Monday, March 21, 2011

Plaintiff's Cost-of-Defense Strategy Warrants Early Claim Construction and Departure from Typical Schedule

The court granted defendants' request for early claim construction of three terms in a consolidated case with over 100 defendants. "Plaintiff’s strategy in this case . . . makes it unlike the typical patent case. Plaintiff has sued over 100 Defendants with the goal of early resolution of the disputes through settlement in a range that essentially amounts to litigation costs. In this case, the Patent Rules and the Court’s standard docket control order—including early production of extensive electronic discovery—make defending the case almost cost prohibitive. . . . Plaintiff’s strategy presents Defendants with a Hobson’s choice: 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 the Patent Rules and the Court’s standard docket control order do not achieve their intended result in this particular case, it is necessary to depart from them in an effort to accomplish both parties’ objectives in the most cost effective manner. . . . Defendants believe there are three claim terms that affect all Defendants which, if construed, would be case dispositive. . . . Construction of these limited terms early in the case will resolve several important issues at a beneficial time for each party to better evaluate its case."

Parallel Networks, LLC v. Abercrombie & Fitch Co., et. al., 6-10-cv-00111 (TXED March 15, 2011, Order) (Davis, J.)

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