Last Friday the Federal Circuit announced that it has taken a case en banc "to reconsider its precedent concerning the drawing
of adverse inferences, with respect to willful patent infringement, based on the actions of the party charged with infringement
in obtaining legal advice, and withholding that advice from discovery." Knorr-Bremse Systeme Fuer Nutzfahrzeuge GMBH v. Dana Corporation (September 26, 2003) (http://www.fedcir.gov/opinions/01-1357.doc). The court has requested briefs on the following issues:
- When the attorney-client privilege and/or work product privilege is invoked by a defendant in an infringement suit, is it
appropriate for the trier of fact to draw an adverse inference with respect to willful infringement?
- When the defendant has not obtained legal advice, is it appropriate to draw an adverse inference with respect to willful infringement?
- If the court concludes that the law should be changed, and the adverse inference withdrawn as applied to this case, what are
the consequences for this case?
- Should the existence of a substantial defense to infringement be sufficient to defeat liability for willful infringement even
if no legal advice has been secured?
The court indicated that it will accept amicus briefs on the first two issues from bar associations, trade or industry organizations,
and government entities.
This issue has significant implications for companies that are faced with the difficult, and expensive, decision of when to
obtain opinion letters. If the court changes the law, it may be less risky to forgo obtaining an opinion letter. If, on the
other hand, the court reinforces the existing presumptions, it may become more important than ever to obtain early and thorough
opinion letters.
