{"id":1634,"date":"2017-07-05T10:56:59","date_gmt":"2017-07-05T14:56:59","guid":{"rendered":"https:\/\/patents.harnessip.com\/?p=1634"},"modified":"2017-07-09T11:56:36","modified_gmt":"2017-07-09T15:56:36","slug":"weak-infringement-position-makes-troll-like-behavior-exceptional","status":"publish","type":"post","link":"https:\/\/patents.harnessip.com\/?p=1634","title":{"rendered":"Weak Infringement Position Makes Troll-like Behavior Exceptional"},"content":{"rendered":"

In Adjustacam LLC v. Newegg, Inc.<\/a>, [2016-1882] (July 5, 2017) the Federal Circuit reversed the district courts decision not to award attorneys’ fees to defendant after plaintiff voluntarily dismissing its complaint after a Markman hearing.<\/p>\n

AdjustaCam sued a large number of defendants\u00a0for patent infringement, voluntarily dismissing most defendants early in the litigation. \u00a0The case against Newegg went through a\u00a0Markman order and extended expert discovery. \u00a0However just before summary judgment briefing, AdjustaCam
\nvoluntarily dismissed its infringement claims against
\nNewegg with prejudice. Newegg then filed a motion for
\nattorneys\u2019 fees. The district court initially denied Newegg\u2019s motion,
\nand Newegg appealed to Federal Circuit, which remanded in view of Octane Fitness. \u00a0On remand the district court again denied attorneys fees.<\/p>\n

A district court abuses its discretion when its\u00a0ruling rests on an erroneous legal conclusion or on a\u00a0clearly erroneous assessment of the evidence. \u00a0The Federal Circuit held that the district court abused its discretion
\nby not awarding fees to Newegg for two independent\u00a0reasons: (1) it failed to follow the Federal Circuit’s mandate on remand;\u00a0and (2) its decision was based on \u201ca clearly erroneous\u00a0assessment of the evidence.\u201d<\/p>\n

As to the first reason, the Federal Circuit said that the district court erred by ignoring our mandate \u201cto\u00a0evaluate whether this case is \u2018exceptional\u2019 under the\u00a0totality of the circumstances and a lower burden of proof\u201d
\nin the first instance. \u00a0Instead of engaging in an independent analysis, the
\ndistrict court adopted the previous judge\u2019s factual findings\u00a0wholesale, the Federal Circuit noting that the entirety of the court\u2019s\u00a0analysis based on those adopted fact-findings consists of\u00a0three sentences. This wholesale\u00a0reliance on the previous judge\u2019s fact finding was
\nan abuse of discretion.<\/p>\n

As to the second reason, the Federal Circuit found that the record developed over the past five years points to\u00a0this case as standing out from others with respect to the\u00a0substantive strength of AdjustaCam\u2019s litigating position. \u00a0While the infringement claim may have been weak at the time of filing,\u00a0after the district court\u2019s Markman order,\u00a0the lawsuit was baseless. \u00a0The Federal Circuit found that\u00a0no reasonable\u00a0factfinder could conclude that Newegg\u2019s products infringe;\u00a0therefore, AdjustaCam\u2019s litigation position was baseless, and the district court’s conclusion otherwise was clearly erroneous. \u00a0The Federal Circuit further found that\u00a0AdjustaCam litigated the case in an \u201cunreasonable manner.\u201d \u00a0The Federal Circuit also noted that\u00a0AdjustaCam relied upon a supplemental declaration making\u00a0new infringement arguments executed two years after the initial fees determination, although the Federal Circuit did not appear to consider that the standard for award of fees changed in the intervening two years.<\/p>\n

The Federal Circuit concluded that the totality of the circumstances demonstrates other dubious\u00a0behavior that, when considered collectively, warrants fees\u00a0under \u00a7 285.<\/p>\n

The Federal Circuit specifically commented on AdjustaCam’s damages model. \u00a0While\u00a0asserting seemingly low damages\u00a0against multiple defendants\u2014or settling with defendants\u00a0for less than the cost of litigation\u2014does not necessarily\u00a0make a case \u201cexceptional\u201d under \u00a7 285, asserting nuisance-value damages against many\u00a0defendants, settled with them for widely varied royalty\u00a0rates, and<\/em> continuing to press baseless infringement
\ncontentions well past an adverse Markman<\/em> order and\u00a0expert discovery as enough to tip the balance in favor of exceptionality.<\/p>\n","protected":false},"excerpt":{"rendered":"

In Adjustacam LLC v. Newegg, Inc., [2016-1882] (July 5, 2017) the Federal Circuit reversed the district courts decision not to award attorneys’ fees to defendant after plaintiff voluntarily dismissing its complaint after a Markman hearing. AdjustaCam sued a large number … Continue reading →<\/span><\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[44],"tags":[],"class_list":["post-1634","post","type-post","status-publish","format-standard","hentry","category-attorneys-fees"],"post_mailing_queue_ids":[],"_links":{"self":[{"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=\/wp\/v2\/posts\/1634","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=1634"}],"version-history":[{"count":1,"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=\/wp\/v2\/posts\/1634\/revisions"}],"predecessor-version":[{"id":1635,"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=\/wp\/v2\/posts\/1634\/revisions\/1635"}],"wp:attachment":[{"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=1634"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=1634"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=1634"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}