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Category: Supplemental Fees

$2.5M Supplemental Fee Award in PersonalWeb Patent Case

December 28, 2023

A recent Law 360 story by Henrik Nilsson, “Amazon Lands Another $2.5M in Fees in Personal Web IP Fight”, reports that a California federal judge awarded Amazon $2.3 million in attorney fees plus another $193,000 in court costs in a patent feud with licensing outfit PersonalWeb, adding to an already more than $5 million fee award, while slamming PersonalWeb's "disgraceful" litigation tactics.

U.S. District Judge Beth L. Freeman granted and denied in part Amazon's motion for supplemental fees in the infringement litigation lodged against it and its various customers by PersonalWeb Technologies LLC, whose allegations over patented cloud-computing technology were ultimately found to be "objectively baseless" in 2020.

"The court notes with grave displeasure that the overriding theme of PersonalWeb's post-judgment conduct has been one of bad-faith evasion of the court's judgment and abuse of due process protections," Judge Freeman wrote her order.  "PersonalWeb's two-track strategy of attempting to avoid this court's jurisdiction, has been disgraceful, and as clear an example of bad faith as any that this court has had the displeasure of observing from the bench."

Judge Freeman saddled PersonalWeb with what was initially $4.6 million in fees in 2021, owed to Amazon's lawyers at Fenwick & West LLP for billing more than 9,260 hours of work on PersonalWeb-related litigation.  Amid appeal, the number has since ballooned to about $5.2 million, which a split Federal Circuit panel upheld Nov. 3.

Amazon said in May that it's entitled to $3.2 million worth of extra fees for work performed between March 2021 and March 2023, which it partly attributed to related Federal Circuit appeals over claim construction, non-infringement and the previous fee award.  In addition, Amazon argued that it incurred fees "attempting to secure or enforce the fee award."  The company later revised that number and asked for almost $3 million in fees and costs.  Judge Freeman said Amazon was entitled to approximately $2.5 million.

The sprawling litigation goes back to early 2018, when PersonalWeb filed around 50 patent suits in a handful of jurisdictions against Amazon Web Services customers, including Airbnb Inc., MyFitnessPal Inc., Reddit Inc., Venmo Inc., Kickstarter, Blue Apron LLC and FanDuel Inc.  But Amazon fired off its own suit in February 2018 arguing PersonalWeb had already lost its case against its customers when it dropped claims against Amazon itself in prior litigation.  A California federal court sided with Amazon in 2019, and the Federal Circuit upheld that decision in June 2020 in a precedential decision.

Judge Freeman approved Amazon's initial request for attorney fees in October 2020, calling the litigation "objectively baseless."  The judge declined to determine the amount at that time, but deemed the case "exceptional."  During a hearing on attorney fees in November, Judge Freeman expressed her frustration with the lengthy litigation, noting that she doesn't "really know what to say," and she's been ruling consistently in favor of Amazon for years, and so far "the Federal Circuit has agreed with me every step of the way."

Throughout the hearing, Judge Freeman criticized PersonalWeb's litigation tactics and its purported attempts to dodge judgment and fee payment by filing appeals and replacing counsel repeatedly, as well as filing a receivership action in state court and obtaining an injunction barring the company from having to meet certain deadlines to pay in the patent infringement cases.

Among the attorney fees awarded to Amazon include approximately $1.1 million for 1,931 hours of work in post-judgment enforcement matters in federal court from March 2021 to March 2023.  Judge Freeman awarded another $562,068 for about 776 hours of work in state court proceedings and $209,582 related to PersonalWeb's petition for certiorari with the U.S. Supreme Court following the Federal Circuit's decision in 2020. The high court denied the petition.

Law Firms Earn Another $10.8M in Fees in GM Ignition MDL

December 16, 2021

A recent Law360 story by Rick Archer, “GM Ignition MDL Firms Get OK for Another $10.8M in Fees,” reports that counsel for plaintiffs in the General Motors multidistrict ignition switch litigation will be receiving an additional $10.8 million after telling a New York federal judge that a $34 million fee award earlier this year left them not even close to fully reimbursed.  U.S. District Judge Jesse M. Furman signed the order authorizing the payments in response to a motion from the MDL's three co-lead firms – Hagens Berman Sobol Shapiro LLP, Hilliard Martinez Gonzales LLP, and Lieff Cabraser Heimann & Bernstein LLP – requesting unused funds from an MDL legal expenses pool be used to supplement the earlier fees and expenses reward.

"To reiterate, even with these reimbursements, co-lead counsel, like participating counsel, will not have recovered anything close to their lodestar," they said in their motion.  In May, Judge Furman approved the payment of $34 million in fees and expenses to 53 firms involved in the case, but earlier this month the three co-leads said in a motion that the payments did not fully cover their share of the case's lodestar and that some participating firms had received no funds from the order.

The firms proposed and Judge Furman agreed that they be paid out of unused cash in the "common benefit order fund" established among the MDL participants to pool the proceeds of individual personal injury settlements from ignition switch cases and use them to reimburse work done for the common benefit of all the MDL plaintiffs.  "At present, co-lead counsel do not anticipate substantial future payments into the CBF, and therefore seek compensation at this time for their firms and participating counsel firms for the many thousands of hours dedicated to this litigation over the last seven years," they said.

Just under $9.2 million of the payments are slated for the lead firms.  The remaining funds will be split between 16 additional firms, in amounts ranging from more than $603,000 to $61.43.  In his order, Judge Furman said the firms had "far more" than this amount in unreimbursed fees.

Federal Circuit: No Supplemental Fees in IP Government Loss

July 30, 2020

A recent Law 360 story by Dave Simpson, “Fed. Cir. Won’t Add to $4.4M Atty Fee in IP Suit Gov’t Lost,” reports that the Federal Circuit refused to tack supplemental attorney fees onto a $4.4 million fee award and a $200,000 judgment against the government in a patent case out of the U.S. Court of Federal Claims, ruling that only the claims court has the authority to grant such fee requests.  In a unanimous unpublished decision, the panel rejected the government to pay appellate fees accrued by Hitkansut LLC and Acceledyne Technologies Ltd. LLC, which had argued that Section 1498 of the Patent Act provides the Federal Circuit with such authority.

"Section 1498 is a limited waiver of sovereign immunity, and waivers of sovereign immunity are construed narrowly in favor of the government," the panel said. "Section 1498's text contains no unequivocal expression by Congress that the United States is subject to the type of fees Hitkansut is seeking in this court."

The companies, owned by late inventor Donna Walker, who passed away in 2018, asked the appeals court for supplemental attorney fees after a three-judge panel on May 1 affirmed the U.S. Court of Federal Claims' March 2019 grant of fees.  The lower court found in 2017 that government researchers at the Oak Ridge National Laboratory directly took Hitkansut's patent-pending technology, which can be used to relax stressed metal in large metal structures like airplanes, without giving Walker any credit, funding or contracts.

Hitkansut and Acceledyne were able to recoup fees at the claims court under a provision of the Patent Act that allows independent inventors, nonprofits and small businesses to recover fees when the government infringes, provided they can show the United States' position was not "substantially justified."

The Federal Circuit said in its May 1 opinion that the government's litigation position was not substantially justified because its arguments were contrary to the evidence in the case and the testimony of government employees, and that its invalidity argument was "contradicted by its own expert witness." The court, however, instructed the parties to bear their own costs.

But Hitkansut and Acceledyne contended that the court has the authority to order the government to pay additional fees under Section 1498, which they argued is not limited to the claims court action, thereby entitling them to recoup all of their costs, including those associated with defending their initial fee bid.  And although the appeals court hadn't previously addressed whether fees for defending an initial fee bid can be recouped under Section 1498, Hitkansut and Acceledyne argued that the court has done so in Wagner v. Shinseki under an analogous law — the Equal Access to Justice Act.

The court in Wagner said that because he partially prevailed in defending against the government's challenge to his initial bid for fees, "he was entitled to supplemental fees."  The Wagner court reasoned that a prevailing party can recoup fees not just for underlying litigation but also for defending an initial EAJA fee request.

Hitkansut and Acceledyne urged the court to apply the same reasoning it did in Wagner to this case, but the government contends its reliance on Wagner is "misplaced" because it says the EAJA is "fundamentally different" from Section 1498, which doesn't give the Federal Circuit jurisdiction over supplemental fee requests.

Congress enacted the Section 1498 fee provision because it believed the EAJA was unavailable for such claims, the government said.  "Had it wanted to do so, Congress had a clear model in EAJA to [ensure] recovery of appellate fees and costs. But Congress selected a different path," the government said.

The panel said that it cannot derive fee authority simply from the reviewed tribunal's ability to award fees, also noting that the circuit has recognized that EAJA and Section 1498 have substantial differences.  "And unlike EAJA, which empowers 'any court having jurisdiction,' Section 1498 authorizes an infringement action against the government only in the Court of Federal Claims, empowering only that tribunal to award reasonable costs, which includes reasonable fees for attorneys, as part of the 'reasonable and entire compensation' for the underlying use of the patent," the panel said.

The Nation’s Top Attorney Fee Experts of 2020

June 24, 2020

NALFA, a non-profit group, is building a worldwide network of attorney fee expertise. Our network includes members, faculty, and fellows with expertise on the reasonableness of attorney fees.  We help organize and recognize qualified attorney fee experts from across the U.S. and around the globe.  Our attorney fee experts also include court adjuncts such as bankruptcy fee examiners, special fee masters, and fee dispute neutrals.

Every year, we announce the nation's top attorney fee experts.  Attorney fee experts are retained by fee-seeking or fee-challenging parties in litigation to independently prove reasonable attorney fees and expenses in court or arbitration.  The following NALFA profile quotes are based on bio, CV, case summaries and case materials submitted to and verified by us.  Here are the nation's top attorney fee experts of 2020:

"The Nation's Top Attorney Fee Expert"
John D. O'Connor
O'Connor & Associates
San Francisco, CA
"Over 30 Years of Legal Fee Audit Expertise"
Andre E. Jardini
KPC Legal Audit Services, Inc.
Glendale, CA

"The Nation's Top Bankruptcy Fee Examiner"
Robert M. Fishman
Cozen O'Connor
Chicago, IL

"Widely Respected as an Attorney Fee Expert"
Elise S. Frejka
Frejka PLLC
New York, NY
"Experienced on Analyzing Fees, Billing Entries for Fee Awards"
Robert L. Kaufman
Woodruff Spradlin & Smart
Costa Mesa, CA

"Highly Skilled on a Range of Fee and Billing Issues"
Daniel M. White
White Amundson APC
San Diego, CA
"Extensive Expertise on Attorney Fee Matters in Common Fund Litigation"
Craig W. Smith
Robbins LLP
San Diego, CA
"Highly Experienced in Dealing with Fee Issues Arising in Complex Litigation"
Marc M. Seltzer
Susman Godfrey LLP
Los Angeles, CA

"Total Mastery in Resolving Complex Attorney Fee Disputes"
Peter K. Rosen
Los Angeles, CA
"Understands Fees, Funding, and Billing Issues in Cross Border Matters"
Glenn Newberry
Eversheds Sutherland
London, UK
"Solid Expertise with Fee and Billing Matters in Complex Litigation"
Bruce C. Fox
Obermayer Rebmann LLP
Pittsburgh, PA
"Excellent on Attorney Fee Issues in Florida"
Debra L. Feit
Stratford Law Group LLC
Fort Lauderdale, FL
"Nation's Top Scholar on Attorney Fees in Class Actions"
Brian T. Fitzpatrick
Vanderbilt Law School
Nashville, TN
"Great Leader in Analyzing Legal Bills for Insurers"
Richard Zujac
Liberty Mutual Insurance
Philadelphia, PA