A recent The Legal Intelligencer story, “Judge: Losing Plaintiff Must Pay $6.5 Mil in Attorney Fees, Costs” reports that a federal judge has ordered the losing plaintiff in a patent infringement case to pay the two defendants a total of $6.5 million in attorney fees and costs.  U.S. District Judge Petrese B. Tucker in Pennsylvania rejected all but one of the plaintiff Checkpoint Systems’ objection to the fees and costs submitted by defendants Sensormatic Electronics Corp. and All-Tag Security.  Checkpoint didn’t contest the reasonableness of the rates the defense lawyers charged or the time they spent on the case, but rather focused on what tasks the company should be forced to reimburse the defendants.

The defendants submitted their bills after Tucker found the case to be “exceptional” under Section 285 of the U.S. Code, which provides for the award of attorney fees in bad faith litigation.  Checkpoint was ordered to pay All-Tag’s attorney fees and costs of $2.43 million.  The company was represented by attorneys at Breiner & Breiner in Virginia and Reed Smith in Philadelphia.  The award includes about $1.61 million in attorney fees, more than $191,000 in expenses, nearly $634,000 in prejudgment interest and $35.98 a day in post-judgment interest, according to the opinion.

Checkpoint was ordered to pay Sensormatic $4.15 million on top of the $91,000 it had already paid the company.  The sum includes slightly more than $3 million in legal fees generated by Morgan & Finnegan and Pepper Hamilton, nearly $337,000 in expenses, about $806,000 in prejudgment interest and $55.63 a day in post-judgment interest.  The award does not include a $50,000 litigation success fee owed by Pepper Hamilton under the firm’s fee arrangement with Sensormatic.  Tucker concluded, “requiring plaintiff to pay the litigation bonus does not align with the purpose of the exceptional case finding, which is designed to compensate a party for money it was required to spend to litigate the case.”

Checkpoint also sought the exclusion of nearly $1.1 million of the combined attorney fees and costs from the two defendants because they were racked up on pieces of the litigation the defendants lost.  Tucker said other courts have expressly rejected that argument, ruling the defendant would not have had incur any legal fees if the plaintiff had not engaged in “inequitable conduct.”  Checkpoint also sought the exclusion of almost $8,000 in fees Sensormatic incurred related to the case but prior to the case filing, and more than $424,000 in fees and costs the company was billed without descriptions of the work performed.  Tucker said other courts have found expenses for preparing for litigation to be included in these awards.  She also pointed out that Sensormatic updated its filings regarding the $424,000 to reflect what work was done for those charges.