Yesterday, Nimitz Technologies LLC, one of the entities involved in the recent Mavexar hearings, filed a petition for a writ of mandamus with the Federal Circuit to "review and reverse" the Court's most recent memorandum order in those cases, and to "direct the district court to terminate its judicial inquisition of the Petitioner."
If you recall from our post last week, the Court issued an order in three of the Mavexar-related cases directing Nimitz and two other plaintiffs to disclose a broad range of communications and documents, including things like retention agreements, bank account statements, and communications between the plaintiffs or their principals or attorneys and Mavexar.
Nimitz argues that the documents and communications that the Court's order seeks are irrelevant and privileged.
Irrelevant "By Statute"
Nimitz argues that the communications are irrelevant because FRCP 17 says that Nimitz can sue "without joining" the real party in interest, and because the patentee is the only real party in interest "by statute":
The Patent Act states plainly and unequivocally that a “patentee shall have remedy by civil action for infringement of his patent.” 35 U.S.C. §281.
Congress defined the term “patentee” as “includ[ing] not only the patentee to whom the patent was issued but also the successors in title to the patentee.” 35 U.S.C. §100. Thus, Congress provided that the legal title holder to a patent, and only the legal title holder, could enforce a patent.
Further, directly related to the district court’s concern of the real parties in interest, Fed. R. Civ. P. Rule 17(a)(1) provides that “[a]n action must be prosecuted in the name of the real party in interest,” and then further defined that[ "]The following may sue in their own names without joining the person for whose benefit the action is brought: . . . (G) a party authorized by statute.["] (Emphasis added).
Thus, Congress provided that only the legal title holder of a patent—the patentee—can sue and is the only real party in interest. And Congress explicitly stated that a “person for whose benefit the action is brought” was not the proper plaintiff.
The petition argues that this information is irrelevant by statute even if other parties are controlling the litigation:
[T]here is no abuse or threat to the judicial system if the legal title holders prosecute patent cases without disclosing who might be other parties in interest or who might be making litigation decisions, because that is what Congress has demanded. The only threat and abuse of the judicial system occurs is when anyone defies Congress’ choice and attempts to rewrite patent law.
I'm not sure I understand how they go from (1) the idea that they do not have to join the real party in interest because the patentee is authorized to sue by statute to (2) the idea that the Court is prohibited from inquiring about any other parties in interest. They seem to try to do that in this section:
The necessary consequence of the above statutes is that Congress made the choice that “person[s] for whose benefit the action is brought” are inconsequential in patent enforcement. The courts cannot consider facts relating to who might be the beneficiaries of patent enforcement. This is so because where the statutes and rules clearly define the sole real party in interest, the district court has no right to choose to pursue other parties in interest. The classic expressio unius est exclusio alterius canon of statutory construction states that the expression of one thing in the Patent Act and the Rules implies the exclusion of others.
But again, the rule they cited said that they could sue without naming the real party in interest, not that the patentee is the real party in interest. So I don't understand their statutory construction point.
I think their fundamental assumption is that the Court has no basis for inquiring about these parties other than FRCP 17. But I haven't seen where the Court has said that, and they don't seem to cite anything.
A Privilege Assertion
Nimitz also argues that the information the Court seeks is privileged:
The district court issued the Memorandum Order even after Nimitz’ managing member testified that Mavexar was handling the litigation interactions between Nimitz and counsel as Nimitz’ “consulting agent.” . . . The Order is intentionally geared towards disclosing the most profound of all privileged communications which are the documents that pass between client and counsel regarding the details and merits of an ongoing litigation.
These communications between Mavexar and counsel are privileged . . . .
At first the privilege and work product assertion seems surprising. At the hearings, the parties did not aggressively assert privilege, and acknowledged in at least one case that one of the LLCs specifically contracted with Mavexar to provide "nonlegal" services.
But on review of the transcript, I don't see a lot of really privilege-invading questions of the Nimitz witness specifically, so I can see how it makes sense that they didn't assert privilege at that time.
Their core argument is that Mavexar was Nimitz's agent, and that Nimitz's attorneys were communicating with Mavexar to provide legal assistance to Nimitz. Thus, in their view, everything is protected by privilege or work product.
Of course, the "agent" here may be the party who was in control in practice, at least based on testimony from the principals of the other LLCs. They made it sound like Mavexar drove the litigation forward and collected the majority of the proceeds, while the LLCs just signed off.
But does that matter, when it comes to the assertion of privilege? The petition doesn't spend any time on that point—and I don't know that it needed to, given that much of that testimony related only to other Mavexar-related LLCs. We'll have to see how it plays out as the appeal progresses.