Judge makes lawyers pay for frivolity
With the verdict overturned, two attorneys must pay the others’ fees.
Article Last Updated: 02/25/2008 02:53:25 AM MST
A federal judge recently got so infuriated by the conduct of two highly regarded trial attorneys that he overturned a jury’s $51 million verdict, then ordered the lawyers to pay the fees and costs of the opposing lawyers, a sum that could total several million dollars.
U.S. District Senior Judge Richard P. Matsch sanctioned attorneys Terrance McMahon and Vera Elson of the firm McDermott, Will and Emery, of Chicago and San Francisco, for “cavalier and abusive” misconduct and for having a “what can I get away with?” attitude during a 13-day patent infringement trial in Denver.
He ruled that the entire trial was “frivolous” and the case filed solely to stifle competition rather than to protect a patent.
Neither McMahon nor Elson returned phone calls. But their firm defended them by stating it “believes in vigorous and ethical advocacy on behalf of our clients. While we respect Judge Matsch, we disagree with the conclusions of the opinion and believe that it will be reversed on appeal.”
The U.S. 10th Circuit Court of Appeals saw it differently and affirmed Matsch’s decision to overturn the verdict.
News of Matsch’s ruling swept through the legal community.
“In 42 years of litigation, I’ve never seen a judge set aside a verdict, then award fees to opposing counsel,” said local attorney Robert Miller, of Perkins Coie LLP. “There are times when a verdict is set aside, and times when lawyers are sanctioned. But I’ve never heard of them happening in one case.
“Judge Matsch does some things that are out there, but he’s usually right. Very infrequently is he reversed on appeal.”
The case began in 1999, when Medtronic Navigation Inc., a Minnesota-based firm with a manufacturing facility in Louisville, sued its competitor, BrainLab Inc., a multinational German company, claiming it had lost more than $100 million because of patent infringement. Both companies manufacture surgical instruments that guide a surgeon’s scalpel very precisely in difficult situations such as the removal of a brain tumor. The guidance technology was the core of the case.
For three years, the two companies couldn’t negotiate a settlement. Medtronics even tried to buy BrainLab but was rebuffed. So Medtronics fired its lawyers and hired McDermott, Will and Emery to take the case to trial.
After presiding over the 13-day trial, Matsch wrote that McDermott’s lawyers not only disregarded his instructions during the trial but argued “with full awareness that their case was without merit.”
BrainLab’s lead attorney, Jay Campbell, said, “We’re very pleased with the decision. The judge wrote eloquently about the improprieties, that they had litigated to end competition rather than to enforce the patent.”