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Judge Andrews denies motion for attorneys’ fees, grants motion for costs

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Following an appeal from the Federal Circuit, Judge Richard G. Andrews recently denied defendant’s motion for attorneys’ fees and granted defendant’s (“Newegg”) motion for costs in Pragmatus Telecom LLC v. Newegg, Inc., C.A. No. 12-1533-RGA (D. Del. Feb. 18, 2015). As to the motion for attorneys’ fees, Judge Andrews was required to determine whether the case was “exceptional” under 35 U.S.C. § 285. To that end, Judge Andrews first considered whether the case was litigated by plaintiff (“Pragmatus”) in an “unreasonable manner.” Id. at 3-7. Judge Andrews explained that “the core of Newegg’s motion revolves around its argument that this lawsuit was brought ‘for the sole purpose of extracting a nuisance settlement rather than resolving a meritorious claim.’” Id. at 6. Judge Andrews found, however, that “[w]hile Newegg criticizes Pragmatus for bringing suit against customers who use the live chat technology, rather than the suppliers who make and sell the technology, I cannot find this case exceptional simply because Plaintiff did something that is expressly allowed and contemplated by the Patent Act.” Id. Moreover, Judge Andrews noted that “[u]nlike in Monolithic Power or Eon-Net, Newegg does not persuasively point to any recurring patterns in Pragmatus’ litigation conduct, nor to any other aggravating factors-such as false testimony, destruction of evidence, or offensive conduct-that led those courts to find litigation misconduct.” Id. Next, Judge Andrews considered the “substantive strength” of Pragmatus’ litigation position. Id. at 7-10. Among other things, Judge Andrews found that “what is relevant to the present motion is that Newegg’s barebones non-infringement arguments do not come close to demonstrating that Pragmatus’ claims were exceptionally meritless.” Id. at 8. Judge Andrews thus denied Newegg’s motion for attorneys’ fees.

Turning to the motion for costs, Judge Andrews explained that “[t]he Federal Circuit’s decision dictates that Newegg is a prevailing party.” Id. at 10. Finding that “Pragmatus has not set forth any persuasive reason justifying a denial of costs,” Judge Andrews referred the proper calculation of costs to the Clerk of Court. Id.

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