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CAFC Weekly: January 14, 2011

by Orlando Lopez

This week produced two precedential opinions, one relating to awarding attorneys fees and costs to the prevailing defendant and another relating to whether a federal district court has jurisdiction over a malpractice case arising out of a patent dispute.

In iLor v. Google, iLor owns  a patent for methods “for adding a user selectable function to a hyperlink” and had sued Google for infringement.  The District Court, after interpreting the claim in question, granted summary judgment of non-infringement.  iLor appealed to the CAFC and the CAFC upheld the claim interpretation of the District Court and the judgment of non-infringement. On remand to the District Court, Google asked for and was granted, attorney fees and costs.  iLor again appealed to the CAFC.  The CAFC reversed the grant of attorney’s fees and costs, stating that a reasonable plaintiff could have offered the claim interpretation that ilor offered to show infringement, and that the patent specification or the prosecution history, did not clearly rule out the claim construction offered by iLor.  The CAFC stated that “simply being wrong about claim construction should not subject a party to sanctions where the construction is not objectively baseless.” The CAFC stayed away from the British Rule, where the loser pays the costs and fees.  The CAFC stated that sanctions, due to declaring the case special, require that the prevailing party show by clear and convincing evidence (a higher standard than more likely than not-preponderance of the evidence) that the suit was frivolous.

In Warrior Sports Inc.  v.  Dickinson Wright LLP, Warrior filed a malpractice suit against Dickinson based on a number of errors during patent prosecution, including errors that led to a defense of inequitable conduct in an infringement suit brought by Warrior and failure to pay the maintenance fee for the patents being asserted by Warrior in the infringement suit.  The infringement suit was settled, but Warrior alleges that it was forced into a less attractive settlement due to the errors in patent prosecution.  The malpractice suit started in state court, then was dismissed and re-filed in Federal District Court.  The Federal District Court found that it did not have subject matter jurisdiction over the case.  Dickinson appealed to the CAFC and the CAFC found that at least one of Warrior’s malpractice claims requires that the District Court resolve an issue of patent law and, therefore, the District Court does have subject matter jurisdiction over the practice case.  The opinion is of interest, not only because it shows the case within a case nature of a malpractice suit, but also because it underscores the growing number of malpractice suits related to patent prosecution issues.

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