From The Alliance

Jan. 27, 2016

WHAT OTHERS ARE SAYING – Judicial Conference’s Rule Changes: Impact of Heightened Pleading Standards and Limits on Discovery on Patent Litigation

“The amended rules … mark significant change, for both lawyers and judges, in the future conduct of civil trials. The amendments may not look like a big deal at first glance, but they are.  That is one reason I have chosen to highlight them in this report.”
       John Roberts, Chief Justice, U.S. Supreme Court
       2015 Year-End Report on the Federal Judiciary

Heightened Pleading Standards:

“On December 1, new procedural rules adopted by the Judicial Conference of the United States, the national policymaking body of the federal courts, went into effect. These new rules heighten pleading standards and resolve one of the key issues raised in pending patent legislation. We applaud the judiciary for taking action to correct its procedures, curb excesses, and restore a centrist balance in the complex area of patent litigation… And another contentious issue can be retired from Congress’ busy legislative agenda.”
       David J. Kappos, former USPTO Director (2009-2013)
       Paul R. Michel, former Chief Judge, U.S. Court of Appeals (2004-2010)
       Morning Consult Tech – Federal Judiciary Change Restores Balance in Patent Litigation, Resolves Legislative Controversy

“The changes, made by the Judicial Conference of the United States, include the elimination of ‘Form 18,’ a patent-specific form that has enabled plaintiffs to file patent suits that include bare-bones claims…’The cookie-cutter, cut-and-paste complaint is on its way out,’ Mammen said. ‘Patent plaintiffs will have to allege more facts…’
       Corporate CounselTrolls Begone (for Now): Patent Pleading Rules Get Tougher,” by Lisa Shuchman

“Federal court rules have made it easy to file a patent suit – until now. The Judicial Conference and the Supreme Court have adopted rule changes that bring pleading standards for patent cases in line with other federal cases, making it harder to get into court. These changes will automatically begin this month – without legislation.”
       Jeffrey Birchak, VP of Intellectual Property, Fallbrook Technologies
       Inventors DigestFive Ways Patent Litigation Abuse Is Being Solved – Without Legislation

“Several features of these bills have also been rendered unnecessary based on recent Supreme Court decisions cracking down on abusive tactics, and administrative reforms, such as the stricter federal Judicial Conference pleading standards set to take effect in December.  Yet these bills remain largely unchanged, confirming many of our worst fears that this legislation is more about weakening patent enforcement generally than stopping limited examples of abuse.”
       Angela Macfarlane, CEO ForSight Labs
       The HillStartups depend on a strong patent system to thrive

“[T]he legislation would create overly burdensome statutory pleading agreements that could be crippling to patent holders trying to defend their intellectual property. The Judicial Conference already voted to abolish Form 18 of the Federal Rules of Civil Procedure, making this provision unnecessary.”
       Rhonda Melancon, Executive Director, LouisianaBio
       Business ReportGuest column: Rhonda Melancon on how strong patent law drives American innovation

“As to the detailed pleading requirements in H.R. 9, ‘That likely had the wind taken out of its sails because of the Dec. 1 changes instigated by the Judicial Conference,’ the congressional aide said… In particular, the changes get rid of the patent world’s ‘Form 18,’ which allowed an infringement charge without any identification of specific patent claims allegedly infringed or even the purportedly infringing products. Though it will take time for the new pleading standard to develop through the courts, all stakeholders believe it will be tougher on patent holders. The aide suggested that some members of Congress might now be more willing to let that development play out rather than intervene with legislation.”
       BloombergBNAPatent Legislation Stalled,” by Tony Dutra

“As the legislative patent reform debate remains stalled, new judicially created rules governing certain aspects of patent litigation are set to take effect in a month, thus potentially providing a further reason for reform to stay stuck in neutral.”
       Michael Rosen, Visiting Fellow, American Enterprise Institute
       Tech Policy DailyNew pleading standards introduce wrinkle in patent reform debate

“With the amendment to the Federal Rules of Civil Procedure going into effect on December 1, 2015 … Rule 84 and all of the accepted forms that go with it –including Form 18 for patent complaints – will be abrogated… [I]ts absence strongly supports that patent owners can no longer file a bare-bones Complaint.”
       Robert Angle, Troutman Sanders LLC
       Virginia IP Law – “Form 18: Goodbye (and Good Riddance?)

Limits on Discovery:

“New federal rules have drawn a lot of attention for raising the pleading standards for patent cases, but attorneys say amendments narrowing the scope of discovery could have broader implications for patent litigation because they severely undercut nonpracticing entities’ leverage against accused infringers.”
       Law360 – “Patent Fights Get Shake-Up Under Fed. Rules On Discovery,” by Erin Coe

“The chief justice’s report welcomed December’s adoption of major changes to the rules governing civil litigation in the federal courts, notably limits on the pretrial exchange of information that lawyers call discovery…. The amended rules limit discovery to materials that are ‘proportional to the needs of the case.’”
       New York Times – “Chief Justice’s Report Praises Limits on Litigants’ Access to Information,” by Adam Liptak

“One of the rule changes involves discovery, the process by which parties to a lawsuit obtain information before trial through depositions, a demand for documents and other procedures that can be unwieldy and time-consuming. Businesses complain that the costs associated with discovery often make settlement a better option. … ‘The amended rule states, as a fundamental principle, that lawyers must size and shape their discovery requests to the requisites of a case,’ Roberts wrote.”
       Washington Post – “Roberts urges lawyers, judges to help improve ‘contentious’ federal system,” by Robert Barnes

“‘Heightened pleading standards impact the initial document filed in court, whereas discovery impacts the bulk of the case,’ said Paul Ragusa, a partner at Baker Botts LLP. ‘Putting together pleadings is a fraction of the total costs that are spent on discovery, and a tool that limits discovery is a more effective tool to limit costs and streamline litigation.’ …The new changes to discovery are likely to make it an uphill battle for nonpracticing entities to go on fishing expeditions and seek a wide range of tangential discovery, according to Ragusa. ‘These changes hopefully mean that when nonpracticing entities come into court and work on a discovery plan, their efforts to seek full discovery will not be accepted by the court,’ he said. ‘They will have to spend more time deciding what they want to get out of the other side. They will be required to spend more time on a case upfront and compromise what the scope of discovery is going to be.’”
       Paul Ragusa, Partner, Baker Botts LLP
       Law360 – “Patent Fights Get Shake-Up Under Fed. Rules On Discovery”

“Before the rule changes … it was very difficult to put practical limits on that kind of discovery request, according to Brian O’Shaughnessy, president-elect of the Licensing Executives Society…. ‘Now, the scope of discovery is narrower and has to be limited to the actual issues that are raised in the case,’ he said. ‘I think the changes give the producing party a much more solid position to argue that requests are not proportional, and therefore, it can refuse to produce.’
       Brian O’Shaugnessy, President-Elect, Licensing Executives Society
       Law360 – “Patent Fights Get Shake-Up Under Fed. Rules On Discovery”