Experts in Patent Cases: A Three-Part Examination of Federal Rules of Evidence 701–706 - Part III

The first article in this three-article series,which appeared in the April 2018 issue of the Intellectual Property & Technology Law Journal, addressed critical differences in how the Federal Rules of Evidence apply to fact and expert witnesses and strategic considerations for offering lay testimony under Rule 701 or expert testimony under Rule 702. The second article, which appeared in the May 2018 issue of the Intellectual Property & Technology Law Journal, examined Rules 703 and 705, which govern the types and disclosure of information underlying expert opinions and establish a framework for the permissible bases of an expert’s opinion and their disclosure. This third article analyzes the use of court-appointed experts under Rule 706.

Rule 706 Experts in Patent Litigations

Experts are prominent in patent litigations, and factfinders, who may be untrained technically, are often called upon to evaluate their complex and usually conflicting testimony.¹ Courts are also required, as part of their gatekeeping function, to ensure that expert testimony is reliable.² One tool to assist in both tasks is appointment of a neutral expert under Rule 706 so that the court “and the jury [are not] completely at the mercy of the parties’ warring experts.”³ The U.S. Court of Appeals for the Federal Circuit has itself endorsed appointment of a Rule 706 expert in “an unusually complex [patent litigation] and what appeared to be starkly conflicting expert testimony.”⁴ While Rule 706 experts are only infrequently appointed,⁵ they have been used on occasion in patent cases to address claim construction,⁶ infringement and validity,⁷ and damages.⁸ Given the Rule’s potential broad applicability and calls for its expanded use,⁹ it is important to understand the principles underlying the Rule and how it works in practice.

The Rule was created in response to “[t]he practice of shopping for experts, the venality of some experts, and the reluctance of many reputable experts to involve themselves in litigation, [all of which] have been matters of deep concern.”¹⁰ A noted concern with the Rule is that “[t]he opinion of a court’s expert may become decisive because the expert wears the mantle of judicial authority and impartiality.”¹¹ Recognizing this risk, the Federal Circuit has commented that court-appointed experts should be used “only in rare and compelling circumstances.”¹² To mitigate the risk when court-appointed experts are used, the jury can be instructed to not give additional weight to a court-appointed expert.¹³ Courts also have discretion to not even disclose to the jury that a given expert was appointed by the court.¹⁴

The potential impact of a court-appointed witness can be significant. In one case, the patent owner argued that the expert’s appointment was dispositive and, what’s more, effectively violated its Seventh Amendment right to trial by jury.¹⁵ While recognizing the policy arguments against Rule 706 and expressing concern over “[t]he predicaments inherent in court appointment of an independent expert and revelations to the jury about the expert’s neutral status,” the Federal Circuit held that the appointment was within the district court’s discretion.¹⁶ It noted that, rather than blindly adopting the appointed expert’s testimony, the jury’s findings differed from the expert’s opinions as to which claims were obvious and which claims were infringed.¹⁷

In operation, Rule 706 experts may be appointed by the court sua sponte as well as on motion by a party.¹⁸ One court took the initiative to appoint an expert based on the technical complexity of a case involving a patent on DNA sequence mapping techniques.¹⁹ After “[h]aving devoted a very lengthy time to the issues in the present motions,” which included claim construction, obviousness, best mode, and infringement, the court concluded that appointment of a Rule 706 expert was warranted because “[t]he issues in [the] litigation are of unusual difficulty and complexity, involving questions well beyond and in a setting or context far removed from the regular ken of issues which courts are called upon to decide.”²⁰

Courts have also appointed Rule 706 experts after finding the parties’ respective experts to be partisan advocates. In one case, the court appointed an expert after finding that the parties’ experts had “become technical advocates for their respective causes, vehemently disagreeing in every particular and abandoning that independence which makes the testimony of such witnesses most helpful to finders of fact and law.”²¹

In one case, a party (Kaidi) seeking a declaratory judgment of non-infringement moved for the court to appoint a Rule 706 expert to provide “an opinion on whether the accused product contains the required two-part guide.”²² Kaidi argued that appointment of a neutral expert would streamline the case by obviating the need for the parties’ separate experts to discuss their respective testing that would “introduce a greater measure of technical complexity than is required to understand the product itself.”²³ The court recognized that “[w]here the parties present ‘starkly conflicting expert testimony’ concerning complex technical matters, the desirability of a court-appointed expert may increase.”²⁴ But the court declined to appoint a Rule 706 expert because the technology at issue was “relatively simply” and could be readily explained by the parties’ respective experts via the “normal adversary process.”²⁵ While a court does not require the parties’ consent for any particular appointed expert, the expert cannot be required to serve but must “consent[ ] to act.”²⁶

Where a party disagrees with an appointment, they can and do object. For example, one can object to the need for appointment at all, due to, for example, changed circumstances or simplifying of the case.²⁷ Specific expert candidates have also been objected to as biased and inexperienced.²⁸ Objections to Rule 706 experts have even been, as noted, the subject of appeals to the Federal Circuit, which then evaluates the appointment under regional circuit law.²⁹

Conclusion

While there does not appear to be any general trend toward the expanded use of Rule 706, one possible exception is the Northern District of California, where Rule 706 has been considered or invoked in multiple patent and other technologybased cases in recent years.³⁰ It remains to be seen whether reliance on Rule 706 will grow further in the Northern District of California or nationally, but understanding the purpose and function of the Rule is important given its potential impact when invoked.

Endnotes
¹  Jeanne C. Fromer & Mark A. Lemley, The Audience in Intellectual Property Infringement, 112 MICH. L. REV. 1251, 1280-84, 1286-88 (2014) (“If that evidence comes in the form of expert testimony, the law is faced with the usual concerns about the reliability of the evidence, a possible battle of the experts, and the ability of laypeople to process this evidence.”).

²  Daubert v. Merrell Dow Pharm., Inc., 509 U.S. 579, 589 (1993).

³  In re High Fructose Corn Syrup Antitrust Litig., 295 F.3d 651, 665 (7th Cir. 2002); see also Daubert, 509 U.S. at 595 (addressing Rule 706 in the context of evaluating admissibility of expert evidence).

⁴  Monolith Power Sys., Inc. v. O2 Micro Int’l Ltd., 558 F.3d 1341, 1348 (Fed. Cir. 2009) [hereinafter “Monolithic I”].

⁵  4-706 Weinstein’s Federal Evidence § 706.02 n.2.1 (2017).

⁶  E.g., Altera Corp. v. PACT XPP Techs., AG, No. 14-cv-02868-JD, 2015 WL 4999952, at *1 (N.D. Cal. Aug. 21, 2015).

⁷  Monolithic Power Sys., Inc. v. O2 Micro Int’l Ltd., 726 F.3d 1359, 1364 (Fed. Cir. 2013) [hereinafter “Monolithic II”].

⁸  Oracle Am., Inc. v. Google Inc., No. C 10-03561 WHA, 2015 WL 7429277, at *1 (N.D. Cal. Nov. 23, 2015).

⁹  Judge Bradford H. Charles, Rule 706: An Underutilized Tool to Be Used When Partisan Experts Become “Hired Guns,” 60 Vill. L. Rev. 941 (2015); Erika Mayo, Gatekeeping Post-Uniloc: Expert Testimony in Multi-Component Patent Litigation, 9 Hastings Bus. L.J. 539, 556 (2013).

¹⁰  Fed. R. Evid. 706 advisory committee’s note on proposed rules.

¹¹  29 Charles Alan Wright & Victor James Gold, Federal Practice and Procedure: Evidence § 6302 (2016).

¹²  Monolithic I, 558 F.3d at 1348.

¹³  Monolithic I, 558 F.3d at 1347-48 (noting with approval the district court’s jury instruction that “[y]ou should not give any greater weight to Professor Santi’s opinion testimony than to the testimony of any other witness simply because the court ordered the parties to retain an independent witness. In evaluating his opinion, you should carefully assess the nature of and basis for Professor Santi’s opinion just as you would do with any other witness’ opinion”).

¹⁴  Fed. R. Evid. 706(d).

¹⁵  Monolithic I, 558 F.3d at 1347-48.

¹⁶  Id.

¹⁷  Id.

¹⁸  Fed. R. Evid. 706(a) (“On a party’s motion or on its own, the court may order the parties to show cause why expert witnesses should not be appointed and may ask the parties to submit nominations.”).

¹⁹  Regents of the Univ. of Cal. v. Oncor Inc., No. C-95-3084-VRW, 1997 WL 670674, at *18-19 (N.D. Cal. Aug. 19, 1997) [hereinafter “Oncor”].

²⁰  Oncor, 1997 WL 670674, at *18-19.

²¹  NEC Corp. v. Hyundai Elecs. Indus. Co., 30 F. Supp. 2d 546, 559 (E.D. Va. 1998).

²²  Changzhou Kaidi Elec. Co. v. Okin Am., Inc., No. CCB-13-1798, 2015 WL 628989, at *1 (D. Md. Feb. 11, 2015).

²³  Id. at *2.

²⁴  Id. at *1-2 (quoting Monolithic Power Sys., 558 F.3d at 1348).

²⁵  Changzhou Kaidi Elec., 2015 WL 628989, at *1-2 (quoting Monolithic Power Sys., 558 F.3d at 1348).

²⁶  Id.

²⁷  E.g., Oracle, 2015 WL 7429277, at *5.

²⁸  Reilly, 863 F.2d at 159; Oracle, 2015 WL 7429277, at *5.

²⁹  Monolithic I at 1346.

³⁰  E.g., Altera, 2015 WL 4999952, at *1 (appointing a Rule 706 claim construction expert); Winding Creek Solar LLC v. Peevey, No. 13-CV-04934-JD, 2015 WL 675388, at *7 (N.D. Cal. Feb. 17, 2015) (considering Rule 706 appointment in complex regulatory case involving energy projects); A&C Catalysts, Inc. v. Raymat Materials, Inc., No. C 14-04122 WHA, 2014 WL 7463467, at *11 (N.D. Cal. Dec. 30, 2014) (directing the parties to propose Rule 706 candidates in case involving chemical manufacturing process); Wang v. Palo Alto Networks, No. C 12-05579 WHA, 2014 WL 12642191 (N.D. Cal. Mar. 14, 2014) (addressing Rule 706 appointment in trade secret misappropriation and patent infringement action); Oracle, 2015 WL 7429277, at *1 (appointing a Rule 706 damages expert).