Sanctions Granted for Repeated Discovery Misconduct and Attorneys' Fees Awarded for Counsel's Fabricated E-Mail

August 17, 2011

Plaintiff brought a patent infringement action alleging direct infringement of a single patent. The defendant, a corporation, sought an extension of time to respond to the complaint through a request from its CEO. Because corporations cannot represented themselves and must instead be represented by a licensed attorney, the district court denied the requested extension and ordered the defendant to answer within 30 days. A few months later, the CEO of the defendant filed an extension request in order to complete a re-examination of the plaintiff's patent even though there was no re-examination request pending before the Patent and Trademark Office. The defendant still had not filed an answer to the complaint.

In response, the plaintiff requested that the district court enter a default judgment against the defendant and to set a hearing to determine the appropriate amount of damages to be awarded to the plaintiff and whether a permanent injunction should issue. More than a week later, the defendant, through an attorney, filed an answer to the complaint. Plaintiff moved to strike the answer because the defendant had failed to seek leave of court to files its late answer. The district court denied plaintiff's motion and permitted the defendant to answer the complaint.

Nearly a year later, the district court held a status conference at which defendant's counsel failed to appear. After the district court entered the docket control and discovery orders, the plaintiff filed a motion to strike the defendant's pleadings arguing that the defendant had consistently refused to abide by the docket control and discover orders, including failing to timely answer the complaint, failing to appear at the status conference, failing to timely serve invalidity contentions, failing to submit proposed claim terms for construction and failing to produce any documents to the plaintiff.

After the district court ordered the defendant to respond to discovery, the plaintiff filed another motion to strike the defendant's pleadings arguing that the defendant was still refusing to participate in discovery. In response to this second motion, the defendant's counsel claimed that he had sent the plaintiff's counsel an e-mail regarding the defendant's purported production. The plaintiff claimed that the e-mail was never received and noted that the e-mail displayed irregularities that might show it was fraudulent.
After several subpoenas sent by plaintiff to uncover whether the e-mail was fraudulent, the district court conducted a hearing at which neither the defendant nor its counsel appeared. The district court found that the defendant had willfully violated court orders on multiple occasions. Most notably, the district court found that the e-mail was fraudulent. "But the Court is now convinced that the email was fraudulent. This is particularly evident from the information provided by Google that the email was never sent ..."

Accordingly, the district court granted the plaintiff's motion to strike the defendant's pleading and entered a default judgment in favor of the plaintiff. The district court also awarded the plaintiff its attorneys' fees and expenses pertaining to the effort it expended to prove that the defendant's counsel's e-mail was fraudulent.

Furminator, Inc. v. Petvac Group LLC, Case No. 2-08-cv-338-TJW (E.D. Tex. Aug. 5, 2011)

The authors of www.PatentLawyerBlog.com are patent trial lawyers at Jeffer Mangels Butler & Mitchell LLP. We represent inventors, patent owners and technology companies in patent licensing and litigation. Whether pursuing patent violations or defending infringement claims, we are aggressive and effective advocates for our clients. For more information contact Stan Gibson at 310.201.3548 or SGibson@jmbm.com.