Trading Technologies, Inc. v. BGC Partners, Inc., No. 10 C 715, Slip Op. (N.D. Ill. Feb.3, 2011) (Kendall, J.).*
Judge Kendall consolidated plaintiff Trading Technologies’ (“TT”) patent infringement cases that were filed in 2010 – Judge Coleman previously denied TT’s motions to consolidate the cases filed in 2005 with those filed in 2010. The Court held that the 2010 cases were sufficiently related pursuant to Local Rule 40.1. While the products were not identical and the asserted patents were not identical for each defendant, the accused products were similar and were all accused of infringing one or more of three of TT’s patent families. Additionally, consolidation would conserve substantial time and effort without causing delay.
The Court also ordered the parties to file a summary of all pending motions and discovery status.
* Click here for much more on this case in the Blog’s archives.

Continue Reading Trading Technologies: Court Consolidates 2010 Cases

Trading Techs. Int’l., Inc. v. CQG, Inc., No. 10 C 718, Slip Op. (N.D. Ill. Jan. 6, 2011) (Shadur, Sen. J.).
Judge Shadur denied plaintiff Trading Technologies’ (“TT”) motion to strike certain of defendants’ (collectively “CQG”) affirmative defenses and counterclaims.* The motion was originally filed September 1, 2010 and had been stayed by agreement as the parties attempted to negotiate a global settlement. Because allowing motions to lie “fallow” for so long was “undesirable” the Court dismissed the motion with leave to refile it should the parties restart the substantive portion of the case.
* Click here for much more on this and the related Trading Technologies cases in the Blog’s archives.

Continue Reading Trading Technologies: Motion Not Allowed to Lie “Fallow”

Rosenthal Collins Group, LLC v. Trading Technologies Int’l, Inc., No. 05 C 4088, Slip Op. (N.D. Ill. Nov. 23, 2010) (Coleman, J.).
Judge Coleman denied plaintiff Trading Technologies’ (“TT”) Local Rule 40.4 motion to consolidate TT’s sixteen pending patent cases,* involving nine patents. Initially, the Court noted that TT did not seek consolidation of all sixteen cases in a single case, but consolidation of the four remaining cases that TT filed in 2005, and separately the twelve cases TT filed in 2010. LR 40.4 requires that a motion to consolidate be filed in the lowest number case. So, while the instant case was the lowest number of the 2005 cases, it was not the lowest number 2010 case. As to the 2010 cases, therefore, the Court did not address consolidation. As to the 2005 cases, TT failed to show that the cases were sufficiently related — while they involved common patents, the accused products operated in “very different manner[s].” Furthermore, while Judge Moran previously coordinated discovery of all of the 2005 cases before the cases were reassigned, TT did not demonstrate that consolidating the 2005 cases would conserve resources.
* Click here for much more on these cases in the Blog’s archives.

Continue Reading Trading Technologies: Court Denies Motion to Consolidate Sixteen Pending Cases

Rosenthal Collins Group, LLC v. Trading Techs. Int’l, Inc., No. 05 C 4088, Slip Op. (N.D. Ill. Feb. 23, 2011) (Coleman, J.).*
Judge Coleman granted defendant/counter-plaintiff Trading Technologies’ (“TT”) motion for evidentiary sanctions and default judgment. Judge Moran previously dismissed plaintiff/counter-defendant Rosenthal Collins Group’s (“RCG”) motion for summary judgment regarding the alleged prior art Buist trading program for discovery abuse, ordered RCG to produce additional documents and things related to the Buist program, and ordered RCG to pay certain of TT’s attorney’s — click here for the Blog’s post on that decision. Initially, the Court the severity of a default judgment as a sanction, calling it “extreme,” and noted that the Seventh Circuit required a showing of willfulness, bad faith or fault by a preponderance of the evidence in order to justify dismissing a case.
The Court held that the high standard was met in this case, for at least the following reasons:
During his deposition, Buist admitted modifying and overwriting source code in 2006 that he and by extension RCG held out as having been created in 1998 or 1999. And in the face of clear evidence of these facts, RCG continued to deny them, even calling the claims “libelous,” “audacious,” and “Oliver Stone-esque.”
Buist later admitted “wiping” or erasing six of seven zip disks that originally contained the relevant source code and that were later produced by RCG because they allegedly contained the code. The seventh was also wiped, although there was a dispute regarding whether Buist or others had access to it when it was wiped. But the Court held that it was “impossible to believe that it is merely coincidence that the seventh disk happened to be wiped on May 2, 2006, which just happened to be the same day that TT was scheduled to inspect it.”
There was evidence that “virtually every piece of media ordered produced by the Court in May 2007 and July 2008 was wiped, altered, or destroyed after those orders were entered . . . .” (emphasis in original).
Even if RCG and its counsel had no knowledge of the destruction of the evidence, the destruction might have been avoided if RCG had timely complied with the Court’s orders to produce the materials. And regardless, RCG and its counsel should have preserved the evidence by taking custody of it.
Buist was RCG’s agent and, therefore, RCG was bound by Buist’s behavior and actions.
Based upon these determinations, the Court found clear and convincing evidence that “RCG, and its counsel, acted in bad faith and with willful disregard for the rules of discovery and this Court’s orders.” And because a monetary sanction alone was not sufficient, the Court entered a default judgment in favor of TT and dismissed RCG’s complaint and struck its defenses to TT’s counterclaim. The Court also fined RCG $1,000,000 for “egregious conduct before the Court” and ordered RCG’s counsel to pay TT the attorney’s fees and costs related to TT’s motion for default judgment.
* I have a few earlier opinions from the Trading Technologies cases, but this one was significant enough that I moved it up. Click here for more on the case in the Blog’s archives.

Continue Reading Trading Technologies: “Willful and Intentional” Evidence Fabrication Leads to $1M Fine & Default Judgment

Trading Techs. Int’l, Inc. v. eSpeed, Inc., No. 04 C 5312, Slip Op. (N.D. Ill. Oct. 29, 2010) (Dow, J.).
Judge Dow denied defendants’ (collectively “eSpeed”) motion to strike or stay consideration of plaintiff Trading Technologies’ (“TT”) bill of costs, and awarded TT $381,831.04 in costs.* Because TT received a damages award at trial, TT was the prevailing party and costs were warranted, absent TT’s trial misconduct or eSpeed’s inability to pay. The fact that TT lost on the issue of eSpeed’s alleged willfulness did not change TT’s status as the prevailing party, nor did the fact that eSpeed was found not to infringe based upon several of its software packages. The Court had previously stayed a determination of the bill of costs pending the Federal Circuit appeal. So, with the appeal complete, there was no reason left to delay the Court’s decision.
The Court then turned to the bill of costs. The following determinations were of particular note:
The Court awarded all undisputed witness travel, attendance and subsistence costs, totaling approximately $21,000. The Court denied travel costs for a trial witness that was flown to trial from Switzerland, rather than from his home in Ohio. Witness fees are only allowed for the shortest possible route from the witness’s residence.
The Court awarded videography costs only for depositions of foreign witnesses that TT disclosed as potential trial witnesses.
Court reporter appearance fees were denied because they are only allowed to the extent the fee plus the per-page rate charged does not exceed the Judicial Conference’s limit. In this case, the per page rate was already more than the allowed per-page recovery.
Because hearing transcripts played a significant role in the case, the Court awarded TT the allowable hearing transcript fees.
The Court awarded 25% of TT’s photocopying request. The reduction accounted for various non-copying charges, such as OCR, blowbacks, etc. and multiple copies of some documents. Recovery is only allowed for a single copy of a document, in most cases.
No costs were awarded for translation because § 1920(6) does not authorize recovery of translation costs, except for “check interpreters” used at trial to dispute certain interpretations.
The Court refused to apportion TT’s costs based upon the portion of the case that eSpeed won (summary judgment of noninfringement) versus the jury award that TT won.
* Click here for much more on this case in the Blog’s archives.

Continue Reading Court Will Not Apportion Costs to Prevailing Party Based Upon How Much of the Case was Won

Trading Techs. Int’l, Inc. v. Speed, Inc., No. 04 C 5312, Slip Op. (N.D. Ill. Sep. 8, 2010) (Schenkier, Mag. J.).
Judge Schenkier recommended denying plaintiff Trading Technologies’ (“TT”) motion to enforce the final judgment and for sanctions. The Court also recommended correcting the final judgment to reflect the jury verdict and the remitted damages award. A jury previously awarded TT $3.5M in damages and found defendant’s infringement willful. The Court later overturned the willfulness finding and ordered a remittitur of damages to $2.5M, which TT accepted. The Court then granted a permanent injunction and entered a final judgment, but that judgment did not reflect the damages award.
Defendant argued that, despite the jury award and remittitur, there was no damages award because it was not reflected in the final judgment and after the Federal Circuit had decided to appeal it was too late to revise the final judgment.
The Court agreed that the first judgment should have included the award, but not that it was too late to fix it. The Court noted that the most likely explanation for the omission was “the fallibility of human beings (judges included).” The Court also noted that TT should have sought to correct the final judgment immediately. But despite the imprecise judgment, the Federal Circuit ruled upon several issues related to the jury verdict, although not the award itself. And neither TT nor defendants disputed the fact or the amount of the damages award. Based upon those facts, the Court recommended that revising the final judgment to reflect the award would merely “correct a clerical mistake or a mistake arising from oversight or omission” pursuant to Fed. R. Civ. P. 60(a). Finally, the Court recognized TT’s frustration over not having received payment 34 months after the jury verdict and 6 months after the Federal Circuit’s decision. But the Court recommended not awarding TT its fees because TT’s failure to promptly get the judgment corrected was the only reason there was a delay in paying the judgment.

Continue Reading Trading Technologies: Court Reconnect Altering Judgment to Reflect Jury Award

Trading Techs. Int’l, Inc. v. GL Consultants, Inc., No. 05 C 4120 & 5164, Slip Op. (N.D. Ill. Oct. 20, 2010) (Schenkier, Mag. J.).
Judge Schenkier denied plaintiff Trading Technologies’ (“TT”) motion for jurisdictional discovery as moot because defendant GL Consultants withdrew its motion to dismiss. The Court also set an abbreviated process for filing the pending motion for a protective order. Click here for the procedures required of the parties before filing a discovery motion.

Continue Reading Trading Technologies: No Need for Jurisdictional Discovery Because Defendant Withdrew Its Motion to Dismiss

Trading Techs. Int’l, Inc. v. GL Consultants, Inc., No. 05 C 4120 & 5164, Slip Op. (N.D. Ill. Oct. 20, 2010) (Schenkier, Mag. J.).
Judge Schenkier set without the following procedures the parties were required to follow before filing discovery motions with the Court, beyond the standard Local Rule 37.2 meet and confer requirement:
Moving party must send opposing counsel a letter setting forth with specificity the relief it was seeking and the basis for the argument, including citing authority;
Opposing counsel has seven days to respond to the letter in writing with similar specificity, including any areas of agreement;
Within five days of opposing counsel’s letter, the parties must have a face-to-face Local Rule 37.2 meet and confer including counsel with full authority to resolve the dispute;
The parties then have five days to prepare a joint statement of the results of the meet and confer not to exceed twenty-five pages; and
The moving party then has five days to file a motion, without a supporting brief, not to exceed five pages.

Continue Reading Trading Technologies: Court Requires Cooperation & Live Meetings Before Discovery Motion

Trading Techs. Int’l., Inc. v. CQG, Inc., No. 10 C 718, Slip Op. (N.D. Ill. Aug. 12, 2010) (Shadur, Sen. J.).
Judge Shadur sua sponte struck defendants’ answer and counterclaim with leave to file an amended answer and counterclaim based upon a variety of pleading deficiencies. First, the Court struck statements that the patents-in-suit “speak for [themselves]” and related answers citing State Farm Mut. Auto Ins. Co. v. Riley, 199 F.R.D. 276, 279 (N.D. Ill. 2001). But the Court granted CQG leave to replead those answers.
The Court also struck several affirmative defenses. CQG’s Fed. R. Civ. P. 12(b)(6) defense was struck because it was not an affirmative defense. And no leave to replead was granted because when plaintiff Trading Technologies’ (“TT”) allegations were accepted as true CQG’s defense was “simply dead wrong.” The Court also struck various affirmative defenses that were only “skeletal recitals” of legal doctrines, with leave to replead if CQG could. Finally, the Court struck CQG’s noninfringement defense because denials in the answer already brought infringement into issue.
The Court also struck CQG’s counterclaim with leave to replead for failure to meet the Twombly/Iqbal pleading standards. Finally, the Court ordered that CGQ’s counsel should not charge CQG for preparing CGQ’s amended answer and counterclaim and should send CQG a copy of the Court’s Order.

Continue Reading Answer and Counterclaims Struck Sua Sponte

Trading Techs., Intl., Inc. v. BGC Partners, Inc., No. 10 C 715, Slip Op. (N.D. Ill. Aug. 17, 2010) (Kendall, J.).
Judge Kendall denied defendant BGC Partners’ (“BGC”) motion to dismiss as moot because of plaintiff Trading Technologies’ (“TT’s”) subsequently filed amended complaint. Courts routinely deny without prejudice motions to dismiss when an amended complaint is filed, but this case was unique because TT opposed dismissal. TT argued that BGC’s improper service argument should be dismissed with prejudice and the remaining arguments should be heard to avoid delay because TT continued asserting similar claims in the amended complaint. The service arguments were, however, moot because BGC did not make the service arguments in response to the amended complaint.
The Court also denied the motion to dismiss without prejudice as to the remaining arguments. While the claims may have remained factually similar, BGC’s arguments went to jurisdiction, not the sufficiency of the facts. Furthermore, the amended complaint added several new defendants. BGC and the other defendants would have been prejudiced if they were not given the opportunity to review the amended complaint and to collectively decide how to address any jurisdiction or venue issues.

Continue Reading Motion to Dismiss Denied as Moot Over Plaintiff’s Objection