Monthly Archive: October 2011

Is It Open Season Now for NPEs?

Among other changes, the America Invents Act (“AIA”) includes the new 35 U.S.C. § 299. This statute purports to reduce the ability of a patent owner to join multiple, unrelated defendants in a single action, a tactic often used by litigious non-practicing entities (“NPEs”), who press for nuisance value settlements. In addition, the AIA commissioned the Government Accounting Office (“GAO”) to study the consequences of NPEs, to include their costs, benefits and economic impact.

Keynote Speaker Announced for Gibbons Fifth Annual E-Discovery Conference

Gibbons is pleased to announce that the Honorable Edwin H. Stern (ret.) will present a brief keynote address where he will provide an insider’s view of some e-discovery concerns facing the courts today at the Gibbons Fifth Annual E-Discovery Conference, which will be held at the Sheraton Meadowlands Hotel & Conference Center in East Rutherford, NJ.

Creditors of Insolvent Delaware Limited Liability Companies Lack Standing to Pursue Derivative Claims

Relying on the plain language of Delaware’s Limited Liability Company Act, the Delaware Supreme Court, in CML V, LLC v. John Bax, et al., recently ruled that creditors of insolvent Delaware limited liability companies lack standing to sue derivatively for their managers’ alleged breach of their fiduciary duties. According to Chief Justice Myron T. Steele, writing for the Court, 6 Del. C. § 18-1002 of Delaware’s Limited Liability Company Act is “unambiguous and limits derivative standing in LLCs exclusively to ‘member[s]’ or ‘assignee[s].’” In so holding, the Court distinguished insolvent LLCs from insolvent corporations, which are subject to derivative claims by creditors, noting that “the General Assembly is free to elect a statutory limitation on derivative standing for LLCs that is different than that for corporations, and thereby preclude creditors from attaining standing.”

Gearing Up for the Litigation Hold Panel Discussion at Gibbons Fifth Annual E-Discovery Conference

Have you ever felt daunted by the prospect of issuing a litigation hold? If so, you are not alone — particularly in today’s dynamic legal environment, where even judges within the same judicial district disagree as to what is required to satisfy the duty to preserve evidence and avoid spoliation sanctions. Please join us at Gibbons Fifth Annual E-Discovery Conference, where we will deconstruct an effective litigation hold notice paragraph-by-paragraph, explaining why each element is included and how to tailor hold notices to any litigation. We will also explain recent developments in this area of the law, which you can draw on to position your company to effectively issue and administer litigation holds, avoid game-changing spoliation sanctions and return the focus to litigating matters on the merits.

First Annual Electronics, Telecom and Software Patent Practice Update

The New Jersey Intellectual Property Law Association (“NJIPLA”) will be hosting its first annual “Electronics, Telecom and Software Patent Practice Update” on Wednesday, November 9, 2011, from 12:00-5:15 pm at the New Brunswick Hyatt. This informative event is co-chaired by Robert E. Rudnick, a Director in the Gibbons Intellectual Property Department and Vice President of the NJIPLA, who will also be a panelist at the event speaking on the recently enacted Leahy-Smith America Invents Act and its impact on patent protection in the electrical arts.

E-Discovery Blog Post Written by Mark S. Sidoti Chosen as “Pick of the Week” by LitigationWorld

In its October 3, 2011 issue, the editorial team of LitigationWorld chose Mark S. Sidoti’s September 28, 2011 blog post entitled New Jersey District Judge Grants Spoliation Sanctions Citing Negligent Litigation Hold Procedures as its Pick of the Week. LitigationWorld is a free weekly email newsletter that provides helpful tips regarding electronic discovery, litigation strategy, and litigation technology. Each week, the editorial team chooses the most noteworthy and insightful articles on the litigation web published during the previous week and, from those, selects one as their Pick of the Week.

ABA Formal Opinion 11-460 is at Odds With Stengart v. Loving Care Agency, Inc.

The American Bar Association recently published Formal Opinion 11-460 to provide guidance to attorneys regarding their ethical duty upon discovering emails between a third party and the third party’s attorney. The Opinion interprets Model Rule 4.4(b) literally, concluding that neither that rule nor any other requires an attorney to notify opposing counsel of receipt of potentially privileged communications. The Opinion is of particular note because it directly contradicts the New Jersey Supreme Court’s opinion in Stengart v. Loving Care Agency. Inc. 201 N.J. 300 (2010).

Representations That Product’s Effectiveness is “Clinically Proven,” Though Not “Puffery,” Fail to Support State New Jersey Consumer Fraud Act and Implied Warranty Claims

In Lieberson, the District Court for the District of New Jersey held that where a complaint does not allege whether or when the allegedly false advertisements appeared in magazines, and whether or when the plaintiff may have viewed them, they were “patently insufficient” to plead a New Jersey Consumer Fraud Act, N.J.S.A. 56:8-2, claim and otherwise fail to satisfy Rule 9(b) . The Plaintiff in Lieberson alleged that Johnson & Johnson’s baby wash products falsely stated that they were “clinically proven” to help babies sleep better. The Lieberson court held that to properly plead a New Jersey Consumer Fraud Act claim with the specificity required under Rule 9(b), a plaintiff must identify the origin of the statements and that they were actually viewed by the plaintiff. Notably, however, the Lieberson court declined to conclude that the product label’s statements that the product was “clinically proven” to help babies sleep better was mere non-actionable “puffery.” On the contrary, the court found that “incorporation of the words ‘clinically proven’ . . . a statement that might otherwise be considered puffery, i.e., that the products will help babies sleep, was transformed into something that appears ‘both specific and measurable.’”

NJ Charges Forward with Electric Vehicle Network

On October 20, 2011, New Jersey Department of Environmental Protection Commissioner Bob Martin announced that New Jersey signed an agreement with other states and the District of Columbia to develop a Northeast Electric Vehicle Network and promote alternative transportation fuels. This announcement comes less than one month after New Jersey, along with the other members of the Transportation and Climate Initiative, received a federal grant of nearly $1 million to start planning a network of charging stations for electric vehicles (EVs). The goal of the Network is to bolster economic growth, maintain the region’s leadership in the clean energy economy and reduce the area’s dependence on oil and its emissions of greenhouse gases and other pollutants.