Monday, July 30, 2018

Is it a good idea to ignore the Court's orders?

No.

Taser International, Inc. sued Phazzer Electronics, Inc. for patent infringement.  The discovery history appears tortured.  Taser pursued a number of motions to compel discovery responses.  Phazzer produced some documents (and apparently no emails), but the documents conflicted with representations Phazzer had made about its corporate structure and relationships with third parties. 

Then came the attempts to schedule depositions of "the handful of critical witnesses associated with Phazzer."  Apparently these critical witnesses for this closely-held company "are represented to be on vacation, out of the country, in surgery, or convalescing."  Taser had been attempting to schedule these depositions for 5 months.

With a Technology Tutorial scheduled in court, the Court ordered the parties and their counsel to attend in person, and cautioned that failure to do so could result in sanctions (including default judgment).  The day the Court entered that order, Phazzer's counsel filed a motion to withdraw.  That same day, the Court denied the motion to withdraw, and specifically ordered counsel to continue to represent Phazzer, notwithstanding counsel's representation of "irreconcilable differences."   The next day, Phazzer's counsel filed a "Notice of Termination of Legal Representation."   The Court struck that notice the same day because "because it is not a motion or a filing that is otherwise authorized by the Federal Rules of Civil Procedure or this Court’s Local Rules."

Phazzer's corporate representative did not attend the Technology Tutorial, failed to attend the corporate deposition of Phazzer, and a number of other Phazzer witnesses did not attend their court ordered depositions. 

The court then set a hearing on Phazzer's counsel's renewed motion to withdraw, specifically ordering a representative of Phazzer to attend.  No corporate representative attended.  Denying Phazzer's motion to stay the case, the Magistrate Judge observed: "it appears that Phazzer, with the assistance of its counsel, is attempting in bad faith to further delay this litigation."

In light of this abusive practice, the Court granted Taser's request for sanctions, and imposed the following relief:

  • Striking of Phazzer's motion to dismiss;
  • default entered in favor of Taser and against Phazzer on all claims;
  • compensatory damages;
  • treble damages for "Defendant's willful infringement" and "willful false advertisement";
  • attorneys' fees and costs; and
  • a permanent injunction.

Notably, while the Court could not name the third-party manufacturers in the injunction (for due process concerns), the Court did note: "it is clear that nonparties who assist the enjoined party in violating the injunction may be held in contempt by this Court."

The injunction should be helpful with ceasing importation of these infringing devices (electroshock cartridges).  Whether Taser will ever see any money from this judgment is another question entirely.  Moral of the story, Court orders are not something to be ignored.

Motion for Sanctions, granted.
Taser International, Inc. v. Phazzer Electronics, Inc., Case No. 6:16-cv-366-Orl-40KRS (M.D. Fla. July 21, 2018) (J. Byron)
 

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