Judge Andrews Clarifies Specifics of Fee Award under Section 285

July 12, 2016

Publication| Intellectual Property

In Vehicle Interface Technologies, LLC v. Jaguar Land Rover North America, LLC, C.A. No. 12-1285-RGA (D. Del. June 15, 2016), Judge Andrews analyzed the total fee amount requested by the prevailing party, Jaguar (whom he already determined was entitled to fees under 35 U.S.C. § 285), in light of the following five objections raised by Vehicle Interface (“VIT”): (1) fees incurred before Jaguar’s filing of summary judgment should not be recovered; (2) the fees should be limited to the forum rate; (3) the fees are unreasonable and include unrecoverable amounts; (4) recovery of costs is not authorized under Section 285; and (5) recovery of expert fees is not authorized under Section 285.

First, Judge Andrews clarified that “fees are appropriate from the date VIT had full notice that its case was objectively baseless.” Jaguar argued that VIT was on full notice when served with Jaguar’s initial invalidity contentions; VIT argued that full notice did not occur until Jaguar filed for summary judgment. Judge Andrews found that, despite VIT’s arguments that the invalidating reference had “no greater prominence than the other references” in the initial invalidity contentions, the initial invalidity contentions contained enough detail to put VIT on full notice. However, Judge Andrews allowed a grace period from when fees would be shifted, stating, “Jaguar is not entitled to fees from the date of service of Defendants’ invalidity contentions because the [prior art] was one anticipatory reference identified along with sixteen others in nearly 500 pages of contentions. VIT could not have been expected to dismiss the case until it had a reasonable opportunity to read and evaluate Defendants’ contentions.” Judge Andrews found that Jaguar had not met its burden to support any date sooner than October 4, 2014—the day after summary judgment briefs were filed—and thus, this date was chosen as the starting date for recovery. Judge Andrews also awarded fees from the appeal—which relied on the same unmeritorious arguments.

Next, Judge Andrews responded to the second objection by requiring that the out-of-state counsel fees be reduced to prevailing rates for Delaware intellectual property attorneys. Third, Judge Andrews allowed recovery for unsuccessful motions and found that the claimed attorney hours were reasonably expended. Fourth, the court found that “expenses” were permitted under Section 285 and that Jaguar’s request included recoverable expenses. Finally, Judge Andrews clarified that expert fees are not recoverable under Section 285, but could be imposed through the court’s inherent power to sanction. Judge Andrews ultimately declined to utilize that power.

Analysis: Throughout his decision, Judge Andrews carefully addressed the objections raised to a prevailing party’s fee request by looking closely at the line items and invoking his understanding of litigation in the District of Delaware. Rather than setting a number himself, he required that the prevailing party submit a proposal to opposing counsel (with support) so that the parties could meet and confer on a proposed order for the court. He did provide a mechanism should the meet and confer fail: letter briefing of three pages per side.

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