A Self-Inflicted Injury

As any regular reader of our blogs has probably discerned, in patent cases our sympathies, in general, lie with the patentee. Occasionally, however, we encounter a case where the patentee deserves no sympathy, having seemingly done everything possible to bring disaster upon itself. Precision Links Incorporated v. USA Products Group, Inc. and Home Depot U.S.A., Inc.

Precision is the owner of a patent directed to what was described by the Court as “essentially a tie-down strap used to restrain cargo during transport.” Precision sued the defendants, alleging claims both for patent infringement and for unfair competition and deceptive trade practices. This latter claim rested on the theory that the accused straps were “manufactured of a cheap and inferior material” so as to “pose a substantially increased risk of malfunction and injury” and that the “selling of the accused straps as the substantial equivalent of the Plaintiff’s genuine straps” caused the Plaintiff injury.

Not surprisingly, the defendants filed a motion seeking to dismiss this second claim. What was surprising was that the plaintiffs failed to respond to this motion within the time required. Eight days after its response was due, the plaintiff requested an extension of time to respond. The Court, noting that “the Plaintiff failed to offer any explanation for its failure to seek such relief prior to the time the response was due,” denied the request and dismissed the claim, but not, however, before describing it as “speculative.”

Five months after filing suit, Precision filed a motion for a preliminary injunction. In most cases, waiting FIVE MONTHS to file such a motion would raise questions as to timeliness, but in this instance the Court never got to that issue. The motion was stricken for failure to comply with the Court’s rules as to type fonts and page limitations.

Shortly thereafter, the Court entered its claim construction ruling. Based on this ruling, the defendants filed a motion for summary judgment of noninfringement. The plaintiff responded to this motion – for once in a timely manner – by agreeing “that the claim construction entered by the Court clearly excludes the accused straps from coverage” by the patent-in-suit. The Court thereupon entered judgment for the defendants. Precision then filed a Notice of Appeal to the Federal Circuit. Adhering to its usual practice, Precision filed this notice late.

The defendants moved to dismiss the appeal as untimely. Precision, creative if nothing else, filed a “motion for miscellaneous relief” asking the district court to characterize its previous response to the defendants’ summary judgment motion as a notice of appeal or, in the alternative, to “Extend the time for filing an appeal or to treat the Plaintiff’s Notice of Appeal as a motion for extension of time in which to file a notice of appeal.” While the Court pondered this request, the Federal Circuit dismissed the appeal as untimely.

The Court now turned its attention to a motion by the defendants for an award of costs and attorney’s fees. Yup, the defendants were asking the Court to find that the case was “exceptional.” A finding that a case is exceptional is warranted “when there has been some inappropriate conduct related to the matter in litigation…misconduct during litigation, [or] vexatious or unjustified litigation….” The defendants argued that the case was exceptional because the plaintiff’s claim interpretation and infringement theory were objectively baseless, the litigation was brought and pursued in subjective bad faith, and the plaintiff’s conduct in the litigation was improper. Precision countered that its proposed claim construction was supported by a plausible reading of the intrinsic evidence, that it had conducted an appropriate pre-suit investigation and that it had secured an opinion of counsel prior to filing suit. Further, Precision denied any litigation misconduct, claiming that “much of the expense claimed by the Defendants is attributable to their unreasonable impatience and to the combative nature of their litigation strategy.” If nothing else, this last argument should entitle Precision to an award for chutzpah.

The Court bought none of Precision’s arguments. First, the Court reminded Precision that it had twice rejected Precision’s proposed claim construction, once with respect to the motion for a preliminary injunction and again in the final Claim Construction Order. The Court then held that “the Plaintiff’s claim interpretation found no support either in the plain language of the claims or the intrinsic record of the patent at issue and was therefore frivolous.”

What of the opinion of counsel secured by Precision? Didn’t that evidence a good faith belief, by Precision, in the merits of its case? In a word, NO! The opinion contained “no explanation of counsel’s claim construction and his applications of the claim limitations to the accused product. There are no citations to the specification or prosecution history, and no analysis is provided to explain why counsel construed the patent terms in the way in which he did…[f]urther, counsel concluded that [a]…limitation is present in the infringing device, but he did not explain how or why he reached this conclusion.” In short, the opinion “is so lacking in any fundamental analysis or evidentiary support that the Plaintiff’s reliance upon this opinion as a basis for alleging infringement…was simply unreasonable and reflects a lack of good faith. Indeed, this opinion letter is so utterly lacking that the Court concludes that no reasonable litigant could believe that an infringement claim could succeed based on this opinion.” Just to avoid any question, the Court went on, “[t]he unreasonableness of counsel’s opinion and of Plaintiff’s reliance on that opinion, stems not from the quality of the conclusion reached but rather from the complete lack of analysis underlying that conclusion.”

As if that were not enough to support an award of attorney’s fees, the Court further found “several instances of Plaintiff’s conduct in this litigation were so vexatious and unjustified as to warrant the imposition of fees…” What, exactly, were these dastardly acts? Well, it seems the Court was really annoyed by Precision’s allegations of unfair and deceptive trade practices. Even after the count of the complaint containing these allegations had been dismissed, Precision had “continued to assert the same speculative allegations in seeking preliminary injunctive relief…” To make matters worse, Precision supported this request for injunctive relief with a declaration of Mark Whitaker, the inventor of the patented strap. Mr. Whitaker opined that the accused strap “appears to be made of an inferior grade of rubber that is not resistant to weathering and cracking due to exposure…[such that] the Accused Strap is substantially more likely to break during overstretching than one of” the Precision straps, whereby “the danger of catastrophic breaking and unexpected recoil, as well as associated consumer injury or death is substantially heightened.” The Court excluded these opinions on the grounds that Mr. Whitaker had failed to provide any factual basis or foundation for his assertions and that they were “merely speculation.” Excluded, but not forgotten!

Finally, as if to put frosting on the cake, the Court took Precision to task for “unnecessarily extending this litigation by filing an untimely notice of appeal with the Federal Circuit and, when it became evident that the Defendants sought to dismiss the appeal due to its untimeliness, by filing a motion in this Court in an effort to salvage the untimely appeal.” This “caused the Defendants to incur needless litigation expense and unnecessarily prolonged the proceedings before this Court.”

So, the defendants recover their costs and attorney’s fees, while Precision ponders the error of its ways and its attorneys consider adopting a new docketing system.

The Lesson To Be Learned – (1) relying on unsupported opinions and declarations will only lead to grief; (2) prepare your papers correctly and FILE THEM IN A TIMELY MANNER; and (3) most importantly, DON’T WASTE THE JUDGE’S TIME.