Venture filed suit against Autoliv alleging that Autoliv breached a supply agreement, along with several other patent law claims, including correction of inventorship, declaratory judgment of unenforceability, and declaratory judgment of infringement of patents Venture claimed to own. In November 2003, trial began on the issue of breach of the supply agreement. The jury found that Autoliv had breached the supply agreement and awared Venture damages. The district court entered final judgment. Autoliv appealed to the Sixth Circuit, which transferred the appeal to the Federal Circuit. The Federal Circuit stayed the appeal to allow Autoliv the opportunity to file a Rule 60(b) motion for a new trial with the district court based on new reports that identified falsified financial information. The district court denied the motion, and Autoliv appealed. 
| Autoliv argued that Venture engaged in discovery misconduct by withholding "Venture's non-public financial information -- the data that ultimately disclosed Venture's fraud," and that such information was responsive to discovery requests and deposition questions. The Federal Circuit affirmed the district court's denial of Autoliv's motion for a new trial pursuant to Rule 60(b)(2). The Court also affirmed the district court's finding that Autoliv was not entitled to a new trial under Rule 60(b)(3) on the basis of discovery misconduct because "Autoliv had ample opportunity to ask the Court to require further of Venture" and it did not. In addition, the Federal Circuit addressed the issue of whether the reliance on the financial statements by Venture's damages expert warranted relief under Rule 60(b)(3). The Court noted that the district court only held that Autoliv failed to establish prejudice according to the Rule 60(b)(2) standard, and held that the standard for prejudice is different under Rule 60(b)(2) and Rule 60(b)(3). The Federal Circuit followed Sixth Circuit law, and found that under Rule 60(b)(3) "prejudice should be presumed[] once the moving party has shown by clear and convincing evidence that misbehavior falling into one or more of the three categories set out in Rule 60(b)(3) has occurred . . . . The burden then shifts to the non-moving party." Under Rule 60(b)(2), "the moving party must show that the newly discovered evidence, if introduced at trial, 'clearly would have produced a different result if presented before the original judgment.'" Because the district court had not applied the Rule 60(b)(3) standard, the Court vacated and remanded. The issue of whether the testimony constituted fraud, misrepresentation, or other misconduct was reserved for the district court to address. |