Patent Law

Discovery

By Gary Odom and Jordan Kuhn

Bancorp sued Metropolitan Life Insurance for infringing 5,926,792, claiming tracking the value of life insurance policies. Unsuccessfully in the first round, as the district court judge granted summary judgment of non-infringement, which failed on appeal, albeit on an affirmed claim construction, because of a "genuine issue of material fact." Not to mention the district court not affording Bancorp sufficient discovery.

Metropolitan Life Insurance v. Bancorp Services and Benefit Finance Partners (CAFC 07-1312)

In June 2005, Bancorp filed a motion pursuant to Fed. R. Civ. P. 56(f), seeking additional discovery to respond to MetLife's summary judgment motion, accompanied by a declaration explaining why it could not present essential facts in opposition to the motion for summary judgment until the completion of the requested discovery.

On January 5, 2006, the district court denied Bancorp's Rule 56(f) motion, reasoning that Bancorp was not entitled to any depositions or additional document discovery because it had not shown that MetLife's declarants would contradict their declarations if deposed and had not shown that additional document discovery would lead to relevant evidence of infringement in light of MetLife's declarations.

Chief Judge Carol E. Jackson of the Eastern District of Missouri first denied MetLif's motion for summary judgment.

MetLife moved for reconsideration, and, by order dated February 6, 2007, the district court granted reconsideration and granted summary judgment of noninfringement in favor of MetLife. The court concluded that its prior denial of MetLife's motion for summary judgment "rested upon a manifest error of fact." Metropolitan Life Ins. Co. v. Bancorp Servs. LLC, No. 4:00-CV-1927, slip op. at 1 (E.D. Mo. Feb. 6, 2007) ("MetLife III").

The district court explained that it had misunderstood a crucial statement made in an expert witness declaration.

On appeal, the CAFC ruled that the district court had improperly dismissed Bancorp's motion for discovery.

Under the Federal Rules of Civil Procedure, the parties must be afforded adequate time for general discovery before being required to respond to a motion for summary judgment. Iverson v. Johnson Gas Appliance Co., 172 F.3d 524, 530 (8th Cir. 1999) ("[S]ummary judgment is proper 'only after the nonmovant has had adequate time for discovery.'" (quoting In re TMJ Litigation, 113 F.3d 1484, 1490 (8th Cir. 1997))) see also Costello, Porter, Hill, Heisterkamp & Bushnell v. Providers Fidelity Life Ins. Co., 958 F.2d 836, 837-39 (8th Cir. 1992) ("Summary judgment is inappropriate until Providers has had an adequate opportunity to conduct discovery.").

Here, Bancorp was never afforded a reasonable opportunity to conduct any discovery in the infringement action.

We also conclude that the district court erred in determining that Bancorp had failed to raise a dispute of material fact with respect to infringement, even on the present record... There was thus a direct conflict in the declarations as to a material fact under MetLife's interpretation of the claims--i.e., whether the spreadsheet calculations were used to administer the policies. The district court dismissed this conflict by crediting the MetLife declarations. Resolving such credibility disputes, however, is not appropriate on summary judgment. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986) ("Credibility determinations, the weighing of the evidence, and the drawing of legitimate inferences from the facts are jury functions, not those of a judge, whether he is ruling on a motion for summary judgment or for a directed verdict."); see also, e.g., Pritchett v. Cottrell, Inc., 512 F.3d 1057, 1063 (8th Cir. 2008) ("In considering a motion for summary judgment, we do not weigh the evidence, make credibility determinations, or attempt to discern the truth of any factual issue." (quoting Thomas v. Corwin, 483 F.3d 516, 526 (8th Cir. 2007))). The conflict in declarations created a genuine issue of material fact that made summary judgment inappropriate.

Vacated and remanded.

Full post as published by The Patent Prospector on June 03, 2008 (boomark / email).