United States District Court, D. Delaware
Stephen B. Brauerman and Sara E. Bussiere, BAY ARD, P.A.,
Wilmington, DE Alfred. R. Fabricant, Lawrence C. Drucker, and
Vincent J. Rubino, III, BROWN RUDNICK, LLP, New York, NY
Attorneys for Plaintiffs
D. Smith II and Michael J. Flynn, MORRJS, NICHOLS, ARSHT
& TUNNELL LLP, Wilmington, DE Michael Levin, WILSON
SONSINI GOODRICH & ROSATI PC, Palo Alto, CA Edward G.
Poplawski and Olivia M. Kim, WILSON SONSINI GOODRICH, Los
Angeles, CA Attorneys for Defendants Bloomberg L.P.,
Bloomberg Finance L.P., The Charles Schwab Corporation, and
Charles Schwab & Co., Inc.
E. Moore, Bindu A. Palapura, and Stephanie E. O'Byme,
POTTER ANDERSON & CORROON LLP, Wilmington, DE Robert S.
Mallin, BRINKS GILSON & LIONE, Chicago, IL Attorneys for
Defendant Interactive Data Corporation
U.S. District Judge
before the Court is Defendants Bloomberg L.P. and Bloomberg
Finance L.P. ("Bloomberg"), Interactive Data
Corporation ("IDC"), and The Charles Schwab Corp.
and Charles Schwab and Co.'s ("Charles Schwab")
(collectively "Defendants") renewed motion to
declare this case exceptional and for attorneys' fees
pursuant to 35 U.S.C. § 285. (D.I. 248) On April 29,
2014, Plaintiff Quest Licensing Corp. ("Quest" or
"Plaintiff) sued Defendants, alleging infringement of
U.S. Patent No. 7, 194, 468 ("the '468
patent"). (D.I. I)
asserted claims of the '468 patent include the following
limitation (or one similar to it): "[a]pparatus for
supplying to interested subscribers via a mobile
telecommunications network changing price
information for a plurality of different sets of
financial market data" (emphasis added). The Court
construed "changing [price] information" to mean
"only [price] data that has changed."
(D.I. 138 at 1) (emphasis added) In doing so, the Court
The plaintiff seeks plain and ordinary meaning, or
"information subject to change over the course of a
period of time." The court rejects this definition for
two reasons. First, as the defendants note, the specification
emphasizes conservation of bandwidth as central to this
invention. See 468 patent at 1:23-27. By sending
updates that include only changed information, the system can
accomplish this goal. 468 patent at 2:29-39, 13:18-23.
Second, the plaintiffs own statements to the Patent Trial and
Appeal Board ("PTAB") support the defendants'
construction. In its Preliminary Response to the Covered
Business Method Patent Review ("CBMR"), the
plaintiff stated that the "claims also provide for an
apparatus whereby only changed
information of interest to the subscriber is sent to that
subscriber's mobile device." (D.I. 123 at ASS
(emphasis in original).) The court declines to construe this
term inconsistently with the explanation the patent owner
provided to the PTAB.
(D.I. 138 at 1 n.2)
the Court granted Defendants' request to file a motion
for summary judgment of non-infringement (D.I. 191) and then,
after briefing (D.I. 194, 207, 208) and a hearing (D.I. 217),
granted the summary judgment motion (D.I. 222). The Court
then denied without prejudice Defendants' first motion
for attorneys' fees. (D.I. 246) The Federal Circuit
affirmed the Court's summary judgment order on June 8,
2018 (D.I. 247) and Defendants renewed their motion for
attorneys' fees on August 8, 2018 (D.I. 248). Briefing
was completed on September 7, 2018. (See D.I. 249;
D.I. 253; D.I. 255) On September 12, 2018, the case was
reassigned from the now-retired Honorable Gregory M. Sleet.
"exceptional" patent cases, a Court may award
"reasonable attorney fees" to the "prevailing
party." 35 U.S.C. § 285. Federal Circuit law
applies when interpreting and applying § 285. See
Highway Equip. Co. v. FECO, Ltd., 469 F.3d 1027, 1032
(Fed. Cir. 2006). "An exceptional case under § 285
is 'simply one that stands out from others with respect
to the substantive strength of a party's litigating
position (considering both the governing law and the facts of
the case) or the unreasonable manner in which the case was
litigated.'" Nova Chems. Corp. (Canada) v. Dow
Chem. Co., 856 F.3d 1012, 1016 (Fed. Cir. 2017) (quoting
Octane Fitness, LLC v. ICON Health & Fitness,
Inc., 134 S.Ct. 1749, 1756 (2014)). "While an
adverse claim construction generally cannot, alone, form the
basis for an exceptional case finding, ... a party cannot
assert baseless infringement claims and must continually
assess the soundness of pending infringement claims,
especially after an adverse claim construction."
Taurus IP, LLC v. Daimler Chrysler Corp., 726 F.3d
1306, 1329 (Fed. Cir. 2013). Ultimately, the Court must make
a discretionary decision based on the totality of
circumstances, which may include factors such as
"frivolousness, motivation, objective unreasonableness
(both in the factual and legal components of the case) and
the need in particular circumstances to advance
considerations of compensation and deterrence."
Octane Fitness, 134 S.Ct. at 1756 & n.6. A party
moving for attorneys' fees must demonstrate, by a
preponderance of the evidence, that a case is
exceptional." Id. at 1758.
is no dispute that Defendants are the prevailing parties. The
Court granted Defendants summary judgment of noninfringement,
writing that Plaintiffs' argument "flies directly in
the face of the court's claim construction." (D.I.
221 at 5-6) The Court found that Plaintiffs'
non-infringement position was essentially an effort to
relitigate claim construction and did not present any genuine
disputes of material fact. (See Id. at 6-8) The
Federal Circuit affirmed without opinion pursuant to Federal
Circuit Rule 36. (D.I. 249 at 1)
cite several reasons for why this case "stands out"
and should be deemed exceptional. Their principal contention
is that Plaintiffs infringement claims became
"exceptionally meritless" after the Court issued
its claim construction order in March 2016, yet Plaintiff
continued to litigate - driving up Defendants' costs and
wasting judicial resources - despite knowing it could not
prevail. After the claim construction order, Defendants
repeatedly advised Plaintiff that, based on the undisputed
manner in which their accused systems operated combined with
Plaintiffs prior statements about the scope of their patents,
Plaintiff should drop its claims (or agree to a stipulated
judgment to allow an appeal) and, if Plaintiff refused,
Defendants would seek their attorneys'
fees. Defendants add that Plaintiffs continued
pursuit of claims it knew to be meritless demonstrates
subjective bad faith. Finally, Defendants assert that
Plaintiff was motivated by financial difficulties, which
posed a threat to Plaintiffs ability to remain an operating
entity, as is highlighted by the purportedly outrageous,
unjustifiable settlement demands Plaintiff made.
are certainly grounds here on which a reasonable judge might
deem this case to be exceptional. Once the Court issued its
claim construction order, Plaintiffs likelihood of prevailing
on infringement was reduced quite
substantially. This reality is evident not just in
Defendants' repeated statements to Plaintiff to this
effect but, more importantly, by Defendants' success in
persuading Judge Sleet to permit them to file a motion for
summary judgment of non-infringement. On November 15, 2016,
Judge Sleet concluded that "[D]efendants have set forth
a compelling argument for non-infringement based on the
court's construction of the term 'changing
information.'" (D.I. 191 at 2) As Defendants observe
(without dispute from Plaintiff): "it was a rare event
for this Court [i.e., Judge Sleet] to even grant permission
to engage in summary judgment practice and to have a ...