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Tag Archives: Cole

Final Invalidity Contentions May Not be Amended to Add Nautilus-Based Indefiniteness Claims

Posted in Local Rules

R-Boc Reps., Inc. v. Minemyer, No. 11 C 8433, Slip Op. (N.D. Ill. Cole, Mag. J.).

Judge Cole denied plaintiff R-Boc’s motions to amend its Final Invalidity Contentions with an allegedly new theory regarding the phrase “approximately perpendicular” based upon the Supreme Court’s Nautilus indefiniteness decision and related motion for summary judgment of invalidity based upon R-Boc’s new argument.

As an initial matter, the Court originally adopted the parties’ agreed construction of “approximately perpendicular” — “approximately 90 degrees.”  The agreed construction was initially proposed by R-Boc.  The Court noted that parties were bound by their strategy decisions in cases generally.  Furthermore, the Supreme Court’s Nautilus decision was about the phrasing of the indefiniteness test, not the meaning of words of approximation, which are common in patent claims.  R-Boc had also been stopped in two prior attempts to change its “approximately perpendicular” construction in the form of a summary judgment motion and a motion for judgment as a matter of law.

Finally, the Court also held that any prejudice to defendant could not be cured by the extensions that R-Boc offered to agree to because the case was over seven years old having been to trial and then gone to the Federal Circuit before returning to the Court.  At this point in the life of the case, any delay in getting to a final resolution would be prejudicial.

Scheduling Delay Does Not Warrant Canceling the Deposition

Posted in Discovery

Cleversafe, Inc. v. Amplidata, Inc., No. 11 C 4890, Slip Op. (N.D. Ill. Jan. 11, 2014) (Cole, Mag. J.).

Judge Cole denied plaintiff Cleversafe’s motion for a protective order and sanctions preventing the deposition of Cleversafe’s CEO.  The CEO was a critical witness — one of two listed on Cleversafe’s initial disclosures.  And defendant Amplidata’s alleged delay in scheduling it did not warrant sanctions.  Furthermore, Cleversafe could point to no harm for the delay.  In fact, the CEO had enjoyed the benefit of not having to prepare or sit for a deposition.

Experts Review of Document Erases Privilege

Posted in Trial

Tellabs Ops., Inc. v. Fujitsu Ltd., No. 08 C 3379 & 09 C 4530, Slip Op. (N.D. Ill. Aug. 29, 2012) (Cole, Mag. J.).

Judge Cole, after an evidentiary hearing, ordered Fujitsu to produce all documents related to an extensive inspection of plaintiff Tellabs’ optical scanner in this patent case.  Fujitsu claimed that certain reports related to the inspection were privileged, but Fujitsu’s expert report stated that the expert had reviewed those report.  Fujitsu and its expert argued that the expert’s statements about reviewing the reports were erroneous.  While the expert had received the reports, he thought they were other documents and put them in a pile without ever reading them.  Regardless of whether the expert and counsel remembered the facts correctly, the story was improbable.  The Court did not believe that an “eminent” professor who was acutely aware of the need for accuracy could mistakenly misstate what he had reviewed twice.  Because the Court held that the expert had considered the reports, any privilege that may have attached to them was waived.

Declaratory Judgment Claims re: Redesigned Product May be Brought in A Separate Suit

Posted in Federal Rules

R-Boc Reps., Inc. v. Minemyer, No. 11 C 8433, Slip Op. (N.D. Ill. July 16, 2012) (Cole, Mag. J.).

Judge Cole denied declaratory judgment defendant Minemyer’s Fed. R. Civ. P. 13(a) motion to dismiss declaratory judgment plaintiff R-Boc’s complaint seeking a declaratory judgment that its redesigned coupler did not infringe Minemyer’s patent.  Minemyer argued that R-Boc’s complaint was improper claim-splitting and that the claim should have been filed in Minemyer’s 2007 suit accusing R-Boc’s original coupler designs.  In February 2012, a jury held that R-Boc’s original coupler did not infringe. 

The Court noted the length of that case - five years and 527 docket entries - quoting the Federal Circuit:

“Patent litigations are among the longest, most time-consuming types of civil actions.  As of 2009, 384 patent cases had been pending in the district courts for three years or more.  Moreover, the costs of patent litigation are enormous with an average patent case costing upwards of $3 million for each side.”  Ohio Willow Wood Co. v. Thermo-Ply, Inc., 629 F.3d 1374, 1376-77 (Fed.Cir. 2011)(citations omitted).

R-Boc’s claims were not claim-splitting.  While a patentholder must assert all claims from a single patent against a single product in one action, claims regarding a new product, need not be filed in the same suit involving an older version of that product.  R-Boc’s declaratory judgment claims regarding the new coupler would only have been compulsory in the earlier suit had that suit accused the new coupler of infringement.

Parties’ Employees May Maintain Work Product Protection, Just Not in This Case

Posted in Discovery

Tellabs Ops., Inc. v. Fujitsu Ltd., No. 08 C 3379 & 09 C 4530, Slip Op. (N.D. Ill. May 1, 2012) (Cole, Mag. J.).

Judge Cole denied defendant and counter-plaintiff Fujitsu’s motion for a protective order prohibiting plaintiff and counter-defendant Tellabs from getting discovery regarding Fujitsu’s inspection of Tellabs’ optical scanner in this patent litigation regarding optical amplifiers.  Fujitsu argued that the inspection was conducted by its employees specifically in anticipation of litigation and, therefore, was work product because the employees would not be testifying at trial.  The issue before the Court was whether an employee could be “specially employed . . . in anticipation of litigation” pursuant to Fed. R. Civ. P 26(b)(4)(D). 

The district courts were split on the answer.  The Court noted that had the Rule been intended to expressly exclude a party’s employees, it would likely have required that the individual be “specially retained” instead of “specially employed.”  The Advisory Committee Note was also instructive, if not conclusive, in excluding generally employees not “specially employed on the case.”  If the Advisory Committee intended to exclude general employees, it could have excluded all general employees in the Note. 

Having determined that the Fujitsu employees could be protected by Rule 26(b)(4)(D) as specially employed, the Court turned to the facts of the case.  But Fujitsu had not met its burden to show that its analysis was done in anticipation of litigation, for at least the following reasons:

  • The evidence showed competition issues, not an expectation or anticipation of litigation at the time of the analysis.
  • The “primary motivating purpose” behind the investigation was not litigation, but at least include competitive concerns.  The fact that the reasons may have later “morphed” into litigation was not relevant.

The Court also commended both sides and their counsel for rarely presenting discovery disputes to the Court.

Arguments Not in Final Pre-Trial Order Waived

Posted in Jurisdiction, Trial

Minemyer v. R-Boc Reps., Inc., No. 7 C 1763, Slip Op. (N.D. Ill. May 11, 2012) (Cole, Mag. J.).

Judge Cole denied defendant Grimsley’s Fed. R. Civ. P. 12(b)(2) motion to dismiss for lack of personal jurisdiction in this patent dispute.  As an initial matter, the motion was denied as waived.  Judge Coar denied an initial motion on the same grounds with leave to refile based upon information gathered during discovery.  But Grimsley did not raise the issue for more than four and a half years, after entry of the final pretrial order and on the sixth day of trial.  By failing to raise his motion in the final pretrial order, Grimsley waived his jurisdiction argument.  And Grimsley would have also lost on the merits.  Judge Coar’s original analysis remained correct.  The fiduciary shield doctrine did not apply.  The evidence showed that Grimsley was not acting at his employer Dura-Line’s instruction.  Grimsley had discretion and control, and was “intimately involved” in a deception regarding the infringing product.

Trial Testimony Makes Otherwise Inadmissible Evidence Admissible

Posted in Trial

Minemyer v. R-Boc Reps., Inc., No. 07 C 1763, Slip Op. (N.D. Ill. Feb. 15, 2012) (Cole, Mag. J.).

Magistrate Judge Cole admitted a third party Power Point presentation in this patent litigation.  The Court originally granted defendant’s motion in limine excluding the presentation, although allowing plaintiff’s expert to rely upon the document because of defendant’s failure to timely challenge the expert report.  Without ruling upon the credibility of testimony or making a factual finding, the Court ruled upon the admissibility of the Power Point presentation as follows:

  • Evidence was introduced that could lead a jury to believe statements in the Power Point presentation were false or misleading.
  • Plaintiffs would argue that evidence at trial showed that defendants intended to copy plaintiff’s coupler and sell it to Verizon.
  • Emails were introduced into evidence suggesting that Verizon may have understood that defendants were offering to use plaintiff’s coupler’s in defendant’s proposal.

Based upon at least these reasons, the Power Point presentation was admitted although not for the truth of the matter asserted:

The Power Point will still not be admitted for the truth of the matter asserted, namely that Dura-Line bid Lozon products or that it was an advantage of the Dura-Line bid that it had bid the Lozon coupler.  Rather, those statements will be received simply to show that they were made and if the jury thought it proper, they could conclude that it was Verizon’s perception that the Lozon couplers had been bid by Dura-Line and that Verizon perceived them as an acceptable and quality product.

 

Document is Excluded, Except for the Expert’s Needs

Posted in Trial

Minemyer v. R-Boc Reps., Inc., No. 07 C 1763, Slip Op. (N.D. Ill. Feb. 6, 2012) (Cole, Mag. J.).

Magistrate Judge Cole held that a Verizon Power Point presentation related to an RFP for some of the accused products was admissible in this patent litigation involving couplers. Initially, the document was authentic pursuant to FRE 901 at least because:

  • A Verizon declaration established its authenticity; and
  • Defendants’ counsel failed to challenge its authenticity for three years after its first use in plaintiff’s damages expert report.

Having held it was sufficiently authenticated, the Court considered whether the presentation was inadmissible hearsay.  The Court held that Verizon’s statement was an FRE 803(b) verbal act, but because plaintiff’s certification of the Power Point was too late, not leaving defendant time to test the veracity of the Power Point it was inadmissible.  But the Court did allow plaintiff’s expert to use the documents because defendants did not timely challenge plaintiff’s expert’s reliance upon the Power Point.  At the eve of trial was too late.

Court Refuses “Back Door” Attempt at Claim Construction

Posted in Claim Construction

Minemyer v. B-Roc Reps., Inc., No. 07 C 1763, Slip Op. (N.D. Ill. Mar. 22, 2011) (Cole, Mag. J.).

Judge Cole denied defendants’ summary judgment of noninfringement. The motion was premised upon an effort to amend the construction of "approximately perpendicular" which the parties previously agrees was "approximately ninety degrees" to no more than five degrees away from a ninety-degree angle. Defendants’ accused couplers had threads at an eighty degree angle – ten degrees away from ninety degrees. But the parties had already cancelled their claim construction process because they agreed upon all constructions, including that approximately perpendicular meant approximately ninety degrees." Even if the arguments were timely, and not a "back door" attempt to avoid the Court’s schedule, defendants’ evidence did not support their construction:

  • The inventor’s testimony suggested ten degrees did not meet the "approximate" modifier. But the inventor’s testimony is heavily discounted if not disregarded, in claim construction.
  • The parties experts also opined that ten percent was outside "approximate." But that was evidence for the trier of fact to weight in considering infringement.
  • The examiner’s use of "perpendicular" without the "approximately" modifier was irrelevant because the allowed claim contains the modifier.

Patent Disclosure Includes the Specification and the Drawings

Posted in Legal News

Minemyer v. B-Roc Reps., Inc., No. 07 C 1763, Slip Op. (N.D. Ill. Oct. 27, 2009) (Cole, Mag. J.)*

Judge Cole granted summary judgment of invalidity based upon the §102(b) on-sale bar and denied summary judgment as to invalidity based upon §102(b) public use and obviousness.

                                                             Priority Date

Plaintiff argued that its pipe coupler patent was entitled to the priority date of its provisional application because the provisional application disclosed in the drawings the tapered threads at issue, although they were not described in the specification. The Court held that figures showing tapered threads would be sufficient, but that the figures did not show tapered threads. Plaintiff alleged that enlargements of the figures showed a 1% taper. But the Court held that the original drawing did not “convey” the tapered threads with "reasonable clarity.” Even the enlargement showed “no true tapers.” Because the provisional application did not disclose the taper, the patent’s priority date was its filing date.

                                                             On-Sale Bar

The Court held that plaintiff admitted he offered the patented couplers for sale more than one year before the filing date, also known as the critical date. Plaintiff also admitted both in interrogatory responses and at deposition that his invention had been reduced to practice at the time of the offer.  Plaintiff claimed that the use was experimental, but the court held that the claim was not properly supported by evidence in plaintiff’s Local Rule 56.1 statement of material facts.

                                                             Public Use Bar

The Court denied summary judgment based upon the public use bar. The alleged prior art device was asserted against other claims in defendants’ invalidity contentions, but not against the claim at issue, claim 12. Furthermore, the evidence of the alleged prior art coupler was provided by a witness that was not disclosed in defendants’ Rule 26 disclosures or their interrogatory responses. He was first identified in a subpoena at the end of fact discovery.

                                                             Obviousness

Defendant’s obviousness arguments were based upon the same prior art as the public use bar prior art. So, summary judgment was not appropriate for similar reasons. Additionally, defendants arguments were cursory and did not even cite case law.

Click here for more on this case in the Blog’s archives.

Court Delays Trial One Year

Posted in Trial

Minemyer v. B-Roc Reps., Inc., No 07 C 1763, Slip Op. (N.D. Ill. Nov. 9, 2009) (Cole, Mag. J.).

Judge Cole granted in part defendants’ motion to extend the trial date.  The Court continued the trial, but not to the early 2010 date defendants requested.  Instead, the Court continued the trial until early 2011.  An early 2010 trial date would have prevented plaintiff from attending the patent trial because plaintiff begins serving a one-year federal prison sentence in December 2009.  The Court held that holding a trial that plaintiff would be unable to attend in person would prejudice plaintiff.  Instead, the Court delayed the trial until plaintiff will be able to attend.  Plaintiff argued that he would be prejudiced by the one-year delay because his damage award would be delayed an additional year.  The Court, however, held that any prejudice from a delayed award was too speculative to be considered because there was no way to know that plaintiff would be awarded any damages.  Additionally, the Court noted that the delay would benefit plaintiff if he ultimately prevails because his award would include an additional year of damages.

Commercially Available Products are Discoverable

Posted in Discovery

Boler Co. v. ArvinMeritor, Inc., No. 03 C 489, Slip Op. (N.D. Ill. Jul. 2, 2008) (Cole, Mag. J.).

Judge Cole decided various discovery and protective order issues in this patent infringement dispute.  Of particular note, the Court denied defendant’s motion to preclude inspection of items that were commercially available.  The Court held that commercially available items were discoverable and that because the items were commercially available there were no protective order implications.

The Court also refused to consider certain oral motions, likely those that the parties could have filed before the hearing, because the Court’s standing order required that motions be briefed.  Always make sure to read the Court’s standing order, as well as the Local Rules.

Counterfeiting Statutory Damages are up to $1M/Trademark

Posted in Damages

Lorillard v. Montrose Wholesale Candies & Sundries, Inc., No. 03 C 5311 & 4844, 2008 WL 1775512 (N.D. Ill. Apr. 17, 2008) (Aspen, J.).

Judge Aspen adopted Magistrate Judge Cole’s Report and Recommendation, denying defendants’ Fed. R. Civ. P. 59(e) motion to alter the Court’s judgment against defendants – click here to read more about that Report and click here to read more about this case in the Blog’s archives. The Court awarded plaintiff Lorillard $2.5M in statutory damages for defendants’ sales of counterfeit cigarettes using Lorillard’s trademarks. Defendants objected to, among other things, a statutory damages award in excess of $1M. Defendants argued that 15 U.S.C. § 1117(c)(2) only allowed $1M in statutory damages per type of goods sold. Because this case only involved one type of goods, cigarettes, defendants argued statutory damages could not exceed $1M. But the Court held that the limitation was $1M per counterfeit mark per type of good. Because Lorillard alleged five counterfeit marks were used, the statutory damages limit was $5M. 

Federal Rules Do Not Authorize Civil Search and Seizure

Posted in Trial

Lorillard Tobacco Co. v. Montrose Wholesale Candies & Sundries, Inc., No. 03 C 5311 & 0844, 2008 WL 954161 (N.D. Ill. Apr. 8, 2008) (Cole, Mag. J.).

Judge Cole denied plaintiff’s motion for inspection and seizure of assets in its trademark counterfeiting case. The Court previously entered judgment for plaintiff – click here for more about this case in the Blog’s archives. Plaintiff brought this motion seeking to identify and seize cash, checks and other financial instruments to satisfy the judgment. The Court held that the motion essentially sought a search warrant directed by plaintiff and utilizing Federal Marshals:

The reality is that the motion is tantamount to a request for a search warrant for Lorillard to enter and search the home of Ray and Sandra Hazemi and the business premises of Montrose Wholesale Candies and Sundries, Inc. (which is owned by them) and for permission to seize any cash, checks or other negotiable instruments belonging to the Hazemis and Montrose and to seize or at least copy all of their financial and accounting records. Nothing in the Motion, itself, suggests that the search and seizure will be accomplished by anyone other than Lorillard. It is not until one looks at the Proposed Order granting the motion that there is even a motion of United States Marshals. But even then, it is Lorillard, through its counsel of record, who is to carry out the search and seizure. The Marshals are merely to accompany Lorillard.

The Court held that the Federal Rules of Civil Procedure did not authorize search warrants. The Court further held that the request was not like a seizure of counterfeit goods, which was authorized by 15 U.S.C. § 1116(d)(1)(A), because it sought a post-judgment search to satisfy a judgment.

Incomplete Discovery Not Sanctionable Because it Complied With Requestors’ Expert Request

Posted in Discovery

Autotech Techs. Ltd. Partnership v. Automationdirect.com, Inc., No. 05 C 5488 2008 WL 783301 (N.D. Ill. Mar. 25, 2008) (Cole, Mag. J.).*

Judge Cole granted in part defendant Automationdirect.com’s ("ADC") motion to compel additional records from plaintiff Autotech’s database. The parties agreed that an ADC expert would be allowed to develop queries which Autotech would run on its database. After a dispute regarding how to produce the results of the search, the Court ordered production of the documents, which related to records of, among other things, customer confusion. Upon review of the records, ADC demanded that Autotech supplement them with information such as the date of the communication and the identity of the Autotech employees involved. Autotech eventually supplemented the documents with an index identifying, among other things, the identity of the Autotech employee involved in each communication, but not the dates of the communications. ADC moved to compel the production of all fields in Autotech’s database for each entry identified by ADC’s query. But Autotech countered that it had produced all fields generated by ADC’s expert’s query. Had the query generated all available fields, they, presumably, would have been produced them all. Because Autotech produced the information generated by ADC’s search and supplemented that production with an index, sanctions were not warranted. But the Court did order production, at ADC’s expense, of the dates of each communication. The Court also ordered the parties to meet and confer to determine how to produce the dates in a useful format.

*Click here for more of this case in the Blog’s archives.

Incomplete Discovery No Sanctionable Because it Complied With Requestors’ Expert Request

Posted in Discovery

Autotech Techs. Ltd. Partnership v. Automationdirect.com, Inc., No. 05 C 5488, 2008 WL 783303 (N.D. Ill. Mar. 25, 2008) (Cole, Mag. J.).*

Judge Cole granted in part plaintiff Autotech’s motion to compel communications between defendant Automationdirect.com, Inc. ("ADC") and any third party regarding ADC’s competing C-More touch screen panel. The Court held that ADC need not produce documents related to source code for the C-More product. The Court previously denied Autotech’s motion to amend its complaint adding claims related to that source code. But the Court held that ADC’s third party communications could be relevant to show whether ADC has complied with its contractual obligation to use its best efforts to sell Autotech’s product, or if its C-More sales efforts interfered with sales of Autotech’s products. The Court also held that any communication evidencing customer confusion must be produced.

Practice Tip: Do not employ new arguments in reply briefs. The Court did not consider Autotech’s reply brief because it changed the scope of its argument on reply. Autotech’s opening brief sought ADC’s third party communications with the exception of those regarding ADC’s source code because claims regarding ADC’s software were not in the case. But on reply, Autotech also sought the source code related communications.

*Click here for more about this case in the Blog’s archives.

Violating Injunctions is a “Big Deal”

Posted in Legal News

Am. Fam. Mutual Ins. Co. v. Roth, No. 05 C 3839 & 3869, 2008 WL 168693 (N.D. Ill. Jan. 15, 2008) (Guzman, J.).

Judge Guzman adopted Magistrate Judge Cole’s Report and Reconsideration in full, holding defendants in contempt for violating the Court’s injunctions requiring that defendants return various customer information taken from plaintiff, defendant’s former employer – click here for more on the prior opinions in the Blog’s archives. It was defendants’ responsibility to ensure that defendants’ former counsel, who had copies of relevant documents, comply with the injunction by turning the documents over to plaintiff. The fact that defendants did not have direct control over their former counsel’s copies did not matter.

Additionally, the Court held that it did not matter that plaintiff did not originally make a “big deal” out of defendant’s non-compliance. Defendants argued that they presumed there was no need to comply with the Court’s injunctions because nobody was making a “big deal” about the return of the materials. That presumption was flawed. Neither party moved to modify either the preliminary injunction or the amended preliminary injunction. Thus, defendants had a duty to comply with the Court’s injunctions as written.

Practice Tip: Do not fall in to the trap of believing that substantial compliance with a court order is sufficient. While that could be true in some cases, you should always contact the court if you have a problem complying with an order. Compliance with orders is one case where the adage that you are better off asking forgiveness than asking permission does not hold true.

Discovery Request Due Dates Must Fall Within the Discovery Period

Posted in Discovery

Autotech Techs. Ltd. Ptnshp. V. Automation Direct.com Inc., No. 05 C 5488, 2007 WL 2746654 (N.D.Ill. Sep. 18, 2007) (Cole, Mag. J.).*

Judge Cole denied plaintiffs’ (collectively “Autotech”) motion to compel production of defendant Koyo Electronics’ (“Koyo”) touchscreen source code. In Autotech’s Third Amended Complaint – filed without the leave of Court required by Fed. R. Civ. P. 15, but later allowed by Chief Judge Holderman – Autotech alleged that defendants infringed Autotech’s copyrights in its touchscreen display images. Autotech also alluded to source code infringement, but did not explicitly claim it. 

In a later interrogatory response, Autotech stated that it was not claiming that defendants’ source code infringed Autotech’s copyrights, but reserved the right to amend the complaint adding such charges. Because Autotech had not sought leave to add source code infringement claims to its complaint, the Court held that the requested source code was not relevant and production was not required. The Court also noted that the request seeking source code was improper because it was served less than thirty days before the fact discovery close in violation of Local Rule 16.1. It did not matter that the deadline was ultimately extended because the extension was granted after the original fact discovery close and after the deadline for responding to the document requests.

Practice tip: Whenever a Court issues a fact discovery close, get out your calendar, count backward thirty days and mark the last day for serving discovery requests. You would be amazed at how many litigators do not take note of this important date.

*Click here for more on this case in the Blog’s archives.

Court Waxes Eloquent on Discovery

Posted in Discovery

Flentye v. Kathrein, No. 06 C 3492, Slip Op. (N.D. Ill. Oct 2, 2007) (Cole, Mag. J.).*

Judge Cole continued defendants’ motion to compel for one week because defendants had not conducted a Local Rule 37.2 conference before filing their motion. But the Court also provided its thoughts on the prosecution of discovery, both in this specific case and generally. The Court noted that after one year of discovery, “not a single document was produced in response to the 70 paragraph document request!”

But what is most interesting about the opinion is the Court’s quotes on various discovery issues. On discovery generally: 

“[D]iscovery is the bane of modern federal litigation.” Rossetto v. Pabst Brewing Co., Inc., 217 F.3d 539, 542 (7th Cir. 2000). It is intrusive, unpleasant, time-consuming and costly. It is, like life itself, “nasty [and] brutish …” Hobbes, Leviathan, Chapt XIII. Unfortunately, it is not generally “short.”

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Evidentiary Hearing Not Required for Contempt Ruling Based Upon Undisputed Facts

Posted in Legal News

Coilcraft, Inc. v. Inductor Warehouse, Inc., No. 98 C 0140, 2007 WL 2728754 (N.D. Ill. Sep. 13, 2007) (Guzman, J.).

Judge Guzman conducted a Fed. R. Civ. P. 72 de novo review of Magistrate Judge Cole’s report which recommended that the Court hold defendant in contempt for violating the Court’s permanent injunction limiting defendant’s use of plaintiff’s Coilcraft mark (click here for further discussion in the Blog’s archive). The Court adopted Judge Cole’s Report in its entirety and gave plaintiff fourteen days to submit a proposed order and proof of its attorneys’ fees and costs related to this motion. The Court also held that Judge Cole was not required to hold an evidentiary hearing before issuing the Report because there were no genuine issues of material fact. The dispute was governed by the language of the Court’s injunction which was not disputed. And the only issue was whether defendant’s advertisements, the contents of which were not disputed, violated the injunction – a matter of law.

$2.5M Statutory Damages Award Set Without Hearing

Posted in Damages

Lorillard Tobacco Co. v. Montrose Wholesale Candies & Sundries, Inc., No. 03 C 5311 & 4844, 2007 WL 2580491 (N.D. Ill. Sep. 10, 2007) (Cole, Mag. J.).

Judge Cole recommended awarding plaintiff $2.5M in statutory damages. The Court had previously entered a Fed. R. Civ. P. 37(b) default judgment against defendants for sales of counterfeit Newport cigarettes in violation of the Lanham Act.* The Court recommended that a damages hearing was not necessary because of defendants’ four year pattern of avoiding discovery obligations leading to a default judgment, including failing to produce damages documents. Having actively avoided producing the information for four years, defendants were not now entitled to seek opportunities to present evidence in their defense. Furthermore, the Court reported that a $2.5 M award was reasonable. $2.5M was half of plaintiff’s estimate of defendants’ infringing sales and it was half of the potential $1M statutory award for each of the five marks defendants infringed.

* For more on this case, see the Blog’s archives.

Striking Evidence Too Strong a Remedy for Wrongly Retained Evidence

Posted in Discovery

Am Fam. Mutual Ins., Co. v. Roth, No. 05 C 3839, 2007 WL 2410074 (N.D. Ill. Aug. 16, 2007) (Cole, Mag. J.).

Judge Cole granted in part plaintiff’s motion to strike evidence and bar its use. The documents at issue were commission statements including plaintiff’s customer information. The Court previously ordered defendants to return to plaintiff all documents in its possession including plaintiff’s customer information in this trade secret matter. After that order, defendants filed the commission statements, including customer information, with the clerk as an exhibit to another document. The Court held that filing of the commission statements was public disclosure which violated the Court’s order that defendants not retain or disclose such information. But the Court held that plaintiff’s preferred sanction for retaining and filing the documents, barring their use as evidence at trial, was not proportional with defendants’ wrong in keeping the document and filing them publicly with the Court. 

Interrogatory Responses Supplemented by Deposition Testimony

Posted in Discovery

Fast Food Gourmet, Inc. v. Little Lady Foods, Inc., No. 05 C 6022, 2007 WL 2156665 (N.D. Ill. Jul. 26, 2007) (Cole, M.J.)

Judge Cole granted in part defendant Little Lady Foods’ (“LLF”) Fed. R. Civ. P. 37 motion to bar evidence of allegedly late–identified trade secrets. Plaintiff Fast Food Gourmet (“FFG”) originally identified four trade secret elements of its process for making thin crust frozen pizza (you can read more about this case in the Blog’s archives). FFG’s Vice President of Operations Crause identified four additional elements during his deposition. And FFG later identified two additional elements. LLF argued that FFG should be limited to the first four elements because FFG never updated its interrogatory responses to include the six additional elements. The Court held that the four additional elements disclosed during the deposition had “otherwise been made known” pursuant to Fed. R. Civ. P. 26(e) and, therefore, were not required to be added to FFG’s interrogatory responses. The Court excluded the other two elements. FFG argued that it had identified the elements by identifying documents containing the elements in its interrogatory responses pursuant to Fed. R. Civ. P. 33(d). But the Court held that the documents FFG identified only identified the two elements sporadically, and in connection with elements that were not trade secrets. This, combined with Crause’s testimony that he had identified all of the trade secret elements, made FFG’s Rule 33(d) statements insufficient.

Practice Tip: Rule 33(d) is often seen as a simple escape from answering cumbersome or difficult interrogatories. Of course, it is also often warranted. But when you use Rule 33(d), make sure to identify the correct documents, and make sure the identified documents fully support your position.

Fee Petitions Must be Detailed and Supported

Posted in Trial

Lorillard Tobacco Co. v. Montrose Wholesale Candies & Sundries, Inc., No. 03 C 5311 & 03 C 4844, Slip Op. (N.D. Ill. Jul. 27, 2007) (Cole, J.).*

Judge Cole recommended granting plaintiff Lorillard Tobacco’s (“Lorillard”) petition for attorneys fees, but reduced the requested fees by about $80,000. Lorillard received a default judgment against defendants in 2006 and, as a result, brought this petition seeking its fees and costs. The Court’s opinion is an excellent guide for anyone preparing a fee petition. The Court refused to consider Lorillard’s costs because although Lorillard submitted a list of costs, it did not total the costs or discuss them in its petition and supporting declaration. Next, the Court accepted most of the costs for the four attorneys whose billing rates were explained in the supporting declaration, but denies any fees for the other nineteen people whose fees were not explained in the declaration. The Court notes that these nineteen people could be partners, associates or paralegals, but the Court cannot assess the reasonableness of their rates or billed activities without knowing their roles. And even for the four, the Court notes that it would have preferred some explanation of each attorney’s experience in past Lanham Act cases, in order to judge whether the attorneys’ billing rates were commensurate with their experience. 

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