I flagged on Wednesday that Chief Judge Connolly planned to hold an evidentiary hearing today regarding compliance with his litigation funding and entity ownership orders in three cases. Well, I went, and it was one of the most remarkable hearings I've seen in a patent case.
The purpose of the hearing was to dig into whether the parties complied with Chief Judge Connolly's standing orders regarding litigation funding and entity ownership.
But the Court's statements at the hearing offered some insight into what motivated those orders in the first place: Chief Judge Connolly believes (as he has said before) that the District Court is not a "star chamber," and that the public has …
Back in May, we wrote about an order by Chief Judge Connolly directing an ANDA plaintiff to cut back to 4 claims prior to trial, or potentially face a more difficult road for injunctive relief.
Plaintiff cut back to 6 claims, apparently dropping five patents from the case, and the bench trial proceeded.
Last month, Chief Judge Connolly issued his post-trial opinion regarding infringement and invalidity, and directed the parties to enter a proposed order. The parties ended up disputing what should happen to those dropped claims from the five dropped patents in the final judgment:
The proposals differ with respect to the disposition …
We've talked a lot about Chief Judge Connolly's standing orders on disclosure and litigation compliance, including about how he recently ordered in-person hearings regarding compliance with those orders in a fairly large number of cases.
Chief Judge Connolly's standing order on Rule 7.1 statements requires disclosure of all individual or corporate owners of certain entities, going all of the way up the chain and including indirect owners:
[I]n all cases assigned to Judge Connolly where a party is a nongovemmental joint venture, limited liability corporation, partnership, or limited liability partnership, that the party must include in its disclosure statement filed pursuant to Federal Rule of Civil Procedure 7.1 the name of every owner, member, and partner of the party, proceeding up the chain of ownership until the name of every individual and corporation with a direct or indirect interest in the party has been identified.
Standing Order Regarding Disclosure Statements Required by Federal Rule of Civil Procedure 7.1 (D. Del. April 18, 2022).
We wrote about one instance, in VLSI Technology LLC v. Intel Corporation, C.A. No. 19-426 (D. Del.), where the Court ordered the plaintiff to confirm compliance with its standing order, and stayed the case when the plaintiff filed an inadequate response.
At this point it's clear that Chief Judge Connolly's standing orders regarding initial disclosures and litigation funding are no joke, and plaintiffs need to comply with them or risk consequences.
Today, the Court took the further step of requiring the owners of plaintiff entities in at least 14 cases to appear in-person for evidentiary hearings regarding compliance with his standing orders.
The orders today generally took the following form:
Whereas the amended corporate disclosure forms Plaintiff filed in the above-captioned cases identify [owner name(s)] as Plaintiff s owner; and
Whereas the Court has concerns about whether Plaintiff has complied with the Court's standing order regarding third-paty litigation funding [or about the accuracy of the …
Federal Circuit on the left vs. Federal Circuit on the right. Will we get to see round 2?Charl Folscher, Unsplash
We talked a couple of days ago about how, in Longbeam Technologies LLC v. Amazon.com, Inc., C.A. No. 21-1559-CFC (D. Del.), Chief Judge Connolly stayed the action after raising plaintiff's inadequate disclosures at a § 101 hearing.
But, at the same hearing, plaintiff actually prevailed on the § 101 motion—and Chief Judge Connolly made some notable comments about how the Federal Circuit has responded to his previous § 101 decisions, and what that means for cases going forward.
Case 1, Universal Secure: Affirmed
The first case, Universal Secure Registry LLC v. Apple Inc., …
We've talked a lot about Judge Connolly's April 2022 standing orders on disclosure statements and litigation funding, including earlier this month when we Judge Connolly stayed an action after a plaintiff failed to fully comply with those orders.
(Plaintiff in that action, by the way, filed an updated disclosure statement claiming it has no knowledge to disclose—we'll have to see how the Court responds to that).
Yesterday, it happened again, but it was triggered by a clever filing by a defendant. In Longbeam Technologies LLC v. Amazon.com, Inc., C.A. No. 21-1559-CFC (D. Del.), the Court put an order on the docket for the parties to comply with its standing orders:
ORAL ORDER: The parties are directed to certify within five days that they have complied with Chief Judge Connolly's April 18, 2022 Standing Order Regarding Disclosure Statements Required by Federal Rule of Civil Procedure 7.1. The parties are also reminded of their obligation to comply with Chief Judge Connolly's April 18, 2022 Standing Order Regarding Third-Party Funding Arrangements. Ordered by Judge Colm F. Connolly on 5/13/2022. (nmf) (Entered: 05/13/2022)
In response, plaintiff filed an updated Rule 7.1 statement but, as far as I can tell, no litigation funding
We've previously talked about how Chief Judge Connolly's new form orders split patent trials into phases, with willful infringement and damages tried only if there is a finding of infringement. We noted at the time that the new form order doesn't say in which phase invalidity goes—with infringement, or afterwards?
It looked like we got an answer late last month, when Chief Judge Connolly held a phased jury trial in MagnoliaMedical Technologies, Inc. v. Kurin, Inc., C.A. No. 19-97-CFC-CJB (D. Del.). There, the Court split the trial into two phases, with infringement by itself and then invalidity and damages together.
We posted earlier this year about Judge Connolly's new standing orders requiring plaintiffs to disclose litigation funding and Rule 7.1 disclosure requirements for certain entities such as LLCs.
In that post, we pointed out that "the language seems to apply to existing cases, but there is no explicit deadline for compliance. Personally, though, I'd probably get moving..."
Apparently, counsel for the parties in VLSI Technology LLC v. Intel Corporation, C.A. No. 18-966 (D. Del.) do not read the blog.
About two weeks ago, the Court issued oral orders in VLSI directing the parties to comply with his standing orders:
ORAL ORDER: It is HEREBY ORDERED that each party shall …
When expert reports go back and forth in a patent case, it's not uncommon to see complaints from the patentee's expert along the lines of "I understand that the opposing party did not produce information regarding x, so I will instead base my opinions y."
In other words, the expert wants to keep the door open to explain to the jury that he or she would have done a particular analysis if only the other side had given them the information they needed. But, obviously, the other side may object to that testimony.
Judge Connolly addressed a situation like yesterday, and held that the expert cannot just testify to the jury about the other sides alleged …
Just a heads up, since this has to be one of the more common things that counsel do in cases—this week, Judge Connolly denied a stipulation extending the answer deadline as untimely and lacking a reason:
ORAL ORDER: The parties' stipulation (D.I. 16) being untimely and offering no justification for an extension, it is HEREBY DENIED. Defendant has until June 23, 2022 to answer, move, or otherwise respond to the complaint. ORDERED by Judge Colm F. Connolly on 6/21/22. (ntl) (Entered: 06/21/2022)
Wikeshire IP LLC v. TransCore, LP, C.A. No. 22-445-VAC (D. Del.).
It's not clear from the docket why it was untimely. It looks like the answer deadline was originally 4/28/2022, then it was extended by stip to 5/28, then 6/14. Then, on 6/14 (the due date), the parties filed another stipulation extending the answer deadline to 6/28.
So it looks like the Court rejected a stipulation filed on 6/14 to extend a 6/14 due date. It may be that the parties filed after the 6pm filing deadline. Or, it may be that the Court is taking the view that the stipulation must be filed early enough for the Court to "so order" it prior to the deadline—but I haven't seen that in other cases.
Either way, it's probably safest to list a justification for your stip extending the answer deadline, and to file early going forward! Of course, this can be tricky in high-volume NPE cases, where plaintiff's counsel may be unresponsive until the parties are right up against a deadline.
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