Putting Teeth To The Tiger
Rule 11 of the Federal Rules of Civil Procedure permits the court to impose sanctions on a party that files a pleading, motion or other document that is presented for an improper purpose, is unsupported by existing law or by a non–frivolous argument for establishing new law, or otherwise falls under certain no–nos delineated by the rules.
All well and good, but Rule 11 rarely is mentioned outside of law school civil procedure exams. As pointed out by IP Watchdog, however, change may be in the air.
In Raylon v. Complus Data, the Federal Circuit reversed the lower court’s holding that there was no Rule 11 violation, and remanded for the court to consider the appropriate sanction. And, because the court’s evaluation of whether to award attorneys’ fees under the “exceptional case” doctrine of Section 285 was based on its Rule 11 analysis, that conclusion was shipped back as well. (In a concurring opinion, Judge Reyna explained that, based on the record, he would have declared this to be an exceptional case, and remanded only for a determination of sanctions).
Providing dentures to what was previously a toothless tiger may be an important step in halting the so–called patent trolls that are a frequent subject of this blog. Should Section 285 and Rule 11 be utilized more frequently to impose penalties on those who file suit without any reasonable basis, solely to shake out a settlement, the patent system’s bad actors may give pause before filing…while patent owners with legitimate grievances will not be impeded.