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					COMMITTEE NO. 601               PHILIP C. SWAIN AND JON W. GURKA, Co-chairs

FEDERAL TRIAL PRACTICE AND PROCEDURE

Scope of Committee: Practice in the federal trial courts in cases involving intellectual property
law matters; and problems and improvements concerning the litigation process in the Trial
Courts, including decreasing costs and length of pendency of cases; studying and making
recommendations where appropriate in cooperation with other ABA entities with respect to the
Federal Rules of Civil Procedure, local trial court rules or the U.S. Code respecting trial court
practice and procedure in intellectual property law.

SUBCOMMITTEE A:                Kenneth Adamo – Subcommittee Co-Chair
                               Christopher Renk – Subcommittee Co-Chair

Subject:       CLAIM INTERPRETATION PROCEEDINGS AND APPELLATE REVIEW

Several members of the Committee expressed interest in participating in the drafting of an
amicus brief in the Phillips v. AWH Corp. case. Ultimately, our committee did not have a role in
the drafting of the brief. At the ABA annual meeting in Atlanta, the IPL Section Council passed
the resolution below, which was later adopted by the House of Delegates, as the official policy of
the full ABA, which is necessary in order for the ABA to file an amicus brief in any court.
The IPL Section Amicus Committee (chaired by Joe Welch of Chicago, Richard Beem of
Chicago (outgoing chair), and Bob Krupka of Los Angeles (incoming chair)) supervised the
preparation of the amicus brief, with Don Dunner and Richard Rainey, both from Washington,
drafting the brief.
Here is the resolution, which served as the basis for the ABA's amicus brief in the Phillips case:
RESOLVED, That the American Bar Association recommends that courts apply the following
principles in interpreting claim terms in a patent—
 --In construing a patent claim term, the ordinary meaning of the claim term to one of ordinary
skill in the art as used in the context of the patent shall apply, unless (a) the patentee has acted as
his or her own lexicographer, in which case the patentee’s definition should control; or (b) there
has been a clear disavowal of claim scope, in which case the patentee should be bound by such
action. In determining the ordinary meaning of the claim term to one of ordinary skill in the art
as used in the context of the patent, the court shall look to dictionaries and similar sources, the
specification and the prosecution history;
 --While technical dictionaries should be given more weight than general purpose dictionaries, all
types of dictionaries and similar sources should be considered;
--In construing or interpreting any disputed portion of a patent claim, courts should not rely on
dictionaries and similar sources unless (a) that material has been made part of the record and (b)
the parties have had a full and fair opportunity to address, challenge, or rebut that material;
--Courts should not apply a rule of claim construction whereby the specification is the primary
source for claim construction such that the range of ordinary meaning of claim language is
limited to the scope of the invention disclosed in the specification;
--Courts should not apply a rule of claim construction whereby the claim construction
methodologies in the majority and dissent in the now-vacated panel opinion in Phillips v. AWH
Corp., 363 F.3d 1207 (Fed. Cir. 2004), are treated as complementary methodologies such that
there is a dual restriction on claim scope, and a patentee must satisfy both limiting methodologies
in order to establish the claim coverage it seeks;
--Courts should not consider invalidity under, e.g. 35 U.S.C. 102, 103, and 112, when construing
claim terms in a patent;
--Courts should apply a rule of claim construction in which the prosecution history is given the
same weight as the specification and both are considered in every case when evaluating the
meaning of a claim term;
--Trial courts should receive expert testimony at the court’s discretion to educate the court on the
technology, but expert testimony may not be used to contradict the claim meaning discernable
from the dictionaries and similar sources, specification, and prosecution history;
--While the ultimate issue of claim construction should be reviewed de novo, an appellate court
should review only by the clearly erroneous standard any underlying findings of fact made by a
trial court in connection with construing a claim term.

The subcommittee intends to continue studying the issue, especially in the wake of the pending
Phillips decision, and develop some initiatives to help provide further guidance on claim
construction.


SUBCOMMITTEE B:               Jonathan James – Subcommittee Co-Chair
                              Jeannine Sano – Subcommittee Co-Chair

Subject:       WILLFUL PATENT INFRINGEMENT

NO PROPOSED RESOLUTIONS

Last year Subcommittee B studied the willful infringement issue and authored supplemental
reports on the FTC and NAS Recommendations. In both reports, the Subcommittee
recommended that no action be taken.
In September 2004, Section Chair Bill LaFuze formed a Task Force to study the National
Academies of Sciences patent reform report and develop proposed resolutions addressing the
topics in the NAS Report. The Section Council requested the Task Force to adopt a response to
the NAS Report for discussion by Council at the Mid-Winter Meeting. The Task Force consisted
of various committee chairs/co-chairs, as well as a few others who have special expertise in the
reform issues. The Task Force included the following individuals:



                                                 2
    Jeff Kushan - Comm. 101, Sam Helfgott - Comm. 102, Larry Welch - Comm 102,
    Donna Meuth - Comm 103, Colin Webb - Comm. 103, Gary Griswold - Comm. 108,
    Hollie Baker - Comm 108, Mark Campagna - Comm. 403, Richard Rainey - Comm. 403,
    Phil Swain - Comm 601, Jon Gurka - Comm 601, Jerry Riedinger - Comm. 604,
    Doug Masters - Comm. 604, Bob Armitage - Council, Todd Dickinson - Council,
    Don Dunner - Delegate to HOD, Don Martens – Council and Task Force Chair

As part of the Task Force, a separate Task Force Subcommittee F consisting of Don Dunner
(Chair), Don Martens, Bob Armitage, Phil Swain and Jon Gurka was formed to consider the
willful infringement reform proposals in the NAS Report. The Task Force Subcommittee F
recommended a list of proposed reform points that were approved by the Task Force as a basis
for preparing a proposed willful infringement reform recommendation. A proposed Resolution
601-1 based on the Task Force Subcommittee F proposal was approved by the Task Force. The
proposed resolution was then circulated to Subcommittee B for a vote and approved by an 8-5
vote, with two subcommittee members not voting. The proposed resolution was then submitted
to Committee 601 for a vote. The proposed resolution, discussion and voting results are reported
below.

NAS TASK FORCE – SUBCOMMITTEE F
Recommendation 6(a): Limiting the subjective elements of willful infringement

PROPOSED RESOLUTION 601-1 (not approved by Committee)

RESOLVED, that the Section of Intellectual Property Law supports, in principle, the
recommendation of the National Research Council of the National Academies relative to
reducing litigation cost and increasing predictability of patent infringement litigation outcomes
in cases involving willful infringement allegations as set forth in their report, A Patent System for
the 21st Century; and

SPECIFICALLY, the Section supports legislation that would implement the following changes
to the existing l

       (1)     elimination of the duty of due care requirement and restriction of willfulness
findings to cases involving reprehensible conduct as per Dyk, J. in his separate opinion in Knorr-
Bremse Systeme Fuer Nutzfahrzeuge GmbH v. Dana Corp., --- F.3d --- (Fed. Cir. 2004);

        (2)    reprehensible conduct will be evaluated based on the totality of circumstances,
including, but not restricted to, whether there was (a) deliberate copying with knowledge of the
patent, (b) the absence of a substantial defense at trial, and (c) intentional concealment of the
infringement;

        (3)     willfulness shall be tried by the court, not a jury, and all findings of fact relevant
to willfulness shall be found by the court;




                                                  3
      (4)    willfulness shall be considered in conjunction with the court's evaluation of
enhanced damages and the award of attorney's fees, but only after liability has been found;

        (5)      per the en banc decision in Knorr-Bremse, no adverse inference shall be drawn as
a result of failure to obtain an opinion of counsel or the failure to produce an opinion of counsel
if one is obtained; while the reliance on an opinion of counsel may be considered as part of the
totality of circumstances of reprehensibility, an opinion is not required to avoid a willfulness
finding;

       (6)      no recommendation is made on the amount of enhancement resulting from a
finding of willfulness.

Past Actions.
Previously passed ABA resolutions on this issue include:

270 (Passed 1990 SP57-R108-2A; Retained 2001; Approved by ABA 2001)
Section opposes in principle a blanket rule under which the failure of an accused infringer to
introduce an opinion of counsel at trial will permit an inference to be drawn that either no
opinion was obtained or, if an opinion was obtained, it was contrary to the accused infringer’s
desire to initiate or continue its use of the patentee’s invention.

266 (Passed 1994 AR308-R401-6/458-1)
Section supports in principle the proposition that an accused patent infringer should not be
required to disclose its attorneys’ opinions to a jury or offer other evidence before a jury in
defense to a charge of willfulness before it has been found liable for infringement nor shall such
attorneys’ opinions be admissible into evidence upon motion of the patentee before the
conclusion of the liability trial.

270 (Passed 1996 AR421-R-601-4)
Section favors in principle that a finding of willful patent infringement shall not be based solely
on the absence of an opinion of counsel and, specifically, favors amendment of the second
paragraph of 35 U.S.C. §284 to add another sentence, as follows:

               “In deciding whether to award increased damages under this
               Section, or attorney fees under Section 285 of this Title, in cases
               where the willfulness of the infringement is in issue, no finding of
               willfulness shall be supported solely by an inference based upon
               the failure of the infringer to obtain or produce an opinion of
               counsel establishing that the infringer had a bona fide good faith
               belief that it was not liable for such infringement; however, this
               shall not prevent the fact finder from taking the absence of or
               failure to produce such an opinion into account as a factor in
               determining whether the infringement was willful based upon the
               totality of the circumstances.”

270 (Passed 1996 AR421-R-601-5)



                                                 4
Section favors in principle the bifurcation of discovery regarding the issue of willful patent
infringement based on a privileged opinion of counsel and, specifically, favors the bifurcation of
discovery directly related to such an opinion or related opinions until after a finding of liability,
allowing a brief hiatus after such finding (e.g., 30-60 days) to conduct expedited discovery
concerning any such opinion or related opinions.

266 (Passed 2001 AR421-R108-8)
Section favors, in principle, that the attorney-client privilege protecting communications between
a client accused of patent infringement and that client’s litigation counsel is not waived with
respect to litigation counsel where the client has asserted the defense of reliance on advice of
counsel in response to an allegation of willful infringement and where (1) the litigation counsel
was at no time involved in rendering the advice upon which the client has asserted reliance; and
(2) the opinion relied upon was rendered prior to the service of any summons and complaint
alleging infringement.

Discussion.

On April 19, 2004, the National Research Counsel of the National Academies of Sciences and
Engineering published a report entitled “A Patent System for the 21st Century” (hereinafter “the
NAS Report”). Included in the NAS Report is Recommendation 6 that the United States patent
statutes be amended to limit certain issues involving a subjective determination of an actor’s
state of mind in patent litigation; specifically, to eliminate or modify the enhanced damages
provision of 35 U.S.C. § 284 because of its dependence on a finding of willful infringement.
[NAS Report at 95-101]. The NAS Report found certain attributes of the willful infringement
doctrine to be problematic, including: (1) that the “requirement” that once a defendant knows of
a possible claim of infringement it must obtain an expensive, exculpatory written opinion from a
patent attorney; (2) that fear of exposure to claims of willful infringement has led to a practice of
deliberately avoiding learning about issued patents, which undermines the patent system’s
disclosure goals; and (3) that there is no empirical evidence that the availability of enhanced
damages provides any deterrent effect to infringement beyond the usual costs and risks of
defending an infringement claim.

Based on these findings, the NAS proposed “elimination of the provision for enhanced damages
based on a subjective finding of willful infringement.” However, the NAS also proposed a
number of alternatives short of completely eliminating the concept of enhanced damages for
willful infringement. Those proposals were: (1) abolishing the requirement that accused
infringers obtain and then disclose a written opinion of counsel; (2) limiting inquiry into willful
infringement to cases where the defendant's infringement has already been established; and (3)
requiring, as a prerequisite for willful infringement, either actual written notice of infringement
from the patentee or deliberate copying of the invention, knowing it to be patented. The NAS
Report also discussed (but did not make a recommendation about) a proposal that the willfulness
“damages” be limited to the least amount needed to deter deliberate copying and that, in most
instances, awarding the successful patentee its attorneys’ fees should suffice as an adequate
penalty.

On September 13, 2004, the Court of Appeals for the Federal Circuit, en banc, held that the trier
of fact cannot draw an adverse inference with respect to willful infringement when the attorney-


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client privilege and/or work product privilege is invoked by a defendant in an infringement suit.
See Knorr-Bremse Systeme Fuer Nutzfahrzeuge GmbH v. Dana Corp., --- F.3d --- (Fed. Cir.
2004). The Federal Circuit further held that the trier of fact cannot draw an adverse inference
with respect to willful infringement when the defendant has not obtained legal advice. Id.
Finally, the Federal Circuit held that the existence of a substantial defense to infringement is not
sufficient alone to defeat liability for willful infringement even if no legal advice has been
secured. Id.

The ABA submitted an amicus brief in the Knorr-Bremse case, advocating that the adverse
inference rule be abolished. At the 2001 Annual Meeting, the ABA had adopted a resolution
opposing any blanket adverse inference rule. Specifically, previously passed IPL Resolutions
108-8 and 651-3 provide as follows:

       “Section favors, in principle, that the attorney-client privilege protecting
       communication between a client accused of patent infringement and that client’s
       litigation counsel is not waived with respect to litigation counsel where the client has
       asserted the defense of reliance on advice of counsel in response to an allegation of
       willful infringement and where (1) the litigation counsel was at no time involved in
       rendering the advice upon which the client has asserted reliance; and (2) the opinion
       relied upon was rendered prior to the service of any summons and complaint alleging
       infringement.”

Previously, a subcommittee within Committee 601 published a Supplemental Report on the NAS
Report recommending that “no action be taken at this time” based on the then-pending Knorr-
Bremse case. Many of the NAS’s criticisms of the willfulness doctrine and recommendations for
modifications to the doctrine also were contained in the Federal Trade Commission’s 2003
Report and Recommendations. In March 2004, the same subcommittee within Committee 601
recommended “that no action be taken at this time with respect to the FTC’s recommendations
for legislation with respect to willful infringement until after the issuance of the Federal Circuit’s
decision in Knorr-Bremse.”

The above resolution is offered as a basis for the Section to respond to the recent NAS Report
that recommends limiting, if not eliminating, willful patent infringement. The resolution is
aimed at limiting the subjective elements of willful infringement in order to drive down the costs
and complexity of patent litigation. The proposed resolution does not go so far as to eliminate
the provision for enhanced damages in Title 35 as recommended in the NAS Report. Rather the
proposed resolution seeks a balanced approach that:

       1)   retains the deterrent of enhanced damages;
       2)   eliminates the duty of care requirement;
       3)   removes the requirement that accused infringers obtain an exculpatory opinion;
       4)   creates a threshold predicate for willful infringement;
       5)   limits the inquiry to cases where liability is established; and
       6)   provides that willfulness be tried to the court, not a jury.




                                                  6
While the NAS Report did not address the status of the “duty of care” requirement, Judge Dyk’s
separate opinion in the Knorr-Bremse case raised serious concerns over the continued vitality of
the “duty of care.” Specifically, Judge Dyk commented that the duty of care requirement finds
no support in the patent damages statute, the legislative history, or Supreme Court decisions.
Moreover, Judge Dyk pointed out that the duty of care requirement is at odds with recent
Supreme Court precedent requiring reprehensibility as a trigger to an award of punitive damages.

While retaining the deterrent of enhanced damages, the resolution proposes restricting willful
infringement to cases involving reprehensible conduct. Reprehensible conduct would be
evaluated under the totality of the circumstances and include situations of deliberate or
calculated copying, the absence of a substantial defense at trial, and intentional concealment of
infringement. Therefore, the resolution proposes a threshold test for having a charge of
willfulness considered by the court, which should deter the assertion of willfulness in most cases.
The resolution is consistent with the AIPLA response to the NAS Report and the
recommendations made by the NAS to require some predicate for willful infringement liability.1

Another important feature of the resolution is to require willful infringement to be tried to the
court with all findings of fact relevant to willfulness be found by the court. Moreover,
willfulness can only be tried after a finding of liability and shall be considered by the court in
conjunction with any evaluation of enhanced damages and attorney’s fees after liability.
Consistent with the AIPLA Response to the NAS Report, the elimination of a jury trial on the
issue of willfulness would not violate the 7th Amendment right to jury trial. See John B. Pegram,
The Willful Patent Infringement Dilemma and the 7th Amendment, 86 J. Pat. & Trademark Off.
Soc’y 271 (2004); Janice M. Mueller, Commentary: Willful Patent Infringement and the Federal
Circuit’s Pending En Banc Decision in Knorr-Bremse v. Dana Corp., 3 J. Marshall Rev. Intell.
Prop. L. 218 (2004).

Consistent with the en banc decision in Knorr-Bremse, the proposed resolution would not allow
an adverse inference to be drawn as a result of failure to obtain an opinion of counsel or the
failure to produce an opinion of counsel if one is obtained. However, reliance on an opinion of
counsel may still be considered as part of the totality of circumstances of reprehensibility, but an
exculpatory opinion is not required to avoid a willfulness finding. Thus, the concerns raised in
the NAS Report regarding the necessity of an exculpatory opinion and the unintended
consequences of such a requirement are addressed by the proposed resolution. The Knorr-
Bremse decision eliminates the concerns raised in the NAS Report regarding deliberate
avoidance of issued patents, the necessity of obtaining an exculpatory opinion and the possibility
of waiver of the attorney-client privilege. Thus, the proposed resolution is aimed at reducing
litigation costs and discovery complications.

No recommendation is made on the amount of enhancement resulting from a willfulness finding,
thus leaving the court with discretion to award “up to three times” the damages amount as
presently set forth in Section 284.


       1 The resolution is also consistent with the FTC’s 2003 Report and the AIPLA’s
response to the FTC report.



                                                 7
The overall impact of the resolution should be to limit the cases in which willful infringement is
alleged to those involving truly reprehensible conduct. The resolution attempts to strike an
appropriate balance in reducing litigation costs, uncertainty and complications in cases involving
willful infringement allegations, while retaining enhanced damages as a deterrent against parties
engaging in reprehensible conduct.

Committee Vote Summary on Proposed Resolution 601-1 and Report:

Members Approving:             42
Members Disapproving:          60
Members Abstaining:            6
Members Not Voting:            40

Several members who voted against the Proposed Resolution 601-1 indicated a preference for a
separate vote on each of the individual parts of the Proposed Resolution. Therefore, the Task
Force requested a committee re-vote of those members voting against the Proposed Resolution,
those abstaining and those not voting, in order to identify whether any parts of the Proposed
Resolution had broad support in order to develop another proposal. The revote failed to provide
any clear consensus on any individual part of the Proposed Resolution.

However, based on the voting results, the Task Force Subcommittee F subsequently
recommended several other proposed resolutions, 601-B through 601-G.          The subsequent
proposed resolutions were then circulated to Subcommittee B for a vote, but the subcommittee
vote failed to reach a quorum. The proposed resolutions were then submitted to Committee 601
for a vote. The proposed resolutions and voting results are reported below.

PROPOSED RESOLUTION 601-2 (not approved by Committee)

RESOLVED, that the Section of Intellectual Property Law supports, in principle, the
recommendation of the National Research Council of the National Academies relating to limiting
allegations of willful infringement, as set forth in its report, A Patent System for the 21st Century;
and

SPECIFICALLY, the Section supports legislation that would eliminate any “duty of due care”
imposed upon a possible infringer unless and until the patent owner (or another party having the
right to bring suit for infringement of the patent) provides actual written notice to the possible
infringer of its activities alleged to constitute infringement.

PROPOSED RESOLUTION 601-3 (not approved by Committee)

RESOLVED, that the Section of Intellectual Property Law supports, in principle, the
recommendation of the National Research Council of the National Academies relating to limiting
allegations of willful infringement, as set forth in its report, A Patent System for the 21st Century;
and




                                                  8
SPECIFICALLY, the Section supports legislation that would prohibit findings of willfulness
except in cases involving reprehensible conduct on the part of the accused infringer, such
conduct to be determined based on the totality of circumstances.

PROPOSED RESOLUTION 601-4 (not approved by Committee)

RESOLVED, that the Section of Intellectual Property Law supports, in principle, the
recommendation of the National Research Council of the National Academies relating to limiting
allegations of willful infringement, as set forth in its report, A Patent System for the 21st
Century; and

SPECIFICALLY, the Section supports legislation that would prohibit findings of willfulness
except in cases involving reprehensible conduct on the part of the accused infringer, such
conduct to be determined based on whether there was (a) deliberate copying with knowledge of
the claimed subject matter in the patent, (b) the absence of a substantial defense at trial, (c)
intentional concealment of the infringement, (d) breach of any applicable duty of due care, or (e)
such other facts or circumstances that evidence reprehensibility as may be determined by a court
to be relevant to the issue.

PROPOSED RESOLUTION 601-5 (not approved by Committee)

RESOLVED, that the Section of Intellectual Property Law supports, in principle, the
recommendation of the National Research Council of the National Academies relating to limiting
allegations of willful infringement, as set forth in its report, A Patent System for the 21st
Century; and

SPECIFICALLY, the Section supports legislation that would provide that the issue of
willfulness shall be tried to the court, not a jury, and all findings of fact relevant to willfulness
shall be found by the court;

PROPOSED RESOLUTION 601-6 (not approved by Committee)

RESOLVED, that the Section of Intellectual Property Law supports, in principle, the
recommendation of the National Research Council of the National Academies relating to limiting
allegations of willful infringement, as set forth in its report, A Patent System for the 21st
Century; and

SPECIFICALLY, the Section supports legislation that would provide that an allegation of
willfulness could not be considered by a court, except (1) in conjunction with the court's
evaluation of the amount of damages and/or the possible award of attorney's fees and (2) after a
final judgment of liability has been entered.

PROPOSED RESOLUTION 601-7 (not approved by Committee)

RESOLVED, that the Section of Intellectual Property Law supports, in principle, the
recommendation of the National Research Council of the National Academies relating to limiting



                                                 9
allegations of willful infringement, as set forth in its report, A Patent System for the 21st
Century; and

SPECIFICALLY, the Section supports legislation to (1) eliminate the duty of due care on a
possible infringer and (2) restrict any award of enhanced damages for infringement to cases
involving reprehensible conduct on the part of the adjudicated infringer.

Committee Vote Summary on Proposed Resolutions 601-2 through 601-7 and Report:

                     601-2        601-3         601-4        601-5        601-6       601-7
Approving             22           25            27           22           26          21
Disapproving          50           47            44           49           45          51
Abstaining            10           10            11           11           11          10
Not Voting            72           72            72           72           72          72

The willful infringement issues raised by the NAS Report are far from decided and the
subcommittee expects to further explore the willfulness issues to allow the Section to develop a
comprehensive legislative proposal.


SUBCOMMITTEE C:              Jacob Wharton – Subcommittee Chair

Subject :      CASE MANAGEMENT IN PATENT LITIGATION

The subcommittee was formed to examine the various district court local rules regarding case
management and provide a report with an aim towards drafting model guidelines in patent cases.
The subcommittee objectives include:
       1.   Determine the federal district courts that have "patent rules" that relate to case
            management;
       2.   Compare and contrast these rules;
       3.   Determine if there are any "model patent rules" that relate to case management;
       4.   Draft a model set of patent case management rules.


The subcommittee has assigned the various circuits to subcommittee members and is in the
process of collecting district court local rules.

At the request of Section Chair Bill LaFuze, the subcommittee formed an ad hoc subcommittee
to study and report recommendations on the ABA Tort and Litigation Section's proposed
recommendations on amendments to Rule 11. The ad hoc subcommittee also reviewed the House
of Delegates report and recommendation on Rule 11 amendments and prepared a resolution and
report, which was approved by the Section Council at the Mid-Winter Meeting in January 2005.
The ad hoc subcommittee's report is reproduced below.



                                                10
Ad Hoc Subcommittee on Proposed Rule 11 Amendments - Albert L. Jacobs, Jr., Chair

Subject. RECOMMENDATIONS ON PROPOSED AMENDMENTS TO RULE 11.

PROPOSED RESOLUTION 601-8.

RESOLVED, that the Section of Intellectual Property Law supports the resolutions concerning
the proposed amendments to Rule 11 of the Federal Rules of Civil Procedure that will be
submitted by the Litigation and Tort Trial and Insurance Practice Sections to the House of
Delegates in February 2005.

Past Action. (Passed 1989 SP 49-R401-3; Retained 2000)
Section favors in principle the filing in Federal Courts of pleadings, motions or other papers
totally prepared by lead counsel and signed by him/her, without subjecting local counsel filing
such papers to sanctions under Rule 11 of the Federal Rules of Civil Procedure.

Discussion. In October and November, 2004, the ABA Litigation and Tort Trial and Insurance
Practice Sections made a series of recommendations and proposed resolutions concerning
proposed amendments to Fed. R. Civ. P. 11 in the "Lawsuit Abuse Reduction Act" (HR 4571).
This report recommends that the IPL Section support and co-sponsor the resolutions that will be
presented by the Litigation and Tort Sections at the House of Delegates meeting in February
2005.

The Litigation and Tort Sections’ proposed resolutions are as follows:

       RESOLVED, That the American Bar Association reaffirms its support for the
       Congressionally-enacted, judicial rulemaking process set forth in the Rules Enabling Act
       and opposes those portions of the proposed "Lawsuit Abuse Reduction Act" of the 108th
       Congress (H.R. 4571) or other legislation that would frustrate that process.

       FURTHER RESOLVED, That the American Bar Association opposes enactment of any
       Congressional legislation that would transgress time-honored principles of federalism by
       imposing the provisions of Rule 11 of the Federal Rules of Civil Procedure upon any
       civil action filed in a state court.

       FURTHER RESOLVED, That the American Bar Association opposes enactment of any
       Congressional legislation that would transgress time-honored principles of federalism by
       imposing venue designation rules or provisions upon a personal injury claim filed in a
       state court.

       FURTHER RESOLVED, That the American Bar Association supports the current
       version of Rule 11 of the Federal Rules of Civil Procedure, which became effective
       December 1, 1993, as an effective means of discouraging dilatory motions practice and
       frivolous claims and defenses.




                                               11
       FURTHER RESOLVED, That the American Bar Association opposes enactment of any
       Congressional legislation that would alter or amend the current version of Rule 11 for the
       purpose of imposing mandatory sanctions and removing its current provisions that
       encourage attorneys to correct, modify or withdraw pleadings or motions.

       FURTHER RESOLVED, That the American Bar Association opposes enactment of any
       Congressional legislation that would impose any form of mandatory suspension due to
       prior violation of Rule 11, a factor that judges can and do take into account in
       adjudicating Rule 11 violations at present.

       FURTHER RESOLVED, That the American Bar Association opposes extending Rule
       11 to problematic discovery motions, requests, responses or non-responses because Rule
       26(g) or Rule 37 are better tailored to address these issues.

The report of the Tort Section is attached below.

Committee 601 believes that the Section should fully support and endorse both the Resolutions
and the Report of the Litigation and Tort Sections with respect to the proposed amendments of
Rule 11 of the Federal Rules of Civil Procedure.

In particular, the mandatory application of Rule 11 is not believed appropriate. The
recommendations support the current version of Rule 11 as an effective means of discouraging
frivolous claims, counterclaims and defenses, and motion practice whose objective is merely
delay. Rule 11 in its current form, which came into effect in 1993, permits courts to focus on the
merits of the cases before them and avoids courts becoming saturated with Rule 11 practice.

The recommendations further oppose attempts by Congress to change the venue rules established
in both federal and state courts. We agree with the Litigation and Tort Sections that designating
venue for state court clearly undermines one of the principles of federalism and we see no merit
to changing the rules for federal courts. The existing federal rules cover determination of venue
in a variety of situations and we believe it is more than adequate.

The recommendations also oppose any effort to force the application of a mandatory suspension
of an attorney for a specified number of violations of Rule 11. The current rules and the judicial
application thereof are more than adequate to enable the courts to properly apply Rule 11.
The recommendations oppose efforts by Congress to extend Rule 11 to motions relating to
discovery and the responsiveness or nonresponsiveness by parties to the litigation because it
believes that Rule 26 (g) and 37 of the Federal Rules of Civil Procedure are better suited to
address such issues.

Last, but certainly not least, it is believed that legislation as adopted by the House of
Representatives is an inappropriate bypassing of the well-settled congressionally specified
procedure that contemplates that evidentiary and procedural rules will first be considered and
drafted by the Committee of the United States Judicial Conference. Such rules will thereafter be
subject to thorough public comment and consideration, following which they should be
submitted to the United States Supreme Court for its consideration and promulgation. Finally,



                                               12
they would be transmitted to Congress, which retains the ultimate power to veto any rule before
it takes effect. This procedure supports and is consistent with the separation-of-powers under the
Constitution of the United States and is consistent with the recognition that, inter alia, rules of
evidence and procedure are a matter of significant concern to the judiciary, which must apply
them on an everyday basis.

                                GENERAL INFORMATION FORM

        Submitting Entities:
        Dennis Drasco, Chair          James K. Carroll, Chair
        Section of Litigation         Tort Trial and Insurance Practice Section

        1.     Summary of Recommendation(s).

       This Recommendation expresses support for the judicial rulemaking process set forth in
the Rules Enabling Act, for principles of federalism and for the current version of Rule 11 of the
Federal Rules of Civil Procedure and opposes legislative change to Rule 11, including changes
proposed in the “Lawsuit Abuse Reduction Act” (H.R 4571).
        The issues addressed in this Recommendation include the Lawsuit Abuse Reduction
Act’s proposals to extend Rule 11 to civil actions in state courts, impose venue designation rules
on state personal injury cases, remove the current “safe harbour” provisions and instead impose
mandatory sanctions, impose mandatory suspension in the case of a prior violation of Rule 11,
and expand the scope of Rule 11 to include problematic discovery matters.
        2.     Approval by Submitting Entity.

        Approved by the Council of the Tort Trial & Insurance Practice Section on November 15,
2004.
        Approved by the Council of the Section of Litigation on October 9, 2004.


        3.     Has this or a similar recommendation been submitted to the House or Board
               previously?

        As a result of passage by the House of Delegates of the policies described in Section 4,
below, the ABA is on record in support of the Congressionally-enacted judicial rulemaking
process set forth in the Rules Enabling Act and is opposed to legislation that would circumvent
that process. The other aspects of this recommendation have not previously been submitted to the
House or Board.
        4.     What existing Association policies are relevant to this recommendation and how
               would they be affected by its adoption?

       In February 1995, the House of Delegates adopted policy supporting the Congressionally-
enacted judicial rulemaking process set forth in the Rules Enabling Act and opposing legislation
that would circumvent that process. In February 1982, the House of Delegates adopted a
recommendation urging, among other things, that the delegation of rule-making authority should


                                                13
be granted by Congress to the Judicial Conference of the United States. In addition to developing
additional policy to address various provisions in pending federal legislation called the "Lawsuit
Abuse Reduction Act," (H.R. 4571) the 1995 and 1982 policies would be reaffirmed by adoption
of this recommendation.
       5.      What urgency exists which requires action at this meeting of the House?

        The leadership of the House and Senate have announced their intention of moving
legislation like HR 4571 in the next Congress.

       6.      Status of Legislation. (If applicable.)

       H.R 4571 was passed by the House is pending in the United States Senate. It has been
announced by the leadership of the Senate that the Senate will take up similar legislation in the
109th Congress as the House of Delegates prepares to meet.

       7.      Cost to the Association. (Both direct and indirect costs.)

        None, except the indirect cost of any lobbying efforts by the Association’s Government
Affairs Office.

       8.      Disclosure of Interest. (If applicable.)

       None.

       9.      Referrals.

       Simultaneously with this submission, referral is being made to: All Sections and
Divisions.

       10.     Contact Person. (Prior to the meeting.)
               Hervey P. Levin (for TIPS)
               6918 Blue Mesa Drive, Suite 115
               Dallas, Texas 75252
               (972) 733-3242
               (972) 733-3269 (Fax)
               hervey@airmail.net

               JoAnne A. Epps (for Litigation)
               Professor of Law & Associate Dean of Academic Affairs
               Temple University Beasley School of Law
               1719 N. Broad Street
               Philadelphia, PA 19122
               (215) 204-8993
               FAX (215) 204-2008
               Email: joanne.epps@temple.edu



                                                14
       11.      Contact Person. (Who will present the report to the House.)
                Hervey P. Levin (for TIPS)
                6918 Blue Mesa Drive, Suite 115
                Dallas, Texas 75252
                (972) 733-3242
                (972) 733-3269 (Fax)
                hervey@airmail.net
                JoAnne A. Epps (for Litigation)
                Professor of Law & Associate Dean of Academic Affairs
                Temple University Beasley School of Law
                1719 N. Broad Street
                Philadelphia, PA 19122
                (215) 204-8993
                FAX (215) 204-2008
                Email: joanne.epps@temple.edu

                                   EXECUTIVE SUMMARY

1.     Summary. This Recommendation expresses support for the judicial rulemaking process
       set forth in the Rules Enabling Act, for principles of federalism and for the current
       version of Rule 11 of the Federal Rules of Civil Procedure and opposes legislative change
       to Rule 11, including changes proposed in the “Lawsuit Abuse Reduction Act” (H.R
       4571).
2.     Summary of Issue. The issues addressed in this Recommendation include the Lawsuit
       Abuse Reduction Act’s proposals to extend Rule 11 to civil actions in state courts,
       impose venue designation rules on state personal injury cases, remove the current “safe
       harbour” provisions and instead impose mandatory sanctions, impose mandatory
       suspension in the case of a prior violation of Rule 11, and expand the scope of Rule 11 to
       include problematic discovery matters.
3.     Explanation. This Recommendation addresses these issues by expressing opposition to
       legislative changes that would frustrate the rulemaking provisions of the Rules Enabling
       Act and by expressing opposition to the specific proposed changes to Rule 11.
4.     Minority Views. No minority views or opposition have been identified at this time.

                                             Report

        Among its primary goals, the American Bar Association strives “to preserve the
independence of the legal profession and the judiciary as fundamental to a free society,” and to
“achieve the highest standards of professionalism, competence and ethical conduct.”2 The
Association’s longstanding commitment to an independent, well functioning, ethical legal system
is evidenced by the extensive policy developed in support of these primary Association goals.
This Recommendation, supported by this Report, continues the ABA’s efforts to preserve an
independent, efficient judiciary and an ethical legal system by building on existing ABA policy
to address the legislation introduced in the 108th Congress entitled the “Lawsuit Abuse Reduction

       2   Goals XI and V of the American Bar Association as adopted by the House of Delegates.



                                               15
Act.” As noted in the dissenting views to the United States House of Representatives report,
“[t]his sweeping overhaul of our civil justice system is being completed on the thinnest
conceivable record of a single cursory hearing and the basis of a few anecdotes and hypothetical
concerns.”3

        The legislation, as adopted by the House of Representatives, would change many aspects
of Rule 11 of the Federal Rules of Civil Procedure. These amendments to Rule 11 are being
proposed without first being submitted to the process set forth in the Rules Enabling Act, a
process fully supported by the ABA that is based on three fundamental concepts: (1) the central
role of the judiciary in initiating judicial rulemaking, (2) procedures that permit full public
participation, including by members of the legal profession, and (3) recognition of a
congressional review period. In 28 U.S.C. §§ 2072-74, Congress prescribed the appropriate
procedure for the formulation and adoption of rules of evidence, practice and procedure for the
federal courts. This well-settled, Congressionally-specified procedure contemplates that
evidentiary and procedural rules will in the first instance be considered and drafted by
committees of the United States Judicial Conference, will thereafter be subject to thorough
public comment and reconsideration, will then be submitted to the United States Supreme Court
for consideration and promulgation, and will finally be transmitted to Congress, which retains
the ultimate power to veto any rule before it takes effect.

        This time-proven process proceeds from separation-of-powers concerns and is driven by
the practical recognition that, among other things, rules of evidence and procedure are inherently
a matter of intimate concern to the judiciary, which must apply them on a daily basis; each rule
forms just one part of a complicated, interlocking whole, rendering due deliberation and public
comment essential to avoid unintended consequences; and the Judicial Conference is in a unique
position to draft rules with care in a setting isolated from pressures that may interfere with
painstaking consideration and due deliberation.

       Mandatory Application of Rule 11

         The Recommendation supports the current version of Rule 11 of the Federal Rules of
Civil Procedure as an effective means of discouraging dilatory motions practice and frivolous
claims and defenses. The previous version of Rule 11, adopted in 1983, required mandatory
sanctions for every violation. During the decade this version was in effect, from 1983 to 1993,
an entire industry of litigation revolving around Rule 11 claims inundated the legal system and
wasted valuable court resources and time. The Judicial Conference of the United States has
noted that a mandatory application of Rule 11 created “a significant incentive to file
unmeritorious Rule 11 motions by providing a possibility of monetary penalty; engender[ed]
potential conflict of interest between clients and lawyers, who advised withdrawal of particular
claims despite the clients’ preference; exacerbate[ed] tensions between lawyers; and provid[ed]
little incentive…to abandon or withdraw a pleading or claim – and thereby admit error – that
lacked merit after determining that it no longer was supportable in law or fact.”4

       3   House Report 108-682, Lawsuit Abuse Reduction Act of 2004, at 95.
       4 Letter from the Judicial Conference of the United States to Hon. James Sensenbrenner,
July 9, 2004.


                                               16
        The current version of Rule 11, which came into effect through amendments in 1993,
allows courts to focus on the merits of the cases instead of extensive Rule 11 motions, while
maintaining the ability to sanction attorneys for frivolous claims or defenses, relying on the
court’s established ability to adjudicate such issues. The current version of Rule 11 allows for
judicial discretion in imposing sanctions for frivolous lawsuits and provides a 21-day period to
withdraw a particular claim or defense subject to a Rule 11 challenge. Since the amendments to
Rule 11 in 1993, the Judicial Conference reports a marked decline in Rule 11 satellite litigation
without any noticeable increase in the number of frivolous filings. There has been no
demonstrated problem with the enforcement or operation of Rule 11. A return to the mandatory
imposition of sanctions for Rule 11 violations, without extensive study and public comment,
would frustrate the purpose of the Rules Enabling Act and potentially harm the effective
functioning of the judicial system.

       Venue

        The Recommendation further opposes attempts by Congress to alter venue designation
rules established in both federal and state courts. Although Congress has the power to designate
venue for federal courts, for example, Title 28 § 1391 of the United States Code is the general
federal venue statute for federal courts, it should not dictate venue rules for state courts, or
change the established rules for federal courts without due deliberation. Designating venue for
state courts undermines federalism principles, as discussed in the next section of this Report, and
changing the rules for federal courts will at the least cause confusion. The existing federal
provisions specify specific rules for determining venue in a variety of circumstances and for a
variety of defendants and were the product of a series of carefully constructed amendments by
Congress over the last decades, after careful study. The venue rules are well established and are
an integral part of the functioning of the courts. Amendments to rules relating to venue and
jurisdiction should be supported by extensive study, vetted publicly, and subject to comment by
the legal profession. It is important that changes to venue and jurisdiction rules do not create
unintended consequences, such as providing a safe haven for foreign corporations by eliminating
the long-arm statutes that allow a corporation to be subject to suit wherever the corporation does
business or has minimum contacts. Transparency and clarity are important for venue and
jurisdiction rules. Changes to venue and jurisdiction rules that, for instance, provide for
mandatory dismissal if a court determines another venue would be the most appropriate venue
would be confusing and potentially injurious to litigant’s rights. Without clear guidance for what
is the most appropriate venue it would be impossible for litigants to navigate the justice system
and seek appropriate redress for valid claims.

State Court Proceedings

        The Recommendation recognizes the time-honored principles of federalism and opposes
any efforts by Congress to make certain federal rules applicable to state court actions, or to make
rule changes that affect purely state court rules. The debate over the role of the 10th Amendment
and the balance of power between the federal government and state governments has been a
central theme to our republican system of government since the founding of the country. It is a
well-established principle that the federal government, via the 10th Amendment, vests in the



                                                17
states the power to establish laws and rules in a variety of areas. Actions by Congress that
circumvent this established system of federalism would have serious repercussions throughout
the legal system, calling into question the power of states to establish a body of laws and rules
that relate to state matters and moving away from a current trend of devolution, which generally
shifts more powers from the federal government to the state courts.

         Sanctions for frivolous lawsuits in the federal courts are regulated by Rule 11 of the
Federal Rules of Civil Procedure. For the most part, state courts have established rules of civil
procedure governing the filing of frivolous claims that are similar to Rule 11. Rules relating to
civil procedure should be designed to provide clear and appropriate guidelines for attorneys and
users of the legal system. The rules should be designed to achieve the goals, as proscribed by the
state, to provide litigants with fair and unbiased access to the court system as well as for the
timely handling of civil claims. It should remain solely within the purview of the states to
establish local rules for procedures, either through the state legislature or through a grant of
rulemaking authority to the state judiciary. The intimate acquaintance with the local procedures
and uses of the courts in each state lends support to maintaining a system that allows states to
establish their own procedural rules. Even with separate rule-making authority between the state
and federal governments, and the possibility for different rules of procedure between the federal
and state systems, and even among the states themselves, there is no empirical evidence to
suggest that the procedures for moving civil cases through the courts are not working efficiently
and effectively.

        Venue and jurisdiction rules are another area that illustrates the ability for state and
federal court systems to operate effectively and efficiently with separate systems of rules. An
effort at the federal level to change the venue of state courts in relation to a particular type of
proceeding would be overreaching the bounds of state/federal relations. An effort by Congress
to carve out venue and jurisdiction rules for personal injury claims in state courts undermines the
legitimacy of such courts and may disrupt the effective functioning of state court systems and
certainly raise serious questions as to whether litigants would be able to adequately address
legitimate civil claims in state courts.

        As an association representative of the legal profession, it should be of paramount
importance to the ABA that all rules related to procedures, whether in state or federal courts,
should be amended only after careful study, extensive public comment, and based on a showing
of serious problems with the existing system. The effective functioning of the courts demands
nothing less.

Penalties to Attorneys with Rule 11 Violations

       The Recommendation opposes any effort to enforce a mandatory suspension of an
attorney for Rule 11 violations. The filing of frivolous claims and defenses is an important issue
that deserves attention. It is appropriate and right for courts to have the ability to sanction
attorneys for abusing the legal system by filing claims meant to harass or intimidate litigants. It
is, however, important to remember that Rule 11 violations can be levied even when, in
hindsight, there was a legitimate claim, especially for civil rights cases or environmental




                                                18
litigation. Attorneys practicing in these areas may be subject to more Rule 11 sanctions than
attorneys who handle other types of cases.

        A system that provides for mandatory suspension of attorneys with three Rule 11
violations would have an extremely chilling effect on the justice system and may
disproportionately impact attorneys who practice in particular areas, such as civil rights. This
type of mandatory suspension is even more damaging when taken in combination with efforts to
require mandatory sanctions for Rule 11 violations, which cannot be appealed until after a
judgment is rendered in a case. Such a rule is even more troublesome if it is allowed to apply
retroactively to violations that occurred before the rule was in place.

         A system that ensures professional conduct and respects the procedures and validity of
the legal process is crucial to the effective functioning of our courts. This type of system,
though, does not stem from arbitrary rules that sanction particular attorneys disproportionately.
The current system that allows for judicial discretion in the imposition of sanctions for frivolous
lawsuits serves the laudatory goal of reducing claims and defenses designed to waste time or
intimidate without imposing mandatory sanctions on attorneys who may be representing clients
with complex or new claims. Recent studies have shown that a significant percentage of cases
where Rule 11 sanctions have been imposed are civil rights cases. 5 In addition, other studies
show that when Rule 11 required the mandatory imposition of sanctions for violations many
legitimate civil rights claims were stifled out of a fear that large attorney fees would be imposed
as the sanction.6 An arbitrary “three strikes you’re out” rule does not effectively accomplish the
goal of reducing frivolous lawsuits and would drastically impact the legal profession by
suspending, indefinitely, many fine attorneys willing to take on controversial, yet important,
litigation.

Extension of Rule 11 to Problematic Discovery Issues

       The Recommendation opposes efforts by Congress to extend Rule 11 to problematic
discovery motions, requests, responses or non-responses because Rules 26(g) and 37 of the
Federal Rules of Civil Procedure are better tailored to address these issues.

        As currently drafted, the Federal Rules of Civil Procedure apply appropriate mechanisms
for addressing discovery abuses. Willful or intentional efforts to obstruct or impede a
proceeding through the intentional destruction of important documents are a serious problem that
should be regulated by the imposition of strong sanctions. The Federal Rules of Civil Procedure
allocate two rules to address the seriousness of discovery violations. Rule 26(g) is designed to
apply a Rule 11 type standard of conduct to discovery. The rule mandates the imposition of
sanctions for violations and designates attorney fees as the appropriate sanction. This rule does
not allow any type of “safe harbor” provision, such as the 21-day period to withdraw in Rule 11,
and it applies to disclosure as well as discovery responses and requests. Rule 37 is similar and
applies to discovery motions. An effort to address discovery violations in a third provision,

       5   House Report 108-682, Lawsuit Abuse Reduction Act of 2004, at 96.
       6   Id.



                                                19
specifically Rule 11, would be cumbersome and confusing as well as redundant. The discovery
sanctions covered by Rules 26(g) and 37 adequately address the very serious issues of intentional
document destruction during discovery. There is no need to address discovery in a rule that
relates to claims and defenses.

Conclusion

        The effective and efficient functioning of our court systems, at both the state and federal
levels, is of paramount importance. The well-established process of court rule-making, as
provided for in the Rules Enabling Act, allows the court system to craft appropriate, useful rules
that address the specific problems of managing cases within the court system. It is important that
rules affecting the functioning of the court be thoroughly vetted and supported by ample
evidence that change is indeed needed to keep the courts functioning. The judiciary is in the
unique position to best analyze what rules improve or hinder the court’s day-to-day functions. In
addition, it is crucial that the time-honored principles of federalism be honored throughout the
rule making process. State courts retain the right to design rules that appropriately address issues
germane to the particular state or district. A one-size-fits-all federal standard rarely works and
often creates unintended consequences. Frivolous lawsuits, forum shopping and discovery
violations should be taken very seriously by the judicial system and the legal profession. Hastily
crafted federal legislation, written without the input of the judiciary or the aid of a thorough
review, can cause more harm than good when attempting to address these serious, nuanced
issues. The Association should support procedures that require judicial input in rule-making and
should advocate against efforts that attempt to usurp state rule-making powers by imposing
federal standards on state court proceedings.
Respectfully submitted,

Dennis Drasco , Chair                 James K. Carroll, Chair
Section of Litigation                 Tort Trial and Insurance Practice Section
February 2005

                       AMERICAN BAR ASSOCIATION
                         SECTION OF LITIGATION
               TORT TRIAL AND INSURANCE PRACTICE SECTION
                   REPORT TO THE HOUSE OF DELEGATES

                                   RECOMMENDATION

RESOLVED, That the American Bar Association reaffirms its support for the Congressionally-
enacted, judicial rulemaking process set forth in the Rules Enabling Act and opposes those
portions of the proposed "Lawsuit Abuse Reduction Act" of the 108th Congress (H.R. 4571) or
other legislation that would frustrate that process.

FURTHER RESOLVED, That the American Bar Association opposes enactment of any
Congressional legislation that would transgress time-honored principles of federalism by
imposing the provisions of Rule 11 of the Federal Rules of Civil Procedure upon any civil action
filed in a state court.


                                                20
FURTHER RESOLVED, That the American Bar Association opposes enactment of any
Congressional legislation that would transgress time-honored principles of federalism by
imposing venue designation rules or provisions upon a personal injury claim filed in a state
court.

FURTHER RESOLVED, That the American Bar Association supports the current version of
Rule 11 of the Federal Rules of Civil Procedure, which became effective December 1, 1993, as
an effective means of discouraging dilatory motions practice and frivolous claims and defenses.

FURTHER RESOLVED, That the American Bar Association opposes enactment of any
Congressional legislation that would alter or amend the current version of Rule 11 for the
purpose of imposing mandatory sanctions and removing its current provisions that encourage
attorneys to correct, modify or withdraw pleadings or motions.

FURTHER RESOLVED, That the American Bar Association opposes enactment of any
Congressional legislation that would impose any form of mandatory suspension due to prior
violation of Rule 11, a factor that judges can and do take into account in adjudicating Rule 11
violations at present.

FURTHER RESOLVED, That the American Bar Association opposes extending Rule 11 to
problematic discovery motions, requests, responses or non-responses because Rule 26(g) or Rule
37 are better tailored to address these issues.

Committee Vote Summary on Proposed Resolution 601-8 and Report:

Members Approving:            43
Members Disapproving:         17
Members Abstaining:           14
Members Not Voting:           75


SUBCOMMITTEE D:               Yar Chaikovsky – Subcommittee Chair

Subject :      DOCTRINE OF EQUIVALENTS

The subcommittee will continue to study the application of the doctrine of equivalents, including
especially how it will be applied in light of the Federal Circuit’s decision in the remand of Festo.
This will include review of procedures for court determination of unforseeability of equivalents,
and the rebuttal of the presumption of surrender when a claim limitation is amended. The
subcommittee is preparing a preliminary report on its analysis of recent cases applying the
doctrine of equivalents.




                                                21
SUBCOMMITTEE E:                Joshua Paul – Subcommittee Chair

Subject :      THE IMPACT OF DAUBERT IN INTELLECTUAL PROPERTY LITIGATION

The committee will continue to study the impact of Daubert and its progeny on the admissibility
into evidence of consumer surveys in trademark cases. Trademark cases involve questions of
consumer perception (“likelihood of confusion”) and parties often feel compelled to commission
expensive market surveys for trial. Following the Supreme Court’s decision in Kumho Tire
(which clarified that a district court’s “gate keeping” function under Fed. R. Evid. 702 applies to
all expert testimony, and not only to “scientific” evidence), the courts now routinely invoke
Daubert in deciding admissibility questions relating to consumer surveys.

Initially, the committee plans to confine the project’s scope to an examination of cases in which
a consumer survey is offered to establish either “likelihood of confusion” or trademark “fame,”
and exclude from the subcommittee’s efforts cases where a survey is offered to establish or rebut
a “dilution” claim, or is addressed to any of the factual issues involved in false advertising cases.

The committee expects to collect and categorize the cases in the form of an annotated case list,
and may produce an article summarizing the report. After this initial project, the committee may
expand it to examine the impact of Daubert in patent and copyright litigation.

The Daubert Subcommittee A of Committee 606 on Experts prepared a draft report based on last
year’s report of Subcommittee A and recent cases on the issue. The draft report has been
circulated to Subcommittee E of Committee 601 for review and comments. The subcommittee
intends to work with the Daubert Subcommittee of Committee 606 in its future analysis of these
issues.

SUBCOMMITTEE F:                Jeffrey C. Morgan – Subcommittee Co-chair
                               Robert Ted Parker – Subcommittee Co-chair

Subject :      ELECTRONIC LITIGATION RULES & PROCEDURES

Earlier this year the ABA Litigation Section promulgated proposed “electronic discovery”
standards, and requested public comments on them, in preparation for presenting them to the
ABA House of Delegates for adoption at the ABA Annual Meeting in August, 2004. The
subcommittee studied these proposed draft standards, and delivered a report and
recommendation to the Section Council this past summer that the Section endorse the proposed
electronic discovery standards.

The subcommittee is reviewing the final ABA resolution and intends to prepare a report on the
final resolution and the steps being taken to implement the resolution.

Subcommittee F also reviewed the Rules Committee of the Federal Judicial Conference’s
proposed amendment to Rule 5(e) regarding mandatory electronic filing and prepared the
following resolution and report.




                                                 22
Ad Hoc Subcommittee on Proposed Rule 5(e) Amendments – Robert Ted Parker, Chair

Subject.   RECOMMENDATIONS ON PROPOSED AMENDMENTS TO RULE 5(e)
           CONCERNING E-FILING.

PROPOSED RESOLUTION 601-9.

RESOLVED, that the Section of Intellectual Property Law supports the Rules Committee of the
Federal Judicial Conference’s proposed amendment to Rule 5(e) affecting amendments to the
Federal Appellate, Bankruptcy, and District Court Rules, which would authorize trial and
appellate federal courts to "permit or require" electronic filing.

Past Action. None (but see note about House of Delegates policy on electronic filing, below).

Discussion. The ABA's Judicial Center has asked the IPL Section whether it has comments that
it wishes to submit to the Rules Committee of the Federal Judicial Conference for changes in the
federal rules that would authorize trial and appellate federal courts to "permit or require"
electronic filing. The above resolution supports the proposed amendment that would appear to
permit the mandating of electronic filing, but does not specifically suggest that any comments be
submitted to the Rules Committee.

Rule 5(e) was previously amended to include authority for courts to authorize electronic filing,
but not yet to require electronic filing as mandatory. Electronic filing is currently a widespread
practice under existing local rules of district courts. The amendment would enable courts to
benefit further from the further elimination of paper from its processing of cases, and would
bring courts into alignment with practices with other government agencies and the private sector.

The proposed amendment to Rule 5(e)(2) of the Civil Rules is as follows (emphasis added):

". . . . A court may by local rule permit or require papers to be filed, signed or verified by
electronic means that are consistent with technical standards, if any, that the Judicial Conference
of the United States establishes. . . ."

The Committee Note reads:

        "Amended Rule 5(e) acknowledges that many courts have required electronic filing by
means of a standing order, procedures manual, or local rule. These local practices reflect the
advantages that courts and most litigants realize from electronic filing. Courts requiring
electronic filing recognize the need to make exceptions for parties who cannot easily file by
electronic means, and often recognize the advantage of more general "good cause" exceptions.
Experiences with these local practices will facilitate gradual converge on uniform exceptions,
whether in local rules or an amended Rule 5(e)."

The ABA House of Delegates adopted policy on standards for electronic filing at last year’s
Midyear Meeting on February 9, 2004. The ABA Judicial Division’s report on Court use of
Electronic Filing Processes is available at http://www.abanet.org/jd/pdf/standard_1_65.pdf. The



                                                23
policy itself contains guidance for court policies and rules on electronic filing. The standard is as
follows:

       Standard 1.65 Court Use of Electronic Filing Processes. Because of the benefits
       accruing to the courts, the bar and the public from the use of electronic records,
       courts should implement electronic filing processes. In doing so, they should
       follow certain general principles, adopt rules and implement electronic filing
       processes as follows:

       (a) General principles

       (i) Official Court Record. The electronic document should be the official court
       record. Paper records, if maintained, should be considered a copy of the official
       court record.

       (ii) Electronic Viewing. Electronic filing processes should presume that all users
       will view documents on their computer screens. Paper copies should be available
       on demand, but their production should be exceptional, not routine.
       (iii) Technical Requirements. Courts should use Internet browser, eXtensible,
       Markup Language, web services7 and World Wide Web Consortium
       recommended standards for electronic filing processes.

       (iv) Document Format. Courts should require electronic documents to be
       submitted in a format that can be rendered with high fidelity to originals, and,
       when possible, is searchable and tagged. Courts should only require formats for
       which software to read and write documents is available free for viewing and is
       available free or at a reasonable cost for writing and printing.

       (v) Self-Contained Documents. Each filed document should be self-contained,
       with links only to other documents submitted simultaneously or already in the
       court record.

       (vi) Data Accompanying Submitted Documents. Courts should require filers to
       transmit data identifying a submitted document, the filing party, and sufficient
       other information for the entry in the court's docket or register of actions. In the
       case of a document initiating a new case, sufficient other information should be
       included to create a new case in the court's case management information system.
       This data should be specified with particularity by the court.

       (vii) Identity of the Sender. Courts should use some means to identify persons
       interacting with its electronic filing system.


       7“Web service” is used in its most generic sense - software components that employ one
or more of the following to perform distributed computing: UDDI, WSDL, SOAP or ebXML.
The term is not used in this document to describe a specific architecture.



                                                 24
(viii) Integrity of Transmitted and Filed Documents and Data. Courts should
maintain the integrity of transmitted documents and data, and documents and data
contained in official court files, by complying with current Federal Information
Processing Standard 180.2 or its successor.

(ix) Electronic Acceptance of Payments. Courts should establish a means to
accept payments of fees, fines, surcharges and other financial obligations
electronically, including the processing of applications to waive fees.

(x) Surcharges for Electronic Filing. Courts should avoid surcharges for filing of
or access to electronic documents if they are able to obtain public funding of their
electronic filing processes. Courts may impose such surcharges or use a private
vendor that imposes surcharges when public funding is not available. Such
surcharges should be limited to recouping the marginal costs of supporting
electronic filing processes if collected by the court or to a reasonable level if
imposed by a private vendor.
(xi) Court Control over Court Documents. Whenever a court's electronic
documents reside on hardware owned or controlled by an entity other than the
court, the court should ensure by contract or other agreement that ownership of
the documents remains with the court or clerk of court. All inquiries for court
documents and information should be made against the current, complete,
accurate court record.

(xii) Addressing the Special Needs of Users. In developing and implementing
electronic filing, courts should consider the needs of indigent, self-represented,
non-English speaking, or illiterate persons and the challenges facing persons
lacking access to or skills in the use of computers.

(xiii) Limiting access to specified documents and data. All electronic filing
applications should contain the capabilities to restrict access to specific
documents and data in accordance with statutes, rules, and court orders.

(xiv) System Security. Electronic filing applications should include robust
features to security features to ensure the integrity, accuracy, and availability of
the information contained in them. They should include, at a minimum,
document redundancy; virus protection software; firewalls, intrusion detection
systems, authentication and authorization features; plans for system archival,
contingency, and disaster recovery,; and other generally accepted security features
to detect and prevent attempts by unauthorized persons to gain access to or
modify court records; system audit logs; secured system transmissions; privilege
levels restricting the ability of users to create, modify, delete, print or read
documents and data; means to verify that a document purporting to be a court
record is in fact identical to the official court record; and reliable and secure
archival storage of electronic records in inactive or closed cases.




                                         25
(b) Court Rules

(i) Service of Filings on Opposing Parties. Court rules may provide that electronic
transmission of a document through the electronic filing process to opposing
counsel or parties who participate in the electronic filing process will satisfy the
service requirements of court procedural rules. Such electronic filing processes
should automatically create and docket a certificate of service for documents
served electronically through the electronic filing process. Court rules need not
provide additional time for responding to documents served in this fashion.

(ii) Use of Unique Identifier. Court rules should provide that a lawyer or other
person provided with a unique identifier for purposes of filing documents
electronically will be deemed to have filed any document submitted using that
identifier.
(iii) Determining when a Document is Filed. Court rules should articulate the
criteria by which an electronic document is deemed "received", "filed," "served,"
and "entered on the docket or register of actions." Courts should record the date
and time of filing and inform the filer of them or of rejection of the document and
the reasons for rejection.

(iv) Availability of Electronic Filing Process. Courts should accept electronic
documents 24 hours per day, 7 days per week, except when the system is down
for maintenance. The date on which documents be deemed filed should be in
accordance with the court's definition of "filed" pursuant to subsection (b)(iii),
whether or not the clerk's office was open for business at the time the document
was submitted electronically.

(v) Remedy for Failure of Electronic Processes. Court rules should create
procedures and standards for resolving controversies arising from the electronic
filing process.

(c) Implementing Electronic Filing Systems

(i) Universal Electronic Filing Processes. Courts should ultimately include all
documents in all case types in electronic filing processes although they may
implement electronic filing incrementally.

(ii) Mandatory Electronic Filing Processes. Court rules may mandate use of an
electronic filing process if the court provides a free electronic filing process or a
mechanism for waiving electronic filing fees in appropriate circumstances, the
court allows for the exceptions needed to ensure access to justice for indigent,
disabled or self-represented litigants, the court provides adequate advanced notice
of the mandatory participation requirement, and the court (or its representative)
provides training for filers in the use of the process.




                                         26
       (iii) Judicial Discretion to Require Electronic Filing in Specific Cases. Judges
       should have the authority to require participation in the electronic filing system in
       appropriate cases until such participation becomes mandatory for all cases.

       (iv) Maintaining Supplementary Scanning Capability. Courts should ensure that
       all documents in electronic cases are maintained in electronic form. Consequently,
       in voluntary electronic filing processes, courts should scan paper documents and
       file them electronically.

       (v) Quality Control Procedures. Courts should institute a combination of
       automated and human quality control procedures sufficient to ensure the accuracy
       and reliability of their electronic records system.

       (vi) Eliminating Unnecessary Paper Processes. Courts should eliminate paper
       processes that are obsolete or redundant in an electronic environment.

       (vii) Integration with Case Management and Document Management Systems.
       Electronic documents should be accessed through a court's case management
       information system. Courts should mandate that case management information
       systems provide an application programming interface capable of accommodating
       any electronic filing application that complies with these standards. Courts using
       electronic filing processes should require automated workflow support.

       (viii) Archiving Electronic Documents. Courts should maintain forward migration
       processes to guarantee future access to electronic court documents.

The Subcommittee recommends that the Intellectual Property Law Section generally support
electronic filing because it simply brings the federal courts on line with the rest of the business
and commercial world. Especially considering the funding pressure the district courts are
constantly under these days with the person-power that electronic filing affords, to not back this
proposal would be to endorse the further administrative weakening of the federal court system.

However, the members of the subcommittee urge caution if electronic filing is made mandatory.
Extremely large attachments, for example, can cause transmission problems in certain email
systems, and "computer problems" should not be a reason for failure to meet a filing deadline.
The Rules Committee appears to recognize the need for exceptions like this in its “Committee
Note,” in which it acknowledges the need to make exceptions for parties who cannot easily file
by electronic means and also appears to acknowledge the need for other "good cause"
exceptions. In addition, the Standard on use of Electronic Filing Processes (Standard 1.65) that
has already been adopted by the ABA House of Delegates does include a provision that court
rules should create procedures and standards for resolving controversies arising from the
electronic filing process.

In these circumstances, the subcommittee believes that the Intellectual Property Law Section can
support the proposed change to the rule without making specific additional comments to the
Rules Committee.



                                                27
Committee Vote Summary on Report:

Members Approving:            73
Members Disapproving:         9
Members Abstaining:           3
Members Not Voting:           59


SUBCOMMITTEE G:               Greg Lyons – Subcommittee Chair

Subject :      COMMERCIAL SUCCESS EVIDENCE IN PATENT LITIGATION

The following subcommittee was added last year to propose recommendations on Section policy
in response to the FTC report on patents and competition policy.

The FTC’s report on patent and competition policy recommendation 3a concerns the issue of
commercial success in patent litigation. The FTC recommends that, in applying the “commercial
success” test to evaluate the obviousness of a patent invention, courts should (1) evaluate on a
case-by-case basis whether commercial success is a valid indicator that the claimed invention
would not have been obvious, and (2) place the burden on the patent holder to prove the claimed
invention caused the commercial success.

The subcommittee investigated this issue and prepared a supplemental report. No resolutions
were proposed at that time.


SUBCOMMITTEE H:               Bruce McDonald – Subcommittee Co-Chair
                              Marc Hankin – Subcommittee Co-Chair

Subject :      HAGUE CONVENTION JURISDICTION AND FOREIGN
               JUDGMENTS

The subcommittee has been assisting the Section Council by participating in hearings and
working sessions to develop a new Draft Hague Convention. Section members have been
involved in this project for several years, but the name and scope of the proposed international
treaty has been changed just recently. The current preliminary Draft Hague Convention on
exclusive choice of court agreements is narrower than the prior Draft Convention on jurisdiction,
recognition and enforcement of foreign judgments in civil and commercial matters.

Background On The Draft Convention

The Section has long supported the U.S. Delegation in its negotiation and expected ratification of
a successful convention which both (a) reduces litigation over jurisdictional issues and (b)
facilitates recognition and enforcement of judgments obtained in one country (notably the United
States) in other countries (notably the remainder of the world, who are not as willing to
recognize U.S. judgments). Over the years, the member-participants and non-governmental
observer-experts who have been participating at the Hague Conference on Private International


                                               28
Law in the Special Commission on Jurisdiction, Recognition and Enforcement of Foreign
Judgments in Civil and Commercial Matters have had to scale back dramatically the scope of the
project.

The purpose of the new Choice of Courts Convention is stated in the preamble: "to provide
international trade and investment through enhanced judicial cooperation." The objective of the
Convention is to make exclusive choice of court agreements as effective as possible in the
context of international business. The hope is that the Convention will do for choice of court
agreements what the New York Convention of 1958 has done for international arbitration
agreements. The preamble describes the following requirement to achievement of the purpose:
"a secure international legal regime that ensures the effectiveness of exclusive choice of court
agreements by parties to commercial transactions and that governs the recognition and
enforcement of judgments resulting from proceedings based on such agreements."

Developing consensus on a draft convention, however, has not been easy, because of
inconsistencies in member State legal systems (e.g., civil vs. common law countries); the rising
importance of the European Commission; the growth of the European Union; the rising
economic significance of China and other Asian member states; and the need to harmonize any
new Draft with existing Conventions, treaties and other formal agreements among the member
States. Success will depend upon the members resolving differences in their respective positions
on various issues. Section members have been participating to try to assist delegates from all
countries understand the U.S. intellectual property systems better, and to try to harmonize our
system with their very different systems.

Section Involvement In The Proceedings

In March 2004, Marc Hankin and Donald Dunner participated in an Informal Working Session in
D.C., and then in April, Marc Hankin traveled to The Hague to participate in the last Session of
the Special Commission convened before the next Official Diplomatic Conference that is
currently scheduled to take place June 14-30, 2005 in The Hague.

The ABA is not eligible to participate directly at The Hague Conference. Because the ABA is
not considered to be an "International Non-Governmental Organization" and only representatives
of those can participate officially at The Hague, Section members have had to seek joint-
sponsorship from the International Bar Association and FICPI to participate at the meetings in
The Hague.

On behalf of Subcommittee H, Mr. Hankin is planning to attend the Diplomatic Conference in
June 2005 and he will coordinate our Section participation internally, and with members of the
AIPLA and several other organizations with whom the Section is aligned in interest.

Substantive Issues For Consideration

In order to achieve the stated objectives of the Draft Convention, it is necessary to impose three
obligations on the courts of Contracting States: the chosen court must be obliged to hear the




                                               29
dispute; all other courts must be obliged to decline jurisdiction; and the judgment given by the
chosen court must be recognized and enforced by courts in other Contracting States.

These obligations are set forth in three key provisions in the Convention in Articles 5, 7 and 9.
Article 5, which is addressed to the chosen court, provides that the court designated in an
exclusive choice of court agreement has jurisdiction and must exercise it; Article 7, which is
addressed to all courts in other Contracting States, provides that those courts must suspend or
dismiss any related proceedings that are brought before them; and Article 9, which is addressed
to the court in which recognition is sought, provides that a judgment given by the court of a
Contracting State designated in an exclusive choice of court agreement must be recognized and
enforced.

Because of the wide differences in the existing rules of jurisdiction in different States and the
unforeseeable effects of technological developments, including the Internet, on the jurisdictional
rules that would have had to be set forth in the Draft Convention as originally conceived,
eventually certain delegations decided to postpone a decision on whether further work should be
undertaken on the preliminary draft Convention of broader scope, and eventually, it was decided
to focus on the issue of jurisdiction based on choice of court agreements in business-to-business
cases. The April 2004 Special Commission Meeting at The Hague produced the current working
text of the Draft Convention, which focuses on intellectual property matters much less than did
the prior draft texts.           To view the history and full texts:                http://hcch.e-
vision.nl/index_en.php?act=progress.listing&cat=4

Current Working Text Of The Intellectual Property Sections Of The Preliminary Draft
Convention On Exclusive Choice Of Court Agreements

Reproduced below are the pertinent intellectual property sections of the current working text.
The bracketed subject matter corresponds to proposed language for which there is not yet a
sufficient consensus of Official Country Delegations, and as to which the U.S. Delegation seeks
input from our Section.

Article 2      Exclusions from scope

2.     The Convention shall not apply to the following matters - …

g)     anti-trust (competition) matters; …

k)     [intellectual property rights other than copyright or related rights, except in proceedings
pursuant to a contract which licenses or assigns such intellectual property rights[{and/or}
including proceedings for infringement of the right to which the contract relates]]; or

l)     the validity of entries in public registers.

3.     Notwithstanding paragraph 2, proceedings are not excluded from the scope of the
Convention where a matter referred to in that paragraph arises merely as an incidental question
and not as an object of the proceedings.



                                                  30
Article 10     Incidental questions

1.      Where a matter referred to in Article 2, paragraph 2, arose as an incidental question, the
ruling on that question shall not be recognized and enforced under this Convention.

[2.     Where an incidental ruling on the validity of an intellectual property right other than
copyright or related rights was necessary for the judgment of the court of origin, recognition or
enforcement of the judgment may be refused to the extent that it is inconsistent with a judgment
on the validity of the intellectual property right rendered in the State under the law of which the
intellectual property right arose. ]

{either select paragraph 10(2) above, or the following proposed variant, 10(3), may be selected}

[3.     Where an incidental ruling on the validity of an intellectual property right other than
copyright or related rights was necessary for the judgment of the court of origin, recognition or
enforcement of the judgment may be postponed or refused at the request of one of the parties if
proceedings on validity are pending in the State under the law of which the intellectual property
right arose. A refusal does not prevent a subsequent application for recognition or enforcement
of the judgment.]

Call To Action

After more than a decade of negotiations, the Delegates have decided that the Diplomatic
Convention this coming June will be the final meeting on this project, and that they will resolve
all negotiations and drafting issues at that time. Accordingly, the Section only has a few months
to re-evaluate its position in view of the new text and to make its views known, first to the U.S.
Delegation, and then to the Commission.

Please review the draft text set forth above and consider the merits of the U.S. ratifying this
version of the treaty. Please contact the Subcommittee H Co-Chairs if you have any views you
would like to make known, if you have any questions you would like answered, or if you just
seek additional information on this project. The Co-Chairs may be contacted by e-mail at:

Bruce McDonald at bmcdonald@schnader.com
Marc E. Hankin at Marc@HankinPatentLaw.com


SUBCOMMITTEE I:               John Marshall – Subcommittee Chair

Subject :      BURDEN OF PROOF FOR INVALIDITY IN PATENT LITIGATION

The FTC’s report on patent and competition policy recommendation 2 is to "Enact legislation to
specify that challenges to the validity of a patent are to be determined based on a "preponderance
of the evidence," rather than the existing "clear and convincing evidence standard." This
subcommittee was formed last year to investigate the FTC’s report on this issue.



                                                31
The subcommittee investigated this issue and prepared a supplemental report. No resolutions
were proposed at that time.

SUBCOMMITTEE J:               Michael Harris – Subcommittee Chair

Subject :     BEST MODE REQUIREMENT IN PATENT LITIGATION

The NAS’ Recommendation 6(b) to “limit the subjective elements of patent litigation,” including
reform of the best mode requirement was studied by the subcommittee last year. The
subcommittee investigated this issue and prepared a supplemental report. The subcommittee
prepared a proposed resolution opposing in principle that the best mode requirement be
significantly modified or eliminated.

As part of the NAS Task Force formed this Fall, a Task Force Subcommittee G consisting of
Jeff Kushan (Chair), Bob Armitage, and Sam Helfgott considered recommendations 6b and 7c
regarding best mode.


SUBCOMMITTEE K:              John Marshall – Subcommittee Co-chair
                             John Schneider – Subcommittee Co-chair

Subject :     INEQUITABLE CONDUCT DEFENSE IN PATENT LITIGATION

The NAS’ Recommendation 6(c) to “limit the subjective elements of patent litigation,” including
reform of the inequitable conduct defense was studied by the subcommittee last year. The
subcommittee investigated this issue and prepared a supplemental report. The subcommittee
prepared a proposed resolution opposing in principle any amendment to eliminate the defense of
patent unenforceability. The subcommittee recommended considering particular reform
proposals individually with more empirical analysis and deliberation that is contained in the
NAS Report.

As part of the NAS Task Force formed this Fall, a Task Force Subcommittee E consisting of Bob
Armitage (Chair), Don Dunner , Don Martens, Jeff Kushan, Mark Campagna and Richard
Rainey considered recommendation 6(c) regarding inequitable conduct.


SUBCOMMITTEE L:              Jeffrey Elikan – Subcommittee Chair

Subject :     HATCH-WAXMAN

This newly-formed subcommittee was formed to review and comment on important decisions
interpreting the Hatch-Waxman Act, as well as unique issues in pharmaceutical patent litigation
that commonly arise in Hatch-Waxman litigation. The subcommittee also intends to review and
comment on proposed legislation and discuss the effect of any such legislation, if passed, on the
Act and on Hatch-Waxman litigation.


                                               32
The subcommittee intends to review local rules or guidelines for patent cases in certain
jurisdictions that may not be appropriate for Hatch-Waxman cases, and to possibly propose
uniform guidelines for Hatch-Waxman cases that would be appropriate.

The subcommittee also hopes to publish reviews and comments on major decisions in an
electronic newsletter in the future.


SUBCOMMITTEE M:                Albert L. Jacobs, Jr. – Subcommittee Co-Chair
                               Stephen Lobbin – Subcommittee Co-Chair

Subject :      JUDICIAL ETHICS & PROFESSIONAL RESPONSIBILITY

This newly-formed subcommittee was formed to review several issues related to the Section
Officers Conference Committee on Ethics and Professional Responsibility on-going revision to
the Code of Judicial Conduct. A few of the issues that the subcommittee intends to review are --
whether trial judges should also be settlement judges, membership of judges in outside
organizations, recusal for stock ownership, and whether the appearance of an impropriety
standard should be maintained.

Subject.    RECOMMENDATIONS ON CODE OF JUDICIAL CONDUCT REVISIONS.
            NO PROPOSED RESOLUTIONS.

Past Action of the Committee.

None.

Discussion.

The subcommittee was asked to review Judicial Canons I to IV and the proposals made by the
Tort Trial and Insurance Practice Section. In particular, the Committee focused on the fact that
Congress was bypassing the customary procedure by which rule proposals emanate from the
courts and are approved by the legislature. In addition, the Committee was disturbed by
Congress’s apparent transgression of the fundamental principles of Federalism and the co-
existence of the federal and state judicial systems.

More specifically, it was the subcommittee's view that the Rules Enabling Act set forth the
appropriate judicial rulemaking process and therefore oppose Congress’s proposed “lawsuit
Abuse Reduction Act of the 108th Congress”. Rule 11 of the Federal Rules of Civil Procedure
has been a matter of discussion, revision, and controversy since its enactment. The Rule in its
present form is, in the opinion of the subcommittee, working fine and does not need to be further
revised. It is furthermore the subcommittee’s view that it was inappropriate to apply the
provisions of the Rule 11 of the Federal Rules of Civil Procedure in civil actions filed in state
courts as this violated the federal/state separation. It is similarly the subcommittee’s view that it
was inappropriate for Congress to impose venue, designation rules, or other venue provisions on



                                                 33
personal injury claims filed in state courts. Such action is appropriately left to the individual
states.

With regard to the particular application to Rule 11, the subcommittee opposed imposing
mandatory sanctions and opposes action which would cause Rule 11 motions to become
contested proceedings within the main proceeding. It is believe that the current Rule is in the
main aptly applied by federal judges and it is unnecessary to specifically extend Rule 11 to
discovery motions, requests, responses, and other aspects of discovery as such issues seem to be
fully addressed by FRCP 26(g) and 37.

At the same time, it seemed appropriate to amend the commentary to certain of the Canons to
emphasize some actions that the bar and the bench can jointly take to better facilitate the
handling of contested litigation in the federal court. These proposals are also in keeping with
ensuring the appearance of fairness of the court to both sides. It is hoped that the suggested
proposals to the commentary accompanying their recommendation will have a salutary effect on
bench and bar alike.

Committee Vote on Report:

Members Approving Report (85):

Mark Abate                        Jon Gurka                           Edward Meilman
Kenneth Adamo                     Marc Hankin                         Edward Meisarosh
Michael Allen                     Daniel Healy                        Jeffrey Morgan
Joan Archer                       Roger Herrell                       Robert Morgan
Blas Arroyo                       Russell Hill                        Jonathan Muenkel
William Atkins                    Allen Hinderaker                    Marilyn Neiman
Robert Auchter                    Gary Hoffman                        Martin O’Donnell
Charles Baker                     Richard Horwitz                     Terrence O’Toole
Gregory Borgognoni                Richard Hoskins                     Glenn Ousterhout
Jeffrey Burgan                    Robert Huffman                      Ted Parker
Stephen Cagle                     Sharon Israel                       Richard Pearson
Daniel Calder                     Albert Jacobs                       Laurence Pretty
Benard Cantor                     Jonathan James                      Christopher Renk
Yar Chaikovsky                    Louis Jameson                       Charles Rutherford
Andrew Chew                       Clifford Jarrett                    Jeannine Sano
Peter Costas                      Robert Kantner                      William Schramm
Ray Coulter                       Lee Kaplan                          Stuart Sender
Donald Curry                      John Kim                            Peter Sullivan
Emily Danchuk                     John Klempir                        Craig Summers
Aaron Davis                       Kenneth Kula                        Philip Swain
Kenneth Davis                     Larisa Lacis                        Bruce Vosburg
Ava Doppelt                       Chad Landmon                        Sanford Warren
Stephen Dorvee                    Bradley Lane                        Jacob Wharton
Stuart Dunwoody                   Irfan Lateef                        Susan Williams
Dianne Elderkin                   Marc Lieberstein                    Gregory Wood



                                               34
Jeffrey Elikan                  Gregory Lyons      Ted Parker
Cheryl Farine                   John Marshall
Gary Frischling                 Kevin McCabe
Kirkland Garey                  Bruce McDonald
Christopher Gerlach             Alan McGrath

Members Approving Report in Part (3):

Frederick Cottrell
R. Matthew Molash
Jack Goldstein

Members Disapproving Report (3):

Michael Broaddus
David Burgert
James Wallace

Members Abstaining from Voting on Report (8):

Don Cameron                   T. Earl Le Vere
John Carlin                   Douglas Masters
John Filosa                   Daniel Riess
Edward Fiorito                Jonathan Tropp

Committee Members Not Heard From (67):

Aldo Badini                     Thomas Hamlin      Henrik Parker
Andre Bahou                     Charles Hauff      Joshua Paul
Charles Baker                   C Erik Hawes       Steven Peretz
William Baker                   Jay Helton         Kathryn Perkins
Caleb Baskin                    Stephen Horace     H Jonathon Redway
Linnea Brown                    Robert Jondle      Michael Smith
Paul Burns                      Michael Jones      Matthew Solomson
Jeffrey Butler                  George Jordan      William Spence
Stephen Butler                  John Kidd          Peter Stavros
Donald Cameron                  Jonathan Korn      Thomas Stine
Eugenia Carter                  James Kyper        John Strand
Mark Cermele                    James Lindon       Kristi Thomas
May Chan                        Stephen Lobbin     Nancy Tinsley
Dan Cherry                      Marcus Manos       Anthony Tokarz
Louis Ciavarra                  Robert Mansfield   John Triggs
James Delaris                   Paul Marshall      Basil Webb
Thomas Duston                   Edgar Martin       Charles Weiss
Robert Edell                    John McDowell      Clyde Wilson
Ellen Efros                     Theresa Moehlman   Walter Zimmerman



                                           35
Ian Feinberg      Marvin Moody
Richard Fladung   Amir Mostafavi
Daniel Garrie     Stephen Nagin
Paul Garrity      Gregory Norrod
Paul Greenspan    Wesley Overson




                            36

				
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