In MarcTec, LLC v. Johnson & Johnson, No. 2010-1285, (Fed. Cir. Jan. 3, 2012), the Federal Circuit affirmed the United States District Court for the Southern District of Illinois’ award of $3,873,865.01 in attorneys’ fees under 35 U.S.C. § 285 and $809,788.02 in expert fees under its inherent authority to award reasonable expert fees in excess of the § 285 statutory limit. On appeal to the Federal Circuit, patent holder-plaintiff, MarcTec LLC (“MarcTec”), argued that the case was not “exceptional” under § 285, and that the district court abused its discretion in awarding expert fees. The Federal Circuit nevertheless affirmed.
MarcTec filed suit against Johnson & Johnson and its subsidiary device manufacturer, Cordis, Corp. (“Cordis”), on November 27, 2007 alleging infringement of U.S. Patents No. 7,128,753 and 7,217,290 (the “‘753” and “‘290” Patents). During procurement of the Patents, the inventor had distinguished the applications from U.S. Patent No. 5,102,417 (the “‘417 Patent”) on the grounds that they include a bonded polymeric material that “is non-flowable and non-adherent at room temperature and becomes flowable, tacky, and adherent upon the application of heat.” Slip. op. at 5. The inventor added claim limitations to capture this difference. See Slip op. at 4.
At claim construction, the district court ruled that (1) the specification of the ‘753 and ‘290 Patents only support “heat bonding,” (2) the claims were amended during prosecution to expressly include “heat bonding” limitations, and (3) the inventor disclaimed coverage of stents based on statements made to the examiner in distinguishing the ‘417 Patent. Subsequently, the defendants moved for summary judgment of non-infringement because (1) the polymer used on Codis’ stent is applied at room temperature, and (2) the ‘753 and ‘290 Patents do not cover stents. MarcTec countered by, notably, presenting expert testimony proffering “junk science” to attempt to show that even though the polymer is applied to the Johnson & Johnson product at room temperature, based on the speed of particles, there was some heating. The district court granted the defendants’ motion. MarcTec appealed and the Federal Circuit affirmed. MarcTec, LLC v. Johnson & Johnson, 394 Fed.Appx. 685 (Fed. Cir. 2010).
Thereafter, the defendants moved the district court for attorneys’ and expert fees under § 285 and the court’s inherent power. The defendants reasoned that the case was exceptional based on (1) MarcTec’s mischaracterization of claim construction law in an attempt to convince the district court to ignore the specification and prosecution history of the ‘753 and ‘290 Patents, (2) MarcTec’s later mischaracterization of the district court’s claim construction, and (3) MarcTec’s “junk science” expert testimony that was excluded as unreliable under Daubert. The district court granted the defendants’ motion and awarded $3,873,865.01 in attorneys’ fees and $809,788.02 in expert fees. MarcTec appealed the “exceptional case” determination and the award of attorney and expert fees.
The Federal Circuit affirmed the exceptional case finding noting that even though MarcTec couldn’t know in advance the exact claim construction that the district court would adopt, the fact that no possible reading of Philips v. AWH Corp., 415 F.3d 1303, 1313-19 (Fed. Cir. 2005) (en banc) supported its position indicated that MarcTec should have known that it had no basis for bringing suit. Regarding the district court’s inherent authority to award expert fees, the Federal Circuit noted that while district courts should typically evaluate attorney and expert fees independently, the fact that MarcTec produced unreliable and irrelevant expert testimony that the defendants were therefore forced to counter weighed in favor of the award.
MarcTec, LLC v. Johnson & Johnson serves as a reminder for litigators and patent prosecutors alike. It suggests, perhaps, an increased willingness to find “exceptional cases” and punish conduct through district courts’ inherent powers.