Parallel Networks v. Abercrombie & Fitch, 6:10cv111 (E.D. Tex. 8/12/11)
Judge: Leonard Davis
Holding: Markman ruling; Motion for Summary Judgment of Noninfringement Granted in (Really Big) Part.
I really appreciate Judge Davis waiting till I got back from my vacation to issue this order, which is important to local practitioners because it represents the first case to finish Judge Davis' recent revised procedures for cases involving large numbers of defendants.
As readers will recall, Parallel Networks is the Judge Davis case in which the plaintiff sued over a hundred defendants and as a result back in March Judge Davis created a new procedure for handling the case - specifically an expedited mini-Markman proceeding (three terms and consideration at the same time of the summary judgment motions of noninfringement that defendants asserted would resolve this case). As I posted previously, in that opinion, Judge Davis observed that the plaintiff's expressed strategy in that case involving over 100 defendants - "the goal of early resolution of the disputes through settlement in a range that essentially amounts to litigation costs" when combined with the requirements of the Patent Rules presented defendants with a Hobson's choice - to "spend more than the settlement range on discovery, or settle for what amounts to cost of defense, regardless of whether a Defendant believes it has a legitimate defense." Because Judge Davis believed that the Patent Rules and his standard docket control order did not achieve their intended result when presented with this situation - which he observed was "unlike the typical patent case" he essentially threw out the normal rulebook and took the parties off-road, setting extra status conferences and soliciting input from the parties as to how to manage this litigation, which involved multiple cases and over a hundred defendants. The end result was, as noted above, an early Markman limited to the three terms the defendants claimed would permit an early summary judgment of noninfringement.
Friday afternoon Judge Davis issued his Markman ruling, and it turns out the defendants were right - his construction of the three terms permitted granting summary judgment of noninfringement as to 99 of the 112 defendants. He ended the opinion with these words:
As of the filing of Defendants’ claim construction brief and summary judgment motion, 112 Defendants remained in the case. The summary judgment motion on the “dynamically generated” issue has resolved this case as to 99 of the 112 Defendants. The Court notes that in many patent cases before it involving multiple defendants, it is frequently faced with motions for severance and transfer to many different districts. Had the Court taken that approach in this case, Parallel and Defendants would be litigating this patent all over the country in many districts at great additional expense to all parties and the judiciary.
The Court commends the parties in this case for working together to identify issues common to nearly all Defendants and moving the case to resolution of these important issues in a timely and economic manner. By doing so, this case was resolved in a manner of months—as opposed to years—for the vast majority of Defendants. By all Defendants remaining in one case in one District, the Court was able to resolve the controversy in the most judicially economic manner sparing many other courts from repetitive work, and at the same time saving the parties very significant sums of money in attorneys fees.
