© 2014 The Texas Lawbook.
By Natalie Posgate
Staff Writer for The Texas Lawbook
(February 27) – Chief Judge Leonard Davis of The United States District Court for the Eastern District of Texas signed an order Wednesday that is designed to help patent cases become more efficient and less costly.
It is the first action in the nation by a federal district court to create a special track to limit the expense of patent cases, including those filed by non-practicing entities. Many of the provisions addressed in the order are parallel to patent legislation that is currently pending in Congress.
General Order 14-3, or “Track B,” requires expedited deadlines for both parties for certain procedures. The following are a few of the key provisions:
• A party claiming patent infringement must disclose their licenses or settlement agreements within 14 days after defendants file their answer;
• Within 30 days after the infringement contentions are filed, all parties must serve initial disclosures including summary sales information of the quantity of accused products sold in the United States and the revenues from those sales;
• Plaintiffs must file a good faith estimate of their expected damages within 14 days of the service of the initial disclosures and summary sales information.
Named patent litigation partner Michael Smith of Seibman, Burg, Phillips & Smith said the provisions are beneficial to both sides of the patent litigation spectrum. They allow defendants to find out the damages and claims much faster in the process. Plaintiffs who are claiming smaller amounts in damages will be able to have their cases resolved faster. He said the provisions will also prevent more frivolous lawsuits from being filed.
“I think this is a win-win for clients, whether they’re plaintiffs or defendants,” said Smith, who has tried more than 400 cases before the Eastern District. “We the lawyers can get down there and work on more cases… when previously we could only do one case [at a time].”
According to Smith, these new provisions could speed up patent cases to move along significantly in six months, versus the current year plus norm that it takes for cases to develop detail-wise.
He hopes that the new order will attract more patent cases to the Eastern District, versus getting cases transferred to district courts in other states such as California, where they will otherwise “drag on.”
Smith also praised the order for cost-saving purposes. Certain studies estimate that it costs parties $3 million on average to defend a patent case from beginning to end, he said.
“[These provisions] would get you much further into the case for a much smaller amount,” Smith said. “I think this could very easily allow you to defend a case for a fraction of what the statistics would say.”
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