Federal Circuit Issues Slightly Revised Opinion in SRI v. Cisco

I blogged about the original panel opinion in March (here), stating:

On willfulness, the court concludes that the evidence did not permit the inference that Cisco willfully infringed during the entire time period that finding covered, and remands for further proceedings . . . .

Surprisingly, perhaps, since fees often are not awarded to the plaintiff unless the infringement was willful, the court affirms the exceptionality finding, though it remands for a recalculation . . . .

On Friday, the court issued a revised opinion modifying the portion of the opinion addressing attorneys' fees.  Here is the relevant portion of the original opinion: 

. . . To meet the abuse-of-discretion standard, the appellant must show that the district court made “a clear error of judgment in weighing relevant factors or in basing its decision on an error of law or on clearly erroneous factual findings.” Bayer, 851 F.3d at 1306 (quoting Mentor Graphics, 150 F.3d at 1377); see also Highmark, 572 U.S. at 563 n.2.

We see no such error in the district court’s determination that this was an exceptional case. The district court found:

There can be no doubt from even a cursory review of the record that Cisco pursued litigation about as aggressively as the court has seen in its judicial experience. While defending a client aggressively is understandable, if not laudable, in the case at bar, Cisco crossed the line in several regards.  Post-Trial Motions Op., 254 F. Supp. 3d at 722.

The district court further explained that “Cisco’s litigation strategies in the case at bar created a substantial amount of work for both SRI and the court, much of which work was needlessly repetitive or irrelevant or frivolous.” Id. at 723 (footnotes omitted). Indeed, the district court inventoried Cisco’s aggressive tactics, including maintaining nineteen invalidity theories until the eve of trial but only presenting two at trial and pursuing defenses at trial that were contrary to the court’s rulings or Cisco’s internal documents. Id. at 722. The district court concluded that all of this, in addition to the fact that the jury found that Cisco’s infringement was willful, led it to exercise its discretion pursuant to § 285 to award SRI its attorneys’ fees and costs. Id. at 723. We conclude that the district court did not abuse its discretion in so finding (pp. 22-23).

Here is the modified opinion, with the new matter in boldface:

. . . To meet the abuse-of-discretion standard, the appellant must show that the district court made “a clear error of judgment in weighing relevant factors or in basing its decision on an error of law or on clearly erroneous factual findings.” Bayer, 851 F.3d at 1306 (quoting Mentor Graphics, 150 F.3d at 1377); see also Highmark, 572 U.S. at 563 n.2.

We see no such error in the district court’s determination that this was an exceptional case. The district court found:

There can be no doubt from even a cursory review of the record that Cisco pursued litigation about as aggressively as the court has seen in its judicial experience. While defending a client aggressively is understandable, if not laudable, in the case at bar, Cisco crossed the line in several regards.
Post-Trial Motions Op., 254 F. Supp. 3d at 722.

The district court further explained that “Cisco’s litigation strategies in the case at bar created a substantial amount of work for both SRI and the court, much of which work was needlessly repetitive or irrelevant or frivolous.” Id. at 723 (footnotes omitted). Indeed, the district court inventoried Cisco’s aggressive tactics, including maintaining nineteen invalidity theories until the eve of trial but only presenting two at trial and pursuing defenses at trial that were contrary to the court’s rulings or Cisco’s internal documents. Id. at 722. Nevertheless, the district court relied in part on the fact that the jury found that Cisco’s infringement was willful in its determination to exercise its discretion pursuant to § 285 to award SRI its attorneys’ fees and costs. Id. at 723. Accordingly, we vacate the district court’s award of attorneys’ fees and remand for further consideration along with willfulness (pp. 22-23, emphasis added).

So, unless I'm missing something, that's it.  I'm having a bit of a hard time wrapping my head around the simultaneous affirmation that there was "no . . . error in the . . . determination that this was an exceptional case," and the decision to remand to determine if the decision to award fees was based on an incorrect determination of willfulness; but I think the court is saying that the exceptionality finding can stand, but that the possible lack of willfulness should factor in to the determination whether to award fees.