July 2014

Spotlight Info

In Source Vagabond Systems Ltd. v. Hydrapak, Inc., Nos. 13-1270, -1387 (Fed. Cir. June 5, 2014), the Federal Circuit affirmed the district court’s orders imposing sanctions under Fed. R. Civ. P. 11 against Source Vagabond Systems Ltd. and its attorneys (collectively “Source”).  The Court held that Source was required to perform an objective evaluation of the claim terms to satisfy its obligation to conduct a reasonable presuit evaluation, and because Source’s proposed definition ignored the canons of claim construction, Source did not meet this standard.  Accordingly, the Court affirmed the district court’s order imposing Rule 11(b)(2) sanctions based on Source’s claim construction arguments.  The Court next held that Source’s literal and DOE infringement positions, even under Source’s proposed claim construction, were untenable, lacking legal and evidentiary support.  The Court thus affirmed the district court’s imposition of Rule 11(b)(3) sanctions against Source.  See this month’s edition of Last Month at the Federal Circuit for a full summary of this decision.