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Rule 11 Prefiling Investigation Determined by a Reasonableness Standard

January 07, 2002
Swan, Jennifer S.

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Last Month at the Federal Circuit - February 2002

Judges: Bryson (author), Lourie, and Linn

In Antonious v. Spalding & Evenflo Cos., No. 01- 1088 (Fed. Cir. Jan. 7, 2002), the Federal Circuit vacated a district court’s finding that the patentee’s attorneys’ prefiling investigation was frivolous because the attorneys’ proposed construction of claim language was not frivolous and remanded for further findings as to the adequacy of the prefiling investigation based on the attorneys’ proposed claim construction.

Mr. Anthony Antonious is the owner of U.S. Patent No. 5,482,279 (“the ‘279 patent”), which is directed to metal golf club heads. Claim 1 of the '279 patent recites that a “hosel,” which is the socket in the head of a golf club into which the shaft is inserted, “extends and connects with” a “peripheral mass” that is positioned along the interface between the ball-striking face and the crown of the club head. Mr. Antonious determined that Spalding & Evenflo Companies’ (“Spalding”) golf club line, the “Intimidator,” infringed the ‘279 patent after he cut one open. He then contacted his patent counsel and advised them that he felt the Intimidator driver infringed the ‘279 patent.

The attorneys reviewed the patent and prosecution history of the ‘279 patent and interpreted the claim 1 limitation of “extends into and connects with said peripheral mass” to mean extends into, or abuts against, and is fastened to a peripheral mass. The attorneys determined that this interpretation was supported by the dictionary definition of the term “into” that means “inside or interior of” or, alternatively, “against” (as in “crashed into a tree”). After construing the claims of the ‘279 patent, the attorneys examined Mr. Antonious’s cut-open Spalding Intimidator club and determined that the Intimidator infringed Mr. Antonious’s patent because the hosel of the Intimidator club both abutted against and joined with the interior portion of the flange. The attorneys also reviewed literature about the Spalding Intimidator clubs, including Spalding’s patents and advertisements, and determined that other Intimidator clubs also infringed the ‘279 patent because this literature disclosed that other Intimidator metal woods used the same titanium insert technology as the drivers. After conducting this investigation, Mr. Antonious, with the assistance of his attorneys, filed suit against Spalding.

Spalding subsequently filed for SJ, which the district court granted. Following an appeal of the district court’s decision of the SJ motions, the district court addressed a sanctions issue and awarded $30,000 in sanctions to Spalding against Mr. Antonious’s attorneys in connection with its claim against Spalding. Specifically, the district court concluded that the attorneys had failed to adequately investigate whether the hosel of the accused Intimidator metal woods extended into and connected with a portion of the peripheral mass and that they had no basis for asserting this limitation of the claims against Spalding. The district court’s conclusion that the attorneys’ prefiling investigation was inadequate was based on the district court’s construction of the claim language at issue.

On appeal, the Federal Circuit examined whether Mr. Antonious’s attorneys’ claim construction was frivolous or if the attorneys’ prefiling investigation was inadequate in violation of Fed. R. Civ. P. 11. The Court stated that Rule 11 in the context of patent infringement cases requires that an attorney interpret the pertinent claims of the patent at issue before filing a complaint alleging patent infringement. Further, the Court stated, in reviewing Rule 11 sanctions, the Federal Circuit applies the law of the pertinent regional circuit, which in this case is the Fourth Circuit. The Fourth Circuit examines an attorneys’ legal arguments using a standard of objective reasonableness. To satisfy that requirement, there must be some basis of law to support each legal argument in the complaint. Using this analysis, the Federal Circuit determined that Mr. Antonious’s attorneys had construed the claim independently and that they could be sanctioned only if a reasonable attorney would have concluded that the claim construction was frivolous. The Court determined, given the alternative meaning of the word “into,” that the claim construction was not frivolous and, therefore, not in violation of Rule 11.

The Court instructed that an attorney is in violation of Rule 11 when an objectively reasonable attorney would not believe, based on some actual evidence uncovered during the prefiling investigation, that each claim limitation reads on the accused device either literally or under the DOE. The Court then remanded the case for a determination as to whether the attorneys’ investigation regarding the cut-open golf club head and the additional literature search was reasonable based on the attorneys’ proposed claim construction.