In Pragmatus Telecom LLC v. Newegg Inc., C.A. No. 12-1533-RGA (D. Del. July 25, 2014), Judge Richard G. Andrews denied defendant’s motion for attorney’s fees and costs, which defendant filed following plaintiff’s unopposed motion to dismiss pursuant to Fed. R. Civ. P. 41(a)(2). Judge Andrews explained that attorney’s fees may be awarded only to a “prevailing party” pursuant to 35 U.S.C. § 285, and that under Supreme Court and Federal Circuit precedent, a party must “win a dispute within the case in favor of it that materially alters the legal relationship between the parties at the time of the judgment” to be considered a “prevailing party.” Id. at 4.
Judge Andrews concluded that defendant could not be considered the prevailing party, and therefore denied its motion for attorney’s fees under § 285: “I have made no finding regarding any substantive issue in the case. I have not construed any terms, resolved a contested motion to dismiss, or resolved any motions for summary judgment. Discovery was ongoing when the case was dismissed. Furthermore, unlike in Highway Equip., where there was no reason given for the motion to dismiss, here the unopposed motion to dismiss states that it is a result of a licensing agreement with Moxie Software, Inc. and LivePerson, Inc., the two companies that provide the live chat software to [defendant].” Id. at 5. Judge Andrews went on to note that “[i]f there were a prevailing party, it would seem that it would more likely be [plaintiff], as [plaintiff] filed suit because it believed that its patent was infringed, and as a result, in part because of the suit, [plaintiff] was able to negotiate a license covering potential infringement of its asserted patent.” Id. at 6. Given that defendant could not be considered a “prevailing party” Judge Andrews also denied defendant’s motion for costs, as a requirement of both Fed. R. Civ. P. 54(d)(1) and Local Rule 54.1(a)(1) is that for a party to be awarded costs, it must be a “prevailing party.” Id. at 8.