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Patent complaint flouts new law's bar on multi-defendant suits

10/26/2011 COMMENTS (1)

Immediately after Congress passed the patent-reform bill known as the America Invents Act, a strange thing happened. The Eastern District of Texas, that reputed haven of patent trolls, saw a sudden flood of complaints naming multiple defendants for infringing the same patent in a multitude of different products. Tech company defenders quickly figured out why: The new patent law barred those sprawling, multi-defendant suits, so patent holders were rushing to get their complaints filed before President Obama's signature enacted the law. As I reported, one tech company, EMC, was named a defendant in three new multi-defendant suits in the days between the law's passage and the president's signature.

A patent holder called Klausner Technologies, however, is apparently not worried about the law. On Tuesday, Klausner's lawyers at Stroock & Stroock & Lavan filed a complaint in federal court in Tyler, Texas, accusing Oracle, Hewlett-Packard, and 28 other tech companies of infringing its patent on linking telephone answering recordings with a display of related data.

On its face, the complaint seems to flout the new law's provision that "accused infringers may not be joined in one action as defendants or counterclaim defendants, or have their actions consolidated for trial, based solely on allegations that they each have infringed the patent or patents in suit." Under the AIA, patent holders can sue multiple defendants in the same case only if all of the defendants contributed to a single allegedly infringing product or process and if "questions of fact common to all defendants or counterclaim defendants will arise in the action."

Klausner and its Stroock lawyers certainly don't allege that all of the 30 defendants in Klausner's complaint contributed to the same product or process; the suit explicitly refers to multiple products. "Defendants each provide a Voice over Internet Protocol messaging service having some common or similar visual voicemail capabilities as those of other defendants," the complaint asserted.

But because the allegedly infringing products are similar, Klausner said it's justified in naming all of the defendants in a single suit. "There are questions of fact common to all defendants and joinder is appropriate," the complaint said. "The claims against all defendants similarly involve common questions of fact which relate to the infringement and/or validity due to the fact that it is the same patent being asserted against all defendants."

Klausner counsel Pierre Yanney of Stroock told me his client was aware of the AIA's bar on multi-defendant suits. He declined to answer additional questions.

But a Gibson, Dunn & Crutcher partner who recently filed an amicus brief at the U.S. Court of Appeals for the Federal Circuit protesting multi-defendant patent suits told me the Klausner complaint "seems to be exactly the type of litigation tactic that Congress sought to prohibit" with the new law. "It would be impossible for plaintiffs to argue with a straight face that Congress intended a case like this to be subject to joinder," said Matthew McGill.

In fact, McGill said, if the Klausner case goes forward against all 30 defendants at once -- including such bitter competitors as Oracle and H-P -- it will mean that the patent-reform provisions barring most multi-defendant suits are essentially toothless. I'll keep an eye on what the defendants have to say about Klausner's gambit.

(Reporting by Alison Frankel)

Follow On the Case on Twitter: @AlisonFrankel 

Follow us on Twitter: @ReutersLegal 


Comments (1)

11/6/2011 9:27:58 PM by tetschner@aol.com

The Klausner visual voicemail patents are a fraud. Solid (publically documented) prior art exists that would totally invalidate the Klausner patents. The prior art that we have pre-dates the Klausner patent filing by almost a decade. Contact: Walt Tetschner, 978-266-1966 or Tetschner@AOL.com to learn how to obtain it.


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