Saturday, July 30, 2005

NESCT reverses SJ in patent law malpractice case

Supreme Court found material issues of fact remained between competing products on "doctrine of equivalents" New Tek Mfg. v. Beehner, 270 Neb. 264 Filed July 29, 2005. No. S-03-457. Neb Supremes reverse Defs' summary judgment in patent law malpractice case against lawyers estate and his law firm for allowing a patent on a guide device for tractor combines to lapse. While the attorney tried to revive the patent it was not able to expand the patent to cover competitors' designs that closely matched the client's patent. The patent owner filed the malpractice case in Douglas County District Court,(nearly ten years ago!, so long that the principal attorney defendant has died) requiring the trial court and state supreme court to wade through the complexities of federal patent law ; State courts have jurisdiction over patent claims that are incidental to non-patent actions such as an attorney malpractice claim. 28 U.S.C. § 1338(a) (2000).The trial court entered summary judgment for the law firm basically because it found the competing tractor combine guide design would not have infringed on the Plaintiff's patent. The Supreme Court notes that the Defendants objected to the trial courts rejection of other positions it took in favor of summary judgment, but the defendants did not properly raise these issues in its cross-appeal: "the defendant did not comply with the requirements of Neb. Ct. R. of Prac. 9D(4) (rev. 2001). A cross-appeal must be properly designated under rule 9D(4) if affirmative relief is to be obtained. Gourley v. Nebraska Methodist Health Sys., 265 Neb. 918, 663 N.W.2d 43 (2003). An appellee’s argument that a lower court’s decision should be upheld on grounds specifically rejected below constitutes a request for affirmative relief, and the appellee must cross-appeal in order for that argument to be considered. Wasikowski v. Nebraska Quality Jobs Bd., 264 Neb. 403, 648 N.W.2d 756 (2002)." The Supreme Court rejected the Plaintiff-patent owner's contention that the designs were identical under patent law structure and function tests, but ultimately ruled that unresolved issues of material fact existed to require reversal for a trial under patent law's "doctrine of equivalents." The Supreme Court determined that the trial court in its ruling for SJ in favor of defendants disregarded material facts as to whether the accused device and the patented device were equivalent. " we conclude that the record fails to establish the defendant’s prima facie case for summary judgment on this issue. On a motion for summary judgment, the question is not how a factual issue is to be decided, but whether any real issue of material fact exists. Range v. Abbott Sports Complex, 269 Neb. 281, 691 N.W.2d 525 (2005)"Determination of infringement, both literal and under the doctrine of equivalents, is a question of fact. Lockheed Martin Corp. v. Space Systems/Loral, Inc., 324 F.3d 1308 (Fed. Cir. 2003), determined by the standard of "one of ordinary skill in the relevant art." Lighting World, Inc. v. Birchwood Lighting, Inc., 382 F.3d 1354 (Fed. Cir. 2004). Justice Gerrard determined the evidence for equivalency from the competing firms sales man and the plaintiff's patent law expert was not sufficient to demonstrate that no factual issue existed. "aside from the Plaintiff's expert attorney witness' admittedly conclusory testimony, there is no evidence that would permit a trier of fact to conclude, one way or the other, whether one of ordinary skill in the pertinent art would consider the differences between (the competing structures) to be substantial, or whether the different structure of the (accused) device is merely an insubstantial change which adds nothing of significance to the patented structure. The Supreme Court has a well deserved reputation for hostility to summary dispositions of contested matters that this case only buttresses. Along with dressing down the defendants who won summary judgment at trial for not properly asserting their cross appeal, the Court seems to be saying that complex cases should go to trial from now on. On the other hand defense counsel may be well aware of the Surpeme Court's hostility to summary dispositions of cases, and press ahead anyway, especially in malpractice cases. The worst that can happen is the case goes back to trial, against contingent fee plaintiffs' counsel and with less insurance coverage, since most malpractice claims-made policies take defense costs out of the gross coverage available.

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