Like anglers fishing with dynamite, most non-practicing entities, a.k.a. patent trolls, would prefer to target as many defendants as possible in individual patent infringement suits. Multi-defendant cases mean less expense for plaintiffs, and more settlement-inducing headaches for defendants.
That tactic is mostly history now, thanks to anti-joinder rules in the America Invents Act. But because the joinder provisions don’t apply retroactively, there’s still the pesky issue of what do about the flood of multi-defendant cases brought by NPEs just before the AIA became law last September. An East Texas patent fight between an NPE called Lodsys and a host of major IT players could help point the way, with major implications for both plaintiffs and defendants.
In a motion filed on Monday, Lodsys’s lawyers at Kelley Goldfarb Gill Huck & Roth and The Davis Firm urged U.S. District Judge Rodney Gilstrap in Marshal to reject a bid by Hewlett-Packard to extract itself from a multi-defendant case that Lodsys brought in February 2011. Gilstrap had already rejected a motion to sever by HP back in March, but HP and its lawyers at DLA Piper urged Gilstrap to reconsider in May, right after the U.S. Court of Appeals for the Federal Circuit handed down a key ruling on the joinder question in a case called In Re: EMC. On July 13 defendant Lexmark and its lawyers at Hayes Bostock & Cronin also filed a motion to sever Lodsys’s claims, again citing EMC. “Surrounded by a circus of other, competing interests, Lexmark’s ability to develop an individual defense is being frustrated,” they wrote.
As we reported, the Federal Circuit held in the EMC case that, to join diverse defendants in an infringement complaint filed pre-AIA, a plaintiff must show that there is “substantial evidentiary overlap in the facts giving rise to the cause of actions against each defendant.” The court largely sided with EMC Corporation and its lawyers at Orrick Herrington & Sutcliffe, who argued that an NPE called Oasis Research shouldn’t be allowed to lump EMC in with other defendants in the same patent suit. That ruling was blow to the hundreds of patent-holders that raced to file infringement complaints before President Obama signed the AIA into law on Sept. 16, 2011. According to Patently-O, 54 new patent cases were filed on Sept. 14, 2011 alone, naming an average of 16 defendants. That’s an all-time high for a single day.