Before Taranto, Stoll, and Stark. Appeal from the United States District Court for the Northern District of California.
Summary: Additional attorneys’ fees may be awarded when a party that brought a frivolous claim doubles down by filing a meritless motion challenging the original fee award.
EscapeX sued Google asserting that YouTube products infringed its patent. Google responded in several letters stating that EscapeX had not adequately investigated its claims because the accused features were either missing from one accused product or, in another accused product, a simple internet search would have shown the product existed before the patent’s priority date. After the case was dismissed, Google moved for attorneys’ fees under 35 U.S.C. § 285. The district court found the case exceptional and awarded fees. EscapeX subsequently moved under FRCP 59(e) to amend the judgment of fees “based on newly discovered evidence.” EscapeX’s “new evidence” was two declarations, one from EscapeX’s president and the other from an engineer who performed the pre-suit investigation and drafted the claim charts, arguing that the pre-suit investigation was sufficient. Google requested that EscapeX withdraw the motion, but EscapeX did not respond until after Google opposed. Google then moved under 28 U.S.C. § 1927 for fees incurred in opposing the motion. The district court found EscapeX’s motion frivolous and awarded Google its fees.
EscapeX appealed the fee awards. On appeal, the Federal Circuit found that EscapeX’s lack of pre-suit investigation was well supported by the record. The Federal Circuit also affirmed the district court’s denial of EscapeX’s 59(e) motion because the declarations were not newly discovered evidence. Lastly, the Federal Circuit held that it was appropriate to hold EscapeX and its attorneys jointly and severally liable for the fee award under 28 U.S.C. § 1927 because “[a]n attorney’s obligation to zealously advocate for a client is not a license to ignore other duties, such as conducting an adequate pre-suit investigation and refraining from filing frivolous motions.” The Federal Circuit awarded Google its costs on appeal.
Editor: Sean Murray
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