April 14 --As the Supreme Court deliberates whether the U.S. Court of Appeals
for the Federal Circuit has set too high a standard for awarding attorneys'
fees to patent infringement case defendants, the appeals court affirmed a
$360,000 award on April 11 in a nonprecedential opinion.
The high court
heard oral argument on Feb. 26 on both its standard for finding an
“exceptional” patent case, under 35 U.S.C. §285--particularly the requirement
to prove the objective unreasonableness of a purported “frivolous” argument--as
well as the court's lack of deference to district court findings (39 PTD,
Cartner, president of Motrim
Inc., is the listed inventor on a patent (U.S. Patent No. 5,197,284) on a
hydraulic motor deceleration system used in large scale mowing machines. To
overcome an examiner's initial rejection based on a patent (No. 4,732,076)
granted to Roland Ewald, Cartner added a limitation requiring deceleration
“without a loss of fluid.”
Group Inc. markets the Tiger and Alamo mowers. Cartner sued Alamo for
patent infringement in May 2007 in the U.S. District Court for the Northern
District of Ohio. During discovery, Alamo submitted a copy of the Tiger mower
schematics which, Cartner agreed, depicted a system similar to Ewald with
respect to the loss of fluid.
The court construed that and other key
terms, after which Cartner stipulated to patent invalidity for lack of written
description. In June 2009, the Federal Circuit modified the construction of
“control orifice” on appeal and remanded the invalidity judgment. 333 Fed.
App'x 565, 2009 BL 129713 (Fed. Cir. 2009).
On remand, the parties
resumed discovery with respect to infringement, but in January 2010, Cartner
initiated a consent judgment of noninfringement, which the court entered two
Judge Lesley Brooks Wells then granted Alamo's motion to
declare this an exceptional case, but rejected the call to award fees going
back to the date when it supplied the schematics to Cartner. Both parties
The Federal Circuit
agreed with the decision to declare this an exceptional case and with the date
The court held that Cartner's arguments were frivolous to
the extent that he continued the claim of infringement after decisions on three
claim terms, not including “control orifice.” In particular, the court rejected
Cartner's contention that there were certain brief moments when the Alamo
devices would not lose fluid when, by the same argument, the Ewald patented
device would perform the same way.
Cartner also argued that he
maintained a claim that the mowers infringed under the doctrine of equivalents,
but he never put forth a related theory at any time, including when Alamo asked
in an interrogatory for a description of “how the asserted patent claims apply
or correspond to each Accused Product.”
The court said, “This language
is best interpreted to require disclosure of all theories of infringement,
including whether infringement is under the doctrine of equivalents.” Cartner's
“bad faith conduct” as to this argument, added to frivolous arguments on
literal infringement, led the court to affirm the exceptional case
As to award
accrual timing, the district court determined that the day of the remand of the
first appeal was “the earliest date upon which issues of claim construction had
been resolved.” The appeals court agreed.
For one, the “without a loss
of fluid” limitation was the only one addressed by the earlier supplied
schematics, and that applied to the Tiger mowers only.
Also, the court
said, Cartner's first appeal was successful as to his case for patent validity.
For that part of the case, the court said, “It would be error to require
Cartner to pay Alamo's attorney fees and costs for litigating an appeal in
which Cartner prevailed.”
“The district court's award of $358,516.44
properly reflects the 'extra legal effort' Alamo had to expend to
'counterract [Cartner's] misconduct,” the court said in conclusion.
Judge Evan J. Wallach wrote the court's opinion, joined by Judges Timothy B.
Dyk and Kimberly A. Moore.
Philip J. Moy Jr. of Fay Sharpe LLP,
Cleveland, represented Cartner. Bryan A. Schwartz of Benesch, Friedlander,
Coplan & Aronoff LLP, Cleveland, represented Alamo.
Text is available at http://pub.bna.com/ptcj/13129314Apr11.PDF.
contact the reporter on this story: Tony Dutra in Washington at email@example.com
To contact the editor responsible
for this story: Naresh Sritharan at firstname.lastname@example.org
To view additional stories from Patent, Trademark &
Copyright Law Daily™ register for a free trial now
SIGN UP FOR OUR FREE NEWSLETTERS >>>>