US jurisdiction report: How to lose a winning patent lawsuit
Imagine a hypothetical scenario where the CEO of a commercially successful company, company X, which owns a US patent covering revolutionary technology, learns that a competitor, company Z, is infringing the patent. Her in-house patent attorney who obtained the patent confirms literal infringement before the company’s in-house counsel refers the CEO to a hotshot patent litigation counsel.
The CEO and the patent counsel confer with one another and the CEO is impressed with his aggressive style and his assurances that he, together with the in-house counsel, will be very vigorous in prosecuting a patent infringement lawsuit against the infringer.
The patent counsel files an artfully-drawn patent infringement complaint in federal district court. The case is assigned for all purposes to Judge ‘Reasonable’. After the initial pleading and motion practice phases, the discovery phase of the lawsuit comes into play. Each party serves its respective document requests, interrogatories, requests for admission, and deposition notices on the other. The CEO is advised that the document and interrogatory responses of company Z clearly show infringement of a valid patent. She is greatly encouraged.
What the CEO is not aware of is that continuously throughout the discovery phase, the patent counsel and especially the in-house counsel have been too aggressive in frustrating the opposing counsel’s efforts to obtain documents and truthful responses. They often refuse to permit witnesses to fully answer deposition questions without the judge intervening. Furthermore, the in-house counsel has either withheld or provided information of questionable veracity. Company Z’s counsel registers complaints about this conduct, but the judge permits the case to proceed to trial.
