Proper Preparation is Key Before Taking Legal Action
Filing a lawsuit that alleges patent infringement is a serious matter. The outcome of the legal action can have significant financial ramifications for both the prevailing party and the losing party. This is why proper preparation is absolutely critical. When a party fails to invest the time to properly prepare, there can be significant legal consequences and remedies that can be levied by a court.
Recoverable Attorney Fees in “Exceptional” Cases
According to 35 U.S.C. § 285, attorney fees can be awarded in “exceptional” patent infringement cases. You may be asking yourself, “what exactly is an exceptional infringement case?” Well, an exceptional case is determined by the court and is typically based on the totality of the circumstances. A patent infringement case can be considered exceptional because of a substantive legal position or because one of the party’s utilized unreasonable litigation tactics. In many instances, courts have awarded attorney fees to a prevailing defendant when the plaintiff was not justified in filing the patent infringement lawsuit in the first place.
An example of a court ordering attorney fees as a result of poor preparation can be found in ThermoLife International LLC v. GNC Corp., 922 F.3d 1347 (Fed.Cir. 2019). In this case, the District Court for the Southern District of California awarded attorney fees to the defendant because the plaintiffs did not adequately investigate the issue of the defendant’s alleged infringement prior to filing the infringement lawsuit.
For context, ThermoLife licensed four patents from Stanford University. The patents covered specific compositions of amino acids. The patents also covered a unique method for using those amino acids that promoted vascular function and improved performance in individuals. Subsequently, ThermoLife alleged that GNC infringed on these patented amino acid compositions and methodology.
Here is the problem – ThermoLife did not conduct the necessary pre-suit investigatory work before taking legal action. In fact, the defendants in the lawsuit went so far as to say that if ThermoLife simply took the time to read the labels on the defendants’ products and performed simple tests, then ThermoLife would have realized that no infringement took place.
A motion for attorney fees was filed pursuant to the aforementioned 35 U.C.S. § 285 and granted by the court. The Federal Circuit determined that ThermoLife failed to conduct an adequate pre-filing investigation which resulted in “objectively unreasonable” allegations of infringement. The court stated that the facts indicated ThermoLife failed to read the defendants’ product labels and or conduct basic testing. The court went further and described the pre-filing investigation of ThermoLife as “severely lacking” which led to the filing “frivolous claims.” ThermoLife appealed the award of attorney fees. However, the Federal Circuit Court of Appeals affirmed the district court’s judgement of attorney fees. Ouch.
The lesson from the ThermoLife case is fairly clear – take the time to conduct a sufficient pre-filing investigation of infringement before deciding to actually move forward with a patent infringement case. If you skimp on the pre-filing investigation, it can come back to haunt you in the form of a large award of attorney fees for opposing counsel.
Need Answers to Questions About Potentially Filing a Patent Lawsuit? Contact the Omni Legal Group Today
If you have questions related to filing a patent lawsuit, whether you have a provisional patent, non-provisional patent, design patent, utility patent, or plant patent application, it is in your best interest to obtain the counsel of a highly reputable patent litigation attorney such as the Omni Legal Group.
Omni Legal Group is a premier Patent, Trademark, and Copyright law firm with offices in Los Angeles, Santa Monica, and Beverly Hills. For further information or to schedule a consultation please contact Omni Legal Group at 855.433.2226 or visit www.OmniLegalGroup.com to learn more.