Pro se patent plaintiff adds the trial judge as a defendant, gets sanctioned. ARUNACHALAM v. IBM

Pro se patent plaintiff adds the trial judge as a defendant, gets sanctioned. ARUNACHALAM v. IBM

A patent grants its owner the exclusive right to make, use, sell and import an invention in the United States.  If someone other than the patent owner attempts to exercise one of these exclusive rights, without authorization, that can be considered patent infringement.  If a patent owner feels that their patent is being infringed on, the patent owner can file a lawsuit in United States Federal Court.

Patent law does not exist in a vacuum, when a plaintiff files a suit for patent infringement there are several requirements that the complaint must meet.  The Federal Rules of Civil Procedure outline the requirements that all complaints must comply with to move forward in court and the general rules that participants in a lawsuit must follow.  Federal courts may assess attorneys’ fees when a party has acted in bad faith, vexatiously, wantonly, or for
oppressive reasons.  Such fees are generally referred to as sanctions.  Sanctions are governed not by rule or statute but by the control necessarily vested in courts to manage their own affairs so as to achieve the orderly and expeditious disposition of cases.  To avoid sanctions, parties to a lawsuit should be respectful of the court’s time.

ARUNACHALAM v. IBM, 2020-1493 (C.A.F.C. 2021) is an example of a patent plaintiff that was sanctioned for not respecting the rules established by the court.

In April 2016, Dr. Arunachalam filed suit in the District Court against IBM and “Does 1-100,” alleging infringement of U.S. Patent No. 7,340,506 (the ’506 patent) and violations of the Racketeer Influenced and Corrupt Organizations Act (the RICO Act). The case was assigned to Judge Richard G. Andrews.

In May 2016, Dr. Arunachalam filed an amended complaint, adding SAP, JPMorgan, and Judge Andrews as defendants.  At Judge Andrews’s request, Chief Judge Leonard P. Stark presided over a motion to dismiss Judge Andrews as a defendant.  Dr. Arunachalam then moved to recuse Chief Judge Stark.  Chief Judge Stark
dismissed the motion to recuse and dismissed Judge Andrews as a defendant.

In March 2017, the District Court granted Defendants’ motion to dismiss the RICO claims because patent infringement is not a crime, and patent infringement is not on the list of acts that can give rise to racketeering.  Defendants’ request for sanctions were denied.   Dr. Arunachalam was allowed to amend the complaint but the amendments did not bring the complaint into a form that would avoid dismissal of the claims.  The only cause of action left in the complaint was patent infringement.

Meanwhile, in 2017 the Patent Trial and Appeal Board found that certain claims of the the ’506 patent were unpatentable.  In May 2018, Defendants motioned to dismiss Count I with prejudice, the District Court granted the motion concluding that the PTAB Decision means there are no valid claims in the ’506 patent to assert.  In July 2018, Defendants moved for sanctions in the form of attorneys’ fees, as well as injunctions against further filings by Dr. Arunachalam.  Dr. Arunachalam requested leave to file a reply, which was granted and a reply was never filed.  Afer several more months of motions the District Court awarded attorneys fees, $57,190.40 to JPMorgan, $51,772.09 to SAP; and $40,000 to IBM.

Dr. Arunachalam then appealed to the Court of Appeals for the Third Circuit, which transferred the case to the Court of Appeals for the Federal Circuit because the case focused on patent infringement.  The Federal Circuit found that the record amply demonstrates Dr. Arunachalam’s vexatious and wanton litigation conduct.  During litigation, Dr. Arunachalam forced Appellees and the District Court to expend resources responding to her repetitive, frivolous, and often bizarre oppositions and motions.  The attorneys fees granted were reasonable because the District Court applied the Lodestar approach to calculating attorney’s fees.  The Federal Circuit concluded that the District Court did not abuse its discretion in imposing monetary sanctions.

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