Mankaruse v. Raytheon Company, 20-2309 (Fed. Cir. 2021) (nonprecedential) [Raytheon Vexatious Litigant]
Nagui Mankaruse is a former Raytheon engineer and also a patentee. U.S.
Patent No. 6,411,512. While an employee, he sued Raytheon for employment discrimination and was later fired. (“Laid off due to a workforce reduction”). He later sued Raytheon in California state for various claims, including trade-secret misappropriation, breach of contract, discrimination, etc. California Code allows for a litigant to be defined as a “vexatious litigant” and Mankaruse was so-named. In one case he posted a $10,000 bond as required by the court (and lost the money after losing the case).
In the present case before the Federal Circuit. Nagui Mankaruse filed a pro se lawsuit against Raytheon alleging patent infringement and trade-secret misappropriation. Raytheon asked the US District Court (C.D.Cal.) to deem Mankaruse a “vexatious litigant” under Federal Law and require a bond before he proceeds with the case. The district court agreed and ordered Mankaruse to pay $25k bond and also seek pre-filing approval from the court of any future lawsuit. He did not pay the money and the case was dismissed. On appeal, the Federal Circuit has affirmed.
The Federal Rules of Civil Procedure do not speak to the “vexatious litigant” designation, but the courts have self-identified an inherent power to protect the judicial process that is also supported by the all writs act. Further, courts have power to order litigants to pay a security-deposit associated with potential future costs or sanctions.
[T]he court properly declared Mr. Mankaruse a vexatious litigant. And the bond amount of $25,000 was not excessive. The purpose of the bond is to provide a defendant security that, if it were to prevail in defending against a suit, would enable it to recoup its costs from a plaintiff, and the parties here do not meaningfully dispute that, at the time the bond was required, predicted costs of further litigation would have exceeded $25,000.
Slip Op. Mankaruse argued that he does not have $25k and so the requirement of the bond effectively excludes him from the court. On appeal, the Federal Circuit found no abuse-of-discretion even if it priced Mankaruse out of the market.