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District Court Determines Litigation Funding Agreement That Provided Funds to Purchase Patents-in-Suit Discoverable as Relevant to Damages

In this patent infringement action, the district court analyzed whether a litigation funding agreement should be produced. After it reviewed the litigation funding agreement that the plaintiff had entered into with a litigation funder, the district court concluded that the funding agreement itself was not relevant to issues of standing.

The district court explained that the funding agreement appeared to provide a security interest in four of the patents-in-suit to a third party, but noted that they had not been exercised and likely would not be exercised, if ever, for a long time. On that basis, the district court concluded that the litigation funding agreement and the related communications would not be relevant to standing.

In reviewing the funding agreement, however, the district court found that a portion of the agreement did not concern funding the litigation but instead detailed how the third-party fund would provide the plaintiff with money that the plaintiff could then use to purchase the four patents-in-suit. The district court concluded “[t]hat portion of the agreement, and any communications relating to it, would appear to be relevant to damages in this case (such that were that content not privileged or work product protected, it should be produced). See, e.g., Integra Lifesciences I, Ltd. v. Merck KGaA, 331 F.3d 860, 871 (Fed. Cir. 2003); Finjan, LLC v. ESET, LLC, Case No.: 17-cv-183-CAB-BGS, 2021 WL 1541651, at *6 (S.D. Cal. Apr. 20, 2021); TC Tech. LLC v. Sprint Corp., No. 16-cv-153-RGA, 2019 WL 2515779, at *10 (D. Del. June 18, 2019); Uniloc USA, Inc. v. Apple Inc., Case No. 19-cv-01692-EJD (VKD), 2020 WL 4368207, at *2 (N.D. Cal. July 30, 2020) (citing cases).”

Speyside Medical, LLC v. Medtronic CoreValve LLC et al, Case No. 1-20-cv-00361 (D. Del. April 28, 2021)

The authors of are patent trial lawyers at Jeffer Mangels Butler & Mitchell LLP. For more information about this case, contact Stan Gibson at 310.201.3548 or