As we've covered in the past, stipulations are hard.
Their very simplicity can lull you into a false sense of security. Their ubiquity obscures their finer details.
(Eds. Note -- this was meant to be a haiku, but I couldn't make it work. Please prepare your own legal haiku for submission to our annual contest.)
Judge Burke's decision in CosmoKey Solutions GmbH & Co. KG v. Duo Security, Inc., C.A. No. 18-1477-JLH-CJB (D. Del. Nov. 15, 2024) (Oral Order), deals with a stipulation that encompassed more than intended.
The case began life under the watchful gaze of Chief Judge Connolly. Like all patent cases assigned to him at the time, the scheduling order required the parties to show "good cause" to amend their contentions.
Nevertheless, many years later the parties stipulated to allow amendment to the contentions. The only explanation for the allowance was contained in the recitals, which stated: "WHEREAS, the Court has recently issued its Markman opinion (D.I. 169) and the parties may wish to supplement contentions." Id., D.I. 179.
Defendant ultimately supplemented by adding 3 new references. The plaintiff opposed, arguing that they had failed to seek leave or show good cause as required by the scheduling order, and that the references were unrelated to the claim construction ruling.
Judge Burke, however, held that the parties new stipulation superseded the scheduling order's good cause requirement, and thus that the new references were allowed as long as they "had something to do with the fact that the Court has 'issued its Markman Opinion.'"
The question is whether the assertion of these new references falls within the letter of the May 2 stipulation. If it did (as Defendants argue), then Defendants are fine. If it didn’t, then Defendants would be out of luck—since a prior Scheduling Order requires them to show good cause in order to later supplement their invalidity contentions, and there wouldn’t be good cause here, since Defendants’ answering letter brief and Plaintiff’s reply letter brief makes it clear that not only have Defendants known about A11-13 since at least December 2023 (if not longer), but they could easily have known of the need to assert the references back then (in light of the parties’ then-current positions in the case.
Id. (internal citations omitted)
Judge Burke further noted that the plaintiffs could have drafted the stipulation to more neatly cabin the supplementation if they had wished to do so:
If Plaintiff had wanted that stipulation to narrowly limit Defendants to only being able to supplement their invalidity contentions if the supplementation “relates to new claim constructions, not proposed by the parties, that the District Court entered after the Markman hearing” (or a similarly cabined set of scenarios) then they could have written the stipulation in just that way. But instead, they agreed to a stipulation that was very broadly worded, such that it facially permitted supplementation so long as the supplementation had something to do with the fact that the Court had “issued its Markman opinion.”
Id.
Ultimately, the Court found that 2 of the new references were sufficiently moored in claim construction whilst a third was not:
Defendants do at least articulate some plausible (if admittedly creative) basis to suggest that the assertion of A12 and A13 had something to do with something that happened during the Markman hearing (and the subsequent issuance of the Court’s oral Markman order. Defendants’ argument here is a thin reed, to be sure. But in the Court’s view, the fault for it having succeeded lies with Plaintiff, who allowed a broad and vague stipulation to be entered as to this issue—and not with Defendants for making the argument . . .
Id. (internal citations omitted)
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