Document ID: ./input/supremecourt_opinions/opinions/boundvolumes/529bv.pdf
Page Number: 535.0

529US2

Unit: $U49

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460

OCTOBER TERM, 1999

Syllabus

NELSON v. ADAMS USA, INC., et al.

certiorari to the united states court of appeals for
the federal circuit

No. 99–502. Argued March 27, 2000—Decided April 25, 2000

Ohio Cellular Products Corporation (OCP) sued respondent Adams USA,
Inc. (Adams), for patent infringement. The District Court dismissed
OCP’s claim and ordered OCP to pay Adams’ costs and attorney fees.
In awarding costs and fees, the court determined that petitioner Nelson,
president and sole shareholder of OCP, had deceitfully withheld from
the United States Patent and Trademark Ofﬁce prior art that ren-
dered OCP’s patents invalid, and that this behavior constituted inequi-
table conduct chargeable to OCP. Fearing that OCP might be unable
to pay the fee, Adams moved under Rule 15 of the Federal Rules of
Civil Procedure to amend its pleading to add Nelson, personally, as a
party from whom fees could be collected. Adams also asked the
court, under Rule 59(e), to amend the judgment to make Nelson im-
mediately liable for the fee award. The District Court granted Adams’
motion in full.
In afﬁrming the judgment entered against Nelson, the
Federal Circuit acknowledged that it was “uncommon” to add a party
after the entry of judgment. Nevertheless, Nelson had not demon-
strated prejudice, the Court of Appeals concluded, because he made no
showing that anything different or additional would have been done to
stave off the judgment had he been a party, in his individual capacity,
from the outset. That court, over a vigorous dissent, was apparently
satisﬁed that the District Court’s simultaneous allowance of the plead-
ing amendment and entry of judgment satisﬁed due process.

Held: The District Court erred in amending the judgment immediately
upon permitting amendment of the pleading. Due process, as reﬂected
in Rule 15 as well as Rule 12, required that Nelson be given an opportu-
nity to respond and contest his personal liability for the fee award after
he was made a party and before the entry of judgment against him.
Pp. 465–472.

(a) Nelson was never afforded a proper opportunity to respond to the
claim against him, but was adjudged liable the very ﬁrst moment his
personal liability was legally at issue. The Federal Circuit observed
that as long as no undue prejudice is shown, due process is met if
Rule 15’s requirements for amended pleadings are met. But the re-
quirements of Rule 15 were not met here, and due process does not
countenance such swift passage from pleading to judgment in the