I heard over the holiday break that one of the Mavexar-related entities, Backertop Licensing LLC, has continued to file suits, this time in the Central District of California. I also heard that they did not disclose Mavexar as an entity with an interest in the case, despite a rule requiring them to do so.
Yep, That Looks Like Backertop
I checked PACER, and it indeed looks like an entity called Backertop Licensing LLC filed two new suits in the Central District of California last week:
- Backertop Licensing, LLC v. Exaktime Innovations, Inc., C.A. No. 2:22-cv-8571 (C.D. Cal.)
- Backertop Licensing, LLC v. Fantasia Trading LLC, C.A. No. 5:22-cv-2081 (C.D. Cal)
Both complaints were filed on November 23, and both list the a principal place of business for Backertop that they also listed in D. Del.
If you recall, Backertop is a patent assertion entity where the sole member is the wife of an attorney at Mavexar. At the November 10 hearing, according to the transcript, Backertop's sole member testified that Mavexar gets either "49 percent of the net proceeds" (Tr. at 29:18) or "95 percent" of the "recoveries" from the suits (Tr. at 41:6-10).
I'm no expert on the Central District of California, but it looks like that district's local rules would require disclosure of Mavexar, if Mavexar retains an interest in the proceeds:
F.R.Civ.P. 7.1. DISCLOSURE STATEMENT
L.R. 7.1-1 Notice of Interested Parties. To enable the Court to evaluate possible disqualification or recusal, counsel for all non-governmental parties must file with their first appearance a Notice of Interested Parties, which must list all persons, associations of persons, firms, partnerships, and corporations (including parent corporations, clearly identified as such) that may have a pecuniary interest in the outcome of the case, including any insurance carrier that may be liable in whole or in part (directly or indirectly) for a judgment in the action or for the cost of defense. A corporate party may include in the Notice filed under this L.R. 7.1-1 any disclosures required under F.R.Civ.P. 7.1; if this information is included in the corporation’s Notice of Interested Parties, the corporation is not required to file a separate Disclosure Statement under F.R.Civ.P. 7.1.
Backertop's disclosure statements, embedded below, list only Backertop itself, its attorneys, and the defendants—not Mavexar.
This suggests that Mavexar no longer has a relationship with Backertop, or that Backertop's attorneys take a different view of the local rule or know of some exception for why they do not need to disclose that Mavexar has a right to a big chunk of the proceeds.
Isn't the C.D. Cal. Rule Harsher than Chief Judge Connolly's?
A local rule like the C.D. Cal's rule above really puts Chief Judge Connolly's standing orders in context. He requires disclosure of certain litigation funding and owners of certain entities; the C.D. Cal. rule appears on its face to be more stringent in some ways, encompassing everyone who may have a pecuniary interest.
2022-12-01 UPDATE: They Tried to Fix It
Since we posted this, Backertop has tried to correct this issue—but we'll have to see whether they've gone far enough.
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