AIA America v. Avid was decided on August 10, 2017 on appeal from the Eastern District of Pennsylvania. There, after the jury found against plaintiff AIA on patent ownership and co-inventorship, the district court found AIA lacked standing to assert the patents. After allowing “the parties to submit extensive briefing, evidence, and declarations on the issue of fees,” the district court granted $3,943,317.70 in attorney fees to defendant Avid. AIA appealed the award of attorney fees, but not the amount awarded.
The Federal Circuit affirmed the award of attorney fees.
The Seventh Amendment does not require a jury trial to decide the facts forming the basis to award attorney fees under § 285. The Seventh Amendment preserves the right to a jury trial for “suits at common law,” i.e., suits “in which only legal rights and remedies were at issue, as opposed to equitable rights and remedies.” Looking back to 18th century actions, the Federal Circuit determined that “English courts for centuries have allowed claims for attorney’s fees in both the courts of law and equity;” and that “when brought in the courts of law, judges, not juries, determined attorney’s fees.” This implies that attorney fees generally do not involve legal rights. The court also held that § 285 attorney fees, although monetary, is an equitable remedy because the fees “raise issues collateral to and separate from the decision on the merits.” The attorney fees inquiry does not require a jury trial even when it “involves considerations of a party’s state of mind, intent, and culpability.”
The district court did not err in making factual findings on AIA’s state of mind, intent, and culpability, issues not considered by the jury. “[A]fter a trial on legal issues, a court may not make findings contrary to or inconsistent with the resolution of any issues necessarily and actually decided by the jury.” Due process was not violated because the district court “provided both parties the opportunity to fully brief the motion seeking attorney’s fees[,] allowed both parties to submit any additional evidence and affidavits,” and “held a hearing on the motion where AIA was allowed to present arguments.”
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