Out of the Fire, But Still in the Frying Pan for Farney Daniels: Judge Grants Preliminary Injunction Against Nebraska AG’s Office

Here is the latest in Activision’s quest to use Farney Daniels as its patent litigation counsel.  (For those unfamiliar with the issue, see my prior postings, which discuss various states’ reactions to this firm’s efforts to enforce patent rights for a particular patent troll across the country.)  This past Monday, the Nebraska U.S. District Court Judge granted Activision’s request for a preliminary injunction against the Nebraska AG’s Office.  Specifically, the Court prohibited the AG from:

[T]aking any steps to enforce the cease and desist order issued to Farney Daniels on July 18, 2013, in any manner that would prevent or impede the Farney Daniels firm from representing Activision in connection with licensing and litigation of U.S. patents owned by Activision with respect to companies based in, or having operations in, Nebraska.

However, this injunctive relief has no bearing on the AG’s ability to continue to investigate Farney Daniels for violations of the State’s Consumer Protection Act and the Court reserved the AG’s right to revisit the injunction should its investigation uncover a claim of bad faith by Farney Daniels. Some may tout this as a great victory for Farney Daniels, but it wasn’t a great surprise. The Nebraska AG’s Office conceded that it wouldn’t oppose Farney Daniels attorneys’ requests to appear in the Activision matter because that matter pre-dated its cease and desist order, which only applied to future actions.  Although Farney Daniels can now file new actions on behalf of Activision against Nebraska-based entities, it’s unclear that there is any desire to do so. Further, the Nebraska AG is still free to investigate any new claim asserted by Farney Daniels.  As such, this firm will continue to operate under the watchful eye of the State and is not out of the woods yet.

Scott R. Bialecki

Scott Bialecki, a former FTC attorney and IP litigator, is the co-Chair of Sheridan Ross P.C.'s Litigation Group.