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The Basics Of An Adequate Pre-Filing Inquiry Under Rule 11

Amanda Mayor

While Rule 11 has not been the subject of recent press in IP circles, compliance with the Rule is a recurring issue, and one that we have seen raised in patent litigation more regularly over the past several months than in years past. Most frequently, the issue is whether the patentee adequately investigated its claims prior to filing suit or a counterclaim for infringement. While the adequacy of any prefiling investigation necessarily is fact-specific, the courts have provided litigants and their counsel with some basic guidelines for fulfilling their Rule 11 obligations.

When an attorney or unrepresented party presents a pleading, written motion, or other paper to the court, “whether by signing, filing, submitting, or later advocating” it, they are certifying that, “to the best of the person’s knowledge, information, and belief, formed after an inquiry reasonable under the circumstances, . . . the allegations and other factual contentions have evidentiary support or, if specifically so identified, are likely to have evidentiary support after a reasonable opportunity for further investigation or discovery.” FED. R. CIV. P. 11(b)(3). As most courts have found, the plain language of Rule 11 requires that a “reasonable inquiry” be conducted prior to filing suit. Thus, a filing for which an adequate inquiry was not made in advance will not be saved by the subsequent discovery or development of facts upon which the filing could have been based.

To satisfy Rule 11, a prefiling inquiry must be “reasonable under the circumstances,” a standard that necessarily depends on the circumstances of the particular case. For example, under the 1983 version of Rule 11, the U.S. Supreme Court found that whether or not a prefiling inquiry was reasonable may depend on the amount of time available to prepare the complaint, i.e., what would be reasonable for a complaint filed with only a few days left before the statute of limitations runs would not be reasonable for a complaint for which there were months to investigate. This time factor was incorporated into Rule 11 during the 1993 revisions.

Time constraints aside, a prefiling inquiry should include a review of all reasonably available materials that are pertinent to the allegations of the complaint. While this does not mean that the investigation of facts must be carried to the point of absolute certainty, it means that, at a minimum, all relevant evidence in the hands of the plaintiff must be reviewed. Some courts have found that publicly available materials should be reviewed as well. In some circumstances, especially where a claim is likely to be based on testimonial rather than documentary evidence, the prefiling investigation should also include interviews of key witnesses. However, Rule 11 does not require counsel or the client to undertake the impossible.

In the context of patent litigation, the Federal Circuit has made clear that a mere good faith belief of infringement falls short of Rule 11’s requirements. Similarly, a prefiling investigation must entail more than simply observing an allegedly infringing device from a distance and surmising how it operates from the patentee’s technical or industry know-how or experience. As a first step, and at a minimum, claim charts must be prepared. As part of this process, counsel must determine the scope of the claims believed to be infringed, taking into consideration the patent’s prosecution history and the known prior art. Then the claim elements must be compared to the accused device, system, or method in more than a summary manner.

Unfortunately, beyond requiring the preparation of a claim chart, the Federal Circuit has not been clear as to what else is required as part of a prefiling investigation. Because patentees typically have only limited access to information regarding the accused product prior to discovery, the determination of whether a prefiling inquiry is reasonable should depend on what evidence is available to the patentee at the time of filing. But what evidence is available to the patentee may be debatable and will depend on the circumstances of the case. In some instances, a sample of the accused product may be available. If so, a sample should be obtained, and if possible, reverse-engineered, so long as reverse-engineering does not violate any laws or agreements prohibiting such action. In addition, and necessary where a sample accused product is not available, the investigation should include alternative methods for gathering evidence, such as research to find statements by the infringer about its products or how they work, trade publications or journals describing the product, interviews of the patentee’s customers to learn about the accused product’s use in the industry, or engagement of an outside consultant to determine how the product works. Finally, the patentee may decide that the most direct investigative route is through a direct query to the infringer for a sample or technical documentation. However, this route is not ideal because it exposes the patentee to the risk of being sued for a declaratory judgment. While the Federal Circuit has hinted that, at least in some circumstances, approaching the infringer for information might weigh in favor of a finding that Rule 11 has been satisfied, the law should not require such action for compliance to be found.

While the reasonability of any prefiling inquiry will be fact-specific, the above investigative actions should be undertaken where possible to assure compliance with Rule 11. Failure to make such inquiries can result in a variety of sanctions under Rule 11, from nonmonetary sanctions, such as striking pleadings, to monetary fines payable to the court or opposing party.

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