Eko Brands v. Adrian Rivera Maynez was decided on January 13, 2020, on appeal from the Western District of Washington. Plaintiff Eko filed a declaratory judgment and an infringement action against defendant ARM. On summary judgment, the district court granted Eko declaratory judgment of noninfringement but denied the motion as to obviousness. After a jury trial, the jury found the relevant claims of ARM’s patent to be invalid as obvious. “During these proceedings, the district court awarded Eko attorney’s fees associated with obtaining a judgment of noninfringement and obviousness.” Regarding Eko’s claim for infringement, “the jury awarded Eko compensatory damages but found that ARM did not willfully infringe, and the district court did not award enhanced damages.” Both parties appealed.
The Federal Circuit affirmed the judgement of invalidity as to ARM’s patent, the award of attorney fees, and the judgment of infringement as to Eko’s patent.
The district court did not err in granting Eko attorney fees as to the issue of noninfringement. “The district court concluded that a fee award was appropriate because of ARM’s unreasonable pursuit of its infringement claims.” The district court found that it was “patently obvious that Eko’s products could not infringe on the claims of [ARM’s] patent because no reasonable person looking at …Eko’s devices would describe them as” meeting an certain claim limitation.
The district court did not err in granting Eko attorney fees as to the issue of obviousness. Federal Circuit precedent does “not hold that the denial of summary judgment conclusively establishes objective reasonableness.” The “cases require only that the district court considers the denial of summary judgment, not that the district court always gives that denial decisive weight.” “Here, the district court carefully explained why it did not give its denial of summary judgment decisive weight.” In its order awarding attorney’s fees, the district court noted that at the pretrial conference, ARM offered little explanation for its obviousness position. And when “trial was well underway[,] it became apparent that ARM was not seriously trying to defend the obviousness of the claims at issue.”
The district court did not err in its jury instructions on willfulness. Here, the jury was instructed that “Willfulness requires you to determine whether Eko proved that it is more likely than not that the infringement was especially worthy of punishment. You may not determine that the infringement was willful just because ARM knew of the Eko 855 patent and infringed it. Instead, willful infringement is reserved for only the most egregious behavior, such as where the infringement is malicious, deliberate, consciously wrongful, or done in bad faith.”
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“Eko argued that the inclusion of the phrases ‘especially worthy of punishment’ and ‘willful infringement is reserved for only the most egregious behavior’ in [the jury instructions], invited the jury to make the legal decision as to whether damages should be enhanced, or whether it is an exceptional case, rather than limiting the jury to the underlying factual question of whether the infringement was willful.” The Federal Circuit agreed with Eko “that the jury instruction contained language that in isolation was erroneous.” “[T]he plain language of 35 U.S.C. § 284 makes clear, the issue of punishment by enhancement is for the court and not the jury.” “The question of enhanced damages is addressed by the court once an affirmative finding of willfulness has been made. It is at this second stage at which the considerations of egregious behavior and punishment are relevant.”
“Although the inclusion of the phrases ‘especially worthy of punishment’ and ‘reserved for egregious behavior’ in [the jury instructions] was erroneous,” the Federal Circuit held that “the instruction taken as a whole provide[d] reasonable clarity as to the correct test for willful infringement.” “The jury was reasonably informed that it could make a finding of willful infringement if it found that ARM deliberately or intentionally infringed the [asserted] patent.” The Federal Circuit also found it “significant that deletion of the only two phrases to which Eko objected would not have cured the problem that Eko identified, since [the jury instructions] would still have referred to ‘malicious,’ ‘consciously wrongful,’ and ‘bad faith’ conduct.”
Judge Reyna concurred-in-part and dissented-in-part, arguing that “the district court relied on its erroneous construction of [a certain limitation] as its basis for granting summary judgment and in awarding attorney’s fees.”