This patent litigation resulted in the overturning of a jury verdict of infringement and invalidation of the sole asserted claim as not enabled. The claim , which covered semiconductors used in LED’s, recited a substrate consisting of a material selected from a group of six different compositions, with a non-single crystalline buffer layer grown thereon and a growth layer grown on the buffer layer. The term “non-single crystalline buffer layer” was construed to cover polycrystalline, amorphous, or mixed polycrystalline and amorphous materials, and the Federal Circuit determined that the specification did not enable growing a growth layer on an amorphous layer. In June, on return to the District Court, Judge Saris allowed in part Defendants’ request for attorneys’ fees, finding that, while the case itself was not exceptional (while Boston University ultimately did not prevail, their argument initially prevailed at trial and in post-trial briefing at the District Court level, demonstrating that it was not without merit), the conduct of Boston University’s counsel in communications with Defendants’ counsel “crossed the line of civility” and found that Defendants should recover the fees and costs associated with the two contempt motions they brought after Boston University’s counsel continued with the objectionable communications in violation of court orders. Judge Saris has now awarded $30,934 in fees, excluding time entries that did not relate or only partially related to the motions for contempt. She denied Defendants’ request for fees associated with briefing and arguing the fee request, however, finding her earlier fee award covered only the contempt motions and not the subsequent fee motion.
Judge Mastroianni granted Hobbs’ request for attorney’s fees pursuant to 35 U.S.C. § 285, finding the case to be exceptional. Judge Mastroianni dismissed the complaint for failing to provide sufficient factual detail or legal underpinning to state a claim on which relief could be granted. The complaint, which had already been amended once, failed to specify which products were accused of infringement, and failed to describe how any products infringed the patents, and was dismissed with prejudice. Noting that the pleading standards had been established years before the complaint was filed, and that Hobbs had notified Sanderson-MacLeod prior to filing its motion to dismiss of the legal issues it would present, but Sanderson-MacLeod failed to withdraw the complaint or move to further amend. Judge Mastroianni referred he case to Magistrate Judge Robertson to determine the fee award.
Judge Stearns denied Cisco’s motion for attorneys’ fees under § 285. Cisco asserted that the case became exceptional on August 17, 2016, when Egenera, in a parallel IPR proceeding, submitted a declaration from one of its employees stating that he had been erroneously named as an inventor. Egenera removed him as an inventor so that it could rely on an internal document that pre-dated his employment to swear behind a reference. The patent was subsequently invalidated for failure to name all inventors when Judge Stearns construed the claims and determined that the employee had made an inventive contribution. According to Cisco, Egenera at that point had thoroughly reviewed the inventorship issue and should have realized, at least as of the claim construction order, that the employee was improperly removed. While agreeing that Egenera’s investigation was “wanting,” Judge Stearns found that the survival of the inventorship dispute through summary judgment meant that the case did not rise to exceptional.
Cisco’s Bill of Costs was denied in part. He allowed costs related to professionally produced video deposition clips and trial demonstratives, noting that the prevalence of witness credibility issues necessitated their use, but found the requested amount of $60,341 for a three-day trial excessive by half. He further cut summons and subpoena costs to eliminate the excess fees charged for emergency or urgent service.
This is the second case I have seen in recent days in which exceptionality was tied to amenability to summary judgment – Judge Saylor denied a request for fees because the plaintiff had not sought summary judgment. I do not that the grant of summary judgment does not automatically result in a finding of exceptionality, however, and hope that this recent small trend does not become a de facto precedent for the award of attorneys’ fees, as I can envision cases that, while having issues of fact in dispute, still rise to the level of exceptionality, and would hate to see arguments to that effect precluded.
Judge Casper awarded Sophos $1,404,949.50 in attorneys fees. She had previously granted Sophos summary judgment of invalidity, and had determined that this was an exceptional case meriting an award of reasonable fees. Here, she determined that the hours and rates sought were reasonable, but that some small degree of block billing occurred, meriting a reduction of 10% but not the substantial reduction sought by RPost. She rejected RPost’s argument that the $1.56 million sought was excessive –RPost’s damages demand, together with the amount of discovery, expert discovery and motion practice, framed the potential stakes and demands for legal work, regardless of Sophos’ belief in the viability of the damages demand.
Having previously granted summary judgment in favor of Defendants and having determined that the case was exceptional and that Defendants were entitled to their reasonable attorney’s fees under 25 U.S.C. § 1117(a), Judge Casper ordered Plaintiffs to pay $153,820.35 in fees. Relying on the opinion of lead counsel, a 2013 Massachusetts Lawyers Weekly article on average rates in Boston, and the approval (over no objection) of the rates sought in earlier discovery proceedings between the parties before Magistrate Judge Kelley, Judge Casper approved of rates of $590-$600 for partners, $290-$465 for associates, and $100-$250 for paralegals. She did reduce the total fees sought by 10% due to some block billing that did not divide out time spent on particular tasks, but otherwise rejected Plaintiffs’ objections to the amount sought.
Judge Casper granted Defendants’ renewed motion for attorneys fees, finding the case exceptional under 35 U.S.C. § 1117(a), which allows for the award of fees to the prevailing party in exceptional cases. She had previously granted summary judgment in favor of the Defendants on all issues. Judge Casper, applying the Supreme Court’s 2014 Octane Fitness guidance in the analysis of whether a patent case is “exceptional” pursuant to 35 U.S.C. § 285, found that sanctions had already been imposed on the Plaintiff for their litigation conduct, repeatedly failed to meet court-imposed deadlines, submitted filings that failed to provide sufficient support for their positions, and otherwise engaging in unreasonable conduct. Moreover, she determined that the plaintiffs’ substantive positions following the completion of discovery were weak and that they failed to produce any evidence of damages. Judge Casper found that Defendants need to be compensated for discovery-related motion practice and for prolonging litigation after discovery through summary judgment. She ordered Defendant to submit its request for fees from the denial of their motion to dismiss forward, excluding fees that had already been awarded through discovery sanctions.
Judge Talwani found GeneAlign in default after it failed to respond to Boston Heart Diagnostic’s patent infringement complaint and entered an injunction barring GeneAlign from making, using, selling or offering for sale any SLCO1B1 test. She further awarded BHD costs and fees totaling $15,641.49 after determining, taking the allegations of the complaint as true, that the case was exceptional under 35 U.S.C. § 285.
Following the trial in this case, in which Abhai was found to infringe a pair of Shire’s reissue patents and to have committed litigation misconduct warranting the award of attorneys’ fees (as well as a $30,000 sanction payable to the Court for wasting the Court’s time), Judge Young awarded fees of $1,501,455.32. He cut some time that would have been incurred regardless of the misconduct and for time spent on motions to compel that were not granted, reducing the award by $833k from what Shire had sought. The case will soon be in condition for appeal.
Plaintiffs Richard Goren, a Massachusetts attorney, his company Small Justice LLC, and Christian DuPont had sued defendants Xcentric Ventures, LLC and Ripoff Report.com for copyright infringement, libel, interference with a contract, and violation of Massachusetts’ unfair competition statute. Goren had represented DuPont in an unrelated matter; DuPont had subsequently authored two reports critical of Goren and posted them to Ripoff Report, a “consumer protection” website owned by Xcentric that allows users to post complaints about companies or individuals. As part of the posting process, the user grants Ripoff Report an irrevocable exclusive license to the copyright, and further warns users that, once posted, the post will not be taken down even at the request of the poster. When DuPont failed to appear in the libel suit that resulted, Goren was granted an injunction prohibiting DuPont from publishing the reports, and was awarded ownership of the copyright of the reports. He then filed the suit that is the subject of this appeal, seeking the enjoin Ripoff Report from continuing to post the complaints and to require them to take all actions necessary to have cached versions and links removed from Bing, Google, and Yahoo.
Xcentric moved to dismiss the complaint, which Judge Casper granted in part. Specifically, Judge Casper dismissed the libel, tortious interference, and parts of the unfair competition counts as blocked by the Communications Decency Act, 47 U.S.C. § 230, which shields interactive computer service providers from liability for information provided by another content provider. The court rejected Goren’s argument that, by holding itself out as the copyright holder and by having “directed” internet search engines to list the postings, Ripoff Report itself became the information provider. Following discovery, Judge Casper granted Xcentric summary judgment on the remaining copyright and Ch. 93A claims, finding the “browsewrap” license conclusive on the copyright claims. Judge Casper modified the judgment to find that the browsewrap license failed to meet the requirements of transferring an exclusive copyright license, and that only an irrevocable non-exclusive license had been granted; this distinction did not, however, change the outcome. Finally, Judge Casper awarded $124,000 in fees and costs to Xcentric pursuant to 17 U.S.C. § 505.
The First Circuit Court of Appeals reviewed the dismissal of the libel and tortious interference claims de novo and affirmed. The § 230 immunity is to be liberally construed, to prevent deterrence of on-line speech; so construed, Xcentric could not be considered to be “responsible … for the creation” of the information, and immunity would apply. Continuing to apply de novo review, the Court affirmed the copyright decision, rejecting Goren’s argument that the license “contract” failed because no consideration was given to DuPont – while consideration is necessary to support an irrevocable license, actually posting the complaints was sufficient consideration under the circumstances. Notably, the Court determined that it need not decide whether a browsewrap agreement can satisfy the exclusive license writing requirement of 17 U.S.C. § 204, leaving this issue open in the First Circuit.
The Court reviewed the fee award for abuse of discretion. After quickly dismissing Goren’s contentions that Xcentric was not a prevailing party or that its fee motion was untimely, the Court looked to the Supreme Court’s Fogerty factors in analyzing the decision to award fees – “frivolousness, motivation, objective unreasonableness [both factual and legal] and the need in the particular circumstances to advance considerations of compensation and deterrence.” Characterizing review of the application of these factors as “extremely deferential,”
The Court found no fault with Judge Casper’s characterization of the legal and factual basis for plaintiffs’ claims as “at best questionable,” with its noting that Xcentric fought the case for more than two years without the prospect of a damage award, or with its determination that Xcentric prevailed on all counts. Finally, the Court noted that a showing of bad faith on the plaintiffs’ part is not a requirement for a fee award pursuant to the statute. The fee award was thus affirmed as well.
Judge Zobel entered final judgment in accordance with the December 14, 2016 jury verdict and her April 24, 2017 Order. The final judgment included:
- direct and indirect willful infringement of U.S. Patent 5,229,137;
- ‘137 patent valid over the prior art of record;
- Perrigo was not entitled to a laches defense because plaintiffs knew or should have known of infringement only as of August 2008, too recent for laches to apply;
- Damages of $10,210,071;
- Attorneys’ fees were not awarded, as the defense, while not successful, was not frivolous or vexatious, as Perrigo had investigated infringement and invalidity before filing its ANDA application ad Brigham’s corporate witness testified that it did not immediately bring suit for fear of losing royalties should the claims be found invalid; and
- Enhanced damages would not be applied, despite the jury’s finding of willfulness, in part because the awarded damages were at the high end of those sought.
Judge Zobel’s April order was interesting in that she found that final judgment had previously been entered, triggering the timelines of Fed R. 50(b) and 59(e), which could not be expanded by the district court, despite her having granted a joint motion to extend the deadline. Thus, Perrigo’s renewed motion for judgment as a matter of law was not timely filed, and its notice of appeal was also late.