December 15, 2016

“Unfamiliarity” with Federal Court Practice Not Enough to Avoid Default

In United Construction Products, Inc., v. Tile Tech, Inc., [2016-1392] (December 15, 2016), the Federal Circuit affirmed default judgment against Tile Tech on claims of patent infringement and unfair competition because of its counsel’s near complete failure to provide discovery.

After cataloging Tile Tech’s numerous discovery failures, the Federal Circuit also considered the Malone factors, as follows:

  1. The Public’s Interest in Expeditious Resolution of
  2. The Court’s Need to Manage Its Docket
  3. The Risk of Prejudice to the Other Party
  4. The Public Policy Favoring the Disposition of Cases on
    Their Merits
  5. The Availability of Less Drastic Sanctions (i.e., Alternatives
    to Dismissal)

The Federal Circuit then found that entry of default was not an abuse of discretion.  Tile Tech tried to undo the default by arguing that its conduct was not willful or in bad faith, noting that the district court found that “while defense counsel perhaps handled the case unreasonably, this [c]ourt does not attribute that to bad faith, but instead a complete lack of preparation.”  The Federal Circuit, however, said that willfulness and bad faith were not the only justifications for entering default, which also include “fault.”  While Tile Tech has argued that its trial attorney had “unfamiliarity” with federal court practice, it has not offered any evidence to suggest that its dilatory actions were outside of its attorney’s control.