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Sandata Technologies, Inc. v. Infocrossing

November 16, 2007


The opinion of the court was delivered by: Theodore H. Katz, United States Magistrate Judge


These related patent infringement actions were referred to this Court for general pretrial supervision. The cases have required an inordinate amount of supervision because of the numerous discovery disputes that have arisen. Presently before the Court are yet additional disputes - these relating to expert discovery.


The instant dispute arises in the following context. In this action, Plaintiff Sandata Technologies, Inc. ("Sandata") asserts that Defendant Infocrossing, Inc. ("Infocrossing") has infringed its patent relating to a telephone call-in system for maintaining time and attendance records of home healthcare workers. Infocrossing, in turn, contends, inter alia, that the Sandata patent is invalid. Thus, on the issue of infringement, Sandata bears the burden of proof and, on the issue of invalidity, Infocrossing bears the burden of proof.

It is routine that the party with the burden of proof on a particular issue be the first to submit its expert reports addressing the issue. The other party then is given the opportunity to submit a rebuttal report and, if requested and allowed by the Court, a reply expert report may follow. See generally Fed. R. Civ. P. 26(a)(2). When the schedule was initially set in this action for the submission of expert reports, Infocrossing's counsel represented that he did not intend to submit any initial expert reports. Consistent with routine practice in this district and elsewhere, the natural and obvious conclusion to be drawn from this statement was that Infocrossing was not going to file an expert report on the issue on which it bore the burden of proof, i.e., invalidity. Sandata was therefore directed to submit its expert reports by July 20, 2007, and Infocrossing was given until August 10 to provide responsive reports.

Sandata served its expert reports as required; however, when Infocrossing submitted what was supposed to be its rebuttal report on infringement, titled Preliminary Expert Report of Kendyl A. Roman ("Roman Report"), in large part the report addressed the issue of invalidity, with only a small section responding to Sandata's report on infringement. Sandata was rightfully concerned that the rebuttal report was in fact an opening report on invalidity, to which it had no opportunity to respond. It therefore requested that the Court strike the Roman Report, or, at a minimum, provide Sandata with an opportunity to submit a rebuttal report on invalidity. In opposing Sandata's request, Infrocrossing's attorney made the unconvincing argument that Sandata was trying to punish Infocrossing because its "expert prepared a more thorough report than Sandata's expert." (Letter from James E. Carty, III, Esq. ("Carty") to the Court, dated Aug. 20, 2007.) Infocrossing therefore argued that there should be no further expert reports but, if the Court permitted Sandata to submit a rebuttal report on invalidity, Infocrossing should be permitted to submit a reply on that same issue.

The Court agreed with Sandata's position but, rather than striking Infocrossing's report, allowed Sandata to submit a rebuttal report on invalidity, by September 12, 2007. The Court explicitly denied Infocrossing leave to submit a reply. (See Memorandum Endorsed Order, dated Sept. 11, 2007.) There had previously been no requests by the parties for the submission of reply reports, and the Court's expert discovery schedule did not provide for replies. Moreover, if the Court permitted Infocrossing to submit a reply on invalidity, fairness would dictate that Sandata be given the right to reply on the issue of infringement, and the Court saw no need to belabor the proceedings in such a fashion. The Court subsequently extended the expert discovery deadline to October 5, 2007, in order to allow for completion of expert depositions.

Sandata submitted its rebuttal report on September 12, 2007. Infocrossing's attorney claimed, however, that the report was untimely because, instead of receiving it by 4:00 P.M., it was faxed to him after midnight. He therefore asked that it be stricken or, at a minimum, that the October 5 deadline for completing expert depositions be extended by thirty days, to November 5.*fn1 Infocrossing's counsel claimed that his expert was abroad and it was necessary for them to consult about the Sandata rebuttal report, which addressed technical matters, prior to the deposition of Sandata's expert. Notwithstanding objection to the extension by Sandata, the Court extended the discovery deadline to October 15, 2007, to allow Infocrossing's attorney additional time to consult with his expert in preparation for the deposition of Sandata's expert. Subsequently, in response to further appeals by Infocrossing's attorney, the Court extended the deadline for deposing experts to October 19, 2007.

Pursuant to a schedule agreed upon by the parties, on October 5, Sandata's damages expert was deposed, on October 9, Infocrossing's damages expert was deposed, and, on October 12, Sandata's technical expert was deposed, with Infocrossing's expert (Mr. Roman) present. On October 16, Mr. Roman's deposition was taken, and it is at this point in time that the events leading to the instant dispute arose.

Approximately thirty minutes into Mr. Roman's deposition, in response to a question directed to him, Mr. Roman made reference to a Supplemental Report he had prepared. When Sandata's counsel expressed puzzlement about any supplementary report, Infocrossing's counsel presented him with a twenty-page report, including more than 100 pages of exhibits, signed by Mr. Roman (the "Supplementary Report"). This was the first Sandata's counsel knew of such a report, and Infocrossing's explanation was that the report was a supplementation of the earlier "preliminary" report Mr. Roman prepared.

After completion of the first day of Roman's deposition, Sandata's counsel wrote to the Court, asking that the so-called Supplemental Report be stricken. (See Letter from Daniel M. Gantt, Esq. ("Gantt") to the Court, dated Oct. 16, 2007.) He argued that, while styled a supplemental report, in large part the report served as a reply to Sandata's rebuttal report, and such a report had been specifically prohibited by the Court. Moreover, Sandata's counsel argued, to the extent the report was a supplement to the first Roman Report, the delay in submitting any such untimely supplementation was a function of Infocrossing's counsel's lack of diligence. This argument was grounded in the undisputed fact, which had been revealed in discovery, that Mr. Roman had not even been retained as Infocrossing's expert until July 27, 2007, and thus, he had been given only two weeks to prepare his expert report.*fn2

As if the untimely and unauthorized Supplemental Report were not enough, on the same day Sandata's counsel was writing to the Court to voice his objection to the Supplementary Report, he was served with yet another supplementary report by Roman, which consisted of 382 pages of report and exhibits (the "Second Supplementary Report"). Sandata argues, not unreasonably, that the untimely reports rendered the deposition taken of Roman meaningless, and were simply Infocrossing's devious way of getting the last word on invalidity. Sandata requests that both supplemental reports should be stricken. (See Letter from Gantt to the Court, dated Oct. 22, 2007.)

In response, Infocrossing contends that Roman's supplemental reports were issued in order to comply with the provisions of Rule 26(e)(1) of the Federal Rules of Civil Procedure ("Rule 26"), which require a party to supplement the disclosures it has made if those disclosures are incomplete or incorrect. (See Letter from Carty to the Court, dated Oct. 19, 2004 ("Carty Oct. 19 Ltr.").) Infocrossing also contends that Sandata has not been prejudiced because its counsel questioned Roman at his deposition about his first Supplemental Report and, if he was truly unable to do so, he could have adjourned the deposition, which he chose not to do.


I. Rule 26

The Court agrees with Infocrossing on the requirements of Rule 26, as they relate to the supplementation of information provided in discovery. The Rule provides, in pertinent part:

A party is under a duty to supplement at appropriate intervals its disclosure under subdivision (a) if the party learns that in some material respect the information disclosed is incomplete or incorrect and if the additional or corrective information has not otherwise been made known to the other parties during the discovery process or in writing. With respect of testimony of an expert from whom a report is required under subdivision (a)(2)(B) the duty extends to both information contained in the report and to information provided through deposition of the expert, and any additions or other changes to this information shall be disclosed by the time the party's [final pretrial disclosures] under Rule 26(A)(3) are due.

Fed. R. Civ. P. 26(e)(1) (emphasis added).

But that is as far as the Court's agreement with Infocrossing goes. With respect to virtually every other position taken by Infocrossing in connection with this dispute, the Court could not disagree more vigorously.

The purpose of the supplementation rule is to avoid ambush at trial and to assure that all material information has been disclosed. By its express terms, the rule imposes a duty to supplement "information" that a party has already "provided" or "disclosed," either in response to a discovery request or in an expert report or deposition, when "the party learns that in some ...

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