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February 8, 2006


The opinion of the court was delivered by: Sweet, D.J.


Plaintiff, Inc. ("ResQNet") has moved for an order to declare that its Rule 11 violation, as determined in the opinion of this Court entered on January 13, 2005, is not ongoing and that a trial on its U.S. Patent No. 5,831,608 will not constitute a further Rule 11 violation. For the reasons set forth below, the motion is denied.

Prior Proceedings

In April 2001, ResQNet filed suit against defendant Lansa, Inc. ("Lansa") for infringement of U.S. Patent Nos. 5,530,961, 5,792,659, 5,812,127 and 5,831,608 (the "'961, '659, '127 and '608 patents," respectively). The case was stayed by consent for settlement talks for most of 2001. After such talks did not resolve the matter, and before Lansa responded to the complaint, ResQNet filed an amended complaint in December 2001, asserting the same four patents and adding U.S. Patent No. 6,295,075 (the "'075 patent"). Lansa responded on the merits to the amended complaint by asserting invalidity, non-infringement, and a variety of other relatively standard defenses, but made no Rule 11 motion. (See Answer and Counterclaim, filed on December 17, 2001).

Although the actual timing is disputed, sometime during early 2002, after partial discovery took place, ResQNet removed the '127 and '659 patents from the lawsuit, leaving only the '961, '075 and '608 patents. This Court then conducted a Markman hearing and issued its claim construction opinion in September 2002 directed to only the '961, '075, and '608 patents.

Shortly thereafter, based upon the Court's claim construction, ResQNet concluded that it could not prevail on its infringement claims. The parties thus stipulated to final judgment in Lansa's favor with respect to all three patents then in the suit. ResQNet's claims were dismissed with prejudice, with ResQNet's consent, by final judgment entered by this Court on November 4, 2002.

The Federal Circuit reversed in part and affirmed in part this Court's claim construction ruling and remanded the case. See, Inc. v. Lansa, Inc., 346 F.3d 1374 (Fed. Cir. 2003). Based upon the stipulated final judgment entered in November 2002, and the Federal Circuit's affirmance of this Court's claim construction ruling on the '961 patent, only the '075 and '608 patents remained on remand in October 2003. The litigation of the '608 and '075 patents continued with discovery and motion practice in this Court for almost another year after remand.

On April 4, 2004, Lansa filed a motion for summary judgment seeking a declaration that the '075 patent was invalid. On August 20, 2004, Lansa filed two more motions for summary judgment of non-infringement on both the '608 and '075 patents. During 2004, ResQNet also filed several motions related to the '075 and '608 patents, all of which were opposed on the merits by Lansa. Further depositions took place in April 2004.

On September 3, 2004, while the foregoing motions were pending, Lansa served a Rule 11 motion upon ResQNet's counsel for the first time, claiming that the assertion of the '127 and the '608 patents in December 2001 was a violation of Rule 11 because ResQNet had admitted there was no infringement of these patents in September 2001. The motion, as required by Rule 11, gave ResQNet's counsel 21 days to withdraw the offending pleading, after which the motion would be filed with the Court. The '127 patent had already been withdrawn years earlier prior to the final judgment in November 2002.

At the time of service of Lansa's Rule 11 brief, ResQNet's counsel now contends that it was in possession of evidence sufficient to overcome summary judgment with respect to the '608 patent.

On January 13, 2005, this Court issued an opinion denying all of Lansa's summary judgment motions and awarding Rule 11 sanctions against ResQNet and its counsel for having asserted the '127 and '608 patents in the amended complaint. Both parties' reconsideration motions were denied by this Court on September 15, 2005.

As ResQNet has noted, in its order of June 9, 2005 dismissing ResQNet's appeal as premature, see, Inc. v. Lansa, Inc., No. 05-1279, 2005 WL 1515410, *1 (Fed. Cir. June 9, 2005), the Court of Appeals for the Federal Circuit stated in its sole footnote:

We assume that the district court, having determined that ResQNet and Kaplan did not have a good faith basis in pursuing the infringement claim, will either dismiss the infringement claim so that ResQNet can pursue the issue on appeal after final judgment without risking further sanctions or assure them that continued pursuit of the infringement claim will not subject them to continuing sanctions. We note that a motion for reconsideration is pending, another sound reason why interlocutory appeal is not appropriate, and a ruling on that motion may change the circumstances of this case.

The instant motion seeking a declaration that any Rule 11 violation that occurred cannot be ongoing at this point and that the case may proceed to trial on both the '075 and '609 patents ...

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