FOLLOW US

A federal judge in Washington has temporarily paused the ongoing patent troll lawsuit involving video game giant Valve Corporation to address a legal fee dispute affecting the defendants' representation.

U.S. District Judge Jamal N. Whitehead of the Western District of Washington issued a 45-day stay in the case to allow the defendants, Leigh Rothschild and his associated companies, time to secure new legal counsel. This pause follows a motion by Merchant & Gould PC, the current defense attorneys, seeking to withdraw from the case due to unpaid legal fees. Merchant & Gould claims the defendants have refused to settle outstanding bills without their insurer providing coverage.

Valve Corp., headquartered in Bellevue, Washington, originally filed the suit in July 2023 to halt what it describes as bad faith patent infringement claims related to U.S. Patent No. 8,856,221. The lawsuit alleges the defendants’ actions violate Washington state’s anti-patent troll laws.

During the hearing, Judge Whitehead acknowledged the valid concerns regarding unpaid fees but emphasized the need to prevent prejudice to either party. Both Valve and the defendants opposed the withdrawal request, expressing concerns that a sudden change in legal representation could disrupt case progress.

“The trial is not scheduled until next year,” Judge Whitehead stated, noting that there is sufficient time to adjust the case schedule without causing undue harm to the parties involved. However, the judge declined to grant an immediate withdrawal by Merchant & Gould, citing local rules that require entity defendants to maintain legal representation.

The defendants, represented by attorneys Donald R. McPhail and Eric R. Chad of Merchant & Gould PC, are simultaneously engaged in separate litigation with their insurer over defense cost coverage.

Valve is represented by Dario A. Machleidt, Kathleen R. Geyer, Christopher P. Damitio, and Andrea A. Anderson of Kilpatrick Townsend & Stockton LLP.

The case, Valve Corp. v. Rothschild et al., Case No. 2:23-cv-01016, remains under the jurisdiction of the U.S. District Court for the Western District of Washington.