Tesco Corp (Plaintiff) v. National Oilwell Varco (Defendant-Appellee) v. Glen Ballard & John Luman (Interested Party – Appellant) (Fed. Cir. 2015)
Interesting case here – Jury verdict for the patentee, but in post-verdict motions S.D. Texas Judge Ellison dismissed the case with prejudice as a sanction against the patentee plaintiff for litigation misconduct. The Judge found that Ballard and Luman had directly lied to the court about the origin of a critical element of prior art. The Judge wrote:
Not every lawyer who lies to a court will be caught, so when such deliberate and advantage-seeking untruthful conduct is uncovered, the penalty must be severe enough to act as a deterrent.
While an appeal of the dismissal was pending, the parties settled “all outstanding issues.” That settlement agreement was signed both by representatives of the parties and the attorneys. However, Ballard and Luman decided to pursue the appeal further – arguing that the reputational harm from the district court opinion justified continued jurisdiction. The Federal Circuit disagreed – finding “no remaining case or controversy.”
Although Ballard and Luman have not been able to defend themselves in court, they will likely get their chance to do so before the Texas Bar. Apparently, they cannot do so publicly because the records are privileged and their former client Tesco will not allow their disclosure.
The majority opinion here was written by Judge O’Malley and joined by Judge Chen.
Writing in dissent, Judge Newman argued that the lawyers should be able to defend their reputation since it is their “most valuable asset.” The basic argument from Ballard and Luman is that the “sole evidentiary basis” for their bad faith is post-trial testimony from the creator of the asserted prior art and, according to the Attorney’s, that post-trial testimony was different from what he had said years earlier. The district court had disagreed with that characterization.
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Brief on Point: TescoAttorneyArg
DanH, I know. But I have not heard from both sides, so I am not going to prejudge the issue of who is lying, counsel or the witness.
Recall in the recent CAFC decision in Shukh, involving the reputational interest of a putative inventor, the CAFC said:
Today, we hold that concrete and particularized reputational
injury can give rise to Article III standing. As we
noted in Chou, “being considered an inventor of important
subject matter is a mark of success in one’s field, comparable
to being an author of an important scientific paper.”
254 F.3d at 1359.
being considered an inventor of important subject matter is a mark of success in one’s field
Reminds me: how is Gil “successful in his field until oops! maybe not” Hyatt doing with his 12,000 pending patent claims?
MM, Gil could give a RatsA$$ about his rep. Just show him the money.
Lawrence, well, at Seagate, at least during my time, people who got patents were honored with ceremonies before their colleagues and at annual events, etc. It was a big deal.
Imagine that there was an important invention that everyone knew about and a bunch of people were honored for receiving a patent for that invention but you, a prime inventor, was not included. It would be downright humiliating.
Imagine if you were inside at Seagate and an alleged omitted inventor were to approach you about be omitted on a patent. Would you show them the door as Apple did to WARF?
See Lawrence B. Ebert, Where Have You Gone, Richard K. Lyon? Intellectual Property Today, December 2001, obliquely referring to
the case of the (now deceased) Richard K. Lyon.
the attorneys involved need to have the ability to clear their names
It appears that the Texas Bar may be able to help them out with that. But at the end of the day, it’s just one judge’s opinion.
Those settlement negotiations must have been loads of fun.
Oops — meant in response to Ned’s comment at 1.
It would be interesting to know more about the facts in this case. Right now, I have no idea who lied, the attorneys or the witness.
Still, if attorneys lie to a court and that lie is discovered, their client is hammered. Potential new client need to know this.
But, if the allegations are untrue … certainly the attorneys involved need to have the ability to clear their names. They ARE harmed, no doubt about it.
There was far more misconduct in this case than the briefing could even begin to sufficiently cover.
close, by both sides or only the patentee’s?
Right now, I have no idea who lied, the attorneys or the witness.
The CAFC opinion linked at the top of the article explains that it was the attorneys’ statements that were at issue.
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