Because Rule 37(b)(2)(C) provides that absent a valid excuse a monetary sanction will be imposed for discovery violations on "the disobedient party, the attorney advising the party, or both," [a Rule 37 motion places the attorney on] clear notice that any monetary sanction issued by the court could extend to him.
On July 26, 2012, in Rates Tech., Inc. v. Mediatrix Telecom, Inc., the U.S. Court of Appeals for the Federal Circuit (Bryson,* Dyk, Moore) affirmed the district court's imposition of $86,965.81 in sanctions against RTI and its lead counsel, James B. Hicks, for willful failure to comply with the court's orders on four occasions to respond to Mediatrix's contention interrogatories in a case involving U.S. Patents No. 5,425,085 and No. 5,519,769, which related to the modification of existing telephone systems to convert them to voice-over-Internet-protocol (VoIP) systems. The Federal Circuit stated:
"The discovery provisions of the Federal Rules of Civil Procedure are designed to achieve disclosure of all the evidence relevant to the merits of a controversy." "When a party seeks to frustrate this design by disobeying discovery orders, thereby preventing disclosure of facts essential to an adjudication on the merits, severe sanctions are appropriate."
Mr. Hicks cites various authorities for the legal proposition that he cannot be sanctioned for failing to produce information not within his possession and that to do so would violate his due process rights. As an initial matter, all of the cases cited by Mr. Hicks involved fact interrogatories, whereas the interrogatories at issue in this case were contention interrogatories that simply asked Mr. Hicks for RTI's theory of infringement. But even accepting Mr. Hicks's assertion that the category of "information not within his possession" can reasonably be said to include responses to contention interrogatories, Mr. Hicks has failed to show any error in the court's sanctions order, because the magistrate judge found that RTI and Mr. Hicks did have the information necessary to respond to Mediatrix's interrogatories yet repeatedly and willfully failed to provide adequate responses. [O]n April 17, 2006, Mediatrix produced thousands of pages of technical drawings and other documents to RTI. RTI did not file any objections to that production during the 10 days the court allowed for it to do so. By the time RTI did complain about Mediatrix's production, nearly five months later, the time to object had long since passed. In any event, the magistrate judge found that the discovery produced by Mediatrix was "substantial" and that it enabled RTI "to make an element-by-element claim construction analysis" with respect to interrogatory no. 3. Mr. Hicks has not even attempted to show that the magistrate judge's finding on that point was erroneous.
Accordingly, we reject Mr. Hicks's assertion that he was improperly sanctioned for failing to produce information that he did not have. The district court sanctioned Mr. Hicks for willfully failing to respond to Mediatrix's contention interrogatories despite possessing sufficient information to do so. Because the court found that he had sufficient information to respond to interrogatory no. 3, we reject Mr. Hicks's argument that sanctioning him for failing to produce information not within his possession violated his due process rights.
We likewise reject Mr. Hicks's argument that he was denied adequate notice of the possibility that sanctions would be imposed. The record shows that Mr. Hicks was put on clear notice of the possibility that the court would impose sanctions if he did not comply with the court's directives. On July 24, 2006, the magistrate judge stated, "It should be noted that this is Plaintiff's final opportunity to comply with this Court's orders and the rules of discovery. Should Plaintiff fail to do so, the Court will fashion an appropriate remedy." And on September 5, 2007, after ordering Mr. Hicks for a fourth time to provide an adequate response to Mediatrix's contention interrogatory, the magistrate judge warned Mr. Hicks "that this is indeed the last opportunity to comply with the directives of this Court and Plaintiff proceeds at its own peril. If a full and complete response is not provided to [Mediatrix] with respect to Interrogatory No. 3, I shall recommend . . . that this matter be dismissed."
The magistrate judge noted that the motion for sanctions under Rule 37(b) necessarily placed Mr. Hicks on notice of the possibility that, as counsel for the sanctioned party, he would be subject to a personal monetary sanction. We agree. Because Rule 37(b)(2)(C) provides that absent a valid excuse a monetary sanction will be imposed for discovery violations on "the disobedient party, the attorney advising the party, or both," Mr. Hicks had clear notice that any monetary sanction issued by the court could extend to him.
To the extent Mr. Hicks argues that the magistrate judge abused her discretion in denying his motion for leave to serve interrogatory nos. 26-30, we disagree. Although the magistrate judge denied the motion on the ground that she was simultaneously recommending that the case be dismissed, the record reveals several other sound reasons justifying the magistrate judge's ruling. The Federal Rules of Civil Procedure allow each party to serve 25 interrogatories. RTI provided no persuasive explanation as to why it needed to serve more than 25 interrogatories, and the record shows that RTI should have been able to answer Mediatrix's pending contention interrogatories without serving additional discovery requests. For that reason alone, the magistrate judge's denial of RTI's motion was justified.
Mr. Hicks also argues that he cannot be sanctioned because he did not personally violate a discovery order or advise his client to do so. His position on this point seems to have two elements. First, he argues that he could not personally be responsible for any discovery violation because he could not produce information that he did not have. We have already considered and rejected that argument. Second, Mr. Hicks tries to shift the blame for the production failures to Robert Epstein, whom Mr. Hicks describes as "RTI's patent counsel." Mr. Hicks argues that, "[a]s a business litigator, Hicks was entitled to rely on the plaintiff's patent counsel's analysis." It is unclear exactly what role Mr. Epstein played in this case, but he is not listed as counsel for RTI on the district court's docket sheet. Rather, Mr. Hicks is listed as "lead attorney." As lead counsel for RTI, Mr. Hicks had a duty to comply with the district court's orders, which he failed to do-a failure that the magistrate judge characterized as willful. Therefore, we reject Mr. Hicks's attempt to shift the blame for the discovery abuses to Mr. Epstein. As for his claimed lack of culpability, the district court flatly rejected that argument, ruling that his conduct as counsel for RTI in the discovery process was "egregious," and that RTI and Mr. Hicks "were both responsible for the sanctionable conduct."
Mr. Hicks has not provided any plausible basis for reversing the district court's sanctions order. The heart of his argument is that he should not be sanctioned for failing to provide information that he did not have. But he ignores the magistrate judge's express finding that he had sufficient information to comply with her orders, and that to the extent he lacked information it was because he "failed to take the most basic steps needed to fulfill [RTI's] discovery obligations." Accordingly, the imposition of sanctions was not an abuse of discretion or otherwise erroneous.
If you have questions about the material presented above, please contact Dr. Lawrence M. Sung (firstname.lastname@example.org or 202.861.1537) or any member of our Intellectual Property Team.
See information regarding Baker Hostetler's Patent Litigation and IP Prosecution and Portfolio Management practices.
Baker & Hostetler LLP publications are intended to inform our clients and other friends of the Firm about current legal developments of general interest. They should not be construed as legal advice, and readers should not act upon the information contained in these publications without professional counsel. The hiring of a lawyer is an important decision that should not be based solely upon advertisements. Before you decide, ask us to send you written information about our qualifications and experience. © 2012 Baker & Hostetler LLP