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Black & Decker Inc. v. Robert Bosch Tool Corp.

November 20, 2006

BLACK & DECKER INC. AND BLACK & DECKER (U.S.) INC., PLAINTIFFS,
v.
ROBERT BOSCH TOOL CORPORATION, DEFENDANT.



The opinion of the court was delivered by: Amy J. St. Eve, District Court Judge

MEMORANDUM OPINION AND ORDER

Plaintiffs Black & Decker Inc. and Black & Decker (U.S.) Inc. (collectively "Black & Decker") brought this lawsuit against Defendant Robert Bosch Tool Corporation ("Bosch") alleging infringement of various claims of U.S. Patent Nos. 6,308,059 (the "'059 patent") and 6,788,925 (the "'925 patent"). On September 22, 2006, a jury returned a verdict finding that the Bosch Power Box radio chargers at issue infringed certain claims of both patents-in-suit and awarded Black & Decker $1,300,000 for lost profits and $450,000 as a reasonable royalty. The jury also found that Bosch's infringement was willful. As the prevailing party, Black & Decker brings the present motions for attorney's fees, to amend the judgment to award enhanced damages, and prejudgment interest pursuant to 35 U.S.C. §§ 284, 285. For the following reasons, the Court denies Black & Decker's motion for attorney's fees under 35 U.S.C. § 285. The Court grants Black & Decker's motions under 35 U.S.C. § 284, enhancing Black & Decker's compensatory damages by 50 percent or $875,000, and awarding prejudgment interest in the amount of $132,447.

ANALYSIS

I. Attorney's Fees -- 35 U.S.C. § 285

A. Legal Standard

Section 285 of the Patent Act is an exception to the "American Rule" in which each party pays its own attorney's fees and expenses. Forest Labs., Inc. v. Abbott Labs., 339 F.3d 1324, 1329 (Fed. Cir. 2003); Mathis v. Spears, 857 F.2d 749, 758 (Fed. Cir. 1988) ("Congress enacted Section 285 to codify in patent cases the 'bad faith' equitable exception to the American Rule.") Based on the legislative history of Section 285, fee-shifting is "limited to circumstances in which it is necessary to prevent 'a gross injustice.'" Forest Labs., 339 F.3d at 1329(citing Mach. Corp. of Am. v. Gullfiber AB, 774 F.2d 467, 472 (Fed. Cir. 1985) (quoting S.Rep. No. 79-1503 (1946))). "Recognizing the good faith/bad faith distinction, Congress expressly limited such awards to 'exceptional cases.'" Mathis, 857 F.2d at 758.

Awarding attorney's fees pursuant to 35 U.S.C. § 285 is a two-step process. Perricone v. Medicis Pharm. Corp., 432 F.3d 1368, 1380 (Fed. Cir. 2005). First, the Court must determine whether Black & Decker has established that this is "an exceptional case" by clear and convincing evidence. Id.; Ruiz v. A.B. Chance Co., 234 F.3d 654, 669 (Fed. Cir. 2000). "Exceptional cases usually feature some material, inappropriate conduct related to the matter in litigation, such as willful infringement, fraud or inequitable conduct in procuring the patent, misconduct during litigation, vexatious or unjustified litigation, conduct that violates Federal Rule of Civil Procedure 11, or like infractions." Serio-US Indus. v. Plastic Recovery Techs. Corp., 459 F.3d 1311, 1321-22 (Fed. Cir. 2006).

If Black & Decker establishes that this case is exceptional, the Court then determines whether an award of attorney's fees is appropriate under the circumstances. See Perricone, 432 F.3d at 1380; see also Group One, Ltd. v. Hallmark Cards, Inc., 407 F.3d 1297, 1308 (Fed. Cir. 2005) ("court is not required to award attorney fees, even when there is an express finding of willful infringement"). More specifically, the decision to award attorney's fees is discretionary, permitting "the judge to weigh intangible as well as tangible factors: the degree of culpability of the infringer, the closeness of the question, litigation behavior, and any other factors whereby fee shifting may serve as an instrument of justice." Serio-US Indus., 459 F.3d at 1322 (citation omitted).

The jury's finding of willfulness satisfies Black & Decker's burden in establishing that this case is "exceptional" under the first step of the attorney's fees analysis. See Group One, Ltd., 407 F.3d at 1308 ("express finding of willful infringement is a sufficient basis for classifying a case as "exceptional"). The Court thus turns to the discretionary criteria to determine whether attorney's fees are warranted under the circumstances. See Serio-US Indus., 459 F.3d at 1322; see also Juicy Whip, Inc. v. Orange Bang, Inc., 382 F.3d 1367, 1377 (Fed. Cir. 2004) ("A decision to award enhanced damages and attorney fees is one committed to the discretion of the trial court.").

B. Black & Decker's Arguments in Support of Attorney's Fees

Black & Decker contends that Bosch's misconduct supports an award of attorney's fees under Section 285. See nCube Corp. v. Seachange Int'l, Inc., 436 F.3d 1317, 1319 (Fed. Cir. 2006) (litigation misconduct and unprofessional behavior appropriate criteria to consider when determining attorney's fees). The Federal Circuit explains proper attorney conduct in patent litigation:

An attorney's obligations to provide zealous advocacy on behalf of his client are not absolute and uncompromising, but must be viewed in light of his additional obligations as an officer of the court to promote the administration of justice and to comply with the court's rules, notices, and orders. Additionally, as with his obligations to his client, the attorney's obligations to the court are ongoing at every stage of the litigation and the attorney must continually reevaluate the positions advanced in light of both the development of the litigation itself and of the relevant case law affecting the litigation.

Allen Eng'g Corp. v. Bartell Indus., 299 F.3d 1336, 1356 (Fed. Cir. 2002) (quoting In re Solerwitz, 848 F.2d 1573, 1577 (Fed. Cir. 1988)). Further, "[c]counsel must remember that they are not only advocates for their clients; they are also officers of the court and are expected to assist the court in the administration of justice, particularly in difficult cases involving complex issues of law and technology." Allen Eng'g Corp., 299 F.3d at 1356. In the context of Section 285 motions, it is the Court's "duty to refuse to condone behavior that exceeds reasonable litigation tactics." Sensonics, Inc. v. Aerosonic Corp., 81 F.3d 1566, 1575 (Fed. Cir. 1996). That being said, "the [C]court may consider the litigation actions of both sides in connection with § 285." Id.

1. Bosch's Pre-Trial Conduct

a. Discovery Disputes

Black & Decker lists certain discovery disputes to support its argument that Bosch engaged in misconduct in defending against this infringement action. Although these disputes show that the litigation was contentious, they do not support the conclusion that Bosch engaged in misconduct during discovery or that Bosch's pre-trial conduct warrants the award of attorney's fees. See FieldTurf Intern., Inc. v. Sprinturf, Inc., 433 F.3d 1366, 1373 (Fed. Cir. 2006) (egregious conduct required to support fee-shifting).

For instance, Bosch filed an untimely discovery response, attempted to bring a defense based on 35 U.S.C. §102(f) after the close of discovery, and may have asked a deponent improper questions. Black & Decker, on the other hand, acted similarly when it attempted to include a new version of the Power Box radio charger, the PB-10 Advanced, as an accused product and tried to offer new opinions of its expert, Andrew J. Neuhalfen, after the close of discovery. Because Black & Decker's own litigation conduct is a factor that the Court may consider in awarding attorney's fees, Bosch's pre-trial conduct is offset by Black & Decker's similar actions. See Motorola, Inc. v. Interdigital Tech. Corp., 121 F.3d 1461, 1468 (Fed. Cir. 1997).

b. Bosch's Contact with John Mizzi

Black & Decker also argues that Bosch's attorneys engaged in misconduct by misleading John Mizzi -- an individual who may have been a co-inventor to the patents-in-suit -- when Bosch contacted Mizzi during discovery. When Bosch contacted Mizzi, he as not an adverse party to this case, he had never been an employee of Black & Decker, and he was not a fact or expert witness for Black & Decker. Black & Decker nonetheless argues that an email from Bosch's counsel to Mizzi concerning Mizzi's inventions shows that Bosch's counsel lied about how they discovered Mizzi. Black & Decker, however, ignores the fact that counsel was trying to locate Mizzi after discovering Mizzi's name from Black & Decker's documents obtained during discovery. Further, Black & Decker argues that Bosch's counsel operated a "bait and switch" to induce Mizzi to talk to him by indicating that counsel was interested in licensing Mizzi's patents. Black & Decker's assertion is based on Mizzi's testimony in which Mizzi believed that counsel wanted to license his patents after Mizzi discovered that counsel practiced at a patent law firm. These factors do not warrant attorneys' fees.

2. Bosch's Conduct at Trial

Black & Decker also argues that Bosch's misconduct during trial supports an award for attorney's fees under Section 285. Black & Decker lists a number of incidences in support of its argument, which the Court addresses in turn.

a. Potter's Testimony

Black & Decker contends that Bosch's motion to strike certain testimony given by its Rule 30(b)(6) witness, Christine Potter, evidences Bosch's misconduct at trial. Specifically, Bosch made several objections to Potter's testimony about copying, to which the Court overruled based on its relevance to questions of willfulness and non-obviousness. Despite the Court's ruling, Bosch filed a bench memorandum seeking to strike Potter's testimony. In its memorandum, Bosch fleshed out the objections it made in court. Although the Court denied Bosch's request to strike Potter's testimony, Bosch's attempt to explain its objections is not a sufficient basis for the Court to award attorney's fees under the circumstances. See FieldTurf Intern., 433 F.3d at 1373.

b. Cheung's Opinion Testimony

Next, Black & Decker argues that Bosch's bench memorandum concerning the expert testimony of Thompson Cheung was improper. To recap, the Court concluded that Cheung could not testify as an expert because Cheung had not provided an expert report and Bosch did not make him available for a deposition. Despite the Court's order, Bosch's counsel attempted to elicit expert testimony from Cheung during trial. Black & Decker, however, similarly attempted to elicit trial testimony in violation of a court order. More specifically, in a motion in limine, the Court precluded Black & Decker's technical expert from opining that the Power Box met a certain claim limitation, yet on two separate occasions, Black & Decker's counsel attempted to ...


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