By Sarah Fackrell, Professor of Law at Chicago-Kent College of Law
The Northern District of Illinois’ “cottage industry,” Schedule A litigation, depends on mass joinder of defendants. Plaintiffs accuse dozens, hundreds—sometimes over a thousand—defendants of IP infringement in a single case. This allows the plaintiffs to save money on filing fees and maximize this litigation model’s profitability.
But lately, a number of judges are pushing back on joinder and raising that issue sua sponte.
For example, Judge Blakey recently highlighted the gap between the allegations and supporting evidence in a multi-defendant infringement case. The plaintiff had alleged that the 18 defendants were properly joined because they ”share unique identifiers, such as design elements and similarities of the unauthorized products offered for sale, establishing a logical relationship between them and suggesting that Defendants’ illegal operations arise out of the same transaction, occurrence, or series of transactions or occurrences” The complaint further stated that “the Infringing Products for sale in the Defendant Internet Stores bear similarities and indicia of being related to one another.” However, Judge Blakely found these allegations were directly contradicted by the plaintiff’s own evidence – the screenshot exhibits attached to the pleadings. Moreover, “Plaintiff offer[ed] nothing to suggest a relationship between defendants allegedly infringing one copyright and defendants allegedly infringing other copyrights.” Based on this disconnect between allegations and evidence, Judge Blakey dismissed the complaint without prejudice. Minute Entry, Heather Picquelle v. The Partnerships and Unincorporated Associations Identified on Schedule A, Docket No. 1:24-cv-11042 (N.D. Ill. Nov. 4, 2024), ECF 19. He later allowed the plaintiff to proceed against five defendants. See id. ECF 29.
In another recent case, Judge Harjani raised the issue of joinder in a utility patent and trademark Schedule A case. Minute Entry, Wiesner Healthcare Innovation LLC v. The Individuals, Corporations, Limited Liability Companies, Partnerships, and Unincorporated Associates Identified on Schedule A, Docket No. 1:24-cv-07124 (N.D. Ill. Aug. 26, 2024), ECF 14. The plaintiff filed a brief in support of joinder which failed to persuade the judge. See id. ECF 17. As readers of this blog are likely aware, there is a special rule for patent joinder set forth in 35 U.S.C. § 299. Specifically, Congress only allows defendants to be joined in patent cases where they make, use, sell, offer to sell, or import “the same accused product.” The plaintiff argued that “joinder [was] proper because all of the defendants are using a subset of product images from a larger collection of images for their listings.” Judge Harjani found that this was insufficient to demonstrate that joinder of the 81 defendants was proper under either § 299 or under the normal rules of joinder set forth in FRCP 20. The plaintiff filed a motion for reconsideration, seeking permission to conduct discovery on whether the defendants were actually related; that motion was denied. Judge Harjani did, however, grant the plaintiff “leave to file an amended Schedule A against one defendant or a much smaller group of defendants if plaintiff can establish that joinder is proper.” ECF 21.
Perhaps the most interesting example of this trend, however, is a Schedule A trademark case brought by Toyota. After raising the issue of joinder sua sponte and ordering briefing, Judge Daniel dismissed the complaint for misjoinder. Order, Toyota Motor Sales, U.S.A., Inc. v. The Partnerships and Unincorporated Associations Identified on Schedule A, No. 1:24-cv-09401 (N.D. Ill. Nov. 18, 2024), ECF 27. In its complaint, Toyota expressly alleged that all of the defendants were working together:
25. Defendants are working in active concert to knowingly and willfully manufacture, import, distribute, offer for sale, and sell Counterfeit Toyota Products in the same transaction, occurrence, or series of transactions or occurrences. Defendants, without any authorization or license from Toyota, have jointly and severally, knowingly and willfully used and continue to use the Toyota Trademarks in connection with the advertisement, distribution, offering for sale, and sale of Counterfeit Toyota Products into the United States and Illinois over the Internet.”
According to Judge Daniel:
This case follows a pattern common to “Schedule A” cases where plaintiffs allege that defendants employ similar methods and “work in active concert” to infringe plaintiffs’ intellectual property. But experience has shown that not all defendants named in a Schedule A case work together. More importantly, experience has shown that joinder under Fed. R. Civ. P. 20 is rarely appropriate in Schedule A cases.
Minute Entry, ECF 23. In response, Toyota basically argued that counterfeiting is bad and, therefore, Schedule A cases should be exempt from the normal rules of joinder. See ECF 24.
To be clear: Actual counterfeiting, as defined under U.S. law, is arguably the worst possible form of IP infringement. No one here is defending actual counterfeiting.
But not all Schedule A cases allege—let alone prove—counterfeiting. (See this forthcoming Harvard Law Review article.) So just saying “counterfeiting is bad” is not a sufficient reason to create a special joinder rule for Schedule A cases.
Toyota also urged the court to adopt the “swarm joinder” theory set forth in Bose Corp. v. P’ships & Unincorporated Ass’ns Identified on Schedule “A,” 334 F.R.D. 511, 517 (N.D. Ill. 2020). Judge Daniel refused, rejecting the “swarm” analogy.
This is not the first time the Bose “swarm theory” has been criticized. See Bailie v. P’ships & Unincorporated Assn’s Identified on Schedule A, No. 1:24-cv-02150, 2024 WL 2209698, at *4 (N.D. Ill. May 15, 2024) (citing Estée Lauder Cosmetics Ltd. v. Schedule A Defs. (Estée Lauder II), No. 1:20-cv-00845, order at 4–10 (N.D. Ill. June 22, 2020); Estee Lauder Cosmetics Ltd. v. P’ships & Unincorporated Ass’ns Identified on Schedule A, 334 F.R.D. 182, 187–190 (N.D. Ill. 2020)). Toyota didn’t mention Bailie but it did mention the Estée Lauder cases, dismissing them as representing a “minority view.”
Given these recent decisions, one wonders how long plaintiffs’ counsel will be able to plausibly characterize these cases as a minority view. At what point will they feel compelled to appeal one of these decisions, to try to make some good Seventh Circuit case law for themselves (like they did with personal jurisdiction)? As Eric Goldman has noted, if other NDIL judges were to follow Judge Daniel’s decision in Toyota, that would seriously undermine the Schedule A business model.
For more on Schedule A litigation, see:
- This essay (by Eric Goldman)
- This student note (by Lei Zhu)
- Section II(B) of this draft article (by me)