{"id":84266,"date":"2017-06-09T07:15:56","date_gmt":"2017-06-09T11:15:56","guid":{"rendered":"https:\/\/ipwatchdog.com\/?p=84266"},"modified":"2017-10-26T15:29:11","modified_gmt":"2017-10-26T19:29:11","slug":"federal-circuit-reverses-remands-district-courts-refusal-award-attorney-fees","status":"publish","type":"post","link":"https:\/\/ipwatchdog.com\/2017\/06\/09\/federal-circuit-reverses-remands-district-courts-refusal-award-attorney-fees\/id=84266\/","title":{"rendered":"Federal Circuit Reverses and Remands District Court\u2019s Refusal to Award Attorney Fees"},"content":{"rendered":"

\"\"Rothschild Connected Devices Innovations, LLC v. Guardian Prot. Servs.<\/u><\/a>, \u00a0(Fed. Cir. June 5, 2017) (Before Prost, C.J., Mayer, and Wallach, J.) (Opinion for the court, Wallach, J.) (Concurring opinion, Mayer, J.)<\/p>\n

This appeal arises from the district court\u2019s refusal to award attorney fees to appellant ADS Security. Rothschild sued ADS for patent infringement of Rothschild\u2019s patent related to a home security system. The suit against ADS was one of over 50 lawsuits asserting on this patent. ADS filed a motion for judgment on the pleadings, alleging that Rothschild\u2019s patent covered patent-ineligible subject matter. ADS sent Rothschild a safe harbor notice under Federal Rule of Procedure 11(c)(2), which would allow Rothschild an opportunity to correct or voluntarily dismiss its pleadings within 21 days before ADS sought sanctions. Rothschild voluntarily dismissed the action, which ADS opposed, cross-moving for attorney fees. In its cross-motion, ADS cited various anticipatory prior art references. The district court granted Rothschild\u2019s motion to dismiss and denied ADS\u2019s cross-motion for attorney fees, finding that Rothschild did not engage in conduct sufficient to make the action exceptional under 35 U.S.C. \u00a7 285. ADS appealed, and the Court reversed and remanded.<\/p>\n

The Court found that the district court abused its discretion for three reasons. The Court\u2019s first reason was the district court’s failure to consider Rothschild\u2019s willful ignorance of prior art. The Court noted the district court\u2019s failure to give proper weight to statements made in Rothschild\u2019s affidavits of counsel. Those affidavits included statements by Rothschild\u2019s counsel asserting its good faith belief that the patent was valid while concurrently admitting that counsel had not reviewed the prior art asserted in the cross-motion. The Court also noted Rothschild\u2019s many assertions of good faith in examining the validity of its patent were unsupported by evidence and conclusory.<\/p>\n

The Court also found that the district court abused its discretion by misjudging Rothschild\u2019s conduct in other litigations. The Court concluded that the district court\u2019s failure to find that Rothschild engaged in vexatious litigation tactics was a clearly erroneous assessment of the evidence. The Court again referred to the district court’s reliance on statements made by Rothschild that held no evidentiary value in supporting the district court\u2019s conclusion that Rothschild\u2019s actions were not unreasonable. Instead, because Rothschild offered no evidence disputing the unreasonableness of its actions, the district court erred in holding Rothschild\u2019s actions were reasonable.<\/p>\n

Finally, the Court found that district court erred when it stated that an award of attorney fees would \u201ccontravene[] the aim of Rule 11[\u2018s] safe-harbor provision.\u201d The Court concluded that whether a party engages in sanctionable activity is not the benchmark for attorney fees, but instead whether the party\u2019s unreasonable conduct is exceptional.<\/p>\n

In concurrence, Judge Mayer agreed with the Court\u2019s opinion but wrote separately to explain that the case did, in fact, present exceptional circumstances warranting an award of attorney fees. Judge Mayer opined that Rothschild\u2019s complaint was \u201cfrivolous on its face\u201d noting Rothschild\u2019s overly broad view of its patent such that its numerous lawsuits were against a wide range of products and the patent\u2019s \u201cpotential to disrupt future innovation\u201d while \u201cits technological contribution is non-existent,\u201d rendering it patent-ineligible.<\/p>\n

When opposing a motion for attorney fees, evidence of a patentee\u2019s frivolous claims and vexatious litigation, including failure to investigate relevant prior art and a pattern of indiscriminate lawsuits, must be rebutted by concrete evidence of reasonableness and good faith. Arguments are not evidence and a district court abuses its discretion by disregarding unrefuted evidence.<\/em><\/p>\n

[Troutman-Ad]<\/p>\n

[Troutman-About]<\/p>\n","protected":false},"excerpt":{"rendered":"

Rothschild sued ADS for patent infringement of Rothschild\u2019s patent related to a home security system. The district court granted Rothschild\u2019s motion to dismiss and denied ADS\u2019s cross-motion for attorney fees, finding that Rothschild did not engage in conduct sufficient to make the action exceptional under 35 U.S.C. \u00a7 285. ADS appealed, and the Court reversed and remanded. The Court found that the district court abused its discretion citing three reasons.<\/p>\n","protected":false},"author":109094,"featured_media":67006,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"content-type":"","footnotes":"","_links_to":"","_links_to_target":""},"categories":[7202,7203,82,228,3],"tags":[1592,553,482,8730,8317,5199,1090,33,107,8742,34,13005],"yst_prominent_words":[],"acf":[],"_links":{"self":[{"href":"https:\/\/ipwatchdog.com\/wp-json\/wp\/v2\/posts\/84266"}],"collection":[{"href":"https:\/\/ipwatchdog.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ipwatchdog.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ipwatchdog.com\/wp-json\/wp\/v2\/users\/109094"}],"replies":[{"embeddable":true,"href":"https:\/\/ipwatchdog.com\/wp-json\/wp\/v2\/comments?post=84266"}],"version-history":[{"count":0,"href":"https:\/\/ipwatchdog.com\/wp-json\/wp\/v2\/posts\/84266\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ipwatchdog.com\/wp-json\/wp\/v2\/media\/67006"}],"wp:attachment":[{"href":"https:\/\/ipwatchdog.com\/wp-json\/wp\/v2\/media?parent=84266"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ipwatchdog.com\/wp-json\/wp\/v2\/categories?post=84266"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ipwatchdog.com\/wp-json\/wp\/v2\/tags?post=84266"},{"taxonomy":"yst_prominent_words","embeddable":true,"href":"https:\/\/ipwatchdog.com\/wp-json\/wp\/v2\/yst_prominent_words?post=84266"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}