Case 3:17-cv-05659-WHA Document 659 Filed 06/10/21 Page 1 of 13
`
`Juanita R. Brooks (CA SBN 75934), brooks@fr.com
`Frank J. Albert (CA SBN 247741), albert@fr.com
`Oliver J. Richards (CA SBN 310972), ojr@fr.com
`FISH & RICHARDSON P.C.
`12860 El Camino Real, Suite 400
`San Diego, CA 92130
`Telephone: (858) 678-5070 / Fax: (858) 678-5099
`
`Robert Courtney (CA SBN 248392), courtney@fr.com
`FISH & RICHARDSON P.C.
`60 South Sixth Street, Suite 3200
`Minneapolis, MN 55402
`Tel: (612) 335-5070 / Fax: (612) 288-9696
`
`Attorneys for Plaintiff, FINJAN, INC.
`
`
`UNITED STATES DISTRICT COURT
`
`NORTHERN DISTRICT OF CALIFORNIA, SAN FRANCISCO DIVISION
`
`FINJAN, INC.,
`
` Plaintiff,
`
`
`v.
`
`
`JUNIPER NETWORKS, INC.,
`
` Defendant.
`
`
`
`
`Case No. 3:17-cv-05659-WHA
`
`FINJAN’S OBJECTIONS TO THE
`SPECIAL MASTER’S REPORT AND
`RECOMMENDATION ON FEES
`
`
`U.S. District Judge William H. Alsup
`Courtroom 12
`
`1 2 3 4 5 6 7 8 9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`Case No. 3:17-cv-05659-WHA
`
`FINJAN’S OBJS TO SPECIAL MASTER’S REPORT AND RECOMMENDATION ON FEES
`
`

`

`Case 3:17-cv-05659-WHA Document 659 Filed 06/10/21 Page 2 of 13
`
`
`
`
`
`TABLE OF CONTENTS
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`Page(s)
`
`FACTUAL BACKGROUND ....................................................................................................... 1
`
`LEGAL STANDARDS ................................................................................................................. 3
`
`ARGUMENT ................................................................................................................................ 4
`
`I.
`
`II.
`
`Goodyear and Rembrandt Do Not Permit “All Fees” Awards
`Absent a Determination of Exceptionality as of the Filing of the
`Complaint, and the Special Master’s Recommended Award of
`Fees Accrued Since the Complaint Should Be Set Aside ..................................... 4
`
`Goodyear and Rembrandt Do Not Permit Recovery of Fees That
`Would Have Been Incurred Regardless of the Exceptional
`Conduct, and the Special Master’s Recommended Award of
`Unrelated Fees Should Be Set Aside .................................................................... 7
`
`A.
`
`B.
`
`As to the ’494 Patent, There is No Causal Connection
`Between Finjan’s Damages Case and Case Proceedings
`on Liability ................................................................................................ 7
`
`As to the ’780 Patent, There is No Causal Connection
`Between the Conduct Held Exceptional and Finjan’s
`Liability Case Against “ATP Appliance” ................................................. 9
`
`CONCLUSION ............................................................................................................................. 9
`
`
`
`
`
`Case No. 3:17-cv-05659-WHA
`i
`
`FINJAN’S OBJS TO SPECIAL MASTER’S REPORT AND RECOMMENDATION ON FEES
`
`1 2 3 4 5 6 7 8 9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`

`

`Case 3:17-cv-05659-WHA Document 659 Filed 06/10/21 Page 3 of 13
`
`
`
`
`
`Cases
`
`TABLE OF AUTHORITIES
`
`
`
`Page(s)
`
`Chambers v. NASCO,
`501 U.S. 32 (1991) .................................................................................................................... 4
`
`Goodyear Tire & Rubber Co. v. Haeger,
`137 S. Ct. 1178 (2017) .......................................................................................... 3, 4, 5, 6, 7, 9
`
`Large Audience Display Sys., LLC v. Tennman Prods., LLC,
`745 F. App’x 153 (Fed. Cir. 2018) ........................................................................................... 5
`
`Lindemann Maschinenfabrik GmbH v. Am. Hoist & Derrick Co.,
`895 F.2d 1403 (Fed. Cir. 1990) ................................................................................................. 8
`
`Monolithic Power Sys., Inc. v. O2 Micro Int’l Ltd.,
`726 F.3d 1359 (Fed. Cir. 2013) ............................................................................................. 3, 5
`
`Octane Fitness, LLC v. ICON Health & Fitness, Inc.,
`572 U.S. 545 (2014) .................................................................................................................. 3
`
`In re PersonalWeb Techs., LLC Patent Litig.,
`No. 18-md-02834-BLF, 2021 WL 796356 (N.D. Cal. Mar. 2, 2021)....................................... 5
`
`In re Rembrandt Techs. LP Patent Litig.,
`899 F.3d 1254 (Fed. Cir. 2018) ............................................................................. 3, 4, 5, 6, 7, 9
`
`SAP Am., Inc. v. Insvestpic, LLC,
`No. 3:16-cv-02689-K, 2018 WL 6329690 (N.D. Tex. Dec. 4, 2018) ....................................... 5
`
`Straight Path IP Group v. Cisco Systems, Inc.,
`411 F. Supp. 3d 1026 (N.D. Cal. 2019) .................................................................................... 6
`
`Straight Path IP Grp. v. Cisco Sys., Inc.,
`No. C 16-03463 WHA, 2020 WL 2539002 (N.D. Cal. May 19, 2020) .................................... 6
`
`Statutes
`
`Patent Act Section 285 ........................................................................................ 1, 2, 3, 5, 6, 7, 8, 9
`
`
`
`Case No. 3:17-cv-05659-WHA
`ii
`
`FINJAN’S OBJS TO SPECIAL MASTER’S REPORT AND RECOMMENDATION ON FEES
`
`1 2 3 4 5 6 7 8 9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`

`

`Case 3:17-cv-05659-WHA Document 659 Filed 06/10/21 Page 4 of 13
`
`
`
`
`
`The Special Master’s report (D.I. 658) does not conform to controlling authority for § 285
`
`fee-shifting. The report reasons, erroneously, that Juniper is entitled to receive nearly all attorney
`
`fees incurred in opposing Finjan’s infringement claims under the ’494 and ’780 Patents, from the
`
`day of the Complaint until final disposition. That reasoning contravenes long-settled law. § 285
`
`does not permit such sweeping fee-shifting except in extraordinary circumstances not present here.
`
`Any fee award in this case should restore only those fees incurred to address the specific parts of
`
`the litigation held to have been exceptional. § 285 does not authorize a windfall of all fees relating
`
`to the ’494 and ’780 Patents; rather, it permits recovery of only those fees related to the conduct
`
`held to have been exceptional. For these reasons, and as set forth below, Finjan respectfully
`
`requests that the Court set aside the Special Master’s overly broad recommendation and remand
`
`for recomputation of those fees particularly related to the conduct held exceptional.
`
`FACTUAL BACKGROUND
`
`The Complaint in this case was filed September 29, 2017. (D.I. 1) The case evolved into a
`
`seven-patent dispute with a high-speed schedule. (See generally D.I. 170-4 (final asserted
`
`patents); D.I. 35 ¶¶ 4, 14 (setting rapid discovery and trial schedule)) This was also a “patent
`
`showdown.” (D.I. 44, at 7:4) The Court ordered two rounds of single-claim summary judgment
`
`motions, both during fact discovery. (D.I. 35 ¶ 11; D.I. 219) Proceedings during and after those
`
`“showdowns” formed the basis of the § 285 determination at issue here.
`
`First showdown, concluding August 2018. The June showdown involved the ’494 and
`
`’780 Patents, and had a split result. On Juniper’s motion, the Court entered summary judgment
`
`that Juniper’s “SRX Gateway” and “Sky ATP” products did not infringe claim 1 of the ’780
`
`Patent. (D.I. 177) In doing so, the Court made claim construction determinations that it
`
`acknowledged differed from those by another judge in this District. (Id. at 7–8; see also D.I. 648,
`
`at 4) As to Finjan’s motion, the Court substantially granted it, entering summary judgment that
`
`Juniper infringed all limitations of ’494 claim 10 save one. (D.I. 185) The Court set trial for
`
`December 2018 to address the remaining ’494 claim limitation and ’494 damages. (D.I. 191)
`
`Thus, as to the ’494 Patent, Finjan and Juniper in pre-trial preparations before the close of fact
`
`discovery.
`
`Case No. 3:17-cv-05659-WHA
`1
`
`FINJAN’S OBJS TO SPECIAL MASTER’S REPORT AND RECOMMENDATION ON FEES
`
`1 2 3 4 5 6 7 8 9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`

`

`Case 3:17-cv-05659-WHA Document 659 Filed 06/10/21 Page 5 of 13
`
`
`
`
`
`The ’494 trial in December 2018. A week before trial began, the Court excluded all ’494
`
`damages opinions of Kevin Arst, Finjan’s expert (D.I. 283), but permitted Finjan to present a fact-
`
`only damages case to the jury (D.I. 335 at 12–13). After the close of Finjan’s presentation, the
`
`Court held that that Finjan’s presentation failed to meet apportionment requirements and entered
`
`JMOL of zero damages. (D.I. 330-1; see also D.I. 338 at 638–39; D.I. 339 at 837–39) The
`
`liability trial continued, and the jury returned a verdict of no infringement. (D.I. 333) After the
`
`Court denied Finjan’s post-trial motions, proceedings on the ’494 patent ended.
`
`Second showdown, concluding May 2019. In the second showdown, Juniper moved
`
`again on the ’780 Patent, addressing claims and products that had survived the first showdown.
`
`The Court granted Juniper’s motion, as follows:
`
`Claim
`’780 claim 9
`
`Accused
`Ruling
`Product
`No infringement
`SRX Gateway
`No infringement
`Sky ATP
`ATP Appliance No damages (infringement held moot)
`
`
`(D.I. 459, at 18) Finjan’s submission in the second showdown concerned the ’154 Patent, not at
`
`issue here. After ’154 proceedings concluded with summary judgment of no infringement, Finjan
`
`voluntarily dismissed its remaining claims.
`
`Fees order of January 2021. Finjan appealed; the Federal Circuit affirmed. On a motion
`
`by Juniper, the Court determined that parts of the case were exceptional under § 285. It found
`
`Finjan’s assertion of the ’494 Patent exceptional “in certain respects.” (D.I. 648 at 1 [“the § 285
`
`Order”]). It held Finjan’s ’494 damages case—e.g., its expert’s opinions (ultimately excluded)
`
`and its attempt to put on a “fact-only” trial presentation—a “fiasco” and “woefully inadequate.”
`
`The § 285 Order did not find or discuss exceptionality for the liability case, except to note that the
`
`jury had rejected the merits of Finjan’s ’494 infringement claim. (Id. at 3) As to the ’780 Patent,
`
`the Court held that Finjan should have dropped the patent after the first showdown rather than
`
`requiring further motion practice on liability or damages. (Id. at 3–4) In view of these
`
`exceptionality determinations, the Court held fee-shifting appropriate as to the ’494 and ’780
`
`Patents, and referred the issue of computing fees to the Special Master. (Id. at 4–5; D.I. 654)
`
`Case No. 3:17-cv-05659-WHA
`2
`
`FINJAN’S OBJS TO SPECIAL MASTER’S REPORT AND RECOMMENDATION ON FEES
`
`1 2 3 4 5 6 7 8 9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`

`

`Case 3:17-cv-05659-WHA Document 659 Filed 06/10/21 Page 6 of 13
`
`
`
`
`
`Special Master’s report. The Special Master took the view that Juniper was entitled to all
`
`fees incurred in its entire defense on the ’494 and ’780 Patents, and not only those fees specifically
`
`related to the conduct identified by the § 285 Order. (D.I. 658 at 3–4) Thus the Special Master’s
`
`report recommended an award of $5,914,156 in fees, which covered work from the date of the
`
`Complaint up until final disposition of the ’494 and ’780 Patents. (Id. at 1)
`
`LEGAL STANDARDS
`
`Section 285 of the Patent Act authorizes district courts to award attorney fees in
`
`exceptional patent cases. 35 U.S.C. § 285. District courts assess § 285 exceptionality on a totality
`
`of the circumstances. Octane Fitness, LLC v. ICON Health & Fitness, Inc., 572 U.S. 545, 554
`
`(2014). A case is exceptional if it “stands out from others with respect to the substantive strength
`
`of a party's litigating position (considering both the governing law and the facts of the case) or the
`
`unreasonable manner in which the case was litigated.” Id. Upon finding exceptionality, a district
`
`court makes a discretionary determination as to the amount of attorney fees to be awarded. In re
`
`Rembrandt Techs. LP Patent Litig., 899 F.3d 1254, 1278 (Fed. Cir. 2018).
`
`Courts’ discretion in setting § 285 fee awards must reflect two principles. First,
`
`“[a]ttorney fees under § 285 are compensatory, not punitive.” In re Rembrandt Techs. LP Patent
`
`Litig., 899 F.3d 1254, 1278 (Fed. Cir. 2018). A § 285 fee award “may go no further than to
`
`redress the wronged party for losses sustained; it may not impose an additional amount as
`
`punishment for the sanctioned party’s misbehavior.” Id. (quoting Goodyear Tire & Rubber Co. v.
`
`Haeger, 137 S. Ct. 1178, 1186 (2017) (internal quote marks omitted)).
`
`Second, and relatedly, the amount of a fee award “must bear some relation to the extent of
`
`the misconduct.” Rembrandt, 899 F.3d at 1278. “Even if [a party’s] misconduct, taken as a
`
`whole, render[s] the case exceptional, . . . [there must be] at least some ‘causal connection’
`
`between the misconduct and the fee award.” Id. at 1281 (quoting Goodyear, 137 S. Ct. at 1187).
`
`Only in extraordinary circumstances does § 285 support sweeping fee awards, such as upon
`
`evidence of “extensive misconduct . . . compris[ing] an abusive pattern or a vexatious strategy that
`
`was pervasive enough to infect the entire litigation.” Monolithic Power Sys., Inc. v. O2 Micro
`
`Int’l Ltd., 726 F.3d 1359, 1369 (Fed. Cir. 2013).
`
`Case No. 3:17-cv-05659-WHA
`3
`
`FINJAN’S OBJS TO SPECIAL MASTER’S REPORT AND RECOMMENDATION ON FEES
`
`1 2 3 4 5 6 7 8 9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`

`

`Case 3:17-cv-05659-WHA Document 659 Filed 06/10/21 Page 7 of 13
`
`
`
`
`
`ARGUMENT
`
`Neither the record nor the law supports awarding Juniper all fees incurred in defense of
`
`Finjan’s ’494 and ’780 infringement claims. Because the Special Master’s report erroneously
`
`assumes Juniper should receive all fees on those patents, the Court should set the report aside and
`
`remand to the Special Master for recomputation of only those fees specifically related to the
`
`conduct that the Court found exceptional.
`
`I. Goodyear and Rembrandt Do Not Permit “All Fees” Awards Absent a Determination
`of Exceptionality as of the Filing of the Complaint, and the Special Master’s
`Recommended Award of Fees Accrued Since the Complaint Should Be Set Aside
`
`The U.S. Supreme Court has made clear that fee awards must comport with the timing of
`
`the “sanctioned conduct.” Goodyear, 137 S. Ct. at 1187. The Special Master’s award of all fees
`
`for the ’494 and ’780 Patents contravenes that instruction. There has been no determination of
`
`misconduct as of the date of the Complaint for either the ’494 or ’780 Patent, nor at any time prior
`
`to the Court’s case-dooming orders in mid-to-late 2018. The Special Master’s award of fees
`
`incurred more than a year before those orders is therefore incorrect and should be set aside.
`
`In extraordinary circumstances, a district court may shift “all of a party’s fees . . . in one
`
`fell swoop.” Id. But that is possible only where the record indicates, and the court finds,
`
`misconduct from the start. Id. (“In exceptional cases, the but-for standard even permits a trial
`
`court to shift all of a party’s fees, from either the start or some midpoint of a suit[.]” (emphasis
`
`added).) Both Goodyear and Rembrandt give examples of the extraordinary, from-the-start
`
`misconduct that would warrant shifting of all fees from the complaint forward. Review of those
`
`examples confirms that no such situation existed here. Goodyear describes how in Chambers v.
`
`NASCO, 501 U.S. 32 (1991), “literally everything the defendant did—‘his entire course of
`
`conduct’ throughout and indeed preceding the litigation—was ‘part of a sordid scheme’ to defeat a
`
`valid claim.” Goodyear, 137 S. Ct. at 1187–88 (quoting Chambers, 501 U.S. at 51). Goodyear’s
`
`second example is hypothetical: “[I]f a plaintiff initiates a case in complete bad faith, so that every
`
`cost of defense is attributable only to sanctioned behavior, the court may again make a blanket
`
`award.” Id. at 1188. Neither of those circumstances resembles this case, as described below.
`
`Case No. 3:17-cv-05659-WHA
`4
`
`FINJAN’S OBJS TO SPECIAL MASTER’S REPORT AND RECOMMENDATION ON FEES
`
`1 2 3 4 5 6 7 8 9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`

`

`Case 3:17-cv-05659-WHA Document 659 Filed 06/10/21 Page 8 of 13
`
`
`
`
`Similarly, Rembrandt describes how in Monolithic Power, both a district court and the Federal
`
`Circuit “held ‘that the party’s rampant misconduct so severely affected every stage of the litigation
`
`that a full award of attorney fees was proper.’” Rembrandt, 899 F.3d at 1279 (quoting Monolithic
`
`Power, 726 F.3d at 1369)). Again, this case is far different.
`
`Other courts implementing Rembrandt and Goodyear have consistently required that
`
`awards reflect the conduct held exceptional. A recent opinion from this District described how
`
`Goodyear required that any fee award “exclude requested fees not directly traceable to . . . [the]
`
`egregious conduct.” In re PersonalWeb Techs., LLC Patent Litig., No. 18-md-02834-BLF, 2021
`
`WL 796356, at *4 (N.D. Cal. Mar. 2, 2021). Conversely, courts awarding all fees have
`
`emphasized that Rembrandt requires a determination of exceptionality from the date of the
`
`complaint. E.g., Large Audience Display Sys., LLC v. Tennman Prods., LLC, 745 F. App’x 153,
`
`157–58 (Fed. Cir. 2018) (recounting misconduct from earliest days, infecting “every stage of the
`
`litigation” (quoting Rembrandt, 899 F.3d at 1279)); SAP Am., Inc. v. Insvestpic, LLC, No. 3:16-cv-
`
`02689-K, 2018 WL 6329690, at *3 (N.D. Tex. Dec. 4, 2018) (awarding all fees because subject-
`
`matter eligibility defects were “readily apparent” pre-filing).
`
`Nothing in the Court’s § 285 Order determined that at the time of the September 2017
`
`Complaint (D.I. 1), Finjan was enmeshed in a “sordid scheme” or “complete bad faith”
`
`(contemplated by Goodyear), or “rampant misconduct” (contemplated by Rembrandt). To the
`
`contrary, the § 285 Order describes how the exceptionality determination rested on events about a
`
`year after the Complaint, for both patents.
`
`As to the ’494 Patent, the Order primarily criticizes Finjan’s trial approach to damages.1
`
`(D.I. 1 at 2–3) Nothing therein identifies, or even suggests, exceptional conduct dating back to the
`
`filing of the Complaint. The § 285 Order begins discussion of ’494 exceptionality by describing
`
`conduct “on the eve of trial” (i.e., December 2018), and how the Daubert order held Finjan’s trial
`
`plan improper, yet Finjan “pressed ahead.” (Id. at 3) There is no discussion, anywhere, of
`
`misconduct before that time, nor could any “causal connection” (Rembrandt, 899 F.3d at 1281)
`
`
`1 Finjan acknowledges that the § 285 Order is binding before this Court. Finjan reserves its right
`to seek appellate relief as to that Order’s legal holdings and factual determinations.
`5
`Case No. 3:17-cv-05659-WHA
`
`FINJAN’S OBJS TO SPECIAL MASTER’S REPORT AND RECOMMENDATION ON FEES
`
`1 2 3 4 5 6 7 8 9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`

`

`Case 3:17-cv-05659-WHA Document 659 Filed 06/10/21 Page 9 of 13
`
`
`
`
`exist between the damages issues cited in the § 285 Order and preceding events. This is
`
`particularly true in a “showdown” case like this, where the exceptionality was found within the
`
`“showdown,” and not in other case phases. On such a record, the Special Master’s
`
`recommendation to award all fees on the ’494 Patent dating back to the September 29, 2017
`
`Complaint is irreconcilable with the Order, with Goodyear, and with Rembrandt.
`
`A similar situation exists for the ’780 Patent. The § 285 Order reasons, “Finjan should
`
`have dropped the ’780 patent after that first round patent showdown[.]” (D.I. 648 at 3 (emphasis
`
`added)) On such reasoning, the Special Master’s recommendation to award all fees on the ’780
`
`Patent dating back to the Complaint is improper. The Court should also set the recommendation
`
`aside as to the ’780 Patent.
`
`Straight Path IP Group v. Cisco Systems, Inc., 411 F. Supp. 3d 1026 (N.D. Cal. 2019),
`
`cited in the § 285 Order, is consistent. As the Court knows, Straight Path’s dispositive issue was
`
`claim interpretation, and the Court’s interpretation reflected Straight Path’s own statements to the
`
`PTAB and the Federal Circuit. See 411 F. Supp. 3d at 1029–30. When considering
`
`exceptionality, the Court focused on “Straight Path’s duplicitous machinations in telling the
`
`Federal Circuit one thing and telling this Court the opposite on a critical point[.]” Id. at 1031. It
`
`described how “the patent owner saved its patents from invalidity by making clear-cut
`
`representations to the Federal Circuit—representations that it cannot now disavow in order to
`
`prove its infringement case[.]” Id. It was because Straight Path, from its complaint onward,
`
`attempted “to escape the consequences of its own representations,” id. at 1032, that the Court held
`
`Straight Path’s entire case “objectively baseless,” id. at 1034–35. This led to an award of
`
`substantially all fees relating to claims having the problem limitation. See also Straight Path IP
`
`Grp. v. Cisco Sys., Inc., No. C 16-03463 WHA, 2020 WL 2539002, at *3 (N.D. Cal. May 19,
`
`2020) (describing award of “comprehensive fees”).
`
`This case is very different from Straight Path. None of the Court’s exceptionality
`
`determinations pivot on determinations that Finjan was inconsistent between tribunals, nor any
`
`other suggestion that Finjan was proceeding in bad faith at the time of its Complaint. As to the
`
`’494 Patent, the § 285 Order rests on case-specific disputes surrounding the damages case, which
`
`Case No. 3:17-cv-05659-WHA
`6
`
`FINJAN’S OBJS TO SPECIAL MASTER’S REPORT AND RECOMMENDATION ON FEES
`
`1 2 3 4 5 6 7 8 9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`

`

`Case 3:17-cv-05659-WHA Document 659 Filed 06/10/21 Page 10 of 13
`
`
`
`
`issues were specific to this dispute and manifested shortly before trial. As to the ’780 Patent, the
`
`§ 285 Order notes that the Court’s first showdown order “disagreed with prior claim constructions
`
`from another esteemed judge in this district” as to the meaning of a crucial limitation. (D.I. 648 at
`
`4) Again, there is no determination that Finjan did, or even could have, anticipated that
`
`development when filing its Complaint.
`
`Because the Special Master’s recommended award improperly covers fees for the ’494 and
`
`’780 Patents reaching back to the Complaint, and because Supreme Court and Federal Circuit
`
`precedent do not permit such an award here, the Court should set the recommendation aside and
`
`remand for recomputation such that the proposed award encompasses no fees for the ’494 Patent
`
`prior to December 3, 2018 (the date of the Daubert order), and no fees for the ’780 Patent prior to
`
`August 9, 2018 (the date of the first showdown order).
`
`II. Goodyear and Rembrandt Do Not Permit Recovery of Fees That Would Have Been
`Incurred Regardless of the Exceptional Conduct, and the Special Master’s
`Recommended Award of Unrelated Fees Should Be Set Aside
`
`Goodyear and Rembrandt also impose subject-matter limitations on § 285 fee awards.
`
`Goodyear applies a but-for test: “The court’s fundamental job is to determine whether a given
`
`legal fee—say, for taking a deposition or drafting a motion—would or would not have been
`
`incurred in the absence of the sanctioned conduct.” 137 S. Ct. at 1187. Rembrandt accords. 899
`
`F.3d at 1280 (“[T]he district court was required to establish at least some causal connection
`
`between the misconduct and the fee award.” (internal quote marks omitted)). The Special
`
`Master’s recommendation reflects neither.
`
`A.
`
`As to the ’494 Patent, There is No Causal Connection Between Finjan’s
`Damages Case and Case Proceedings on Liability
`
`The § 285 Order identifies Finjan’s “damages fiasco” as the basis for the exceptionality
`
`determination on the ’494 Patent. (D.I. 648 at 2–3) Though Juniper’s motion on fees spent
`
`several pages urging exceptionality as to ’494 liability, the § 285 Order takes up none of those
`
`arguments and makes no such determination. (Compare D.I. 634 at 12–13 (urging exceptionality
`
`as to liability) with D.I. 648 at 2–3)
`
`Case No. 3:17-cv-05659-WHA
`7
`
`FINJAN’S OBJS TO SPECIAL MASTER’S REPORT AND RECOMMENDATION ON FEES
`
`1 2 3 4 5 6 7 8 9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`

`

`Case 3:17-cv-05659-WHA Document 659 Filed 06/10/21 Page 11 of 13
`
`
`
`
`
`On such a record, there is no basis to award fees on the ’494 Patent unconnected to the
`
`damages issues. To the extent Juniper contends that a case exceptional as to damages moots
`
`liability, and so is exceptional in its entirety, such a contention would be wrong as a matter of law.
`
`A failure of proof on damages, even an exceptional one, does not moot liability because proof of
`
`liability is per se proof of damage. See Lindemann Maschinenfabrik GmbH v. Am. Hoist &
`
`Derrick Co., 895 F.2d 1403, 1406–07 (Fed. Cir. 1990) (“In patent law, the fact of infringement
`
`establishes the fact of damages because the patentee’s right to exclude has been violated.”). In
`
`other words, even if Finjan presented no damages evidence at all, it would still have had a legal
`
`right to a reasonable royalty upon proving infringement. Apple Inc. v. Motorola, Inc., 757 F.3d
`
`1286, 1326–30 (Fed. Cir. 2014) (“[A] finding that a royalty estimate may suffer from factual flaws
`
`does not, by itself, support the legal conclusion that zero is a reasonable royalty.”).
`
`Here, the record indicates Finjan’s ’494 liability case, though ultimately unsuccessful, was
`
`within typical patent litigation standards. Indeed, the Court’s ’494 showdown order confirmed as
`
`a matter of law that Juniper’s accused products practiced all but one limitation of ’494 claim 10.
`
`(D.I. 185 at 16–17) The remaining limitation, of course, went to trial and was hotly disputed, and
`
`Juniper prevailed. But as the Court noted, “Losing, in itself, does not make a case exceptional.”
`
`(D.I. 648 at 2) If Finjan’s ’494 liability case was, on its own, unexceptional—as Finjan contends,
`
`and as the § 285 Order indicates—then case expenses necessitated by the liability claims are non-
`
`recoverable because they would have been incurred regardless of the damages issues.2
`
`The Special Master’s report fails to reflect these requirements of § 285 law. The report
`
`makes no division between the damages-only issues held exceptional by the Court, and the myriad
`
`of non-damages-related fees sought by Juniper. For example, the Special Master’s
`
`recommendation would shift fees as to the ’494 Patent on non-damages issues such as
`
`(1) discovery on ’494 infringement issues, (2) discovery on ’494 validity issues, (3)
`
`correspondence and motion practice on pleadings, (4) case management issues such as protective
`
`
`2 The situation applies with even more force to Finjan’s liability claims under the ’494 Patent for
`Juniper’s “ATP Appliance” accused product, which were not part of the December 2018 trial
`and were never litigated to resolution at all before Finjan voluntarily dismissed them to
`prepare the case for appeal. (D.I. 601 at 1 (Jt. Stip. Dismissal))
`Case No. 3:17-cv-05659-WHA
`8
`
`FINJAN’S OBJS TO SPECIAL MASTER’S REPORT AND RECOMMENDATION ON FEES
`
`1 2 3 4 5 6 7 8 9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`

`

`Case 3:17-cv-05659-WHA Document 659 Filed 06/10/21 Page 12 of 13
`
`
`
`
`order negotiations, (5) pre-trial, trial, and post-trial practice on ’494 liability issues, and
`
`(6) Juniper’s case planning and strategizing on ’494 validity issues, amid others. None of these
`
`are recoverable under Goodyear and Rembrandt because none are connected to the damages issues
`
`held exceptional for the ’494 Patent. The Court should set aside the Special Master’s
`
`recommendation and remand for recomputation as to the ’494 Patent for this reason as well.
`
`B.
`
`As to the ’780 Patent, There is No Causal Connection Between the Conduct
`Held Exceptional and Finjan’s Liability Case Against “ATP Appliance”
`
`The § 285 Order notes that the ’780 first showdown order did not resolve every accused
`
`product. (D.I. 648 at 4) Claims relating to Juniper’s “ATP Appliance” product survived, due in
`
`part to the timing of their entry into the case. The Order found Finjan’s damages case as to ATP
`
`Appliance exceptional (due to notice issues), but neither that Order nor any of the Court’s prior
`
`orders addressed liability as to ATP Appliance. As discussed supra, even assuming exceptionality
`
`as to ’780 damages, nothing in the record suggests that Finjan’s liability case on ATP Appliance
`
`was exceptional. The Court should set aside the Special Master’s recommendation on the ’780
`
`Patent and remand for recomputation.
`
`CONCLUSION
`
`For the reasons set forth herein, Finjan respectfully submits that the Court should set aside
`
`the Special Master’s report and recommendation and remand for recomputation of those fees for
`
`which recovery is actually supported by the Court’s exceptionality determinations.
`
`
`
`Dated: June 10, 2021
`
`
`Respectfully Submitted,
`
`By: /s/ Robert Courtney
`Juanita R. Brooks (CA SBN 75934) brooks@fr.com
`Frank J. Albert (CA SBN 247741) albert@fr.com
`Oliver J. Richards (CA SBN 310972) ojr@fr.com
`FISH & RICHARDSON P.C.
`12860 El Camino Real, Suite 400
`San Diego, CA 92130
`Phone: (858) 678-5070 / Fax: (858) 678-5099
`
`
`Case No. 3:17-cv-05659-WHA
`9
`
`FINJAN’S OBJS TO SPECIAL MASTER’S REPORT AND RECOMMENDATION ON FEES
`
`1 2 3 4 5 6 7 8 9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`

`

`Case 3:17-cv-05659-WHA Document 659 Filed 06/10/21 Page 13 of 13
`
`Robert Courtney (CA SBN 248392),
`courtney@fr.com
`FISH & RICHARDSON P.C.
`60 South Sixth Street, Suite 3200
`Minneapolis, MN 55402
`Tel: (612) 335-5070 / Fax: (612) 288-9696
`
`Attorneys for Plaintiff FINJAN, INC.
`
`
`
`
`
`
`
`
`
`1 2 3 4 5 6 7 8 9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`Case No. 3:17-cv-05659-WHA
`10
`
`FINJAN’S OBJS TO SPECIAL MASTER’S REPORT AND RECOMMENDATION ON FEES
`
`