Joinder By Any Other Name…

As discussed before, multi–defendant cases persisted even after patent reform. However, the Federal Circuit has recently deemed the practice of joining multiple unrelated defendants in one case merely by alleging that they infringe the same patent unacceptable even for cases filed prior to the America Invents Act.

But that appears to be only part of the story. Once it is determined that the defendants were misjoined, what then? Theoretically, the cases are severed, and scatter to the four corners of the earth—or, at least, to the four corners of the federal judiciary, depending on whether transfer is appropriate.

Chief Judge Davis of the patent–heavy Eastern District of Texas has now weighed in on this issue. In a recent order issued in Norman IP Holdings v. Lexmark International, Judge Davis found the parties that had been added to an existing case following the enactment of the America Invents Act were misjoined, and severed them into separate causes of action. However, the Court remained vocal on its view of the inefficiencies presented by multiple, parallel cases, where “the Court is required to waste time digesting duplicate arguments to ensure that new arguments are not hidden among the plethora of common arguments.” Relying on his authority under Rule 42 of the Federal Rules of Civil Procedure, which allows for consolidation of proceedings for “common question[s] of law or fact,” Judge Davis then ordered the newly–severed actions consolidated with the original filed case “as to all issues, except venue, through pretrial only.”

We at IPWise are not immune to the point that oftentimes efficiencies may be gained by a de factoconsolidation of proceedings for pretrial purposes, when there truly are common questions of law or fact. That, of course, is the role of the Judicial Panel on Multidistrict Litigation.

But we have concern with the Court’s comments regarding motions to transfer venue for any severed defendant who wishes to file one, specifically, that even if transfer is appropriate, the Court will retain the case through claim construction. In other words, if it turns out that the District of Puerto Rico or the Western District of Washington is the venue which, “in the interest of justice” and “for the convenience of parties and witnesses,” is the most appropriate venue for a given case—the Eastern District of Texas will nonetheless keep the case through the claim construction stage, which might be a matter of years, following months of discovery and motion practice.

Chief Judge Davis warns that this order should not be taken as an invitation to file motions to transfer venue, noting that he has spent considerable time addressing venue in recent years, and carries one of the heaviest patent dockets in the country. We believe, however, that the Eastern District of Texas’ patent docket would be considerably lighter if it simply transferred cases it has recognized appropriately belong in another district.

Posted by Stacy Stitham