District of Massachusetts’s Judge Michael A. Posner granted Specialized Technology Resources Inc.’s (STR) motion to dismiss a suit brought by JPS Elastomerics Corp., accusing STR of attempting to drive JPS out of the specialized polymer market by bringing a sham claim in state court.
JPS brought the suit in federal court after having lost a state case in which the court ruled against JPS on STR’s trade secret claim. Judge Posner dismissed the suit, explaining that because STR won in state court, Supreme Court precedent precluded JPS’s sham claim. The Supreme Court has held that a winning lawsuit is by definition not sham litigation. JPS attempted to find an exception to the rule by claiming that STR had obtained the judgment through fraud on the court. Judge Posner rejected the argument.