Article by Mark Michels appearing on Law.com on the LTN news website.
This article discusses the Eon-Net LP v. Flagstar Bancorp, No. 2009-1308 (Fed. Cir., July 29, 2011) case, which was decided in the U.S. District Court for the Western District of Washington. The case upheld a ruling of a $500,000 sanction for attorneys fees based on litigation misconduct due to discovery abuses by the plaintiff.
As the article points out, "Eon-Net (and its counsel) eventually destroyed all inventor and non-public prosecution records after discovery closed in these initial cases, and also initiated a data retention policy in which the entity kept no records whatsoever. Eon-Net undertook these actions notwithstanding the fact that there were other ongoing and contemplated patent infringement actions." The court had no trouble declaring that the parties actions were an exceptional case of abuse of discovery, and decided to issue sanctions based on the improper conduct, and the failure to preserve documents when obligations to preserve them had clearly arisen.
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