[00:00:00] Speaker 03:
Case before the court is Taser International Inc.

[00:00:04] Speaker 03:
vs. Phaser Electronics Inc.

[00:00:08] Speaker 03:
Case number 172637, appeal from the District Court in the Middle District of Florida.

[00:00:29] Speaker 03:
Okay, Mr. Davida, you want three minutes for a rebuttal?

[00:00:32] Speaker 03:
Yes, Your Honor.

[00:00:34] Speaker 03:
Okay.

[00:00:37] Speaker 02:
You may please the Court.

[00:00:38] Speaker 02:
Your Honors, if I can, I want to get to the nuts and bolts of this.

[00:00:42] Speaker 02:
I'm rather ambitious if there's three points I could reach, but I know there'll be about two that might wind up getting through instead of the third.

[00:00:49] Speaker 02:
I want to go through the issue that the sanctions order was improperly entered.

[00:00:53] Speaker 02:
That would be the first point.

[00:00:55] Speaker 02:
Second point I want to try to get to is that the sanctions order after being entered is unsustainable under 54C, rule of civil procedure under 55, and under the application of the case law thereafter.

[00:01:06] Speaker 02:
Third point, if we can get to it, Your Honors, is the collateral consequences of such a decision and how that effect.

[00:01:14] Speaker 03:
On the first point, I don't understand how you can say default was improper when you asked for default.

[00:01:23] Speaker 02:
Your Honor, I would disagree respectfully.

[00:01:25] Speaker 02:
I don't think the default was ever asked for.

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And in fact, the allegation that the default was asked for, I think, is rather spurious.

[00:01:32] Speaker 02:
That's not what occurred, even when you read through it.

[00:01:35] Speaker 02:
Essentially, there was a discussion.

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The discussion was had about the financial difficulties that were occurring.

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But nowhere was there any affirmative request for a default.

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And in fact, the way it was presented in the answer brief

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essentially took sentences out of context.

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That's not, that was not the position.

[00:01:57] Speaker 03:
So you're saying that the lower court's interpretation that you actually wanted to default because you weren't going to go forward with any, or respond to any of the court's orders, that the lower court was wrong in believing that you opted for default rather than to comply?

[00:02:15] Speaker 02:
Well essentially I think what the court is suggesting is that somehow there was a silence, was a waiver, and I don't know that that's the case.

[00:02:22] Speaker 02:
So

[00:02:22] Speaker 03:
Well, you made it clear to the district court that you had no intention of complying with the court's orders, right?

[00:02:27] Speaker 02:
No.

[00:02:28] Speaker 02:
Essentially, I would disagree, Your Honor.

[00:02:29] Speaker 02:
And what we're talking about here is, and I believe if I'm correct in what Your Honor is suggesting, is that we have a period of time in which there were depositions missed and a discovery conference that were missed within a period of 30 days.

[00:02:43] Speaker 02:
I think that's what Your Honor is referring to.

[00:02:46] Speaker 02:
And to suggest that somehow in a case that has been pending for

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uh, 13 months, if not longer at that period of time for which there were three separate motions to compel for which there were 30,000 documents provided from phaser to the other side in response to all those court orders.

[00:03:05] Speaker 02:
I think that taking this sentence out of context to suggest that yet we were saying to the court

[00:03:11] Speaker 02:
Yeah, we want a default is inaccurate and really belies the actual position of the litigant, which my client was at the time.

[00:03:19] Speaker 03:
And you also didn't show up for the technology tutorial, right?

[00:03:23] Speaker 02:
Your Honor, I'm not standing before this Court to say that missing two depositions and that technology conference should not have some form of repercussions from the Court.

[00:03:34] Speaker 02:
That's not what I'm standing here saying.

[00:03:36] Speaker 02:
What I'm saying is, one, the manner in which they were imposed was improper.

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especially after we looked at Chudasama, which we presented and I didn't... So the court issued an order.

[00:03:44] Speaker 04:
Do I understand correctly the court issued an order having scheduled the depositions requiring your client to attend and your client didn't attend?

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And this was after repeated attempts in order to have your client provide people for their depositions.

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And so essentially what I think is important for the court to look at here and what we're presenting before you, Your Honor, is that there was a motion to withdraw filed

[00:04:10] Speaker 02:
And essentially, yes, the client speaks through its attorney.

[00:04:12] Speaker 04:
And what was the language used in the motion to withdraw?

[00:04:15] Speaker 04:
There was a word.

[00:04:16] Speaker 04:
I don't remember exactly what it was, but it was something default.

[00:04:20] Speaker 01:
Control default.

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Control default.

[00:04:22] Speaker 01:
8986.

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This is your motion for conference, where this is your paper, where you say, FASER wishes to discuss its quote unquote control default in these proceedings.

[00:04:37] Speaker 02:
And I understand, Your Honor, that that was presented, but that was not essentially what occurred.

[00:04:43] Speaker 02:
That's not what happened, and that's not what the client was going through at that period of time.

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You have discussions through one attorney, Mr. Ackery, in that 30-day period in which the motion of withdrawal is filed.

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And then you have what was those two missed dates.

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And essentially, and I'm, I apologize if I. Three missed dates.

[00:05:05] Speaker 02:
Three missed dates.

[00:05:05] Speaker 02:
I apologize, Your Honor.

[00:05:06] Speaker 02:
I don't know if we had supplemented the record with it, but there was, oh, communications with the attorney about the scheduling issues related to the individuals.

[00:05:18] Speaker 02:
So essentially, what I'm suggesting- But you've got court orders.

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And correct me if I'm wrong, but my understanding is each of those court orders actually said, if you don't comply with this order, you will be subject to sanctions up to and including default.

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And I can't deny that that's what it said.

[00:05:35] Speaker 02:
But what I would like to try to explain to the court is that we have procedures for this.

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And I don't want to lose short of my time, because we both have the 54C arguments after and the 55.

[00:05:45] Speaker 04:
These are important questions that we have.

[00:05:47] Speaker 02:
I understand.

[00:05:47] Speaker 04:
So I have another question, too, which is on appendix page 1082.

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It's stated, and this is your client's paper in response to the motion for sanctions.

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It says, as Basar is defaulting in this matter,

[00:06:03] Speaker 02:
says indeed as phaser is defaulting such relief would have no effect on phaser how is the district court to understand this set this phrase as phaser is defaulting in this matter well essentially your honor and i i think we're taking a jump here and so we're saying that the district court somehow um suggested that phaser wanted to default when it never actually put that in writing there's nothing within the order of phaser's

[00:06:28] Speaker 02:
I understand, but what I'm saying is your honor has suggested that somehow the court relied on phasers suggesting that there was a voluntary default.

[00:06:34] Speaker 02:
And there's nothing in writing from the court suggesting that there's a voluntary default.

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And in fact, it never came from a voluntary default.

[00:06:41] Speaker 02:
This came from a motion for sanctions, after which we went 13 months with motions to dismiss outstanding in contravention at Judasama.

[00:06:49] Speaker 02:
But if we can, your honor, we can jump to the 54C.

[00:06:53] Speaker 02:
Yeah, I think you'd be better.

[00:06:55] Speaker 02:
And that's fine.

[00:06:56] Speaker 02:
This judgment that was entered goes well beyond what was requested in the complaint.

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There's a finding of validity.

[00:07:03] Speaker 02:
There's an imposition not just against what the claim was, claim 13, for the data court on the firearm, this electronic firearm, but for all firearms.

[00:07:13] Speaker 03:
And when we get to that issue... Well, I mean, the court made clear in the contempt order that it was talking about, and this is exactly language from our TIVO opinion, that these products for ones that are not

[00:07:25] Speaker 03:
reasonably different or something like that.

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It went, Your Honor, respectfully, it went well beyond that.

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And in fact, it did so in subsequent orders.

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So essentially, the only way I can liken this and having discussions in preparation would be as if there was some claim against Toyota for a navigation system.

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And so then Toyota sells cars with navigation systems.

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And then when the order gets entered, because let's say Toyota defaults, it's not just against cars with navigation systems or the ability to have navigation systems, it's against all cars.

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And the reason being, and this is the logic behind the trial bench on this one, is that it was robbed, this is from the language, of the opportunity to make the determination.

[00:08:05] Speaker 02:
And that's in direct contravention of Rule 55, especially when we get to the case of Clapperot, which essentially states that you can hold the trial after to make these determinations.

[00:08:15] Speaker 02:
And Taser comes in and says, oh, well, it's defaulted on well-pled facts.

[00:08:20] Speaker 02:
Well, that's true, but not well-pled facts, not conclusions of law.

[00:08:24] Speaker 02:
And we know from Markman that validity is a conclusion of law.

[00:08:28] Speaker 03:
And so let me ask this question.

[00:08:31] Speaker 03:
There's no doubt that an assertion of invalidity would be a defense to an infringement claim, right?

[00:08:38] Speaker 03:
So even if you're right that a declaration of validity was not appropriate,

[00:08:45] Speaker 03:
in this particular order.

[00:08:47] Speaker 03:
Of what material impact would that be given our NALOC decision that says you would be precluded from ever asserting invalidity as it relates to the products that were covered by that infringement determination?

[00:09:01] Speaker 02:
Well, and I guess what I'm trying to say is that the preclusion is coming from an over-broad sanctions order and that the sanctions order was not rationally related to the conduct.

[00:09:12] Speaker 03:
So what's over-broad about the sanctions order?

[00:09:14] Speaker 03:
So you concede that whether it's a declaration of invalidity or simply the fact that you never assert the defense, that validity as it relates clearly to the products identified in the complaint is off the table, right?

[00:09:31] Speaker 02:
If it did, I don't think that's what it does.

[00:09:35] Speaker 02:
And it goes to the products that aren't even in the complaint.

[00:09:37] Speaker 02:
It goes to all products.

[00:09:38] Speaker 04:
So that's just...

[00:09:41] Speaker 04:
Injunction goes beyond products listed in the complaint.

[00:09:43] Speaker 04:
Yes.

[00:09:44] Speaker 04:
It's not the same products listed in the complaint.

[00:09:46] Speaker 02:
Correct.

[00:09:46] Speaker 02:
One hundred and fifty percent, Your Honor, correct.

[00:09:49] Speaker 02:
My client has not been able to sell any electronic firearm as a result of the order.

[00:09:55] Speaker 02:
And when I can come back before that, Your Honor... Where in your blue brief is this issued?

[00:10:00] Speaker 02:
Uh, it's, it's, it's in the, that's in the order.

[00:10:02] Speaker 01:
It says- No, I'm, I'm, I'm trying to figure out the issues that are on appeal.

[00:10:07] Speaker 01:
There's like 18 issues.

[00:10:08] Speaker 01:
No, no, I- I don't remember this issue being of those.

[00:10:12] Speaker 02:
And I apologize, uh, because when I was preparing, I, I thought it would be easier for the oral presentation of the argument to present to your honors in a different fashion than it was laid out in the numerical.

[00:10:23] Speaker 04:
That's fine, but is it in your opening brief?

[00:10:26] Speaker 04:
It, it is.

[00:10:26] Speaker 04:
It's not, then, it's not an argument we're going to consider.

[00:10:29] Speaker 02:
Oh, it is, Your Honor.

[00:10:30] Speaker 02:
All of those issues are in the opening brief and then responded to in the reply brief.

[00:10:35] Speaker 02:
They're just written in a different format.

[00:10:37] Speaker 04:
Where is it in your opening brief?

[00:10:38] Speaker 02:
And if I can re-hear Your Honor's question so I can concisely go to it.

[00:10:43] Speaker 01:
You seem to be arguing right now that the scope of the injunction order was much too broad and so I'm trying to figure out where in your blue brief

[00:10:54] Speaker 01:
Are you appealing that issue?

[00:10:56] Speaker 01:
I understand that you're appealing the injunction order, making a determination on validity of the trademark.

[00:11:06] Speaker 02:
That's correct.

[00:11:07] Speaker 01:
But what about this other issue you're now telling me that you've been enjoying from selling any of your products?

[00:11:14] Speaker 02:
I believe, and if I may, it was referenced initially under the section that Your Honor is saying as to validity.

[00:11:22] Speaker 02:
which referenced that the scope went too far, validity was one of the issues.

[00:11:27] Speaker 02:
We went further in that, and I want to say... I'm looking at it now.

[00:11:33] Speaker 02:
So essentially the opening brief, let me go to it, got to validity in part... This whole section is three pages.

[00:11:45] Speaker 02:
Yes, it was, I think it was parts one and two.

[00:11:49] Speaker 02:
and responded to in the reply brief, which expanded that issue related to the scope of the injunction being too far.

[00:11:57] Speaker 03:
And in addition, Your Honors, I believe we supplemented... Show me on the page where you say the scope of the injunction covered too many products.

[00:12:06] Speaker 02:
In the opening brief, Your Honor?

[00:12:07] Speaker 04:
Yeah.

[00:12:08] Speaker 04:
Yes.

[00:12:10] Speaker 02:
If I could have one second.

[00:12:50] Speaker 02:
I apologize, Your Honor, as I'm wasting a lot of time referring back to an exact sentence within the brief, which if was not presented... I don't see this issue in your brief.

[00:13:03] Speaker 04:
Having looked at it just now, and having looked at it before, I don't see this issue presented in your brief.

[00:13:07] Speaker 02:
Respectfully, Your Honor, I believe it's in the brief.

[00:13:11] Speaker 02:
It's 55 pages.

[00:13:12] Speaker 02:
I don't have the... Or 50 pages or so, or all the briefs that we... And the reply brief.

[00:13:18] Speaker 02:
And in addition, I know that we set aside

[00:13:20] Speaker 02:
or at least presented to this court some of the 60B motions, which also contain those issues.

[00:13:26] Speaker 02:
And this court's not prevented from looking at that.

[00:13:28] Speaker 02:
I'm into my reserve time, Your Honors, for rebuttal.

[00:13:32] Speaker 03:
Give you two minutes for rebuttal.

[00:13:34] Speaker 02:
Thank you.

[00:13:42] Speaker 00:
May it please the court, Pam Peters on behalf of Taser International.

[00:13:46] Speaker 00:
Taser's egregious,

[00:13:49] Speaker 00:
flagrant, intentional obstructionist behavior, and willful abuse of the judicial process, those are all the district court's words, not mine, are well documented in the record, in the court's sanction order, and in our opening brief.

[00:14:03] Speaker 00:
It was certainly not an abuse of discretion under the circumstances of this case, which were extreme, and in which phase are violated very clear and numerous court orders under threat of default, as Your Honor pointed out.

[00:14:18] Speaker 03:
the scope of the injunction.

[00:14:21] Speaker 03:
Now, first of all, do you concede that the court had no authority to actually enter a declaratory judgment of validity?

[00:14:31] Speaker 00:
We do not, Your Honor.

[00:14:34] Speaker 00:
Regarding the scope of the injunction... Did you ask for a judgment of validity?

[00:14:38] Speaker 00:
We submitted a proposed order to the court, which included that particular language.

[00:14:43] Speaker 00:
In your complaint, did you ask for a declaration of validity?

[00:14:45] Speaker 00:
So in the complaint, we asked for a declaration of infringement.

[00:14:50] Speaker 00:
So your answer is no to whether you asked for a declaration of validity?

[00:14:53] Speaker 00:
Not expressly, Your Honor.

[00:14:54] Speaker 00:
But I think how you specifically get there is that there are well-pleaded facts in the complaint relating to the federal registration of the trademark

[00:15:05] Speaker 00:
and the issuance of the patent and the ownership relating to those particular pieces of an electoral property.

[00:15:14] Speaker 00:
So those factual allegations on Fazer's default are taken as true.

[00:15:18] Speaker 00:
And there are legal consequences that then flow from that, including that the patent is deemed valid and enforceable, which was the language that the court used.

[00:15:27] Speaker 03:
That goes back to the point I was making in court.

[00:15:29] Speaker 03:
It may be particularly true in light of our NALAC decision

[00:15:34] Speaker 03:
it would seem true that they would be precluded from later asserting invalidity as it relates to the products that were subject to this infringement judgment.

[00:15:44] Speaker 03:
But that's not the same as a declaration of validity for all purposes.

[00:15:49] Speaker 00:
Well, I think that the, obviously, in terms of a declaration for infringement, it subsumes the validity of the patent and the trademark.

[00:15:56] Speaker 03:
Well, common versus Cisco, the Supreme Court said, you know, that's not right.

[00:15:59] Speaker 00:
There are two different things.

[00:16:03] Speaker 00:
There are well-pleaded facts in the complaint relating to the ownership, which gives rise to a legal presumption of validity.

[00:16:10] Speaker 00:
And so there is nothing improper then with the court stating.

[00:16:15] Speaker 01:
But maybe all that means is you identified that these pieces of property enjoy presumption of validity.

[00:16:23] Speaker 01:
And that's all that continues forward from this order, that the presumption continues on.

[00:16:29] Speaker 01:
And that's it.

[00:16:32] Speaker 00:
Well, the presumption, yes, certainly does continue on.

[00:16:35] Speaker 00:
But as to FASER, which defaulted in this matter, it's binding as to them.

[00:16:40] Speaker 03:
Right.

[00:16:40] Speaker 03:
That's a different question.

[00:16:42] Speaker 03:
It's binding as to them as it relates to the products that were the subject of this infringement judgment.

[00:16:47] Speaker 03:
Correct.

[00:16:48] Speaker 00:
Correct.

[00:16:48] Speaker 00:
I cite to the court an additional authority, GRAPHON, G-R-Y-P-H-O-N, Mobile Electronics versus Brookstone, which is a 2016

[00:17:00] Speaker 00:
District of Central District of California decision at 2016 Westlaw 763987, which addresses this specific issue.

[00:17:10] Speaker 00:
And it found that plaintiffs trademark and patent was valid on default under a Rule 54C analysis

[00:17:18] Speaker 00:
based on statutory presumptions arising from the ownership allegations in the complaint.

[00:17:23] Speaker 04:
So in that case, there was no pleading that was asking for a declaration of validity, or is it that case distinguished in that fashion?

[00:17:30] Speaker 00:
No, it's the same as this one, where there was a request in terms of infringement.

[00:17:34] Speaker 00:
And the court found that the factual allegations in the complaint relating to ownership of the trademark and the patent and then incorporating the actual

[00:17:45] Speaker 00:
documents as exhibits to the complaint, which we did here as well, was sufficient in order to support the presumption of validity than stated in the order.

[00:17:55] Speaker 04:
I'm sorry?

[00:17:57] Speaker 04:
That is not binding on this court, correct?

[00:17:59] Speaker 00:
No, not binding on this court, Your Honor, but certainly another court that had done this analysis under Rule 54C and did come out the way that we did.

[00:18:06] Speaker 03:
But I think I understand that the issue is not before us in this appeal.

[00:18:12] Speaker 03:
But one of my concerns is that once the contempt order, once the contempt was sought, doesn't our en banc case law require a district court to do an analysis of whether or not the products are the ones identified in the complaint and the judgment or

[00:18:32] Speaker 03:
as even the district court says, which I think he's rightly allowed to say, not confusingly similar to those products.

[00:18:39] Speaker 03:
But he never did that analysis.

[00:18:40] Speaker 03:
Isn't that a problem?

[00:18:41] Speaker 00:
Well, it was done certainly after this and the Locutory Appeal was filed because FASER continued to violate the injunction and attempt to sell these products and to demonstrate them to law enforcement while this, after this injunction was entered.

[00:18:55] Speaker 00:
And so we filed a motion for contempt.

[00:18:57] Speaker 00:
The court held a four-hour evidentiary hearing

[00:19:00] Speaker 00:
And it was at that hearing for the first time that Phaser raised this issue of, hey, we have a product that's also called an enforcer conducted electrical weapon that doesn't include a data port.

[00:19:13] Speaker 00:
And so that's a non-infringing product that we should be allowed to continue to sell.

[00:19:19] Speaker 00:
The court in its ruling specifically found that that issue had never been raised, and TASER had never been allowed any discovery in the case relating to that, that the injunction related to enforcers, CEWs, and that they had never, prior to that time, ever argued or provided discovery that there was a supposed non-infringing product.

[00:19:43] Speaker 00:
So the court then determined that because of that, again, because of their

[00:19:47] Speaker 00:
willful abuse of the process and failure to comply with discovery orders, that it could not make that determination and that they had been waived that in terms of whether or not there was another product.

[00:19:58] Speaker 00:
And as Your Honor pointed out, it's not raised in the opening brief here, and it is waived on that ground as well.

[00:20:05] Speaker 00:
But I want to take you back also, though, to the specific sanction response that FASER filed in this case, in which it specifically says that

[00:20:16] Speaker 00:
a declaratory judgment of general validity and enforceability of the patent and the trademark would have no additional effect on FASER, who would be already bound on infringers.

[00:20:27] Speaker 00:
And that's at Appendix 1083.

[00:20:30] Speaker 00:
And so the response conceded that the deemed valid language in the proposed order didn't add anything additional as to FASER.

[00:20:38] Speaker 00:
As it said, as Your Honor pointed out, as FASER is defaulting in this matter, such relief would have no effect whatsoever on FASER.

[00:20:46] Speaker 03:
So you want us to just simply interpret that essentially declaratory judgment of validity as only relating to the circumstances of this case and to the presumption of validity that attachment had not been rebutted for this case and these products.

[00:21:07] Speaker 00:
Right.

[00:21:07] Speaker 00:
The 54C argument that was made in the district court wasn't asked to the effect of this language on phaser.

[00:21:14] Speaker 00:
And so it waived that argument.

[00:21:16] Speaker 00:
It was only as to hypothetical unnamed third parties that somehow might come into conflict with FASER in the future.

[00:21:23] Speaker 00:
And as to those people, it was saying that a general declaration of validity would be improper.

[00:21:30] Speaker 00:
But of course, those folks would not be bound by a default order or an injunction specific to FASER.

[00:21:36] Speaker 00:
So that was the limitation that FASER made itself to the district court in the sanctions response.

[00:21:42] Speaker 00:
And so they've waived, I think, the issue related here.

[00:21:45] Speaker 00:
And as they've acknowledged, it doesn't have any additional impact on them because they would be bound by the infringement injunction in any event in exactly the same manner that they are in terms of the validity and enforceability language, which are, in fact, presumed by statute.

[00:22:01] Speaker 03:
Bound by the infringement judgment and not allowed to assert a defense that they never asserted before.

[00:22:07] Speaker 03:
Right?

[00:22:08] Speaker 03:
Yes.

[00:22:09] Speaker 03:
That was a softball question.

[00:22:13] Speaker 00:
So I think there's no correction that's really warranted here on the record.

[00:22:21] Speaker 00:
Certainly there's no voiding of the injunction in any way.

[00:22:26] Speaker 00:
If your honors would find that that language was somehow beyond the scope, it can certainly be remanded with orders to remove that particular language, but I do think

[00:22:38] Speaker 00:
that T. R. Fazer has acknowledged that it has no impact on it and there's really no reason to do that.

[00:22:44] Speaker 03:
At the time of the default proceedings, did they ask for the court to have a hearing to define exactly which products it would apply to?

[00:22:53] Speaker 00:
No, Your Honor, they did not.

[00:22:55] Speaker 03:
Did they move for reconsideration for that purpose?

[00:22:59] Speaker 00:
No, they didn't.

[00:23:00] Speaker 00:
Subsequently, after this appeal was filed, filed some Rule 60B motions attempting to

[00:23:05] Speaker 00:
expand the scope of what was in front of the court at the time.

[00:23:08] Speaker 00:
But at the time here, they didn't ask for a hearing under Rule 55, which, of course, is discretionary with the court.

[00:23:15] Speaker 00:
In any event, they didn't ask for it.

[00:23:18] Speaker 00:
The court didn't hold one.

[00:23:20] Speaker 00:
And I think based on, again, the well-pled facts and the complaint relating to the ownership of the trademark and the patent.

[00:23:29] Speaker 00:
part of the complaint that they don't specifically raise as an issue, but they ask this court to basically allow them or give them permission to go to the TTAB and continue to pursue the cancellation action that was suspended in that court.

[00:23:47] Speaker 00:
And there is language in the court's injunction order at appendix 14 paragraph 4 that bars them from doing that.

[00:23:54] Speaker 00:
from challenging the validity or enforceability of the, specific to the patent registration, the trademark registration, I'm sorry, the 789 registration.

[00:24:05] Speaker 00:
And so they don't, they didn't object to that language in the proposed order in front of the district court.

[00:24:12] Speaker 00:
So again, I think that it's waived.

[00:24:14] Speaker 00:
But in any event, this court's decision in Nasalak, I think is on all fours with this.

[00:24:21] Speaker 00:
I do however.

[00:24:22] Speaker 03:
That was an appeal from the TTAB, right?

[00:24:23] Speaker 03:
It was.

[00:24:24] Speaker 00:
It was.

[00:24:24] Speaker 03:
And in the contempt order, the district court judge conceded that he had no authority to tell the TTAB how to apply its own preclusion rules.

[00:24:34] Speaker 00:
Yes.

[00:24:34] Speaker 00:
But I think that here, and I do want to correct the misstatement in our answering brief on page 40 relating to that particular case and apologize for the error there.

[00:24:46] Speaker 00:
The holding in that case was not based on

[00:24:49] Speaker 00:
invalidity being a compulsory counterclaim, but instead that claims of trademark invalidity that collaterally attack a prior infringement judgment are subject to claim or defendant preclusion.

[00:25:00] Speaker 00:
So the result is the same, but under a different ground.

[00:25:06] Speaker 00:
And so there, the court specifically found that a default judgment can be raised judicata under these types of circumstances where it's used as a collateral attack

[00:25:18] Speaker 00:
on a prior injunction or infringement finding and concluding then a subsequent cancellation action.

[00:25:30] Speaker 00:
So I do think that it supports that little court's language there as well.

[00:25:35] Speaker 00:
Also, specifically I want to refer the court to the district court in connection with the subsequent contempt proceedings address this issue also specifically in the contempt order that's now

[00:25:47] Speaker 00:
on appeal in front of this court in a separate matter.

[00:25:51] Speaker 00:
But that particular document, that order May 4th of 2018 was issued after this case was fully briefed.

[00:25:59] Speaker 00:
And it's district court number 271 at pages 6 through 7.

[00:26:05] Speaker 00:
And because the issue was raised at the contempt proceedings relating to this particular clause,

[00:26:12] Speaker 00:
and the prohibition, prospective prohibition about continuing to further that litigation.

[00:26:18] Speaker 00:
And the court in the contempt order specifically found that that language was proper based on Fazer's egregious failure to abide by the court's orders and otherwise participate in this litigation.

[00:26:31] Speaker 00:
And it cited a statute and a variety of authorities in that decision, which I would commend to this court as additional authorities that also

[00:26:39] Speaker 00:
support this.

[00:26:41] Speaker 00:
What's the district court docket number on that one?

[00:26:43] Speaker 00:
It's document number 271 at pages 6 and 7.

[00:26:48] Speaker 00:
And several authorities confirming its power to enjoin the litigants from instituting further litigation, particularly as a sanction when it's done as a sanction against parties who abuse the judicial process.

[00:27:04] Speaker 00:
And so I would just commend those authorities to the court as well.

[00:27:09] Speaker 00:
If this court were to determine that the prohibition on continuing the cancellation action is improper or premature for any reason at all, TASER would request language that it be stricken without prejudice to fully briefing the claim preclusion issues at such time as TASER seeks to reactivate its cancellation petition to make clear that

[00:27:37] Speaker 00:
That's not being resolved on the merits, but the further briefing on that would be appropriate at the given time, so there's no confusion relating to that.

[00:27:46] Speaker 00:
I briefly just want to touch on the second office action, which is raised quite substantially in the reply.

[00:27:55] Speaker 03:
Well, he never got to that part, so.

[00:27:58] Speaker 03:
Okay.

[00:27:58] Speaker 00:
Okay.

[00:27:59] Speaker 00:
All right.

[00:28:00] Speaker 00:
Thank you, Your Honor.

[00:28:00] Speaker 00:
If you have any further questions, I'd ask that the injunction order be affirmed in its entirety.

[00:28:07] Speaker 00:
and that the matter be considered.

[00:28:11] Speaker 00:
Thank you.

[00:28:16] Speaker 02:
Thank you, Your Honors.

[00:28:17] Speaker 02:
And if I may, just to rehash a couple things here.

[00:28:21] Speaker 02:
And that is, we started with the imposition of the sanctions order.

[00:28:26] Speaker 02:
And I think we should start at Genesis.

[00:28:29] Speaker 02:
We start at the beginning.

[00:28:30] Speaker 02:
And part of what I'm getting at here is that we went 13 months without an answer

[00:28:37] Speaker 02:
on a motion to dismiss.

[00:28:39] Speaker 02:
The pleadings were not framed.

[00:28:41] Speaker 02:
The quote from Chudasama, and I'll read it quickly, allowing a case to proceed through pretrial processes with an invalid claim that increases the cost of the case does nothing but waste the resources of the litigants and the action before the court, delay resolution of disputes between other litigants, squander scarce judicial resources, and damage the integrity of the public's perception of the federal judicial system.

[00:29:04] Speaker 02:
And that's essentially what had occurred here.

[00:29:07] Speaker 02:
So we jump immediately into with this Court, how come you said you were going to default?

[00:29:12] Speaker 02:
Why were you agreeable to a default?

[00:29:14] Speaker 02:
It's because the little guy got hammered in discovery for 13 months with a motion to dismiss pending.

[00:29:21] Speaker 02:
Second, in one minute, what I want to try to get to also, Your Honors, is that this Court is permitted.

[00:29:28] Speaker 02:
Well, really, in fact, I'll finish with those two.

[00:29:31] Speaker 02:
And that's it.

[00:29:32] Speaker 02:
That is, there were other sanctions available.

[00:29:34] Speaker 02:
There were other sanctions that were absolutely available and could have been used.

[00:29:37] Speaker 02:
They could have struck both of those witnesses, any of those witnesses at trial.

[00:29:41] Speaker 02:
They could have imposed financial sanctions.

[00:29:43] Speaker 02:
They could have imposed daily financial sanctions.

[00:29:46] Speaker 02:
None of those things occurred.

[00:29:48] Speaker 02:
And instead, they could have struck the motion to dismiss and required an answer and affirmative defenses.

[00:29:53] Speaker 02:
Also, counterclaims, if you had any.

[00:29:55] Speaker 02:
And that didn't happen either.

[00:29:57] Speaker 03:
And so essentially, we have... Did you recommend any of those alternative sanctions to the court?

[00:30:01] Speaker 02:
Absolutely, Your Honor.

[00:30:02] Speaker 02:
In fact, here's my relief.

[00:30:03] Speaker 02:
In my 10 seconds, I think the court should reverse the order.

[00:30:06] Speaker 03:
Wait, wait, wait.

[00:30:06] Speaker 03:
I'm saying at the time that this whole thing was ongoing, did you ask the court to consider alternative sanctions?

[00:30:14] Speaker 02:
Your Honor, I was not present before the court at the time.

[00:30:17] Speaker 02:
And I don't believe that... No, no one did.

[00:30:19] Speaker 02:
OK.

[00:30:20] Speaker 02:
And I don't believe they did.

[00:30:21] Speaker 02:
If the court, for my two seconds, asked for relief... Your time's up.

[00:30:25] Speaker 02:
Thank you, Your Honor.

[00:30:26] Speaker 02:
Okay, thank you.

[00:30:29] Speaker 02:
All rise.

[00:30:32] Speaker 02:
The Honorable Court and the adjournment will be following at 6 o'clock AM.