On Tuesday, October 29, 2013, Chief District Judge Leonard Davis, on behalf of the Eastern District of Texas, adopted a model "Order Focusing Patent Claims and Prior Art To Reduce Costs." The Model Order's goal is to reduce the expense of the parties by focusing patent cases on the issues at the core of the dispute. A copy of this Model Order is available HERE.
The Model Order limits the number of patent claims and prior art references that can be raised during a patent infringement lawsuit. The Model Order provides that, by the completion of claim construction discovery, the patent claimant must assert no more than 10 claims from each patent and not more than 32 total claims for all patents-in-suit. If only one patent is at issue, the patent owner may raise no more than 15 total claims.
Once the patent owner provides the defendant with notices concerning its reduced asserted claims, the defendant has 14 days to limit its asserted prior art references to no more than 12 references for each patent and no more than 40 total references. If there is only one patent-in-suit, the defendant can assert no more than 18 prior art references.
The Model Order requires additional narrowing of claims as the case moves forward. No later than 28 days before the plaintiff's deadline to serve its expert reports on infringement, the plaintiff must identify no more than 5 asserted claims per patent–from the 10 previously identified–and no more than 16 total claims. If only one patent is in dispute, 8 total claims may be asserted. At least 28 days before defendant's invalidity expert report deadline, the defendant must also narrow the asserted prior art references to no more than 6 against each patent–out of the prior 12–asserting no more than 20 total prior art references. In cases with only one patent-in-suit, the alleged infringer can assert 9 prior art references.
The Model Order was included as an appendix to the Eastern District of Texas's Local Rules, as opposed to incorporation into the Local Rules themselves. This provides flexibility for the parties and the court to tailor limits based on the specific facts of each case. Accordingly, the court can approve modification of the above limits if the parties agree or if a party shows good cause for such modification.
This Model Order was adopted at least in part to force parties to assess the merits of the case at an earlier stage in the litigation. Previously, no motivation existed for parties to spend the time necessary to narrow arguments early in the case. As such, a plaintiff's initially broad allegation of asserted claims and defendants' similarly broad assertion of prior art references would linger throughout litigation. Because most cases in the Eastern District are allotted only one week for trial, preparation for trial has often been the sole motivating factor for parties to narrow their respective claims and invalidity contentions.
The Model Order will require the parties to identify their strongest infringement claims and invalidity arguments much earlier in the litigation. Narrowing the parties' contentions earlier in the case will likely reduce the time and resources the court will have to expend on each individual case, and will also keep parties and their experts from having to evaluate in detail numerous infringement claims and prior art references that will never be asserted at trial. In addition, the Model Order should eliminate from the court's docket the motions to reduce the number of asserted claims and invalidity arguments that had become commonplace.
One potential practical concern arising out of the Eastern District's Model Order is the timing of a party's hiring of experts. Both the initial narrowing of claims and prior art references and the final narrowing deadline occur prior to the expert reports' deadline. Parties will thus likely decide to hire experts earlier in a case, prior to these new narrowing deadlines, to help evaluate the strongest infringement claims and best invalidity arguments.