In re EMC – the Federal Circuit Limits Joinder for Pre-AIA Cases
Joinder in patent infringement cases has had a complicated history. A plaintiff may litigate a very different case based on how many defendants can be joined together. Different districts have different rules about what parties can be joined together, potentially leading to a particularly significant split. In the Eastern District of Texas, for instance, courts allowed joinder of defendants based on alleged infringement of the same patent, because the legal scope of the patent was a shared question in all the cases (referred to as a “nucleus of operative facts”). However, other courts specifically rejected this test, and required a showing of a “right to relief arising out of the same transaction or occurrence” beyond alleged infringement of the same patent.
Congress stepped in to resolve this issue in the AIA, and included a provision specifically addressing joinder. The joinder provision for patent infringement cases, 35 U.S.C. § 299, specifically rejects the “nucleus” test and requires that both the parties’ claims arise from the same transaction or occurrence involving the “same product or process.” The law goes on to explicitly state that “accused infringers may not be joined in one action as defendants or counterclaim defendants, or have their actions consolidated for trial, based solely on allegations that they each have infringed the patent or patents in suit.”
This rule applies only to cases filed after the America Invents Act was passed. However, the Federal Circuit in In re EMC also limited joinder in pre-AIA cases. The Federal Circuit explicitly did not rule on the new joinder rule, instead interpreting FRCP 20, in a case that originated in the Eastern District of Texas. The Federal Circuit’s Opinion also held that infringement of the same patent alone was not sufficient for joinder, stating, “[i]n the present context the mere fact that infringement of the same claims of the same patent is alleged does not support joinder, even though the claims would raise common questions of claim construction and patent invalidity.” The Federal Circuit required a logical relationship between the parties, stating that “the defendants’ allegedly infringing acts, which give rise to the individual claims of infringement, must share an aggregate of operative facts.”
The Federal Circuit also rejected joinder based on the fact that the products accused of infringement are similar: “Joinder of independent defendants is only appropriate where the accused products or processes are the same in respects relevant to the patent. But the sameness of the accused products or processes is not sufficient.” Basically, while defendant products that are similar may be joined, the fact that they are similar is not enough to justify joining them together. The Federal Circuit noted that there must be an underlying link between the similar products. The Federal Circuit specifically declines to note whether the “sameness” test here would apply to the “same accused product or process” requirement from the America Invents Act.
While the Federal Circuit’s opinion is based on pre-AIA cases, this case does seem to cover both joinder provisions of the America Invents Act – it states a “sameness” test and specifically rejects joinder solely based on infringement of the same patent. The AIA provision, requiring the “same” product may ultimately create a more rigid requirement than the one articulated by the Federal Circuit in In re EMC. However, this holding may mean all those who rushed to file before the AIA was passed may not be able to join as many defendants as they had hoped. Now the real question will be whether either the AIA or the Federal Circuit’s holding have effectively put an end to large cases initiated against many unrelated defendants.