IP Law Daily Imperium wins $7 million in fees as prevailing party in dispute with Samsung
Wednesday, April 4, 2018

Imperium wins $7 million in fees as prevailing party in dispute with Samsung

By Robert Margolis, J.D.

The federal district court in Sherman, Texas has awarded Imperium IP Holdings(Cayman), Ltd. approximately $7.08 million in attorney fees as the prevailing party in its patent infringement suit against several Samsung entities. The court granted Imperium’s motion for fees under 35 U.S.C. §285, rejecting all but one of Samsung’s arguments for reducing Imperium’s requested fees (Imperium IP Holdings (Cayman), Ltd. v. Samsung Electronics Co., Ltd., April 3, 2018, Mazzant, A.).

Imperium sued the Samsung entities for infringing U.S. Patent Numbers 6,271,884 ("the ’884 Patent), 7,092,029 ("the ’029 Patent"), and 6,836,290 ("the ’290 Patent"). The jury returned a verdict for Imperium finding that (1) Samsung infringed several claims of the ’884 Patent and the ’029 Patent; and (2) Samsung’s infringements were willful. The jury also found that a claim of the ’290 Patent was invalid for obviousness. The jury awarded Imperium damages of $4,840,772 for the ’884 Patent’s infringement and $2,129,608.50 the ’029 Patent’s infringement. The court later awarded enhanced damages for willful infringement and entered final judgment.

On September 13, 2017, the Court granted in part and denied in part Imperium’s Motion for §285 Attorneys’ Fees and Non-Taxable Costs, awarding $581,681.44 in non-taxable costs or expenses, but finding that Imperium did not provide sufficient information to determine the reasonableness of its estimate of attorneys’ fees. The court found to be missing the number of hours Imperium’s attorneys spent on this case, which is necessary to calculate the lodestar. The court ordered Imperium to submit documents showing hours and billing rates for all legal assistants, associates, and partners who worked on this case. After Imperium’s submission and Samsung’s opposition filing, the court issued its ruling.

Lodestar method. The court has discretion to determine attorney fee awards under Section 285. It followed Federal Circuit law in using the two-step lodestar method to calculate the fee award. First the court calculates the lodestar by multiplying the number of attorney hours reasonably spent working on the case by an appropriate hourly rate in the community in which the court sits. After calculating the lodestar, the court determines whether to make an upward or downward adjustment, based on the circumstances of the case. The Fifth Circuit uses the 12 factors set forth in Johnson v. Ga. Highway Express, Inc., 488 F.2d 714, 717–19 (5th Cir. 1974) (the "Johnson factors"). Because the lodestar is presumptively reasonable, an upward or downward adjustment is warranted only in exceptional cases, the court noted.

Imperium sought $7,110,290.771 in attorney fees based on 13,178.6 attorney hours. Samsung sought to limit the award to $3,799,784.81, raising four arguments related to the number of hours billed. Samsung did not challenge the hourly rates for the attorneys. The court rejected most of Samsung’s arguments, reducing the requested fees by $29,595.00 for clerical work that should not have been billed. The court awarded Imperium attorney fees of $7,080,695.77

Unsuccessful claims. First, Samsung contended that Imperium did not exclude time spent on unsuccessful claims and unrelated defendants. In particular, Samsung sought a 33% fee reduction because Imperium only succeeded on its claims relating to two of the three patents-in-suit, and Samsung claimed that those two patents formed a small fraction of Imperium’s claims. The court rejected this argument, however, finding that the work by Imperium’s attorneys on unsuccessful claims was intimately related to the work performed on the successful ones. Most of the work was performed on the case "as a whole," making parsing out time related to one particular patent impossible, the court held. The court also noted that the unsuccessful claims did not add any witnesses to the trial.

Billing judgment. Samsung next argued that the claimed fees should be reduced 20% because Imperium’s attorneys failed to exercise billing judgment, defined as "documentation of the hours charged and of the hours written off as unproductive, excessive, or redundant." Saizan v. Delta Concrete Prods. Co., Inc., 448 F. 3d 795, 799 (5th Cir. 2006). Samsung argued that the absence of judgment is reflected in senior attorneys doing work that should have been done by support staff or junior attorneys at a lower hourly rate. The court refused to reduce the fees on that basis noting that the more senior attorneys may have performed the work efficiently than someone more junior. The court did delete from the requested fees amounts billed for paralegals performing clerical work, such as printing and filing documents. This led to a reduction of $29,595.00 from the requested amount.

Samsung also argued that many of the attorney time entries "are so vague it is nearly impossible to determine whether the billed time was unproductive, excessive, or redundant," so that Imperium could not meet its burden of establishing billing judgment. The court disagreed, noting that one of the attorneys, in an affidavit, detailed certain time written off as unproductive, excessive, or redundant. This excluded time included travel time, and administrative time spent managing case files, documents, and the like. The court found this evidence sufficient to deny Samsung’s request to further reduce the fees.

Block billing. Samsung also contended that the billing statements improperly include block billing. The court found otherwise, noting that Imperium attorneys itemized their tasks and recorded time on a per-task basis.

Johnson factors. The court considered all the Johnson factors and found no exceptional circumstances that would support adjusting the lodestar.

The case is No. 4:14-cv-00371-ALM.

Attorneys: Jeffrey Saltman (Fisch Sigler LLP) for Imperium IP Holdings [Cayman], Ltd. Jesse J. Jenner (Ropes & Gray LLP) for Samsung Electronics Co., Ltd. and Samsung Electronics America, Inc.

Companies: Imperium IP Holdings [Cayman], Ltd.; Samsung Electronics Co., Ltd.; Samsung Electronics America, Inc.

MainStory: TopStory Patent TexasNews

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