On Tuesday, February 25, 2014, the Eastern District of Texas adopted General Order 14-03, entitled “General Order Regarding Track B Initial Patent Case Management Order” (the “Order”). The Order presents an alternative Case Management Order (“CMO”) for patent cases that is designed to promote “additional efficiencies and cost savings … while still ensuring a speedy determination of each case on its merits.”  Known as “Track B,” this CMO is meant to compliment the default procedures of Track A under the Local Rules.

The Track B CMO generally expedites the exchange of disclosures, contentions and damages information before the Initial Case Management Conference.   It becomes effective upon all parties filing a joint notice of election prior to all defendants answering the complaint or upon “an order of the Court.”  The CMO requires the party asserting infringement to serve its infringement contentions within 14 days of the defendant’s answer or 12(b) Motion to Dismiss, and to produce all “licenses or settlement agreements concerning the patents in suit and any related patent.”  In turn, within 30 days of service of the infringement contentions, each party is required to serve Initial Disclosures and each party opposing a claim of infringement is required to produce summary sales information reflecting the quantity of accused products sold in the United States and the revenues from those sales, including all products identified in the infringement contentions and all reasonably similar products.  Within 14 days of service of the Initial Disclosures and summary sales information, each party asserting infringement shall file a non-binding, “good faith” estimate of its expected damages, including the method employed to arrive at the estimate.  Invalidity Contentions are due 14 days after the damages estimate.  Within 5 days of receipt of the Invalidity Contentions, the Plaintiff shall file a notice that the case is ready for Management Conference. Prior to the conference, the parties are required to confer and file a discovery plan that addresses 12 matters relating to discovery, use of district model orders, ADR and pretrial and trial scheduling and procedures.

What this means to You

The early disclosure of license and sales information plus the damages estimate should enable patent litigants to make an earlier, quicker and more realistic valuation of the case and tailor a discovery and case management plan that is cost-effective based on the valuation.  In a matter of months the parties will have information they might not otherwise have for up to a year or more.  Ideally, this Track B approach will facilitate early case dismissals, settlement negotiations, and shorter time to trial, resulting in reduced litigation costs.

A copy of the Track B Order can be found here.