East Texas Judge Orders eDekka To Pay Accused Infringers’ Fees

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East Texas Judge Orders eDekka To Pay Accused Infringers’ Fees


In a closely watched case from east Texas, Judge Gilstrap has awarded attorneys’ fees to defendants who successfully moved to dismiss the claims against them because the asserted patent was drawn to patent–ineligible subject matter. As we reported in September, Judge Gilstrap granted a set of motions to dismiss under Alice v. CLS Bank, then sua sponte invited the defendants to brief the issue of whether they were entitled to attorneys’ fees under the “exceptional case” standard. [Full disclosure: we represented a defendant in the litigation that filed an Alice motion, but is no longer involved in the case.]

After briefing on the attorneys’ fees question, Judge Gilstrap concluded that the case is exceptional because eDekka’s claims were objectively unreasonable and eDekka litigated in an unreasonable manner. On the first point, Judge Gilstrap noted that eDekka “proffered completely untenable arguments to the Court throughout the…briefing process and at the…hearing” (ellipses added). On the second point, the court highlighted eDekka’s “aggressive strategy that avoids testing its case on the merits and instead aims for early settlements falling at or below the cost of defense.” The court cited in particular the fact that eDekka offered a number of defendants “to settle their cases for three–thousand dollars each” just two days before the hearing on the motions to dismiss. From these facts, the court deduced that eDekka was attempting to exploit the high cost of defense to extract nuisance–value settlements. Noting that it was generally reluctant to find a patent case exceptional just because the plaintiff lost on the merits, the court determined that, in these cases, “the threshold of exceptionality has been crossed by eDekka.”

It remains to be seen whether this welcome development is the exception that proves the rule that fees will almost never be awarded, or a stern warning that this court, with its overload of patent cases, will look more skeptically into the litigation strategy of patent trolls in cases in which a similar “aggressive strategy” is being deployed.

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