Evidence of Pre-Suit Investigation Defeats Sanctions Claim


Rule 11 sanctions motions are most often filed after a defendant wins the case on summary judgment. The Defendant will then argue that the plaintiff’s claims were objectively unreasonable or that the plaintiff failed to conduct a pre-suit investigation. In Dominguez v. Barracuda Tackle, LLC, No. 8:20-cv-1538 KKM-AEP, a patent infringement lawsuit, the court granted summary judgment to the Defendant but denied Rule 11 sanctions on the ground that plaintiff had conducted a pre-suit investigation. The court’s opinion contains a thoughtful, if pithy, explanation for the denial of sanctions.

Defendants’ objections raise two principal assertions regarding the motion for sanctions: (1) Plaintiffs’ counsel did not perform a pre-suit investigation and (2) Plaintiffs’ legal claims were clearly unreasonable. Upon a de novo review, the Court agrees with the well-reasoned explanation of the Magistrate Judge on those points. First, the Court finds that the declaration of Yunior Dominguez is evidence of a pre-suit investigation. While the declaration was not signed by Plaintiffs’ counsel, it still shows that Plaintiffs and counsel explored the validity of claims prior to suit. Second, the Court agrees with the Magistrate Judge that a reasonable juror could conclude that the two bait nets at issue perform substantially the same function with substantially the same result. While ultimately this is not enough to create a triable issue of fact in the light of the claims construction, it was “not so quixotic as to warrant sanctions.” Rodick v. City of Schenectady, 1 F.3d 1341, 1351 (2d Cir. 1993). Indeed, if all suits that did not create a triable issue of fact were sanctionable, one doubts if the legal profession would continue to be a profitable enterprise. Although the Defendants assert that Plaintiffs filed this suit for the improper purpose of extracting a nuisance-value settlement from Defendants, at bottom, they offer no evidence of this malintent apart from the losing disposition of the claims. The Court declines to impose sanctions on this basis.

Edward X. Clinton, Jr. www.clintonlaw.net

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