The above-titled article by Donald R. Dunner, Bryan C. Diner, Esther H. Lim and Troy E. Grabow (all Partners with Finnegan, Henderson, Farabow, Garrett & Dunner, LLP) appears in Volume 59 (page 809) of the American University Law Review.
The following is an excerpt addressing Rule 11 sanctions in ICU Medical, Inc. v. Alaris Medical Systems, Inc.:
In ICU Medical, the Federal Circuit held that the district court did not commit clear error when it granted Rule 11 sanctions. The Federal Circuit noted that “the Supreme Court has advised all appellate courts to ‘apply an abuse-of-discretion standard in reviewing all aspects of a district court’s Rule 11 determination.’” Under this standard, “[a] district court would necessarily abuse its discretion if it based its ruling on an erroneous view of the law or on a clearly erroneous assessment of the evidence.” The Federal Circuit applied Ninth Circuit law in determining whether a sanctions award under Rule 11 was appropriate, explaining that “a district court must conduct a two-prong inquiry to determine (1) whether the complaint [or relevant document] is legally or factually ‘baseless’ from an objective perspective, and (2) if the attorney has conducted ‘a reasonable and competent inquiry’ before signing and filing it.” Applying these laws, the Federal Circuit found that the district court properly determined that ICU’s frivolous construction and assertion of certain claims in its amended complaint justified sanctions under Rule 11. The Federal Circuit also noted the district court’s decision not to award monetary sanctions for the violations of Rule 11, because the amount of the award of Rule 11 sanctions was “subsumed” by the amount of attorneys’ fees awarded under § 285, which “ha[d] sufficiently admonished ICU and its counsel for any improper conduct under Rule 11.”
Read the full article here.