (1)

DaveV1.0 (203135) | more than 5 years ago | (#22550752)

Apparently you can't read, have a reading comprehension problem, or are just plain stupid. Those is the only explanations for your horrible supposition. The cases have almost nothing in common.

This is a case where a company hired lawyers to file a frivolous lawsuit, lost, and the judge penalized the plaintiff's law firm for it's conduct.

What you describe is a small company suing a large company and being "out-spent" and being forced to concede the lawsuit or going bankrupt. It would be pretty hard for Sony to deny that they have violated copyright law as the copyrights are on file. It would be a fairly straight forward case, and the plaintiff could file for summary judgment if Sony tried to delay the trail and the would probably get it.

Now, please show me where Sony has ever re-listed someone's catalog without permission. It seems to me that you would be more likely to do that to Sony than Sony do that to someone else. After all, look at all the people who violate copyright laws now.

Sounds like you are afraid Sony will act like, well, someone like you.

Why? (2, Interesting)

arizwebfoot (1228544) | more than 5 years ago | (#22550020)

So why did the judge reverse? I always thought that the Jury was the "trier of fact".
Aha, first post?

Re:Why? (2, Informative)

plague3106 (71849) | more than 5 years ago | (#22550066)

A judge can do that if he feels the jury made a wrong decision. I'm not sure if its only in civil cases (which this is) or in criminal cases.. although I think in criminal cases they can only throw out an improper guilty verdict, not an innocent one.

Re:Why? (1)

KokorHekkus (986906) | more than 5 years ago | (#22550194)

AFAIK that's because in U.S. criminal cases the defendant has the right to a jury trial. Changning the jurys acquittal to a guilty verdict would nullify that right.

Re:Why? (1)

sconeu (64226) | more than 5 years ago | (#22550718)

They also have a right to a jury trial in civil cases, so long as you're dealing with more than $20.

Re:Why? (1)

terrymr (316118) | more than 5 years ago | (#22550330)

It varies by jurisdiction - but most have some options for "Post verdict relief" where the evidence did not support the jury's verdict. Even in criminal cases.

Re:Why? (2, Informative)

SatanicPuppy (611928) | more than 5 years ago | (#22550418)

It's pretty much only when the jury comes to a conclusion that is in opposition with the known facts of the case, though the whole thing can be tossed because of irregularities in the conduct of the lawyers as well.

The judges also have a large amount of say in the verdict, though there they have to follow precedent and the law; if a jury tries to award an absurdly high (or low) amount of money (based on precedent) the judge can throw out or modify the verdict within the scope of the law.

Re:Why? (3, Interesting)

stratjakt (596332) | more than 5 years ago | (#22550504)

It's there when the jury, despite irrefutable evidence of innocence, decides to come in with a guilty plea, because the defendant happens to be the wrong color/sex/religion/whathaveyou. Or, when they're basically bamboozled by a slick-talking lawyer. Basically, the Judge is tasked with making sure the jury does its job properly, and if they don't, he can toss their verdict.

This, and the Judges discretion during sentencing, are very, very crucially important checks and balances in our justice system.

Mandatory sentences, three-strike laws, and other such populist "think of the children" bullcrap removes those checks and balances, so now you have people going to jail for 25 years for jaywalking, and maybe we can even return to the era of all-white juries sentencing every nigger that comes in front of them.

GO TEAM DEMOCRAT LETS SAVE AMERICA WITH HOPE AND CHANGE

Re:Why? (1)

whoever57 (658626) | more than 5 years ago | (#22550898)

I think in criminal cases they can only throw out an improper guilty verdict, not an innocent one.
You may be wrong about that -- a friend who was studying law told me that judges can impose guilty verdicts even if a jury finds the other way. Whether this actually happens, I don't know.

Re:Why? (5, Informative)

ridgecritter (934252) | more than 5 years ago | (#22550090)

Judges have broad authority to set aside or nullify a jury verdict. Usually called "judgement non obstante veredicto", or judgement notwithstanding the verdict. If the judge strongly believes the jury got the facts and/or the applicable law very badly wrong, a jnov can be entered. It's unusual, as juries are accorded very strong cred as the triers of fact.

Re:Why? (0)

Anonymous Coward | more than 5 years ago | (#22550868)

juries are accorded very strong cred as the triers of fact.

Which makes it all the more unfortunate that juries are usually very deliberately filtered down to the lowest common denominator of intelligence available in the juror selection pool.

Re:Why? (0)

Anonymous Coward | more than 5 years ago | (#22551052)

Which makes it all the more unfortunate that juries are usually very deliberately filtered down to the lowest common denominator of intelligence available in the juror selection pool.
Does that mean I can sue the state for selecting me twice for jury duty and use my IQ test results as evidence that they were guilty of defamation of character? Please provide evidence of your claims with full citations that would hold up in court.

Jury trial in this regard with class action status for all living jurors that have served could make for an interesting discussion as to whether or not it influenced the jury's decision, considering they would have an interest in the results. Wonder if this would cause the defense to be lavish in their praise of intelligent juries while being extremely careful not to use words the juries might not understand. Would love to watch the defense trip over themselves on this.

Re:Why? (1)

calebt3 (1098475) | more than 5 years ago | (#22550096)

I think juries are mostly for criminal cases. When corporations are involved, want to bribe as few people as possible.

Refreshing but... (4, Funny)

pwnies (1034518) | more than 5 years ago | (#22550028)

...if dumb lawsuits slowly disappear, where will I get my humor from on /.?

Re:Refreshing but... (1)

sm62704 (957197) | more than 5 years ago | (#22550158)

...if dumb lawsuits slowly disappear, where will I get my humor from on /.?

There's always Cowboy Neal, the USSR, Linux, and a beowolf cluster of hot grits. And Microsoft, spelled with a "$". And don't forget the iPoop.

Ok, is there anybody left I haven't offended with this inane comment?

Re:Refreshing but... (1)

calebt3 (1098475) | more than 5 years ago | (#22550244)

Taco, the trolls, IBM, script kiddies, Bush, Cheney, Adobe...
I think of more later.

Re:Refreshing but... (1)

calebt3 (1098475) | more than 5 years ago | (#22550316)

...Clinton, Obama, Ron Paul, the FCC, FISA, Comcast and freinds, ISA, ECMA, China...

Re:Refreshing but... (1)

calebt3 (1098475) | more than 5 years ago | (#22550498)

...ninjas, pirates, insensitive clods, Gore, the new guys, Ted Stevens (the 'series of tubes' Senator), our ____________ overlords, the MAFIAA, Vista's UAC, Ballmer, Gates, Netraft, old people in Korea, CATS, sharks w/fricken' lasers, BSD, Ars Technica, EA Games, WoW fans, AMD, Intel, NVidia, ATI, Dell & friends, OLPC...

Re:Refreshing but... (0, Offtopic)

Sciros (986030) | more than 5 years ago | (#22550310)

From me!

Five ninjas do battle against a commando. The commando shoots 2 of them. How many ninjas are left?

Two, because the others ran away!

Har har har!

Re:Refreshing but... (1)

Satanboy (253169) | more than 5 years ago | (#22550574)

...if dumb lawsuits slowly disappear, where will I get my humor from on /.?


there's always Jack Thompson and Duke Nukem!

Stupid Patents Suits Won't Vanish (0)

Anonymous Coward | more than 5 years ago | (#22550616)

It seems that these patent trolls didn't know enough to sue in Marshall, Texas [techdirt.com] , where all the professionals go.

Wow. (5, Insightful)

SatanicPuppy (611928) | more than 5 years ago | (#22550042)

I never thought this one would stand up to appeal...The judge threw out the jury verdict and then made the plaintiff pay the court costs. Read that again: he threw out the jury verdict.

And the appeals court backed him up! Holy crap! I guess that's one way to deal with stupid juries and slick lawyers...Get some decent judges who aren't willing to put up with the crap.

Re:Wow. (0)

Anonymous Coward | more than 5 years ago | (#22550378)

And the appeals court backed him up! Holy crap! I guess that's one way to deal with stupid juries and slick lawyers...Get some decent judges who aren't willing to put up with the crap.

And patient defense lawyers too that didn't screw it up. Too bad RIM didn't use this defence and go the distance.

Re:Wow. (1)

terrymr (316118) | more than 5 years ago | (#22550480)

This is not that unusual - the reason it happens is something like this :

The judge hears all the evidence and concludes that it's not even close the defendant should win.

If he dismisses the case before it goes to the jury he can be certain that it will be appealed. If he lets the jury come back with a verdict in favor of the plaintiff it likely ends there. When this goes wrong and the jury returns an obviously stupid verdict the judge overrules it knowing that there will be an appeal but the defendant is no worse off than if the case had been dismissed before the jury verdict.

Re:Wow. (4, Informative)

DragonWriter (970822) | more than 5 years ago | (#22550790)

If he dismisses the case before it goes to the jury he can be certain that it will be appealed. If he lets the jury come back with a verdict in favor of the plaintiff it likely ends there. When this goes wrong and the jury returns an obviously stupid verdict the judge overrules it knowing that there will be an appeal but the defendant is no worse off than if the case had been dismissed before the jury verdict.


IIRC, the important difference that this glosses over is that if the judge enters a decision prior to the verdict (a judgement as a matter of law), rather than overturning the jury verdict, if there is an appeal and the judge's decision is thrown out on appeal, it can require a empaneling a new jury and trying the case again. Whereas, if the jury returns a verdict and the judge enters a JNOV and that is appealed, the original jury verdict still exists and can be entered (or modified less radically.)

Re:Wow. (1)

mapkinase (958129) | more than 5 years ago | (#22550886)

Jury is an outrageous abuse of both democracy and legal system. It is basically a competition between lawyers who will manipulate better the ignorant randomly selected civilians.

Judges should be elected from amongst the most trustworthy citizens with legal education. "12 angry men" my butt.

Re:Wow. (0)

Anonymous Coward | more than 5 years ago | (#22551010)

That's nothing. I like it when plaintiffs shop around for the friendliest county to file their suit. There is one county in Texas that is a favorite with patent suits and one in NY that is a favorite for suits against corporations because the people there treat lawsuits like winning the lottery.

Common sense? (5, Funny)

TitusC3v5 (608284) | more than 5 years ago | (#22550046)

Is that you? We've missed you!

Re:Common sense? (1)

esocid (946821) | more than 5 years ago | (#22550248)

It's great! It was tied up in a patent trolling case recently and was not allowed to comment.

Re:Common sense? (1)

Yath (6378) | more than 5 years ago | (#22550624)

Don't be too gleeful. Remember that the jury returned a verdict for the plaintiff. Where was common sense then?

Re:Common sense? (0)

Anonymous Coward | more than 5 years ago | (#22550710)

Oh, I'm only here a few days. You know, with me being on that damned terrorist watch list and all... I snuck in on a Military transport plane from Germany. Good thing the MP's don't look at your face when they see those fake stars on the uniform....

Anyways, I'm heading back to Norway after this short stint, as I have to return to normalcy else my equilibrium changes.

Best wishes to all!!

C.S.

Re:Common sense? (0, Troll)

Lewrker (749844) | more than 5 years ago | (#22551022)

I might be cynical but I think this only happened because this certain judge wasn't offered a cut of the profit.

No impact on patents (4, Interesting)

EmbeddedJanitor (597831) | more than 5 years ago | (#22550068)

Frivolous cases, of all kinds, are often struck down with costs. No reason to think this will have any significant impact on patents, any more than on other laws.

Re:No impact on patents (4, Insightful)

MightyMartian (840721) | more than 5 years ago | (#22550192)

Indeed. I don't see why this is all that revolutionary. It was a patent infringement trial, which gets our attention, but it simply appears to be a judge who felt that the jury was out to lunch and that the plaintiff's lawyers were playing games and wasting the court's time. In short, they pissed off a judge even after being given instructions, and he's responded.

Re:No impact on patents (5, Informative)

pete-classic (75983) | more than 5 years ago | (#22550490)

I see you didn't make it to the seventh paragraph of the article:

"In 42 years of litigation, I've never seen a judge set aside a verdict, then award fees to opposing counsel," said local attorney Robert Miller, of Perkins Coie LLP. "There are times when a verdict is set aside, and times when lawyers are sanctioned. But I've never heard of them happening in one case.


-Peter

Re:No impact on patents (5, Interesting)

DrEldarion (114072) | more than 5 years ago | (#22550274)

It's significant because typically the lawyers aren't the ones paying the opposing team's costs. Usually, the lawyers always win every trial, because they get paid no matter what. If you punish the lawyers themselves for going ahead with cases they know are frivolous, then you'll start to see far, far fewer lawyers taking frivolous cases.

Loser pays is pad policy (1, Insightful)

Anonymous Coward | more than 5 years ago | (#22550706)

If we had "loser pays" for all civil cases the certain result would be that only rich people and companies could sue anyone.

Average Joe: I want to sue MegaFoodCorp.
Lawyer: Why?
Average Joe: There was glass in the food I bought from them. It severally cut my throat and stomach, I had to be rushed to hospital for surgery. I missed 3 weeks of work and lost my job. Now I have $80,000 hospital bill that I can't pay. Also since I lost my job my house is in forclosure and my wife left me.
Lawyer: They will spend at least a million bucks defending themselves. Since we have a loser-pays system in this state, you'll need to put a million dollars in escrow just in case we lose. But it sounds like you have no money. Too bad. Sucks to be you.

Re:Loser pays is pad policy (4, Informative)

DaveV1.0 (203135) | more than 5 years ago | (#22550900)

Apparently you have never heard of torts and contingency fee based lawsuits. In fact, the lawyer would jump at that case and do it on a contingency basis because it would be so easy to get at least a settlement.

The fun part for the lawyer would be when he started running commercials stating anyone who was injured by glass in MegaFoodCorp's products should call him to see about joining a class action lawsuit. Hell, just the thought of commercials like that would have MegaFoodCorp shitting their pants and offering high 6 figure settlements. After all, look what happened to Wendy's after the "finger in the chili". They were hurt badly, with sales down for months. And, no one was hurt in that one.

It would go more like this:

Average Joe: I want to sue MegaFoodCorp.
Lawyer: Why?
Average Joe: There was glass in the food I bought from them. It severally cut my throat and stomach, I had to be rushed to hospital for surgery. I missed 3 weeks of work and lost my job. Now I have $80,000 hospital bill that I can't pay. Also since I lost my job my house is in forclosure and my wife left me.
Lawyer: I will take 30% of what we get. *calls MegaFood*
Lawyer: Hi, we are suing you. We have evidence of glass contamination resulting in injury. We will be running commercials nationally to find other victims.
MegaFood Lawyer: We will give you 600,000 shut up, never speak of this again, and go away.
Lawyer: ChaChing!

Re:Loser pays is pad policy (0)

Anonymous Coward | more than 5 years ago | (#22551060)

That's not how "loser pays" works. The payment of the lawyers on both sides is determined by the amount that is at stake in the suit. There are rules to determine a reasonable amount, so there's no ballooning of lawyer's fees if someone wants 48 million US$ for his lost pair of trousers. The layer's payment is usually quite close to those costs determined by the judge, unless you employ some star-lawyers. If experts are required to determine the facts of the issue at hand, those will be sent and paid for by the justice, but their cost will later be part of what the loser pays.

Now if you sue someone for 100million and are awarded only 1000, you're the loser in terms of cost - you'll end up paying 99.9% of the court's and lawyers' cost, assuming that your 100million had been accepted at all in the first place.

Re:Loser pays is pad policy (0)

Anonymous Coward | more than 5 years ago | (#22551076)

Yep, loser pays sounds good from the perspective of shutting down certain abuses of the legal system, in practice it would make big money immune from lawsuits and make the threat of a lawsuit an even bigger bludgeon for big money than it currently is.

Re:No impact on patents (1)

MadJeff451 (841329) | more than 5 years ago | (#22550830)

Frivolous cases, of all kinds, are often struck down with costs.
Disagree. From the article:

"In 42 years of litigation, I've never seen a judge set aside a verdict, then award fees to opposing counsel," said local attorney Robert Miller, of Perkins Coie LLP. "There are times when a verdict is set aside, and times when lawyers are sanctioned. But I've never heard of them happening in one case.
In other words the judge called the jury on a bad decision, and took the additional step of penalizing the lawyers who brought the case to court. Apparently that's quite rare (but I'm no lawyer).

Patent troll? How about yellow journalist? (-1, Offtopic)

Anonymous Coward | more than 5 years ago | (#22550072)

Look at the bias in this article, 'patent trolls' as a term against a lawyer who argued patent infringement AND WON. The judge overturned the JURY VERDICT and this author has the nerve to call the attorney a 'patent troll'. An out-of-control judiciary, yet another infringement on our rights by the gov't. Add it to the ever-growing list of violations:
They violate the 1st Amendment by opening mail, caging demonstrators and banning books like "America Deceived" from Amazon.
They violate the 2nd Amendment by confiscating guns during Katrina.
They violate the 4th Amendment by conducting warrant-less wiretaps.
They violate the 5th and 6th Amendment by suspending habeas corpus.
They violate the 8th Amendment by torturing.
They violate the entire Constitution by starting 2 illegal wars based on lies and on behalf of a foriegn gov't.
Support Dr. Ron Paul and save this great country.
Last link (unless Google Books caves to the gov't and drops the title):
America Deceived (book) [iuniverse.com]

Re:Patent troll? How about yellow journalist? (-1, Offtopic)

MightyMartian (840721) | more than 5 years ago | (#22550146)

No one took Ron Paul seriously. Get over it. His campaign couldn't be any deader than if they founding floating face down in his bathtub. He's now been replaced in the Kooky Idiot Candidate department by another egomaniacal moron; Ralph Nader.

Re:Patent troll? How about yellow journalist? (2, Funny)

chimpo13 (471212) | more than 5 years ago | (#22550174)

As long as the 21st Amendment doesn't get infringed upon. No one cares about the others.

Re:Patent troll? How about yellow journalist? (2, Informative)

flyneye (84093) | more than 5 years ago | (#22550416)

Anon cow forgets that the Federal United States is a different entity than the several states u.s. The constitution applys to the several states.
Translation: once you step foot on federal ground (courthouse,military base,atomic test sites,U.S.highways,etc.) your constitutional rights are more like constitutional favors you are granted if they feel like it. Other ways you are wangled out of your rights are by having a Federal address on your house(for reasons of recieving mail from Federal Post Office, signing documents whose fine print makes you subservient to Federal regulation, etc.)In other words Your constitutional rights were lost long ago by sneaky legislation hidden in history and enacted for the convenience of the Federal Government.
        Many may disagree but will find that it explains the carte blanche the Fed takes with regards to things like wiretapping,income taxes,national debt. and other things that nothing ever gets done about and even the press blindly accept now.Anyone who speaks up is instantly just a nut job and taken for granted because after all,"whoever heard of such a thing? They never taught us anything like that in (Federally funded)school! We are a Democracy(only since the last century) and pay our fair share of taxes(also from the same time frame) .

Law is a slow beast to change, by design (5, Insightful)

newgalactic (840363) | more than 5 years ago | (#22550094)

Law is a slow beast to change, by design. Technology will advance much faster then Law. As a result, we'll continue to see issues like the one we face with "patent infringement". But, Law does eventually change to correct itself. I'm relieved to see that things are working as they should.

Re:Law is a slow beast to change, by design (1)

aztektum (170569) | more than 5 years ago | (#22550554)

How does that explain crap like the PATRIOT Act or any other crud passed in a hurry since 9/11?? Law changes quickly when it benefits the right people.

Re:Law is a slow beast to change, by design (1)

hyades1 (1149581) | more than 5 years ago | (#22550598)

I think it's still illegal to drive a motor vehicle through my town after dark unless two men bearing lanterns walk in front of it. Does this mean that could change soon?

Yippee!

Re:Law is a slow beast to change, by design (1)

Alistar (900738) | more than 5 years ago | (#22550792)

I would think that having headlights on your car would fulfill the spirit of this particular law.

I can't imagine this surviving any sort of review in a court room.

You're all missing the point... (1)

quickpick (1021471) | more than 5 years ago | (#22550204)

Whenever a cavalier S.O.B. gets kicked square in the nuts there should be much rejoicing.

Did I miss something? (4, Interesting)

jmichaelg (148257) | more than 5 years ago | (#22550210)

Reading the article (gasp!) left me with the impression that the Judge was ticked off because of the attorney's behavior and method of prosecuting their case and not that the Judge thought the patents were bogus. It's as if the plaintiff is getting nailed because it hired a pair of SOB's to press its case.

Perhaps there's a clearer report out there?

Re:Did I miss something? (4, Interesting)

esocid (946821) | more than 5 years ago | (#22550380)

Reading the article (gasp!) left me with the impression that the Judge was ticked off because of the attorney's behavior and method of prosecuting their case and not that the Judge thought the patents were bogus. It's as if the plaintiff is getting nailed because it hired a pair of SOB's to press its case.
I believe that is partially the point. They wasted the court's time by pursuing a case that was baseless and had no grounds by simply trying to litigate the other company out of existence. The prosecuting lawyers acting like arrogant fools trying to make a buck in the world of patent trolling. But just for fun here is another link to the story [abajournal.com] and the judge's ruling (PDF) [amlaw.com] .

Re:Did I miss something? (2, Insightful)

Zontar_Thing_From_Ve (949321) | more than 5 years ago | (#22550488)

Reading the article (gasp!) left me with the impression that the Judge was ticked off because of the attorney's behavior and method of prosecuting their case and not that the Judge thought the patents were bogus. It's as if the plaintiff is getting nailed because it hired a pair of SOB's to press its case.

I read the same article. That's not how I read it. There were apparently 2 problems.
1) The lawsuit was frivolous and that caused the judge to set aside the jury verdict. The jury blew it, but they usually do in patent cases.
2) The attorneys acted in a bad manner, disregarding some specific instructions from the judge and proceeding onward in a case which the judge felt should never have gone to trial. But that is what attorneys do, as they know sometimes when you roll the dice, a stupid jury goes your way.

Judges don't like their time being wasted - at all. I see only good coming from this.

Separate the Patent from the Lawyers (4, Interesting)

CajunArson (465943) | more than 5 years ago | (#22550292)

The article notes that the technology here is for guiding scalpels to do precision work on brain tumors, so the subject matter is highly technical in nature. I'd like to see what the actual patents involved are before making a judgment. This case might have come down to the (apparently off the wall) behavior of the lawyers, even if the plaintiff may have had a legitimate case.
    One thing you have to remember is that (with rare exceptions) the court is only going to go with the arguments that each side presents. It is not the judge's or jury's job to go out and collect evidence and make up a decision, it is instead their job to decide the case based on the evidence actually submitted and arguments actually made by opposing parties (this is called the "adversarial system"). Even if the plaintiff may have had a case, if these lawyers went out and did a completely shitty job of presenting it, presented no real evidence, and made no real legal arguments, then they can and will lose the case. The extra sanctions here are quite unusual, and go beyond the negative consequences of just not doing a good job of lawyering. I think that these "respected litigators" were probably ignoring the judge's instructions and committing other infractions that REALLY pissed the judge off. On appeal, the court does NOT hear new facts, so the appeals court went with the factual record and judgment of the District Court judge on this one.

Keep hacking away at it! (1, Funny)

aapold (753705) | more than 5 years ago | (#22550362)

Patent Trolls have fast healing 7... the judge tried using some acid to make sure it stayed down but I'm not sure...

Details? (1)

Frosty Piss (770223) | more than 5 years ago | (#22550408)

The Denver Post story nor the Slashdot write-up give any detail about what the exact claims where in this case, so while it *MIGHT* be a patent troll case (and given the judge's remarks, that seems likely), it's kind of hard to really tell, from what we know.

But, this is Slashdot, guilty as charged...

Utah is in Tenth Circuit (1)

tyrantking31 (1115607) | more than 5 years ago | (#22550436)

This is great because the earlier article entitled "Apple, Starbucks Sued Over Music Gift Cards" concerns a Utah couple (they are both attorneys) who presumably brought their patent suit in Utah, which is a part of the 10th Circuit. All of which means they should have known better.

Judge Make Lawyers Pay For Frivolous Patent Suit (2, Funny)

sm62704 (957197) | more than 5 years ago | (#22550450)

Me make fun of illiterate editors

Re:Judge Make Lawyers Pay For Frivolous Patent Sui (5, Funny)

flyingsquid (813711) | more than 5 years ago | (#22550606)

Me make fun of illiterate editors

Why you make fun of article? Hulk work hard on article! Not easy. Many long words. Hulk hands big, computer keys tiny!

Narrow the scope perhaps (2, Insightful)

Linker3000 (626634) | more than 5 years ago | (#22550452)

"could this case be the 'shot heard round the world' in the revolution against patent trolls?"

Not until/unless (take your pick) US legal jurisdiction extends round the world - on an official level!

Re:Narrow the scope perhaps (1)

ArsonSmith (13997) | more than 5 years ago | (#22550878)

I'm sorry...did those people not in the US think they were part of the world? How quaint.

Re:Narrow the scope perhaps (1)

DaveV1.0 (203135) | more than 5 years ago | (#22550966)

I have no idea why you were modded up, because your comment is stupid.

The "shot heard round the world" refers to the shots fired at Lexington and Concord that started the American Revolutionary War. It is metaphor for something that starts a major change. It does not mean that it will effect the entire world.

Judge Matsch's opinion and order (4, Informative)

Anita Coney (648748) | more than 5 years ago | (#22550508)

United States District Court,
D. Colorado.
MEDTRONIC NAVIGATION, INC., Medtronic Sofamor Danek, Inc., Sofamor Danek Holdings, Inc., St. Louis University, and Trustees of Dartmouth College, Plaintiffs,
v.
BRAINLAB MEDIZINISCHE COMPUTERSYSTEMS GMBH, Brainlab AG, Brainlab USA, Inc., and Brainlab, Inc., Defendants.
Civil Action No. 98-cv-01072-RPM.
Feb. 12, 2008.

Anthony Lawrence Giacomini, Sean Connelly, Daniel M. Reilly, Hoffman, Reilly, Pozner & Williamson, L.L.P., Conor Fitzgerald Farley, Lee Frederick Johnston, Holland & Hart, LLP, Denver, CO, J. James Li, Vera M. Elson, McDermott Will & Emery, LLP, Palo Alto, CA, Krista Leigh Vink Venegas, McDermott, Will & Emery, Los Angeles, CA, Kurt A. Luther, Leslie I. Bookoff, Finnegan, Henderson, Farabow Garrett & Dunner, Washington, DC, David W. Harlan, Senniger Powers, St. Louis, MO, for Plaintiffs.

James Edward Hartley, Holland & Hart, LLP, Denver, CO.

Jay R. Campbell, John J. Del Col, Joshua M. Ryland, Renner, Otto, Boisselle & Sklar, LLP, Kyle B. Fleming, Cleveland, OH, L. Andrew Cooper, Marc David Flink, Thomas H. Shunk, Baker & Hostetler, Denver, CO, for Defendants.

ORDER FOR AWARD OF ATTORNEY FEES AND COSTS TO BRAINLAB DEFENDANTS

RICHARD P. MATSCH, Senior District Judge.
*1 The defendants (collectively BrainLAB) seek to recover all of their attorney fees and costs incurred in the defense of this suit for patent infringement, contending that it was filed and prosecuted not to protect the technology protected by the patent claims but to drive a competitor out of a market for an emerging technology for application in the navigation of surgical instruments in procedures requiring exquisite precision, as in the removal of a brain tumor. Medtronic Navigation, Inc. (Medtronic) and its predecessor Surgical Navigation Technologies, Inc. (SNT) marketed variations of a device called "StealthStation" in competition with BrainLAB's "VectorVision" devices. The accused devices can be described as passive optical systems in contrast to an active acoustic system. That contrasting technology was at the core of this case.

BrainLAB contends that it is entitled to fees and costs because this is an exceptional case justifying relief under 35 U.S.C. 285; that plaintiffs' lead counsel should be held responsible under 28 U.S.C. 1927 and that the Court should grant the motion in the exercise of its inherent authority to protect the integrity of the processes of adjudication. Upon reflection, this Court finds and concludes that the rulings on the claims construction issues adjudicated the fairly debatable issues in this case and that the manner in which plaintiffs' counsel continued the prosecution of the claims through trial was in disregard of their obligations as officers of the court. The fairness of the adversary system of adjudication depends upon the assumption that trial lawyers will temper zealous advocacy of their client's cause with an objective assessment of its merit and be candid in presenting it to the court and to opposing counsel. When that assumption has been contradicted by a trial record of conduct reflecting a winning is all that is important approach to the trial process, the court has a duty to redress this resulting harm to the opposing party.

BrainLAB has made a plausible argument that this entire civil action was frivolous. The chronology of the suit must be viewed against the backdrop of developments in the field of image-guided surgical navigation technology.

In approximately 1991, SNT began development of an image-guided surgical navigation product. SNT worked with Dr. Richard Bucholz of St. Louis University. SNT also collaborated with Dr. Peter Heilbrun of the University of Utah. In 1994, SNT obtained rights to the application for patent that issued as U.S. Patent No. B1 5,383,454 to Bucholz (the 454 Patent or the Bucholz Patent). The claims of that patent relate to a system that depends on the activation of sound emitters on a surgical instrument and the patient which are tracked by an array of microphones establishing coordinates that give their positions through triangulation. SNT did not commercialize the active acoustic technology described in the Bucholz patent. It developed a product employing active optical technology, a system using light emitting from diodes on a surgical instrument and the patient, detected by an array of cameras to establish the positions of the instrument and the patient through triangulation. In January 1996, SNT received FDA approval and began marketing its product as StealthStation.

*2 In May 1997, BrainLAB received FDA approval to market an image-guided surgical navigation product using passive optical technology, a system employing reflective markers on a surgical instrument and the patient and an array of cameras to establish their positions using triangulation. In late April 1998, BrainLAB's counsel wrote a letter to SNT, informing SNT that BrainLAB expected to receive a patent for passive optical navigation technology, in essence cautioning Medtronic not to incorporate that technology into its products. Twelve days later, on May 12, 1998, SNT and its parent, Sofamor Danek Group, brought this suit, complaining that the BrainLAB products using passive optical technology infringed the Bucholz 454 Patent.FN1

        FN1. The plaintiffs also sought a declaration of non-infringement of a patent owned by BrainLAB (the 861 Patent), and BrainLAB counterclaimed for infringement of that patent. After the court issued its order construing the 861 Patent, all issues relating to the 861 patent were dismissed.

Significantly, the prosecution history of the Bucholz Patent included statements by the applicant explaining that the claimed invention was distinguished by having emitters on the surgical probe as well an emitter attached to the patient's head. The prosecution history also included a narrowing amendment.

In January 1999, Medtronic acquired SNT through its acquisition of Sofamor Danek Group. Later that month, Medtronic acquired rights to three patents to Heilbrun, U.S. Patent Nos. 5,389,101; U.S. Patent No. 5,836,954, and U.S. Patent No. 5,603,318 (the Heilbrun Patents) from the University of Utah. The Heilbrun Patents describe camera-based apparatus and methods for locating a surgical instrument and patient in a medical workspace. In November 1999, Medtronic acquired a license for U.S. Patent No. 4,722,056 to Roberts (the Roberts Patent) by assignment from Elekta Company. The Roberts Patent relates to a computer-based surgical navigation system that allows a surgeon to look through the eye piece of a microscope at a target area, and see, for example, the outline of a prior image of a body part superimposed on a live image of the patient's body part.

Medtronic amended the complaint, adding claims of infringement and adding and substituting plaintiffs to encompass those having ownership interests in the relevant patent rights. By the fourth amended complaint, filed April 25, 2000, the plaintiffs included claims of infringement of the Bucholz 454 Patent, another Bucholz patent (the 183 Patent), the three Heilbrun Patents, and the Roberts patent. Sofamor Danek Holdings, a subsidiary of Sofamor Danek Group, was added as a plaintiff, along with St. Louis University (the owner and assignor of the Bucholz Patents) and the Trustees of Dartmouth College (the owner and original assignor of the Roberts Patent). The caption was subsequently changed to reflect that Sofamor Danek, Inc. had become Medtronic Sofamor Danek and that SNT had become Medtronic Navigation, Inc. Throughout the trial, Medtronic's lawyers portrayed SNT as the plaintiff.

Notably, Medtronic added claims of infringement of two of the Heilbrun patents on February 1, 1999, within days of acquiring those patents from the University of Utah. At trial, Dr. Kurt Smith, one of the founders of SNT, testified that the timing was merely a coincidence. He also testified that the Heilbrun patents had been added to the complaint as an "afterthought." Before Medtronic acquired the Heilbrun and Roberts Patents and added them to this suit, no one had ever asserted that either the VectorVision products or the StealthStation embodied any claims of those patents. Even considering Dr. Smith's entire testimony about Medtronic's reasons for acquiring the Heilbrun and Roberts Patents, the reasonable inference to be drawn is that Medtronic added these claims to bolster its position that it owned the patent rights to passive optical technology. Medtronic and its counsel undoubtedly anticipated that the scope of the Bucholz 454 Patent would be hotly contested. Adding other patents to the suit increased its complexity and increased the pressure on BrainLAB.

*3 Medtronic then approached BrainLAB about a potential settlement. BrainLAB's President, Stefan Vilsmeier, testified that those discussions centered on Medtronic's efforts to acquire BrainLAB. There was a hiatus in court proceedings during the later half of 2001, when Medtronic and BrainLAB jointly requested several postponements of a scheduling conference, due to the ongoing settlement negotiations.

BrainLAB rejected Medtronic's buy-out overtures. In January 2002, when the settlement negotiations broke down, Medtronic changed lead counsel, and lawyers from the McDermott, Will & Emery (MWE) law firm entered their appearances. Fact and damage discovery were then reopened.

The parties briefed issues of claims construction, and a Markman hearing was held. Medtronic advocated broad constructions of the patents-in-suit. With respect to claim 14 of the Bucholz patent, Medtronic argued that the "reference means" should be construed as an "array of sensors," an argument that would have allowed Medtronic to proceed on a theory of literal infringement and avoid having to show that active acoustic (or active optical) and passive optical technologies are equivalent. On September 29, 2004, the Court issued its order construing the disputed claim language. That order limited the Bucholz and Roberts patents to acoustic reference systems and ruled that the Heilbrun Patent claims required a "static" workplace coordinate framework. At a scheduling conference held on February 4, 2005, Medtronic's counsel stated that it would proceed with claims of infringement under the doctrine of equivalents.

The defendants moved for summary judgment of dismissal, arguing that under the Court's construction of the asserted claims, the BrainLAB devices could not be found to infringe and that the doctrine of prosecution history estoppel precluded the application of the doctrine of equivalents as to the Bucholz Patent claims.

What was apparent to defendants' counsel and should have been equally obvious to Medtronic's principal lawyers was not perceived by the Court. The Court elected to proceed to trial, accepting the plaintiffs' assertion that there were material factual questions to be resolved at trial, particularly with respect to issues of equivalents. At that stage in the proceedings, the Court, unlike Medtronic and its counsel, had not had an opportunity to view the accused devices. The Court's decision to proceed to trial was based on its view that the legal questions in the case could be better evaluated in the context of a full evidentiary record, rather than on information communicated through legal briefs and declarations of expert witnesses. Accordingly, the court determined it was prudent to proceed to trial, giving Medtronic a full opportunity to present its case.

At trial, Medtronic alleged infringement of claim 14 of the Bucholz 454 Patent, claim 1 of the Roberts Patent, claim 1 of the Heilbrun 101 Patent, and claim 1 of the Heilbrun 318 Patent. The Bucholz Patent, however, was the centerpiece of Medtronic's case. Of the asserted patents, the Bucholz Patent was the only one that SNT had owned during the first several years that it sold the StealthStation and the only one it owned when it filed suit. The Bucholz 454 patent provided the primary basis for Medtronic's claim that it had suffered lost profits of over $100 million.FN2

        FN2. Medtronic had paid $1.25 million for rights to all three Heilbrun Patents. Because of the ownership structure of the Heilbrun Patents, Medtronic was limited to seeking reasonable royalty damages with respect to its claims of infringement of those patents. The Roberts Patent was relevant only to the microscope feature of the accused products.

*4 BrainLAB moved for judgment as a matter of law at the close of the evidence, but the Court submitted the case to the jury, recognizing that a defendants' verdict would end the litigation if the claims construction rulings were affirmed on appeal but that another trial would be required if those rulings were reversed and the Court had granted the motion. The Court did not submit the issues of prosecution history estoppel to the jury, ruling that those were questions to be determined by the Court.

The jury found for the plaintiffs but the verdict was set aside by this Court's order granting the Rule 50(b) motion. Mem. Op. and Order, Feb. 24, 2006 [doc. 545]. The premises of that order were for the most part the same as those presented in the defendants' motions for summary judgment. In retrospect, those motions should have been granted, saving BrainLAB the cost of a 13-day jury trial. In setting aside the jury's verdict, this Court found that misleading trial tactics by the MWE lawyers, Mr. McMahon and Ms. Elson, had influenced the jury verdict, and their tactics were an abuse of advocacy.

After the entry of judgment in favor of BrainLAB, Medtronic appealed the judgment, and BrainLAB moved to recover its costs and attorney fees. BrainLAB's motions for costs and fees were stayed, pending the outcome of Medtronic's appeal.

The judgment in favor of BrainLAB was affirmed by the Federal Circuit Court of Appeals in March 2007, in an unpublished opinion. The Federal Circuit adopted this Court's reasoning with respect to claim construction and its reasons for rejecting the plaintiffs' evidence and theories of infringement as to all of the asserted patent claims, including the conclusion that the Bucholz Patent's prosecution history precluded Medtronic's claim of infringement of that patent under the doctrine of equivalents.

On May 3, 2007, BrainLAB followed this Court's direction at a status conference following appeal to identify the entities against which fees and costs are sought, to provide specific evidentiary support for these claims and to make more explicit the legal theories relied on. BrainLAB did that in its filing of May 3, 2007. Recognizing that the responses of Medtronic and MWE would require separate representation by new counsel, the Court extended the time for those filings to July 23, 2007, and the reply to August 27, 2007.

Upon review of all of the papers filed, the Court finds and concludes that Medtronic and MWE have joint and several liability for the attorney fees and expenses BrainLAB incurred in defending this action in this court after BrainLAB's summary judgment motions showed that the claims construction rulings had eviscerated the plaintiffs' case. Fees are awarded against the Medtronic plaintiffs (Medtronic Navigation, Inc., Medtronic Sofamor Danek, Inc., and Sofamor Danek Holdings, Inc.) pursuant to 35 U.S.C. 285 and the court's inherent authority, and against MWE pursuant to 28 U.S.C. 1927 and the court's inherent authority.FN3

        FN3. BrainLAB's supplemental memorandum in support of its motion for attorney fees and costs [Doc. 569] states that it seeks fees against only the Medtronic plaintiffs, not St. Louis University or The Trustees of Dartmouth College, and as to the counsel who represented the plaintiff group, BrainLAB seeks fees against MWE only.

*5 The evidence is not sufficient to support a finding that Medtronic's contentions up to the time of the Court's ruling on the claims construction issues were frivolous, without merit or vexatiously presented. After receiving the Court's claims construction ruling, however, Medtronic and the MWE lawyers had a duty to reexamine this litigation and make an objective assessment of the validity of Medtronic's claims that BrainLAB's products infringed the patent claims as construed. They were obliged to accept those rulings as the law of the case and proceed with an appeal by requesting certification of an interlocutory appeal or conceding the summary judgment motions. Rather than accept that the claims construction rulings stripped the merits from this case, counsel chose to pursue a strategy of distorting those rulings, misdirecting the jury to a different reading of the claim language, and blatantly presenting the jury with a product to product comparison contrary to established law and the Court's cautionary instructions. Additionally, they deceived the jury into accepting the statements in BrainLAB's FDA application as an admission of patent infringement. Capping all of this was a closing argument that misdirected the jury's attention from the focus of the case, carefully crafted to avoid the Court's instructions. That argument distorted both the evidence and the law, misleading the jury into a plaintiffs' verdict.

Litigation misconduct is a basis for transferring the burden of attorney fees and expenses under both of the statutes relied on by BrainLAB and the Court's inherent authority to supervise the conduct of litigation. In essence, the response from the plaintiff and MWE, through new counsel, is that the Court had the obligation to stop any trial conduct that stepped over the line of zealous advocacy. In short, they argue that they should not be held responsible for what they were able to get away with during the trial presentation. The adamant denial that there was any abuse of advocacy in this case is in disregard of what this Court has already concluded and displays the same arrogance that has colored this case almost from its inception. Throughout these proceedings Medtronic and the MWE lawyers have demonstrated that when they are faced with adverse court rulings, they proceed undeterred, with only superficial observance of the court's determinations. Such conduct supports the conclusion that after the Markman rulings, Medtronic's primary objective in pursuing this litigation was to put economic pressure on its competitor in the market.

This case is exceptional under 35 U.S.C. 285
"The court in exceptional cases may award reasonable attorney fees to the prevailing party." 35 U.S.C. 285. "A case may be deemed exceptional when there has been some material inappropriate conduct related to the matter in litigation, such as willful infringement, fraud or inequitable conduct in procuring the patent, misconduct during litigation, vexatious or unjustified litigation, conduct that violates Fed.R.Civ.P. 11, or like infractions." Brooks Furniture Mfg. v. Dutailier Int'l, Inc., 393 F.3d 1378, 1381 (Fed.Cir.2005) (citations omitted). "There is a presumption that the assertion of infringement of a duly granted patent is made in good faith.... Thus, the underlying improper conduct and the characterization of the case as exceptional must be established by clear and convincing evidence." Id. at 1382 (citations omitted). Those standards are met in this case.

*6 The Court has already concluded that Medtronic engaged in litigation misconduct during the trial. That same misconduct also supports the conclusion that Medtronic continued this suit vexatiously after the claims were construed. Vexatious conduct includes conduct that "obfuscates the legal issues and complicates the defendants' and the court's task of sorting them out." Shackelford v. Courtesy Ford, Inc., 96 F.Supp.2d 1140, 1144 (D.Colo.2000) (citing Braley v. Campbell, 832 F.2d 1504, 1509 (10th Cir.1987)).

Medtronic and MWE point to the testimony of Medtronic's experts as evidence that its claims were not objectively baseless or brought in subjective bad faith. That argument is unavailing. The opinions of Medtronic's experts were crafted to fit the infringement theories put forward by Medtronic's counsel, and those theories were legally and factually untenable in light of the court's claim construction. Medtronic pursued a strategy of giving superficial recognition to the court's claim construction rulings, while pressing its own interpretations of the claims.

Medtronic's first witness, Dr. Smith, repeatedly described the Bucholz invention as having "an array of sensors" for detecting radiated energy-the claim construction that Medtronic had argued and lost. Medtronic then continued that same theme throughout the presentation of its expert testimony and closing arguments. Dr. Grimson, who testified as an expert on behalf of Medtronic with respect to infringement of the Bucholz and Roberts patents, described the reference means (the array of microphones) of the Bucholz patent as "sensors" for detecting radiation, and then used those terms when opining that the accused products infringed. With respect to the Heilbrun Patent claims, Medtronic contended that BrainLAB's dynamic referencing system was simply a faster version of the static system described in the Heilbrun Patents, but it supported that contention with the testimony of Dr. Taylor, whose infringement analysis failed to take into account the actual operation of the BrainLAB products. As the Court pointed out in its previous order, Medtronic's representations in its summary judgment responses with respect to the Heilbrun Patents were different from the positions it advocated at trial. Mem. and Op. on Post-Trial Mots. at 35 & 41. In short, after the Court issued its claim construction order and even through trial, Medtronic struggled to articulate a viable theory of infringement as to the Heilbrun patents. It never was able to do so.

Despite its acknowledgment that product-to-product comparison would be improper for the purpose of showing infringement, Medtronic repeatedly compared the StealthStation and VectorVision products, portraying BrainLAB as a follower who had wrongfully capitalized on the success of the StealthStation. Importantly, Medtronic did not contend that the StealthStation embodied all of the elements of the asserted patent claims. To the contrary, in response to questions raised by the Court before trial, Medtronic argued that such a showing was unnecessary for the purpose of proving lost profits. See Pls.' Mem. Addressing Damages, Sept. 2, 2005 [Doc. 421].

*7 The most egregious example of Medtronic's improper product-to-product comparisons was its presentation of testimony and closing argument regarding a letter BrainLAB submitted to the FDA. In seeking FDA approval, BrainLAB had referred to the StealthStation as a predicate device and stated that the VectorVision was substantially equivalent. In his rebuttal testimony, Dr. Smith repeated the wording of BrainLAB's FDA submission, emphasizing the phrase "substantially equivalent." Tr. at 2714:5-13; 2723:3-10. During rebuttal closing argument Mr. McMahon then told the jury that "[BrainLAB] went to the FDA, and they told the FDA that our products are-the substantial equivalence here is between this product-that is, the VectorVision-is similar in design, composition, and function to the StealthStation. Bears directly on what we are doing here today." Tr. at 2976, emphasis added. When BrainLAB's counsel objected, the court responded that "the jury will know and be told again that the comparison is to be made to the claims and the defendant's products. This is not a comparison between the StealthStation's products and BrainLAB's products." Mr. McMahon responded, "Right, Your Honor, this is an admission. " Id. at 2977. That is, while appearing to agree with the Court's statement about the proper comparison, Mr. McMahon continued comparing the products, telling the jury that the term "substantially equivalent" in BrainLAB's FDA submission was an admission that BrainLAB infringed under the doctrine of equivalents.

Medtronic and MWE argue that their trial conduct was not abusive advocacy because the Court did not do enough to restrain it. That argument ignores the Court's admonitions on the issue of product-to-product comparisons (Tr. at 1578-79), as well as Medtronic's own representations to the Court. During argument about whether Medtronic should be allowed to demonstrate its StealthStation to the jury, Medtronic's counsel acknowledged that product-to-product comparisons would be improper for the purpose of showing infringement. Tr. at 917:10-12. When cross-examining Mr. Vilsmeier, Mr. McMahon (in response to objections) represented that BrainLAB's FDA letter was not going to be used for the purpose of making product-to-product comparisons. Tr. at 1925:19-1926:18. On this issue, the parameters had been established. Counsel were obligated to observe the court's admonitions and to comply with their own representations to the Court.

Medtronic cannot credibly claim that the product comparisons were a justified response to BrainLAB's assertion that it was the first to commercialize passive optical technology. Throughout the trial, Medtronic's counsel and witnesses described the StealthStation as the product that revolutionized the field of image-guided surgery and portrayed BrainLAB as a follower. In presenting its defenses, BrainLAB was entitled to explain the development of the relevant art and the place of its products in that chronology. BrainLAB's presentation did not "open the door" for Medtronic to tell the jury that BrainLAB had admitted infringement in its FDA submission. Medtronic's counsel were experienced patent litigators who understood the differences between the doctrine of equivalents and the FDA process. They knew that BrainLAB's statements in its FDA submission were not an admission that the BrainLAB products infringed the asserted patents. Indeed, Medtronic as a defendant has argued that admission of similar statements it made in an FDA application would be misleading and unfairly prejudicial. See Cardiovention, Inc. v. Medtronic, Inc., 483 F.Supp.2d 830, 840-41 (D.Minn.2007).

*8 Medtronic and MWE cannot argue that product comparisons were appropriate to show that the VectorVision and StealthStation products were substitutes for the purpose of determining lost profits. BrainLAB did not dispute that the StealthStation and VectorVision products competed directly with each other. The only conclusion to be drawn is that Medtronic crafted and executed an intentionally misleading trial strategy.

As set forth above, the Bucholz Patent was the centerpiece of Medtronic's case, and in particular its damages case. At trial, Medtronic and BrainLAB presented evidence regarding the prosecution history of the Bucholz Patent. During the jury instruction conference, the Court informed counsel that the issues of prosecution history estoppel would be determined by the Court. During closing argument, Mr. McMahon told the jury that the absence of jury instructions about the prosecution history of the Bucholz Patent showed that BrainLAB had not been forthright in its presentation. Tr. at 2991-92. Mr. McMahon's commentary on the lack of jury instructions was another example of the excessive partisanship that colored this trial.

The Bucholz prosecution history ultimately proved fatal to Medtronic's claim based on that patent. MWE's attempt to blame to BrainLAB for delay in raising the issue of prosecution history estoppel is unfounded. Prosecution history is relevant to claim construction-and in fact was argued by both Medtronic and BrainLAB during the Markman hearing, but prosecution history estoppel is a different question. That issue came to the forefront after the Court issued its order on claim construction, rejecting Medtronic's interpretation of the Bucholz Patent claims. From that point, the Bucholz prosecution history impacted the range of what could be considered an equivalent. Rather than alter course after the Court issued its claim construction order, Medtronic and MWE proceeded to trial, continuing to advocate Medtronic's interpretation of the Bucholz Patent and telling the jury that "this whole notion that whatever happened in the patent office on this patent, that somehow it was a limitation, is just nonsense." Tr. at 2991:19-21. By pointing the jury to language in the patents that supported Medtronic's reading of the claims, Mr. McMahon was directing the jury to override the court's claim construction. Tr. at 2983-84. He then repeatedly told the jury during closing argument that "tracking is tracking," a statement that misguided the jury about the requirements of infringement analysis.

The procedural history of this case, particularly the numerous amendments to the complaint, indicates that Medtronic fully understood that it could not rely on the Bucholz 454 Patent to support its position that Medtronic owned the patent rights to passive optical technology, unless the Bucholz Patent claims were construed so as to bring that technology within the literal claim scope. During closing argument, Mr. McMahon told the jury that Medtronic had built its case "brick-by-brick." But Medtronic's case was built on the Bucholz Patent, and that foundation crumbled after the Court's claim construction order.

*9 Medtronic argues that fees should not be awarded against it where its claims survived summary judgment and were presented to the jury which returned a verdict in its favor. Medtronic's argument overstates the significance of what it refers to as the "objective signposts." The Court's denial of BrainLAB's motions did not relieve Medtronic of its duty to evaluate its claims, and the Court's rulings certainly were not a license for Medtronic to engage in abusive conduct at trial. As the Court has already concluded, the jury verdict was influenced by the litigation misconduct that gives rise to the present motion.

The conduct of Medtronic and its counsel constituted much more than a few instances of overstepping during a hard-fought battle. This case involved complicated technology. Patent law is complex and not intuitive to the average juror. Parties and counsel have an obligation to refrain from seeking to take advantage of those complexities by employing misleading strategies. Medtronic's infringement claims had the appearance of substance because BrainLAB's VectorVision products, like Medtronic's StealthStation, employed concepts and some features that were also present in the inventions of the asserted patents. Conceptual similarity, however, is not enough to show infringement, and a patent holder cannot pick and choose among features found in various patents in its portfolio and then combine them to show infringement. Medtronic's burden was to prove that each element and limitation of each of the asserted patent claims was found in each the accused products. Instead, Medtronic guided the jury to a comparison of the accused products and the StealthStation, and then offered them a short-cut with the "tracking is tracking" sound bite. Medtronic's untenable positions and misleading tactics complicated the Court's task of analyzing the legal issues.

BrainLAB has suffered an injustice, and the court has the authority under 35 U.S.C. 285 to remedy that wrong. BrainLAB is entitled to recover the attorneys' fees it incurred in connection with the district court proceedings after it moved for summary judgment.

An assessment of fees against MWE is warranted under 28 U.S.C. 1927:
Any attorney or other person admitted to conduct cases in any court of the United States or any Territory thereof who so multiplies the proceedings in any case unreasonably and vexatiously may be required by the court to satisfy personally the excess costs, expenses, and attorneys' fees reasonably incurred because of such conduct.

Under this statute, "excess costs, expenses, or attorney's fees are imposable against an attorney personally for conduct that, viewed objectively, manifests either intentional or reckless disregard of the attorney's duties to the court." Braley v. Campbell, 832 F.2d at 1512. Subjective bad faith is not a prerequisite to an award under the statute. Id. "A lawyer's reckless indifference to the law may impose substantial costs on the adverse party. Section 1927 permits a court to insist that the attorney bear the costs of his own lack of care." Id. at 1511 (quoting In re TCI Ltd., 769 F.2d 441, 445 (7th Cir.1985). Costs and fees may be awarded under 1927 "when an attorney is cavalier or bent on misleading the court; intentionally acts without a plausible basis; [or] when the entire course of the proceedings was unwarranted." Dominion Video Satellite, Inc. v. Echostar Satellite L.L.C., 430 F.3d 1269, 1278 (10th Cir.2005) (quoting Miera v. Dairyland Ins. Co., 143 F.3d 1337, 1342 (10th Cir.1998)).

*10 An award under 1927 requires findings that the attorney's conduct was improper and caused an unreasonable multiplying of the proceedings. See Braley, 832 F.2d at 1513 ("the court must identify the extent of the multiplicity resulting from the attorney's behavior and the costs arising therefrom"); see also Sangui Biotech Int'l, Inc. v. Kappes, 179 F.Supp.2d 1240, 1243 (D .Colo.2002). Both requirements are met here.

After the Court issued its claim construction rulings, Medtronic's counsel proceeded cavalierly, with reckless indifference to the merits of Medtronic's infringement claims. The continued prosecution of a claim after its lack of merit has become apparent warrants sanctions under 1927. Shackelford, 96 F.Supp.2d at 1145. At trial, MWE's conduct was in disregard for the duty of candor, reflecting an attitude of "what can I get away with?" Throughout the trial, the MWE lawyers artfully avoided the limitations of the patent claims and created an illusion of infringement. They did so with full awareness that their case was without merit.

There is a split of authority on the question of whether section 1927 authorizes fee awards against law firms. See Claiborne v. Wisdom, 414 F.3d 715, 722-24 (7th Cir.2005) (discussing circuit split and concluding that " 1927 does not provide a legal basis for an order of fees against an entity like a law firm that is not itself 'admitted to practice' "). The United States Court of Appeals for the Tenth Circuit has not addressed this issue. In this case, an award against the firm is appropriate. As the lead lawyers, Mr. McMahon and Ms. Elson were the most visible, but numerous MWE lawyers and support staff participated in the litigation and in the trial. Liability should be borne by the firm. If section 1927 does not support an award of fees against MWE as an entity, then such an award is appropriate under the court's inherent authority.

An fee award is appropriate under the Court's inherent authority
Federal courts have inherent authority to "assess attorney's fees when a party has acted in bad faith, vexatiously, wantonly, or for oppressive reasons." Chambers v. NASCO, 501 U.S. 32, 50 (1991) (quoting Alyeska Pipeline Service Co. v. Wilderness Society, 421 U.S. 240, 258-59 (1975)). This authority includes the authority to assess fees against counsel who engage in abusive litigation conduct. To impose an award of attorney's fees against counsel under the court's inherent powers, the court must find that the counsel's conduct constituted or was tantamount to bad faith. Roadway Express, Inc. v. Piper, 447 U.S. 752, 766-67 (1980).

The facts discussed above support an award of fees under the court's inherent authority. Medtronic's and MWE's pursuit of meritless litigation to eliminate competition in the medical products market requires remediation.

Based on the foregoing, it is

ORDERED that the order staying any proceeding on defendants' bill of costs [doc. 559] is vacated. The defendants' motion for costs [doc. 552] will be determined initially by the Clerk of the Court; it is

*11 FURTHER ORDERED that the defendants' motion for attorney fees [doc. 553] is granted in part. On or before March 12, 2008, the defendants shall file a detailed description of the services rendered by their attorneys in connection with the district court proceedings in this suit from February 24, 2005, through the date of this order, with accompanying affidavits and summaries of the relevant qualifications and experience as required by Local Rule 54.3. Objections to the requested fees may be filed on or before April 11, 2008.

Could this case be the 'shot' against trolls? (4, Informative)

DRJlaw (946416) | more than 5 years ago | (#22550548)

Simply put, no.

"After the court issued its claim construction rulings, Medtronic's counsel proceeded cavalierly, with reckless indifference to the merits of Medtronic's infringement claims," Matsch wrote."

"Matsch said the McDermott lawyers willfully ignored his rulings on claim construction in their arguments before a Colorado jury in 2005. In patent cases, those orders define the scope of the patents and, therefore, what the plaintiff's lawyers can argue for infringement."

"The judge said in his Tuesday ruling that while McDermott paid lip service to the orders, the lawyers improperly pointed the jury toward Medtronic's broad reading of the patents. McMahon also made comparisons of the two companies' products, the StealthStation and VectorVision, instead of comparing Medtronic's patents to BrainLAB's product, "contrary to established law," Matsch wrote."

Summary for lawyers [law.com]

In the anatomy of the typical patent case, there is

1. The filing of a suit
2. Discovery
3. A so-called "Markman hearing" to resolve disputes between the litigants as to the meaning of disputed terms or phrases within the patent claims
4. Summary judgment motions
5. A trial (bench or jury)
6. Post-verdict motions
7. Appeal

If you read through the judge's ruling, or even the law.com article, it's apparent that the judge believed that the trial was unnecessary, and that the case could and should have been resolved by summary judgment (and any subsequent appeal). If the case had ended at this point, there would likely be no talk of sanctions or the like. Therefore the answer to the question at the end of the summary is no.

All the rest relates to the judge's determination that 1. the platintiff's attorneys misrepresented the state of the case in their briefs opposing the motions for summary judgment that would have ended the trial phase and 2. the plaintiff's attorneys disregarded both his rulings in case and unequivocable legal standards for what does and does not constitute patent infringement.

To use bad sports analogies, this ruling is the red card or the technical foul called on the field, not a warning that the team should never have attempted to play the game.

Disbar Frivolous Lawyers (4, Interesting)

Doc Ruby (173196) | more than 5 years ago | (#22550564)

The judge should have been able to set against the frivolous lawyers a "strike" that would add up towards disbarment if they did it again. Given repeated frivolity found by courts, lawyers should get a warning, a fine, a suspension and finally disbarment as the strikes accumulate over time, perhaps resetting once a year or 5 or 10 or 20 if not repeated. Perhaps several strikes assigned at once when the frivolity is really serious and the judge wants to push them towards disbarment, or out completely.

Then lawyers will be a lot more careful about flooding the courts with these worthless cases just because they have nothing better to do (and the client pays). That's their sworn job anyway, as "officers of the court", but they don't honor that oath without teeth when they break it - they're lawyers. And for those who see good cases get rejected just because they're not open/shut for lazy lawyers, that kind of refusal is also grounds for suing lawyers; suits in which the judges typically look very critically on the lawyers who should be staying out of trouble. Maybe that counterbalance needs stronger teeth, too, but there's certainly plenty of ways to get these lawyers to respect the merits of a case, whether trying or refusing it.

Re:Disbar Frivolous Lawyers (1)

Ollabelle (980205) | more than 5 years ago | (#22550744)

Don't count out the "strikes" you mentioned. The client could very well submit a complaint to the appropriate State Bar Association (the judge could, but I doubt it), who will then begin an investigation. It could take a long time, but various State Bar Associations don't treat this conduct lightly. To me, this conduct is approaching Fraud upon the Court and could mean significant trouble for those lawyers.

as a reminder.. (1)

pig-power (1069288) | more than 5 years ago | (#22550592)

Be careful what you wish for. Don't be blinded by the subject to not see that the Judge overturned the juror's decision. It makes me think that the jury was un-needed? But, the jury box is our(we) "the peoples" final test of laws and there justness.

He did it because the lawyers suckered the jury (5, Informative)

Ollabelle (980205) | more than 5 years ago | (#22550672)

I read a bit of background on this http://www.law.com/jsp/article.jsp?id=1202990197454 [law.com] and noted that the judge in pre-trial motions restricted the construction of the patent claim to fairly narrow grounds. But in the trial, the lawyers ignored that restriction and, among other things, showed the jury how the two competing products were similar rather than showing how the competing product used their client's patent. If effect, the jury based their reasoning on improper evidence. The judge rightfully tossed the verdict and slammed the lawyers for their deceitfulness.

Now, where's my violin?

comment on a comment in the story.. (1)

greywire (78262) | more than 5 years ago | (#22550848)

I just wanted to add something based on a comment in that story, though it may be directly applicable to this particular case.

The comment had to do with some other case, over the law of adverse possession (which I believe is just another way saying squating). He said in that case the just was just doing his job, and judging based on the law.

Well that's not entirely correct. Yes, a judges job is to know the law and try to decide if one has been broken or not. And the judge can overide the jury if he chooses. But a judge (and the jury) can also decide to rule in a way disregarding the law at hand, if they believe the law to be wrong. That's one of the important powers of the judicial system and its how laws can get changed.

In the case of current patent law, its probably going to take more cases like this where the law is disregarded and the jury or judge rule in favor of common sense before our patent system has a chance of being reformed..

Confusion over Judge's conduct in the trial (2, Insightful)

MobyDisk (75490) | more than 5 years ago | (#22550922)

After presiding over the 13-day trial, Matsch wrote that McDermott's lawyers not only disregarded his instructions during the trial but argued "with full awareness that their case was without merit."
(IANAL). If the lawyers disregarded the judge's instructions, shouldn't the judge have found them in contempt of court and declared a mistrial? It seems like waiting until the jury came to a decision and then overturning it doesn't result in a fair verdict.
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