In our Augmented Reality/Virtual Reality Litigation Update series, we provide continuous updates on legal proceedings involving AR/VR technology. As we follow these developing proceedings, we highlight the technologies involved, the intellectual property at issue, and the litigation strategies of the parties.
In our first post regarding AR Designs Innovations, we noted that three furniture companies were being sued for patent infringement of U.S. Patent No. 7,277,572 owned by AR Design Innovations. Recently, the Eastern District of Texas ordered that the three cases be consolidated into a single action.
Under the Federal Rules of Civil Procedure, courts have the power to consolidate cases that involve “a common question of law or fact” into a single trial. Fed. R. Civ. P. 42(a). Essentially, consolidation is a procedural vehicle that allows a court to reduce its volume of litigations while maximizing efficiency and judicial economy. A court may choose to completely consolidate or consolidate for a specific purpose—like pretrial. The degree of consolidation affects the treatment of the consolidated cases. If a case is completely consolidated, it is generally treated as a single case with a single docket. Cases that are consolidated for a specific purpose, however, retain their individual identities. Even when cases are completely consolidated into a single case, they will retain separate identities in some respects. Notably, since 2018, all consolidated cases retain their individual identities for the purposes of appealability under the Final Judgment Rule. See Hall v. Hall, 138 S. Ct. 1118, 1131 (2018).
Here, the cases pending against Ashley Furniture, Ethan Allen, and La-Z-Boy were consolidated “for all pretrial issues (except venue)” with the individual cases remaining “active for . . . trial.” Further, as the consolidation order explained, the Eastern District of Texas’s local rules regarding page limitations for Markman briefs and other motions will apply to the consolidated case. In our previous post, we explained that all three of AR Design Innovations’ complaints were nearly identical in their allegations and requests for damages. Because of the similarity of the cases, prejudice to the individual defendants is less likely and they may benefit from the consolidation by paying out lower legal fees. Plus, as explained above, the parties will retain their individual identities for trial purposes and appeal.
What does this mean? If the cases do not settle before trial, the defendants will move through claim construction and discovery together before going to their individual trials before the court. And after trial, if any of the alleged infringers wish to appeal, they may do so individually. Stay tuned for future updates as these cases continue to develop.