Delaware Chief Judge Colm F. Connolly ordered counsel for Nimitz Technologies LLC to appear before him last week “prepared . . . to show cause why he and Nimitz should not be sanctioned for failure to comply with” a November 10, 2022 order to produce to the court a set of documents related to Nimitz’s formation and control. The court canceled that hearing in light of Nimitz’s April 6 production (two days after the order to appear), which it explained required more time to review. Perhaps previewing some of what might have been said at that canceled hearing, counsel for Nimitz filed a “motion for reargument”, challenging Judge Connolly’s order requiring him to appear as a misread of appellate procedural rules. According to the motion, a mandate has yet to issue in relation to a denied petition for a writ of mandamus from the Federal Circuit and therefore Judge Connolly presumably still lacks jurisdiction to take this case back up. Nimitz’s motion drew a swift and clipped response from the court.

For a few months, a quiet had settled over the “Series of Extraordinary Events” unfolding from the courtroom of Delaware Chief Judge Colm F. Connolly. New cases associated with IP Edge LLC, the Texas monetization firm linked to multiple plaintiffs whose compliance with that court’s April 2022 standing orders had been under scrutiny, came to a halt—first in Delaware but then nationwide. Those suits already before Judge Connolly sat stayed, apparently while one of the plaintiffs, Nimitz Technologies LLC, considered whether to take “an issue which has never been addressed by any court” to the top one, the US Supreme Court. Now, Judge Connolly has ordered counsel for Nimitz to appear before him this week; Nimitz has produced a trove of documents for Judge Connolly’s inspection; another IP Edge-linked plaintiff has tried to exit Delaware via amended covenants not to sue; and still other such plaintiffs continue to contest orders requiring them to produce their own troves of documents. Quiet no more.

The Federal Circuit has turned away another request from Nimitz Technologies LLC, a plaintiff with links to formerly prolific patent monetization firm IP Edge LLC. In a brisk order, the court denied a request that it “stay issuing the mandate” regarding the Federal Circuit’s earlier denial of Nimitz’s petition for a writ of mandamus. Nimitz had sought the appellate court’s intervention to stop Delaware Chief Judge Colm F. Connolly from requiring production to the district court of a wide-ranging set of information concerning Nimitz’s ownership/control, assets, and legal representation. In its now-denied motion, Nimitz signaled plans to seek US Supreme Court review, terming Judge Connolly “the adversary in this case” and characterizing its appeal as “raising a substantial question, and, indeed, raising an issue which has never been addressed by any court”.

This past week the full Federal Circuit turned away an appeal of a panel denial of a petition for a writ of mandamus filed by Nimitz Technologies LLC, a plaintiff with links to formerly prolific patent monetization firm IP Edge LLC. Nimitz had asked the Federal Circuit to vacate an order, handed down by District of Delaware Chief Judge Colm F. Connolly, that would require Nimitz to produce to the district court a wide-ranging set of information concerning ownership/control, assets, and legal representation. A Federal Circuit panel denied the petition, prompting Nimitz to file an appeal with the full appellate court. On January 31, 2023, that appeal was also denied. Now, Nimitz—represented throughout by George Pazuniak of O’Kelly & O’Rourke, LLC—has asked the Federal Circuit to stay the associated mandate so that it can appeal further, this time to the US Supreme Court. In its motion, Nimitz sharpens its assessment of the situation, calling Judge Connolly “the adversary in this case”, to whom the production order would require it to deliver materials covered by the attorney-client privilege “not for the purpose of determining whether privilege applies, but for purposes of using the attorney[-]client communications in an investigation of Nimitz”. Per Nimitz, its further appeal is “raising a substantial question, and, indeed, raising an issue which has never been addressed by any court”.

Nimitz Technologies LLC, a plaintiff with links to prolific patent monetization firm IP Edge LLC, has responded to two adverse turns among the recent “Series of Extraordinary Events” unfolding before Delaware Chief Judge Colm F. Connolly. First, Nimitz has appealed the rejection of its petition for a writ of mandamus to the full Federal Circuit. Nimitz argues that the panel (and the district court) both failed to properly apply the principle that a court should avoid considering issues that are not presented to it by the parties and improperly considered an uninvited, legally erroneous memorandum penned by Judge Connolly. Nimitz argues that full court consideration is necessary to “answer to a precedent-setting question of exceptional importance: whether the district court may require that a litigant provide attorney-client privileged documents to the judge that is investigating the party, where the crime-fraud exception to the attorney-client privilege has not been, and could not be, invoked”. Back before Judge Connolly, Nimitz has also responded to an order to show cause why it should not be sanctioned, there arguing that the court has jumped the gun and that Nimitz cannot be required to produce to the court documents that would moot the appeal underway before the full Federal Circuit.

Litigants have been closely watching the “Series of Extraordinary Events” that have been playing out in Delaware as the result of a pair of standing orders issued by Chief Judge Colm F. Connolly in April, which require the disclosure of details on funding and corporate control for parties in his courtroom. Recent weeks have seen a group of related plaintiffs taken to task by Judge Connolly for their noncompliance with these orders, including their failure to disclose links to monetization firm IP Edge LLC and purported consulting firm MAVEXAR LLC—subjecting the NPEs to a series of revelatory evidentiary hearings and imposing a set of sweeping orders requiring some of those plaintiffs to produce a wide-ranging ream of information on their ownership/control, assets, and legal representation. Judge Connolly has now denied a motion to withdraw one of those production orders from one of those plaintiffs, Nimitz Technologies LLC—rejecting it as “devoid of merit”, and ordering it to show cause why he should not sanction the entity for failure to provide the required evidence, as a parallel fight over his probing plays out before the Federal Circuit.

In April of this year, Delaware Chief Judge Colm F. Connolly posted two standing orders imposing heightened disclosure requirements—regarding party ownership and any third-party litigation funding—on litigants in his courtroom. The responsive disclosures from certain plaintiffs, associated with various notable patent monetization players, have spawned intense scrutiny from the court, including a series of evidentiary hearings followed by an order requiring the production to the court of documents governing the relationships between those plaintiffs and those monetization outfits, together with related communications. Four of the plaintiffs then filed separate petitions for writs of mandamus with the Federal Circuit, prompting Judge Connolly to take certain additional hearings off calendar, to stay some of these cases, and to submit a memorandum to the appeals court, “explain[ing] more fulsomely and in writing” the reasons for this series of extraordinary events. This past week, (1) the Federal Circuit denied two of those petitions, (2) a denied petitioner filed a motion before Judge Connolly seeking the withdrawal of his explanatory memorandum (as well as recusal from its cases going forward), (3) defendants and amici filed responses to the other two petitions still pending before the appeals court, and (4) VLSI Technology LLC and Intel provided their answers to four related questions that Judge Connolly posed in the Delaware case between the two, in advance of a December 14 hearing.

For years, RPX has reported on the intelligence that can be culled from public records about the approach to patent monetization by the large collection of patent plaintiffs linked to IP Edge LLC. That Texas monetization firm has never filed suit itself but has, through its associated LLCs, been the top filer by volume of NPE litigation, both for several years running and by an order of magnitude. The “Series of Extraordinary Events” currently underway—first before Delaware Chief Judge Colm F. Connolly, but now also the Federal Circuit—appears to have confirmed that body of reporting, based solely on public records, that the founders of IP Edge, through sister entity MAVEXAR LLC, have constructed a business model by which individuals with no prior, cognizable connection to patent monetization take ownership of patents, the assertion of which MAVEXAR manages—all for a small percentage of the proceeds paid back to those individuals.

Three plaintiffs with apparent links to Texas monetization firm IP Edge LLC recently filed separate petitions for writs of mandamus, asking the Federal Circuit in the short term to order Delaware Chief Judge Colm F. Connolly to cancel evidentiary hearings that had been scheduled for December 10 to consider whether those plaintiffs have complied with the court’s April 2022 standing orders addressing disclosure of comprehensive ownership information, as well as certain third-party litigation funding. Judge Connolly, separately, canceled that evidentiary hearing, and the Federal Circuit has quickly denied one of those petitions. Meanwhile, the same three plaintiffs have continued to file cases in their respective campaigns, Creekview IP LLC hitting RadioShack Online (3:22-cv-02653); Swirlate IP LLC, RAB Lighting (1:22-cv-06660) and Schweitzer Engineering Labs (2:22-cv-00300); and Waverly Licensing LLC, Aukey (2:22-cv-08642) and Impero Electronics (VisionTek Products) (2:22-cv-08642), all outside Delaware. Each of those campaigns has included prior cases filed in other districts as well—districts that require the disclosure of nonparties having an interest in the outcome of the litigation. In the Aukey case, litigation counsel (Garteiser Honea, PLLC) has already (on November 30) had to update Waverly’s disclosure to the Central District of California because the prior version (filed two days earlier) omitted MAVEXAR LLC from the list of parties with a pecuniary interest there. MAVEXAR will by now be well known to those following the “Series of Extraordinary Events” arising out of Delaware. As those events unfold, other counsel for Creekview IP, Swirlate IP, and Waverly may have more due diligence—and cleanup—ahead.

So far in November, Delaware Chief Judge Colm F. Connolly has held two extraordinary evidentiary hearings, to evaluate the compliance of patent plaintiffs Backertop Licensing LLC, Lamplight Licensing LLC, Mellaconic IP LLC, and Nimitz Technologies LLC with standing orders, new this past April, regarding corporate and third-party litigation funding disclosures. Thereafter, Judge Connolly handed down a set of orders requiring extraordinarily sweeping production to the court of materials related to, for example, communications between the plaintiffs, its “consultant” handling litigation, and various attorneys. Nimitz filed a petition for a writ of mandamus from the Federal Circuit to intervene, using extraordinary language to describe the district court’s actions, as, for example, conducting “perverse prying into the innards of [Nimitz’s] finances, business, and prosecution”. The Federal Circuit stayed Judge Connolly’s order in the Nimitz case, triggering stays in the other suits, with all this extraordinary activity continuing to ripple through other Delaware cases over Thanksgiving week.