Monday, February 23, 2009

Civil Procedure: Pre-Suit Filing Requirements Meant to Screen, Streamline and/or Prevent Litigation.

Whenever a particular kind of litigation becomes abundant, cumbersome and/or very costly, state courts and legislatures often attempt to meet it with some sort of control or prophylactic measure. In Washington, construction defect litigation was met by RCW 64.50.020 (mandating notice of claim and procedures for negotiations pre-suit) and RCW Chapter 64.55 (prescribing inspection, arbitration and mediation procedures for multi-unit residential building litigation). Lawsuits against governmental entities have long required compliance with pre-suit notice and claim procedures under RCW 4.96.020. In California, laws attempt to prevent frivolous or vexatious litigation by requiring court approval of actions brought by person(s) deemed vexatious. In contrast, Washington law tends to address issues of possible 'vexatious litigation' only after a case is underway. These are just a few examples of laws that attempt to blunt or streamline litigation that is viewed as particularly burdensome to society.

Due to the ever increasing cost of litigation and the strain it can put on public services and private industry, we will likely see an increase in the number of laws that subject new litigation to pre-suit scrutiny (especially in this economy). It makes sense to track such legislation in other states, not only because similar measures could be adopted here in some form, but also because laws seeking to improve court procedure can provide good ideas for argumentation by analogy.

Recent examples include a newly proposed tort reform law in Oklahoma concerning suits against professionals. Oklahoma House Bill 1570 would require people filing civil lawsuits for professional negligence to attach an affidavit stating that they had consulted a qualified expert who had reviewed the facts and had provided a written opinion that the facts support the lawsuit’s allegations. The proposed bill provides for dismissal of the suit if the required affidavit is not provided. Those opposing the new law argue, among other things, that it would create an unconstitutional monetary barrier to courthouse access for litigants. It was estimated that a person filing a malpractice lawsuit (at least in Oklahoma) would have to spend on average between $500 and $5,000 for an expert opinion on a lawsuit’s merit.

As argued by opponents of the proposed Oklahoma law, pre-filing requirements can be so costly and/or confusing that they can undermine policies of fairness and free access. For example, time sensitive notice provisions can be very tricky and are often labeled as unfair "traps for the unwary" which attorneys, let alone pro se litigants, can easily violate.
See e.g., Lakemont Ridge HOA v. Lakemont Ridge Ltd. P'ship, 125 Wn.App. 71 (2005); Christiansen v. Ellsworth, 162 Wn.2d 365 (2007).

If you have an example of a law or court rule (in place or just proposed) that creates what might be considered a particularly burdensome or tricky pre-suit hurdle for plaintiffs, please share it with a comment to this post including any thoughts you may have about whether the requirement(s) imposed operate fairly or present, in your opinion, any basis for constitutional or other challenge.

1 comment:

  1. Via Rule 11 of the Federal Rules of Civil Procedure all actions brought in federal court have a pre-filing investigation requirement. Rule 11 demands that before any claim is asserted, the party asserting the claim must have performed an "inquiry reasonable under the circumstances" as to the legal and factual merits of the claim. Fed. R. Civ. P. 11(b). The Supreme Court has instructed that Rule 11 "imposes on any party who signs a pleading, motion, or other paper – whether the party's signature is required by the Rule or is provided voluntarily – an affirmative duty to conduct a reasonable inquiry into the facts and the law before filing, and that the applicable standard is one of reasonableness under the circumstances." Business Guides, Inc. v. Chromatic Communications Enterprises, Inc., 498 U.S. 533, 551 (1991) (interpreting Rule 11 pre-1993 amendments). The Court also recognized that "the legal inquiry that can be reasonably expected from a party may vary from case to case" and party to party, such that "what is objectively reasonable for a client may differ from what is objectively reasonable for an attorney." 498 U.S. at 550.

    In patent litigation, the requirement is vigorously enforced (I don't know about other areas of the law). Thus, before filing a patent infringement lawsuit, counsel for the patent holder must conduct an investigation into the merits of the claim of infringement. Such an investigation should include an independent examination by counsel of the accused product, an analysis of the patent claims, including a claim construction analysis that accounts for the prosecution history, and a comparison of the construed claims to the accused product. The Federal Circuit has stated "In bringing a claim of infringement, the patent holder, if challenged, must be prepared to demonstrate to both the court and the alleged infringer exactly why it believed before filing the claim that it had a reasonable chance of proving infringement. Failure to do so should ordinarily result in the district court expressing its broad discretion in favor of Rule 11 sanctions, at least in the absence of a sound excuse or considerable mitigating circumstances." View Engineering, Inc. v. Robotic Vision Sys., Inc., 208 F.3d 981, 986 (Fed. Cir. 2000) (affirming Rule 11 sanctions in the amount of attorney’s fees totally almost $100,000 imposed against patent counsel for filing infringement counterclaim on eight patents without having seen the accused product or conducting a independent formal or informal claim construction and infringement analysis for each asserted patent claim but basing the infringement claims on the accused infringer's advertising and the knowledge of an employee of the patentee as to the patents).

    Following the language of Rule 11, the investigation demanded for a patent action only requires something "reasonable under the circumstances." Hence, unlike the proposed Oklahoma law, a patentee does NOT have to get a formal written opinion of counsel from a patent-law expert and/or a technical expert before filing suit. But the counsel filing the infringement complaint must personally make a sufficiently adequate investigation (this requires that the counsel have an adequate knowledge of patent law). The counsel cannot blindly take his or her client's word that an accused product infringes, but must make its own assessment that there is infringement. Judin v. United States, 110 F.3d 780, 784 (Fed. Cir. 1997) (reversing denial of Rule 11 sanction due to patent counsel's unreasonable conduct in blindingly deferring to his client's opinion of infringement without conducting its own comparison of the claims with the accused product). Getting a formal written opinion can help to insulate a patentee and it counsel from a charge of bad faith litigation to defend against a request for attorneys fees under the Patent Act or defend against an state law unfair competition claim based on an allegation that the patentee brought a frivolous infringement suit in bad faith as a means to unfairly compete against the accused infringer.

    In the foregoing context, the Rule 11 pre-filing investigation requirement does not appear too onerous or cost prohibitive. To me, it seems to strike a reasonable balance between requiring a full blown analysis and the costs of permitting a do-nothing approach. Of course, patent litigation typically is a very costly proposition and usually involves sophisticated corporate litigants. Thus, it likely does not implicate the same public policy concerns when ordinary citizens are seeking redress for professional malpractice. [Posted by Robert Matthews, Jr. of Latimer, Mayberry & Mathews IP Law, LP at]