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

Angel Sales Inc. v. Hollywood Gadgets Inc., No. 07 C 1362, Min. Order (N.D. Ill. Nov. 19, 2007) (Denlow, Mag. J.).

Judge Denlow sanctioned defendant in the amount of plaintiff's attorney's fees and costs for preparation and attendance at a settlement conference before the Court.  Defendant's counsel attended the conference, but defendant did not appear.  In a subsequent order, the Court entered a sanctions award of $1,710 based upon plaintiff's fee affidavit.

There is not much to say about this opinion, but I included it as a practice tip and a cautionary tale.  Parties often do not want to personally attend settlement conferences before judges, or they attempt to send a representative without full settlement authority.  But that is a perilous choice.  It can result in sanctions, as here, and, at the least, it usually harms the chances of settlement.  The opposing party that took the time to be at the conference is generally offended that its time was wasted.

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APC Filtration v. Becker, No. 07 C 1462, 2007 WL 3046233 (N.D. Ill. Oct. 12, 2007) (Ashman, J.)

Judge Ashman granted in part plaintiff’s motion for discovery sanctions based upon defendant William Becker’s (“Becker”) disposal of his personal computer, which had allegedly crashed, in a dumpster twenty miles from Becker’s home, after plaintiff filed its Complaint. The Court held that Becker’s post-filing destruction of evidence was in bad faith and ordered sanctions pursuant to the Court’s inherent powers and Fed. R. Civ. P. 37. The Court did not grant a default judgment, but held that the destruction prejudiced plaintiff’s misappropriation claims. And as an intermediate sanction, the Court held that defendant Becker had communications with two third-party customers of plaintiff during Becker’s employment with plaintiff for the purpose of inducing the third parties to enter exclusive agreements with defendant SourceOne Plus, Becker’s new employer. The Court also awarded plaintiff certain related attorney’s fees and costs.

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Chicago Architecture Foundation v. Domain Magic LLC, No. 07 C 764, Slip Op. (N.D.Ill. October 12, 2007) (Norgle, J.).

Judge Norgle denied defendant’s Fed. R. Civ. P. 12(b)(2) motion to dismiss for lack of personal jurisdiction. Although defendant was a Florida corporation, defendant’s website – www.chicagoarchitecturefoundation.com – played upon plaintiff Chicago Architecture Foundation’s (“CAF”) name and only included links to other Chicago businesses. The Court, therefore, held that defendant’s website targeted the Northern District creating general personal jurisdiction.

Additionally, as a Fed. R. Civ. P. 37 sanction for failing to answer interrogatory responses as the Court ordered, the Court held that defendant generated revenue from the use of CAF’s trademark. 

Practice tip: Answer discovery requests on time and, if you cannot for some reason, at least answer them by the Court ordered deadline. 

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Rosenthal Collins Group, LLC v. Trading Techs. Int'l, Inc., No. 05 C 4088, 2007 WL 844610 (N.D. Ill. Mar. 14, 2007) (Moran, Sen. J.).*

Judge Moran denied in part and granted in part declaratory judgment defendant Trading Technologies' ("TT") Rule 37 motion for sanctions.  The Court held that declaratory judgment plaintiff Rosenthal Collins Group's ("RCG") motion for summary judgment of invalidity was "somewhat misleading" and possibly "disingenuous," but refused to dismiss the case.  Instead the Court struck the declaration underlying RCG's motion, denied RCG's summary judgment motion with leave to refile a motion "supported by proper evidence" and awarded TT its costs and attorneys fees associated with the Rule 37 motion, as well as its software expert's fees.  RCG filed a summary judgment motion arguing that TT's patents covering "double click" methods for executing an electronic trade were anticipated by the alleged prior art system "Wit DSM" as embodied in a software package RCG presented to the Court and TT on a laptop and claimed was essentially the software as it is existed more than one year prior to TT's patent filing.  TT's software expert identified that several lines of code had been added to the software by RCG's declarant, and that the added code performed certain functionalities required for anticipation.  When RCG's declarant was deposed, he stated that he had not written the "double click" portion of the original code and could not be sure that it was in the alleged prior art version of the WIT DSM.  These facts did not warrant dismissal of the case or barring of any evidence because RCG and its declarant had not made any false statements, although they had made deliberately vague statements.  Furthermore, while RCG did not identify that the software package included added code which the Court found disturbing, it did include a comparison program on the laptop it provided to TT and the Court which would have identified the added code.

This case involves the several of the same patents as the other TT case before Judge Moran.

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Ropak Corp. v. Plastican, Inc., No. 04 C 5422, 2007 WL 328880 (N.D. Ill. Jan. 30, 2007) (Valdez, Mag. J.).

Magistrate Judge Valdez awarded plaintiff certain of its fees related to motions to compel based upon the Court's August 15, 2006, order imposing Rule 37 discovery sanctions.  The Court noted its "considerable discretion" before reducing the fees so that they only included fees directly related to the particular discovery motions at issue.  The Court also removed entries for administrative tasks performed by attorneys that could have been performed by support staff.  And finally the Court reduced the hourly rates of the attorneys because plaintiff did not justify its rates by providing the Court information regarding standard rates in the Northern District or any biographical information regarding the attorneys to support their rates based upon their respective experience levels.  Practice tip:  If you are preparing a motion for fees, this opinion is an excellent place to look for determining what information to include in your motion and how to support your rates.

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