We’ve written before about the high cost of patent litigation (e.g. here and here). Not much has changed in that regard. But the Supreme Court’s 2014 decision in Octane Fitness, LLC v. Icon Fitness slightly leveled the playing field, particularly for those defending against patent cases that should never have been filed in the first place. Before Octane Fitness, a case was exceptional (under Federal Circuit precedent) only when there was litigation-related misconduct of an ‘independently sanctionable magnitude’, or if the litigation was brought in subjective bad faith.
Octane Fitness was winding through the courts while Dow Agrosciences was putting together its request that the Delaware District Court find Bayer Cropscience’s patent case against it ‘exceptional’ (Bayer Cropscience v. Dow Agrosciences) under Section 285 of the Patent Act (35 U.S.C. 285). Under Section 285, the court has discretion to award the prevailing party its attorneys’ fees if the litigation meets the legal definition of being an ‘exceptional case.’ Dow Agro argued that Bayer’s case was exceptional because Bayer hadn’t done its due diligence and must have known that its case was without merit before filing its complaint. Ultimately, the court found the case exceptional in large part due to Bayer’s stance that it still held rights to the patents even though it had divested its at-issue intellectual property and assets. During the case, that stance was characterized more than once as ‘ridiculous.’
The Court of Appeals for the Federal Circuit affirmed the district court decision in October 2014. That meant that Plaintiff Bayer had to face the possibility of having to pay nearly six million dollars to Dow and it obviously wasn’t happy about that. So, when Dow Agro moved for its attorneys’ fees under Section 285, Bayer fought tooth and nail to have the fees award reduced.
Recently, on June 18, District Court Judge Bumb (D. Delaware) found that Dow Agro’s attorneys’ fees award under 35 U.S.C. 285 should be reduced, but only just a tad (unpublished decision). The district court painstakingly went through all of Dow’s pertinent attorney billing and reduced the attorneys’ fees award to $5,902,590.
Plaintiff Bayer Cropsciences had filed its case against Dow Agro back in March 2012, claiming that Dow infringed a hundred and four claims from seven of Bayer’s patents. The patents at issue were directed to a soybean technology called a “Triple Gene Event”, which makes the plants genetically resistant to herbicides. Bayer’s complaint alleged that Dow Agro’s Enlist E3 product infringed the seven patents at issue.
Dow Agro, on the other hand, argued that its activities didn’t infringe Bayer’s patents and that, in any event, it had a sublicense authorizing its activities. The court agreed with Dow and granted its request for summary judgment in October 2013.
After Dow Agro prevailed in having the case declared exceptional, it submitted its attorney billing invoices to the court pursuant to the standards discussed in Homeland Housewares (Homeland Housewares, LLC v. Sorensen Research & Development Trust, Federal Circuit 2014, non-precedential). Bayer began by objecting to Dow Agro’s request for over $276,000 in attorneys’ fees to prepare a key declaration in the case- “the Peel Declaration.” The court did trim a bit off of the associated attorneys’ fees, but noted that the declaration was a key aspect of the case and that the majority of fees incurred were reasonable.
While it might appear to be simple nitpicking, much of the court’s fee trimming had one thing in common. That one thing was time billed for “attorney review and editing”:
While attorney review and editing are important… …[Bayer] should not have to pay for excessive multiple attorneys’ reviews.
For example, the court trimmed over $45,000 from the cost for preparing Dow Agro’s motion for summary judgment because some of that billing included multiple reviews by many attorneys.
Bayer also argued that it should not have to pay for the mock oral arguments that Dow had carried out to prepare for the real thing. The court found that conducting a mock oral argument- as well as a follow up one to address feedback from the first one- was reasonable because the case was complex. But the court did cut over $45,000 from those fees because it believed that Bayer should not have to pay for more than two of the mock proceedings.
All in all, the court left much of the attorneys’ fees award intact and Bayer still owes Dow Agro almost six million dollars in attorneys’ fees. As was well said by the District Court in the Northern District of California in the Linex Technologies case last year, “[p]atent litigation is a burdensome venture for all parties involved [and] plaintiffs must conduct careful investigation before bringing suit.”
This post is intended to convey general information only and should not be construed as a legal opinion or legal advice. We disclaim liability for any errors or omissions and readers should not take any action that relies upon the information contained herein. Readers should consult their own attorney concerning their own situation and any specific legal questions. The writing herein does not establish any form of attorney-client relationship with us.