Judge Sleet Denies Motion to Dismiss and Comments on Defendants’ Frustrated Attempt to Collect Fees

March 17, 2016

Publication| Intellectual Property

In f’real Foods LLC v. Hamilton Beach Brands Inc. et al., C.A. No. 14-1270-GMS (D. Del. Feb. 26, 2016), Judge Sleet granted the plaintiff’s motion for voluntary dismissal of counts I-IV in the underlying complaint, and denied the defendants’ motion for partial dismissal for lack of standing.

Over a year into this patent infringement action, the defendants in the case learned that the plaintiffs had assigned the patents-in-suit to a third party. In light of the standing ramifications arising from this discovery, the parties met in an attempt to resolve the issue per the Court’s order. Nonetheless, the parties were unable to agree on a procedure to dismiss the case, as the defendants held-out for attorneys’ fees. The defendants pointed to the plaintiff’s conduct that prevented timely discovery of the standing issue and the resulting financial injury caused to the defendants by having to litigate the matter.

Although the Court granted the defendants’ request to submit a motion to dismiss, the plaintiffs filed a motion for voluntary dismissal on their own. When the defendants subsequently submitted their motion to dismiss to the Court, they requested that the Court grant the motion “so that Defendants, as the prevailing party, can move for their costs and attorneys’ fees.” In a footnote to the order, Judge Sleet noted that the defendants’ attempts to seek costs and attorneys’ fees, as highlighted in their motion to dismiss for lack of standing, “is frankly a waste of the court’s time,” as the dismissal of a complaint on jurisdictional grounds fails to designate the defendants as the “prevailing party” for attorneys’ fee purposes.

Analysis: In certain cases, defendants cannot obtain attorneys’ fees as the prevailing party on a motion to dismiss for lack of jurisdiction.

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