VIZIO, Inc. & the Two Dismissal Rule

Blue Spike LLC
Vizio(Santa Ana CA, May 22, 2017) – While the two dismissal rule is unfortunately employed by patent and copyright infringers as a strategy to avoid a fair trial on the merits, blatant misuse of Rule 41 may move a court to deny application of the two dismissal rule. See Two Strikes and You’re ‘Out!’ – FRCP 41 & Copyright Trolls at DieTrollDie.com (accessed Nov. 8, 2017). Moreover, it may also place an infringer in the unfavorable position of trying a case before a judge who views its litigation strategy as underhanded.

On Wednesday, November 1, 2017, Honorable David O. Carter, U.S. District Judge for the Central District of California, denied Defendant VIZIO Inc.’s request to dismiss Blue Spike LLC’s patent infringement claims (PDF) pursuant to the so-called two dismissal rule. See Blue Spike LLC v. Vizio, Inc. Case. No. SA CV 17-1172-DOC (KES) (C.D. Cal. Nov. 1, 2017); Fed. R. Civ. P. 41. While the Court declined to create precedent that limited Rule 41 to clearly non-consensual dismissals, it did view VIZIO’s attempts to escape its day in court through Rule 41 unfavorably. See Blue Spike, supra, at 10-12.

The Court held that VIZIO was judicially estopped from invoking the two dismissal rule. Id. In overcoming VIZIO’s attempt to invoke Rule 41, Blue Spike was able to demonstrate that VIZIO intentionally worked towards an unjust application of Rule 41. Id. at 9, 10. Moreover, Blue Spike demonstrated that in its second dismissal, VIZIO represented an inconsistent position that was “tantamount to a knowing misrepresentation to or even fraud on the” Eastern District of Texas court. Id. at 11, citing, Samson v. NAMA Holdings, LLC, 637 F.3d 915, 935 (9th Cir. 2011). In the wake of TC Heartland, VIZIO represented to the Eastern District of Texas that it sought a stay or change of venue that would not prejudice either party. Id. at 12. VIZIO then collaboratively worked with Blue Spike to dismiss and move the complaint to the Central District of California, where it attempted to invoke the two dismissal rule. Id. Ultimately, Blue Spike prevailed because it was able to establish that VIZIO acted to “take advantage of the parties’ good faith efforts by invoking the two dismissal rule.” Id. at 12.

Plaintiff Blue Spike LLC is represented by Randall T. Garteiser, Christopher A. Honea, and Kirk J. Anderson of Garteiser Honea PLLC.

Defendant VIZIO, Inc. is represented by Adrian M. Pruetz, Guy M. Rodgers, and Rex M. Hwang of Glaser Weil Fink Howard Avchen & Shapiro.




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