“an affront to the integrity of the judicial process”
by: Robert Kelly, Senior Vice President, Licensing | August 28, 2018
In a recent opinion, the United States District Court for the Eastern District of Michigan held that an attorney’s reckless filing of an altered exhibit justified granting a motion for sanctions. Webastro Thermo & Comfort N. Am., Inc. v. Bestop, Inc., No.16-13456 (E.D. Mich. Aug. 9, 2018). The court noted that the attorney’s “decision not to inform the Court, his untimely and inadequate investigation into the cause of the false filing, his complete lack of contrition, and his cavalier attitude about the seriousness of [the] matter” was an affront to the integrity of the judicial process (regardless of how the court ruled on an underlying motion to dismiss) and therefore justified granting the motion for sanctions.
The case revolved around allegations made by Plaintiff, Webastro Thermo & Comfort North America, Inc., that Defendant, Bestop, Inc., infringed its U.S. Patent No. 9,346,342 for a vehicle roof and roof opening mechanism. Defendant filed a motion to dismiss in which it argued that the ‘342 patent was invalid due to a public disclosure and submitted as an exhibit a copy of a Power Point presentation that was alleged to be evidence of the public disclosure. However, the exhibit was missing a footer from the original presentation stating that “disclosure or duplication without consent is prohibited.” Once it became known to the parties that the footer was missing, Defendant’s counsel managed to make things worse every step of the way—e.g., by failing to adequately investigate how the mistake occurred and making excuses about why the removal of the footer didn’t matter—the result of which was Plaintiff filing a motion for sanctions.
The court outlined a number of steps (and feelings) that Defendant’s counsel should have undertaken, but didn’t, during the ordeal: “First, before an attorney files an exhibit, it should be carefully scrutinized for completeness and accuracy. And a reasonable attorney who became aware that he or she had inadvertently filed an exhibit that had deleted this information would be horrified. The first thing that attorney would do would be to immediately notify the Court. The attorney would then undertake an exhaustive investigation of how the error occurred. Last, but not least, the attorney would offer a sincere apology to the Court and to opposing counsel. Mr. Sadowski did none of these things. Instead, after being informed that he filed an exhibit that he should have known had relevant information removed, he dug in.”
The Court ultimately determined that even though Defendant’s counsel removed the footer by mistake, he still acted recklessly because he failed to “preserve and monitor the condition of evidence that could be pivotal to the suit.” Citing Marrocco v. Gen. Motors Corp., 966 F.2d 220, 224 (7th Cir. 1992). Based on that determination, the Court ordered Defendant’s counsel to pay Plaintiff’s attorney’s fees for time reasonably expended in litigating an unnecessary motion for sanctions.