Chicago IP Attorney & Lawyer : R. David Donoghue : Chicago IP Litigation Blog

Bone Care Int'l, LLC v. Pentech Pharma., Inc., No. 08 C 1083, Slip Op. (N.D. Ill. Jul. 16, 2010) (Ashman, Mag. J.).

Judge Ashman granted plaintiffs' motion to strike defendants' late-filed expert declaration. The Court previously held that discovery in this case was long closed and that "enough [was] enough." The Court, therefore, granted the motion to strike defendants' expert declaration filed with a Daubert motion for three reasons:

1. The Court's February 9, 2010 Order holding that "enough [was] enough" regarding discovery was still in effect.
    
2. Plaintiff would suffer prejudice from defendants' late-filed expert declaration with trial "looming."
    
3. Defendants had the information required in December 2009, before discovery closed.

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Bone Care Int'l, LLC v. Pentech Pharm. Inc., No. 08 C 1083, Slip Op. (N.D. Ill. Jul. 16, 2010) (Ashman, Mag. J.).

Judge Ashman granted plaintiffs' motion to strike defendants' expert affidavit (the "Affidavit") in this patent case. The Affidavit was filed in support of defendants' Daubert motion filed after the close of fact discovery. The Court struck the Affidavit for three reasons:

1. The Court had already warned the parties regarding discovery that "enough [was] enough."
    
2. The Affidavit, which contained substantive opinions and calculations, would prejudice plaintiffs. Discovery was closed, trial was looming, and plaintiffs would not have had enough opportunity to consult their experts or to file supplemental reports addressing the Affidavit.
    
3. Defendants had the information in the Affidavit at least by December 2009.  Defendants could have filed the information as part of a timely expert report.

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Chief Judge Holderman recently gave the annual State of the Court address, concluding that the Northern District continues to be an active, growing district court. Civil case filings were up 6.2% from 2008 to 2009, and the Northern District remains in the top 10% of district courts for median time to disposition – 6.2 months. 

The Court began 2009 with one vacant judgeship – created by Judge Filip's March 2008 resignation. The Court ended 2009 with from after Judges Bucklo, Coar and Gettleman took senior status. In February 2010, Judge Manning also took senior status. Judge Feinerman was confirmed last month, reducing the vacant seats by one, but there could be five vacancies again at the end of July when Judge Anderson retires. 

The magistrate bench was also active. Judges Ashman and Keys shifted to recalled status. Judges Finnegan, Gilbert and Kim joined the bench. 

Finally, the number of registered e-filers is up 18% to over 25,000. And the daily filing rate is up 15% to an average 867 documents per day. 

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Bone Care Int'l, LLC v. Pentech Pharms, Inc., No. 08 C 1083, Slip Op. (N.D. Ill. Feb. 4, 2010) (Ashman, Mag. J.).

Judge Ashman granted defendants' motion for a protective order precluding plaintiffs' proposed supplemental expert reports as untimely filed. Plaintiffs' supplemental reports sought to respond to alleged improper new material in defendants' reply expert report. Reasoning that "[e]nough is enough," the Court granted the motion to avoid an additional round of expert reports by both sides, further delaying resolution of the case. The Court, however, noted that plaintiffs were free to move in limine to exclude any allegedly new or unfair material in defendants' reply report.

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Heriot v. Byrne, No. 08 C 2272, Slip Op. (N.D. Ill., Apr. 9, 2008) (Ashman, Mag. J.).

Judge Ashman issued this Order finding that certain of defendants' allegedly privileged documents were privileged and ordering that others be produced.  The Court did not discuss specific documents or the analysis that went into the decisions.  But the Court  did provide the following list of general explanations for why some documents asserted to be privileged were in fact not privileged and had to be produced:

• not confidential;
   
• did not reveal privileged communications, directly or indirectly; or
   
• the advice was that of accountants, not lawyers, and was not used to assist the lawyers in giving legal advice.

Both young lawyers preparing privilege logs and senior lawyers reviewing them for exchange would do well to read this list.  It covers most of the common reasons documents are erroneously withheld as privileged.

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Heriot v. Byrne, No. 08 C 2272, Slip Op. (N.D. Ill., Mar. 20, 2008) (Ashman, Mag. J.).

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Chief Judge Holderman recently gave his annual State of the Northern District speech.  In a word, Judge Holderman said that the state of the District is "good."  Here are some of the highlights of the presentation (click here to read the Court's press release):

• Judge Gettleman intends to take senior status May 5 and Judge Coar intends to take senior status August 12.  Additionally, Magistrate Judge Ashman intends to retire later this year.
   
• Combined with the vacancy created when Judge Filip went to the Justice Department, when Judges Gettleman and Coar take senior status there will be three Article III and one magistrate vacancies on the Court.
   
• Civil filings were up 2.7% in 2008 over 2007.  And the Court resolves those disputes quickly.  The Northern District is in the top 10% of district court with its median time of 6.2 months to disposition.
   
• The Court is participating in a pilot program which allows jurors to fill out jury forms and get information about their service online.

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Constant Compliance, Inc. v. Emerson Process Mgt. Power & Water Sol'ns., Inc., No. 08 C 3724, Slip Op. (N.D. Ill. Feb. 13, 2009) (Ashman, Mag. J.).

Judge Mason granted in part plaintiff's motion to bar defendant from opposing plaintiff's claim constructions because of defendant's failure to meet the Court's deadline for the parties to exchange proposed claim constructions. In response to an interrogatory, defendant identified claim terms that it believed required construction. But defendant did not submit any proposed constructions until two weeks after receiving plaintiff's constructions on the date of the Court's deadline for joint exchange of constructions. The Court held that defendant was barred from offering constructions for those terms it identified as requiring construction in its interrogatory response, but allowed defendant's constructions of those terms offered by plaintiff, but not in defendant's response. Additionally, as to the terms identified in defendant's interrogatory response, the Court adopted plaintiff's constructions because no alternative construction had been timely offered.

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Baxter Int’l, Inc. v. Fresenius Med. Care Holdings, Inc., No. 08 C 2389, Slip Op. (N.D. Ill. Sep. 25, 2008) (Ashman, Mag. J.)

Judge Ashman granted defendants Fresenius’s motion for a stay pending the Federal Circuit appeal of an earlier case between the parties involving related, but not the same, hemodialysis patents. But the Court denied a stay pending an ex parte reexam of plaintiff’s related patents (the same as in the Federal Circuit appeal) and an inter partes reexam of the patents in suit. The reexam of the related patents had only uncertain and limited benefits to the Northern District. Because the patents under reexam were not the patents in suit, there could be no issue preclusion.  And any potential streamlining of the case the reexam might achieve was outweighed by the reexam’s potential for extreme delay.

The reexam of the patents in suit was filed, as was the stay motion, early in the case. And the inter partes nature of the proceeding guaranteed that it would streamline the case. But the potential benefits were outweighed by the likelihood for extreme delay. The court cited statistics showing that the average inter partes reexam lasts 6.5 years and that they can last as long as ten years. Finally, the Court noted that in the ten year history of inter partes reexam, no case had progressed through every possible level of examination and appeal.

Finally, the Court held that a stay pending the Federal Circuit’s decision on appeal would benefit the case. The Federal Circuit was reviewing a claim term used in the patents in suit. And the Federal Circuit was reviewing obviousness and validity, both issues that could shape this case. And the Federal Circuit decision was expected within months, in early 2009. So, the delay did not outweigh the benefits. 

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Judge Ashman granted in part plaintiff Lorillard's motion to strike defendant Elston's expert report. Lorillard alleged that Elston, in violation of the Lanham Act and state law, knowingly bought and sold counterfeit Newport cigarettes. Elston offered an expert to opine on three general subjects: (1) customs and practices in the cigarette industry; (2) Elston's cigarette purchasing history; and (3) whether the prices of the allegedly counterfeit cigarettes would have made it obvious to Elston that the cigarettes were counterfeit.

The Court held that the expert's seven years in the cigarette industry and subsequent consulting were sufficient to qualifying him as an expert in the custom and practice of the industry. But the Court struck the remainder of the expert's opinions. His opinions regarding Elston's purchasing history were based solely on produced documents. And the jury could glean the same information from its review of the documents. The expert's opinions regarding Elston's subjective reaction to the price difference were struck because they were beyond both the expert's expertise and his personal knowledge.

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Amari Co. v. Burgess, No. 07 C 1425, ___ F.Supp.2d ___, 2008 WL 656072 (N.D. Ill. May 7, 2008) (Ashman, Mag. J.).

Judge Ashman denied plaintiff Amari Co.’s motion for a protective order to prevent defendants’ alleged intimidation of Amari's non-party witnesses in this Racketeering Influenced and Corrupt Organization Act ("RICO"). Amari argued, among other things,* that defendants were intimidating ex-employees of former defendant International Profits Associates ("IPA"), which was run by defendants, by threatening to enforce confidentiality agreements signed by all IPA employees.

The Court held that it could not grant Amari its requested relief for two reasons. First, to be effective the injunction would have had to enjoin non-party IPA from suing its ex-employees to enforce the agreements. The Court could not enjoin IPA without proof it was working in concert with defendants or that IPA was defendants’ alter ego.  And before enjoining IPA, IPA would have to be given notice of the motion and an opportunity to respond.

Second, Amari sought a blanket injunction from enforcing the agreements against IPA’s ex-employees, but did not allege that the agreement was unenforceable. While confidentiality agreements cannot be used to hide a company's potential impropriety, they can be used to protect proprietary information. Without identification of specific ex-employees allegedly threatened with a suit, the Court could not determine whether IPA might have been using the confidentiality agreement for enforceable or unenforceable ends. And if Amari identified a specific individual, it could subpoena them, removing the need for an injunction.

*Amari alleged other forms of intimidation, but they are not related to IP and are, therefore, not discussed in this post.

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Judge Ashman struck plaintiffs' expert report pursuant to Fed. R. Civ. P. 37(c)(1). Plaintiffs' authored the song "Is It Because I'm Black" in 1968. Plaintiffs' alleged that defendants, the musical group Cypress Hill (click here for some of the group's music on their MySpace page), infringed their copyright in the song by using parts of it in their Black Sunday album. Cypress Hill contended that plaintiffs sold the copyright pursuant to a 1969 songwriters contract. Plaintiffs argued that the contract was a fraud.

Plaintiffs submitted an expert report (the "Report") to support that the contract was fraudulent. In six paragraphs, the expert stated that he ran various tests and concluded that the 1969 contract was a fraud because it was printed and signed by an inkjet printer — inkjet printers were developed in the 1970s or 1980s. When Cypress Hill complained that the Report was incomplete, plaintiffs supplemented it with pictures of the testing.

But the Court held that the supplemented Report was not sufficient because it did not explain the expert's methodology. There was no way to know how the expert translated data into conclusions. And no reputable rebuttal expert could test the expert's methodology or opine that the data was misinterpreted. It did not matter that the missing information could likely be obtained in a deposition. Rule 26 requires that an expert report include "the basis and reasons" for the expert's opinions. Because the Report did not disclose the expert's methodology and reasoning, and because Cypress Hill was prejudiced by the late-served, incomplete Report, the Court struck the Report.

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Wunderlich-Malec Sys., Inc. v. Eisenmann Corp., No. 05 C 04343, 2006 WL 3370700 (N.D. Ill. Nov. 17, 2006) (Ashman, Mag. J.).

Magistrate Judge Ashman granted plaintiff's motion to compel certain documents and held that defendant waived privilege as to certain documents it produced despite claiming attorney-client and work product privileges.  Defendant produced for inspection twenty two binders of documents, including four binders which defendant's counsel had internally identified as privileged and did not intend to produce for inspection.  About six weeks after the inspection, defendant realized that it had provided certain of these documents to plaintiff and sought the return of seventeen pages from the four binders.  Then, over the next several weeks, defendant sought the return of the remainder of the produced documents from the four binders claiming that they contained privileged information or trade secrets unrelated to the case.  Plaintiff retained the bulk of the documents arguing that any privilege that existed had been waived by disclosure of the documents.  Defendant argued that the documents were disclosed inadvertently and should be returned.

The Court employed the Northern District's standard three part test and found the privilege waived.  First, the Court assumed for purposes of the motion, without ruling upon the issue, that the documents for which defendant claimed privileged were privileged.  For those documents defendant claimed included trade secrets, the Court suggested defendant could seek a protective order, but noted that inclusion of trade secrets was not a basis to seek retraction of produced documents.

Second, the Court considered whether the disclosure was inadvertent.  The court held that the disclosure was not inadvertent because of defendant's failure to produce a privilege log (prior to the request that plaintiff return the privileged documents) listing the supposedly inadvertently produced documents and because of the time it took for defendant to request the return of all of the documents after learning of the supposedly inadvertent disclosure.

Finally, the Court used the balancing test to determine that defendant had waived the privilege.  The court found that defendant's precautions to prevent disclosure were not sufficient and that defendant did not act promptly to seek return of all of the produced documents.

Despite holding that the privilege was waived, the Court did not find a complete subject matter waiver, but instead limited the waiver to the specific documents at issue in the motion because a subject matter in this case would have been an essentially complete waiver of privilege and would have been to harsh for the facts of the case.

Practice tip:  Make sure to produce privilege logs as quickly as possible after producing documents.  The Court in this case repeatedly cites the lack of a privilege log as a factor weighing against defendant's arguments.

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Litetronics Int'l., Inc. v. Technical Consumer Prods., Inc., No. 03 C 5733, 2006 WL 2850514 (N.D. Ill. Sept. 28, 2006) (Ashman, Mag. J.).

Defendant sought sanctions pursuant to Fed. R. Civ. P. 37 arguing spoliation of evidence because plaintiff Coollite sold a factory in China which included various documents defendant had requested during discovery.  Judge Ashman denied the motion for sanctions because defendant had not shown that the documents had been destroyed.  The issue was who controlled the documents, but neither plaintiff nor defendants had requested the documents from the plant's new owner.  Additionally, defendant had not investigated whether the Hague Convention might allow for discovery of the documents.  This leads to an important practice tip:  make sure to ask for third party documents, or at least start the process of asking for them, before seeking help from a court to get the documents.

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