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McDermott, Will & Emery and client Medtronic Inc. must pay $4.3 million in attorney fees as punishment for alleged “abuse of advocacy” in a patent case, a Colorado federal judge ordered on Sept. 30. Judge Richard Matsch had slammed top San Francisco Bay Area IP litigators Terrence McMahon and Vera Elson in a February sanctions order for misleading jurors in a patent fight between Medtronic Inc. and BrainLAB over technology used to control surgical instruments. “The [McDermott] lawyers artfully avoided the limitations of the patent claims and created an illusion of infringement. They did so with full awareness that their case was without merit,” Matsch wrote at the time. Now, McDermott and Medtronic must pay BrainLAB’s lawyers for nearly three years of work on the case that went to trial in 2005. It was unclear Wednesday what portions would be paid by the company and the law firm, but they are jointly and severally liable. A Medtronic spokesman said that because the company intends to appeal the decision, it’s not making any decisions on how to divide up the payment. McDermott is also appealing, but a firm spokeswoman did not return a call seeking comment. McDermott particularly objected to paying attorney fees to Orrick, Herrington & Sutcliffe, which provided a second opinion on the case to BrainLAB’s primary lawyers at Renner, Otto, Boisselle & Sklar. But Matsch dismissed that argument — and took a pointed dig at McDermott. “An objective assessment of BrainLAB’s arguments and the evidence by new counsel after the verdict was a prudent measure taken by BrainLAB to determine its position and the expense of it is recoverable,” Matsch wrote. “If Medtronic had engaged other counsel in such an objective evaluation of its litigating position after this Court’s claims construction order it would have avoided its liability under 35 U.S.C. §285.” In the sanctions order, Matsch had said the McDermott lawyers willfully ignored his rulings on claims construction in their arguments before a Colorado jury in 2005. In patent cases, those orders define the scope of the patents and, therefore, what the plaintiff’s lawyers can argue for infringement. Lawyers for McDermott argued that the court had an obligation to stop any litigation conduct that stepped over the line, according to the ruling. McDermott’s lawyers also argued that the judge could have granted BrainLAB’s summary judgment motion for dismissal if the case really didn’t hold any water. Legal ethics expert Paul Vapnek, a partner at Townsend and Townsend and Crew, called the award “substantial.” He also noted that expensive sanctions are becoming more commonplace in big-ticket patent cases. Medtronic was also hit with a $10 million sanction in a patent case in Massachusetts earlier this year for disregarding claims construction. The company was using a different law firm for that case, New York’s Dewey & LeBeouf. In the now-infamous Qualcomm discovery disaster, that company was sanctioned for $8.5 million. “The courts are sending a very clear message that they’re not going to tolerate misbehavior,” said Diane Karpman, a partner in Los Angeles’ Karpman & Associates and a legal ethics expert. Karpman and Vapnek said there’s little precedent for how such a sanction would be split between law firm and client, but Vapnek did predict that McDermott will most likely be seeing Medtronic in court. “I’m going to go out on a limb, and I will predict such litigation in the future,” Vapnek said.

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