Georgetown Rail Equipment Company v. Holland L.P.

Filing 208

MEMORANDUM OPINION AND ORDER granting Georgetown's fourth motion in limine (Doc. No. 192 at 16-17). Signed by Magistrate Judge John D. Love on 11/17/14. (mll, )

UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF TEXAS
TYLER DIVISION
GEORGETOWN RAIL EQUIPMENT
COMPANY, a Texas corporation,
Plaintiff
v.
HOLLAND L.P., an Illinois corporation
Defendant

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No. 6:13-cv-366-JDL

MEMORANDUM OPINION AND ORDER
Before the Court is Georgetown Rail Equipment Company’s (“Georgetown”) Motion in
Limine Number Four (“MOTION”) (Doc. No. 192 at 16-17). Defendant Holland L.P. (“Holland”)
filed a response (“RESPONSE”) (Doc. No. 196). The Court heard arguments regarding the motion
on October 30, 2014.

Georgetown moves the Court to prohibit Holland from presenting

evidence or arguments at trial regarding any advice of counsel defense.

Furthermore,

Georgetown moves the Court to be permitted to introduce evidence or argument of Holland’s
absence of an opinion of counsel at trial as it is relevant to the totality of the circumstances
regarding willfulness. Having considered the arguments before the Court and for the reasons set
forth herein, Georgetown’s fourth motion in limine is hereby GRANTED (Doc. No. 192 at 1617).
BACKGROUND
On May 1, 2013 Georgetown filed a complaint against Holland seeking damages and a
permanent injunction against Holland’s manufacture, use, sale, or offer for sale of Holland’s Rail
Vision Systems (the “Accused Products”) and any other Holland products or systems that
infringe any claims of United States Patent No. 7,616,329 (the “’329 Patent”) (Doc. No. 1 at 3).

The Docket Control Order (Doc. No. 156) for this litigation required Holland to furnish
documents and privilege logs pertaining to willful infringement by June 20, 2014 if it intended to
do so. Holland did not produce these documents and has not indicated that it intends to produce
any opinion-of-counsel evidence at trial. As such, it is precluded from introducing such evidence
at trial.
The principal issue in this motion is whether Georgetown may introduce the absence of
opinion of counsel as part of its case for willful infringement.
LEGAL STANDARD
The Federal Circuit has emphasized that “there is no affirmative obligation to obtain
opinion of counsel.” In re Seagate Technology, LLC, 497 F.3d 1360, 1371 (Fed. Cir. 2007).
Furthermore, it has instructed that “[t]he adverse inference that an opinion was or would have
been unfavorable, flowing from the infringer's failure to obtain or produce an exculpatory
opinion of counsel, is no longer warranted.” Knorr–Bremse Systeme Fuer Nutzfahrzeuge GmbH
v. Dana Corp., 383 F.3d 1337, 1344 (Fed. Cir. 2004) (en banc) (cited in Seagate, 497 F.3d at
1370).
More recently, the Federal Circuit held that “[i]t would be manifestly unfair to allow
opinion-of-counsel evidence to serve an exculpatory function . . . and yet not permit patentees to
identify failures to procure such advice as circumstantial evidence of intent to infringe.”
Broadcom Corp. v. Qualcomm Inc., 543 F.3d 683, 699 (Fed. Cir. 2008).
DISCUSSION
Georgetown argues that the Broadcom holding allows for the failure to produce an
opinion of counsel at trial to be considered by the finder of fact as part of the "totality of
circumstances” regarding willfulness. Holland argues that Broadcom does not apply to the

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present motion because Broadcom considered the role of the absence of the opinion of counsel in
the context of an induced infringement claim, whereas the present litigation involves a direct
infringement claim. Holland argues that the Federal Circuit allowed for the absence of attorney
opinion to be produced for the purpose of proving the knowledge requirement of induced
infringement. In a direct infringement claim, Holland argues, the only possible purpose for
raising this issue is for the prohibited purpose of creating an adverse inference with regard to
willfulness.
Holland’s reading of Broadcom improperly narrows the scope of the Federal Circuit’s
holding. This district previously held, “For purposes of trial, Broadcom permits the finder of fact
to consider the failure of the accused infringer to produce an opinion of counsel as part of the
‘totality of circumstances’ regarding willfulness.” Retractable Technologies Inc. v. Becton,
Dickinson and Co., 2009 WL 8725107, at *3 (E.D. Tex. Oct. 8, 2009) (citing Broadcom, 543
F.3d at 698). Furthermore, the Federal Circuit’s logic that “it would be manifestly unfair to
allow opinion-of-counsel evidence to serve an exculpatory function . . . and yet not permit
patentees to identify failures to procure such advice as circumstantial evidence of intent to
infringe,” applies equally in induced infringement and direct infringement claims. Id. at 699.
Finally, the Federal Circuit’s analysis of the jury instructions in Broadcom indicates that a
party’s failure to procure an opinion of counsel can be presented as evidence in both direct and
indirect infringement claims:
[I]n the context of instructions pertaining to willfulness, the district court
instructed the jury as follows:
In considering whether [the accused infringer] acted in good faith, you should
consider all the circumstances, including whether or not [the accused
infringer] obtained and followed the advice of a competent lawyer with regard
to infringement. The absence of a lawyer's opinion, by itself, is insufficient to
support a finding of willfulness, and you may not assume that merely because
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a party did not obtain an opinion of counsel, the opinion would have been
unfavorable. However, you may consider whether [the accused infringer]
sought a legal opinion as one factor in assessing whether, under the totality of
the circumstances, any infringement by [the accused infringer] was willful.
This instruction comports with our holding in Knorr–Bremse [], where we held
that there is not “a legal duty upon a potential infringer to consult with counsel,
such that failure to do so will provide an inference or evidentiary presumption that
such opinion would have been negative.”
Broadcom, 543 F.3d at 698 (citations omitted) (emphasis added).
Accordingly, Georgetown is permitted to introduce evidence or arguments regarding the
absence of an opinion of counsel at trial, but Georgetown cannot indicate Holland had an
affirmative duty to seek an opinion of counsel, nor can it indicate that any adverse inference
should be drawn as to what the content of an opinion of counsel would have been. For example,
Georgetown is prohibited from presenting the argument that the absence of an opinion of counsel
at trial means that any opinion obtained was negative or would have been negative. Moreover,
Georgetown may not argue or present evidence that Holland sought an opinion of counsel but
has declined to produce it. Any such arguments, inferences, insinuations, or implications would
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be irrelevant and would put “inappropriate burdens on the attorney-client relationship.” Seagate,
497 F.3d at 1370 (citing Knorr-Bremse, 383 F.3d at 1345-46); see also Retractable
Technologies, 2009 WL 8725107, at *3-4.
CONCLUSION
For the foregoing reasons and in accordance with the above-mentioned instructions,
Georgetown’s fourth motion in limine is GRANTED (Doc. No. 192 at 16-17).

SIGNED this 19th day of December, 2011.
So ORDERED and SIGNED this 17th day of November, 2014.

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