Case 5:18-md-02834-BLF Document 646 Filed 11/16/20 Page 1 of 8
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`AMAZON.COM, INC., and AMAZON WEB
`SERVICES, INC.,
`Plaintiffs,
`
`v.
`PERSONALWEB TECHNOLOGIES, LLC and
`LEVEL 3 COMMUNICATIONS, LLC,
`Defendants.
`
`J. DAVID HADDEN (CSB No. 176148)
`dhadden@fenwick.com
`SAINA S. SHAMILOV (CSB No. 215636)
`sshamilov@fenwick.com
`MELANIE L. MAYER (admitted pro hac vice)
`mmayer@fenwick.com
`TODD R. GREGORIAN (CSB No. 236096)
`tgregorian@fenwick.com
`RAVI R. RANGANATH (CSB No. 272981)
`rranganath@fenwick.com
`CHIEH TUNG (CSB No. 318963)
`ctung@fenwick.com
`T.J. FOX (CSB 322938)
`tfox@fenwick.com
`FENWICK & WEST LLP
`Silicon Valley Center
`801 California Street
`Mountain View, CA 94041
`Telephone:
`650.988.8500
`Facsimile:
`650.938.5200
`
`Counsel for AMAZON.COM, INC.,
`AMAZON WEB SERVICES INC., and
`TWITCH INTERACTIVE, INC.
`UNITED STATES DISTRICT COURT
`NORTHERN DISTRICT OF CALIFORNIA
`SAN JOSE DIVISION
`IN RE: PERSONALWEB TECHNOLOGIES,
`Case No.: 5:18-md-02834-BLF
`LLC ET AL., PATENT LITIGATION,
`
`Case No.: 5:18-cv-00767-BLF
`Case No. 5:18-cv-05619-BLF
`RESPONSE OF AMAZON.COM, INC.,
`AMAZON WEB SERVICES, INC., AND
`TWITCH INTERACTIVE, INC. TO
`SUPPLEMENTAL BRIEFING ON
`REASONABLENESS OF ATTORNEY
`FEES
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`PERSONALWEB TECHNOLOGIES, LLC and
`LEVEL 3 COMMUNICATIONS, LLC,
`Plaintiffs,
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`v.
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`TWITCH INTERACTIVE, INC.,
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`Defendant.
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`RESPONSE OF AMAZON AND TWITCH TO
`SUPP. BR. RE REASONABLENESS OF FEES
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`Case Nos.: 5:18-md-02834-BLF;
`5:18-cv-00767-BLF; 5:18-cv-05619-BLF
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`ATTORNEYS AT LAW
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`FENWICK & WEST LLP
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`Case 5:18-md-02834-BLF Document 646 Filed 11/16/20 Page 2 of 8
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`I.
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`PERSONALWEB BASED ITS PROPOSED REDUCTIONS ON AN INCORRECT
`LEGAL STANDARD.
`PersonalWeb devotes most of its brief to legal arguments about tying the fee award to
`discrete acts of litigation misconduct and limiting it to successful defense motions. These incorrect
`arguments would have the Court commit legal error in service of a reduced award.
`Section 285 empowers the district court to award fees for an exceptional case—i.e., one that
`“stands out from others” based on the totality of the circumstances or for specific acts of litigation
`misconduct. See Octane Fitness, LLC v. ICON Health & Fitness, Inc., 572 U.S. 545, 554 (2014).
`In the former circumstance, the district court can award fees from “the entire case, including any
`subsequent appeals.” Therasense, Inc. v. Becton, Dickinson & Co., 745 F.3d 513, 517 (Fed. Cir.
`2014) (quoting Hensley v. Eckerhart, 461 U.S. 424, 437 (1983)). Indeed, the Federal Circuit has
`instructed that district courts should not rely just on “discrete acts of litigation conduct” when
`setting the amount of such an award. AdjustaCam, LLC v. Amazon.com, Inc., 2018 WL 1335308
`(E.D. Tex. Mar. 18, 2018) (citing Homeland Housewares, LLC v. Sorensen Research, 581 Fed.
`App’x 877, 881 (Fed. Cir. 2014); see also Blackbird Tech LLC v. Health in Motion LLC, 944 F.3d
`910, 918-19 (Fed. Cir. 2019) (affirming award of fees for entire case), cert. denied., 140 S. Ct. 2765
`(2020); Inventor Holdings, LLC v. Bed Bath & Beyond, Inc., 876 F.3d 1372, 1380 (Fed. Cir. 2017)
`(same).
`This is consistent with Goodyear Tire & Rubber Co v. Haeger, ––– U.S. –––, 137 S. Ct.
`1178 (2017). Goodyear did not address fees awarded under a fee-shifting statute—much less one
`that expressly makes fees recoverable for a “case” based on a showing of exceptionality. Rather,
`Goodyear concerned fees awarded under the court’s inherent power to sanction and held that in
`such cases the award should consist of fees incurred due to the misconduct. Id. at 1186; Comm’r,
`I.N.S. v. Jean, 496 U.S. 154, 161-62 (1990) (“fee-shifting statutes[] favor[]treating a case as an
`inclusive whole, rather than as atomized line-items”). But even if this holding is applicable, when
`a district court has already found the case exceptional, all the fees reasonably incurred in defense
`of the exceptional case satisfy the “but for” standard of Goodyear. The question at that point is
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`RESPONSE OF AMAZON AND TWITCH TO
`SUPP. BR. RE REASONABLENESS OF FEES
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`1
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`Case Nos.: 5:18-md-02834-BLF;
`5:18-cv-00767-BLF; 5:18-cv-05619-BLF
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`FENWICK & WEST LLP
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`Case 5:18-md-02834-BLF Document 646 Filed 11/16/20 Page 3 of 8
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`only how the district court will use its discretion to arrive at a reasonable award.1
`Moreover, the grounds the Court relied on here concern conduct that goes to the case as a
`whole. The Court found that that the case both lacked “substantive strength” and was litigated in an
`“unreasonable manner.” Dkt. 636 at 33. PersonalWeb brought baseless claims, frequently changed
`its infringement positions in order to avoid dismissal, unreasonably prolonged the case after claim
`construction, took unreasonable positions in the customer cases and submitted inaccurate
`declarations. Id. That conduct was pervasive—the defense fees incurred all flow from Amazon
`and Twitch’s attempts to put an end to just that abuse. PersonalWeb’s legal arguments are therefore
`irrelevant, and an award of the full costs of defense is appropriate.
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`II.
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`THE COURT SHOULD REJECT PERSONALWEB’S PROPOSED REDUCTIONS.
`PersonalWeb chose to file more than 80 patent infringement cases against Amazon’s
`customers on claims that had already been decided. The fee request here—less than $100,000 per
`case—is reasonable considering the results achieved and the actual expense to defend against
`PersonalWeb’s unreasonable conduct. But for the points of agreement addressed below, the Court
`should reject PersonalWeb’s misguided proposed reductions to the award.
`Investigation; Motion for Declaratory Judgment; Motion for Preliminary Injunction;
`Motions to Stay; MDL. In response to dozens of customer suits filed around the country, Amazon
`promptly filed a declaratory judgment complaint and moved to enjoin those cases, moved to stay
`the cases proceeding in other jurisdictions, and responded to PersonalWeb’s attempt to circumvent
`that effort at the JPML. These costs relate entirely to Amazon’s attempt to defend claims that the
`Court has already found were baseless, and to do so in the most efficient way possible. That the
`Court and the JPML ultimately chose to structure the proceedings differently is wholly irrelevant
`to whether these fees are recoverable. See Mathis v. Spears, 857 F.2d 749, 756 (Fed. Cir. 1988);
`Phigenix, Inc. v. Genentech Inc., 2019 WL 2579260, at *18 (N.D. Cal. June 24, 2019) (noting that
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`1 In re Rembrandt Techs. LP Patent Litig., 899 F.3d 1254 (Fed. Cir. 2018) is not to the contrary.
`There, the Federal Circuit held the district court failed to explain how its $51 million fee award
`related to its exceptional case finding. That case cannot be read as requiring the district court to
`apportion fees to specific acts of misconduct, as doing so would place it in irreconcilable conflict
`with the line of Federal Circuit cases that hold that the reasonable cost of defense is recoverable on
`a finding of exceptional case. See, e.g., Therasense and Homeland Housewares, supra.
`RESPONSE OF AMAZON AND TWITCH TO
`Case Nos.: 5:18-md-02834-BLF;
`SUPP. BR. RE REASONABLENESS OF FEES
`5:18-cv-00767-BLF; 5:18-cv-05619-BLF
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`FENWICK & WEST LLP
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`Case 5:18-md-02834-BLF Document 646 Filed 11/16/20 Page 4 of 8
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`the non-prevailing party could not “cite a single case in which a court declined to award a party
`fees for losing on an argument, as opposed to losing on a claim”); Monsanto Co. v. Bayer
`Cropscience, N.V., 2007 WL 1098504, at *9 (E.D. Mo. 2007) (awarding over $8 million, refusing
`to “divide the fee based on whether hours were spent in preparation for one legal question or
`another”), aff’d, 275 Fed. App’x 992 (Fed. Cir. 2008). Moreover, it was Amazon’s declaratory
`judgment action and presence in the MDL that made it possible for the Court to resolve the case as
`efficiently as it did. And had the Court accepted PersonalWeb’s proposal to have multiple customer
`cases go forward, the MDL proceeding would have been significantly more expensive.
`Motion for Judgment on the Pleadings. PersonalWeb accused CloudFront for the first
`time ten months into the case—one of the changes in infringement positions that the Court found
`made the case exceptional. At the Court’s suggestion (Dkt. 381 at 10, 27), which itself came about
`because PersonalWeb and Level 3 did not provide the Court with a clear answer about their
`respective rights to the patents, Amazon moved for judgment on the pleadings asserting that
`PersonalWeb lacked standing to accuse CloudFront. Again, that the Court ultimately denied the
`motion does not bear on whether these fees are recoverable. See Hensley, 461 U.S. at 435; Mathis,
`857 F.2d at 755; Eli Lilly & Co. v. Zenith Goldline Pharm., Inc., 264 F. Supp. 2d 753, 771 (S.D.
`Ind. 2003) (holding that, in a successful lawsuit, “reasonable efforts” leading to “some dead ends”
`are compensable). PersonalWeb’s cited authority on this point is inapposite. See Supp. Br. at 5
`(citing Chamberlain Grp, Inc. v. Techtronic Indus. Co., 915 F. Supp. 3d 977, 1020 (N.D. Ill. 2018)
`(denying fees to a non-prevailing party that lost on appeal)).
`Infringement Contentions, Invalidity Contentions, and Damages Contentions.
`PersonalWeb argues these costs should be excluded because Amazon did not rely on an invalidity
`defense, and because the other contentions relate either in whole or in part to the CloudFront claims
`that the Court did not find baseless as it did the S3 claims. But Amazon had to perform all this
`work as part of its defense of an exceptional case that the Court did find “substantively weak” and
`“unreasonably litigated.” For example, Amazon’s invalidity contentions would not have been
`needed at all but for PersonalWeb filing 80+ baseless lawsuits that it then unreasonably prolonged
`by changing its theories repeatedly. Given the case schedule, Amazon could not have avoided
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`RESPONSE OF AMAZON AND TWITCH TO
`SUPP. BR. RE REASONABLENESS OF FEES
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`3
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`Case Nos.: 5:18-md-02834-BLF;
`5:18-cv-00767-BLF; 5:18-cv-05619-BLF
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`Case 5:18-md-02834-BLF Document 646 Filed 11/16/20 Page 5 of 8
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`drafting the contentions without waiving its defenses. Again, PersonalWeb asks the Court to take
`a uniquely myopic view of awardable fees and its own unreasonable conduct.
`Fact Discovery and Discovery Disputes. PersonalWeb’s arguments for reducing fees for
`fact discovery fees are unsupported. First, it asks the Court to exclude fact discovery that did not
`relate specifically to the baseless S3 claims, ignoring the other reasons that the Court found the case
`exceptional. The Court should reject that reduction for the reasons discussed above.
`Next, PersonalWeb asks the Court to make a 75% reduction based on an erroneous analysis
`of the bills. Staffing during discovery was appropriate to the task and not “top-heavy.” Partner
`hours account for only 19.6% of this work, over half of which were Ms. Mayer’s, who defended
`multiple depositions and supervised fact discovery. See Dkt. 592-7 (Gregorian Dec.) Ex. 6;
`Supplemental Gregorian Declaration (“Supp. Gregorian”) Ex. 18. PersonalWeb cites no authority
`suggesting that these hours are unreasonable or excessive; instead, it points to cases where, unlike
`here, attorneys “billed excessive hours for routine and duplicative work.” See, e.g., Hernandez v.
`Taqueria El Grullense, 2014 WL 2611214, at *2-3 (N.D. Cal. June 11, 2014).
`Depositions were also reasonably staffed. PersonalWeb claims without support that it is
`excessive to have two attorneys attend depositions—while failing to mention that it brought at least
`two attorneys to nine depositions, and in fact staffed the depositions in this case with many more
`attorneys than Amazon and Twitch. Supp. Gregorian Ex. 17. Regardless, such fees are only
`excessive if the additional attorneys duplicate work and do not provide benefit to the client. See
`Oberfelder v. City of Petaluma, 2002 WL 472308, at *7 (N.D. Cal. Jan. 29, 2002); see also Lopez
`v. S.F. Unified Sch. Dist., 385 F. Supp. 2d 981, 993-994 (N.D. Cal. 2005) (refusing to reduce fees
`for multiple attorneys present at a deposition given size and complexity of the case); Chang v. Cnty
`of Santa Clara, 2016 WL 6162460, at *9 (N.D. Cal. Oct. 24, 2016) (reducing fees where the
`prevailing party billed nearly $5,000 per deposition hour). PersonalWeb’s other purported evidence
`for “overstaffing” mischaracterizes the record: (1) it assumes time billed by associates was “training
`time,” when those attorneys took or defended the depositions in question; and (2) it includes
`Twitch’s in house counsel and two summer associates who attended depositions but, as
`PersonalWeb itself acknowledges, were excluded from the fee request for that time. Supp.
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`RESPONSE OF AMAZON AND TWITCH TO
`SUPP. BR. RE REASONABLENESS OF FEES
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`4
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`Case Nos.: 5:18-md-02834-BLF;
`5:18-cv-00767-BLF; 5:18-cv-05619-BLF
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`Case 5:18-md-02834-BLF Document 646 Filed 11/16/20 Page 6 of 8
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`Gregorian ¶ 8; Knapton Ex. 6.
`Claim Construction and Expert Discovery. All such attorney fees were incurred in the
`defense of an exceptional case and are recoverable. But even accepting PersonalWeb’s incorrect
`view of the law, such fees were specifically incurred due to PersonalWeb’s pursuit of weak claims
`that each had multiple flaws (as shown by the Court’s summary judgment ruling). The Court also
`expressly found PersonalWeb’s attempt to prolong the case by reinterpreting the Court’s claim
`constructions made the case exceptional. Most expert discovery fees could have been avoided if
`PersonalWeb had not engaged in this unreasonable conduct. Amazon and Twitch agree with
`PersonalWeb that the Court should award retained expert fees (see Dkt. 592-6 at 2) only if it finds
`PersonalWeb engaged in vexatious conduct, committed fraud on the court, or abused the judicial
`process. See Takeda Chem. Ind., Ltd. v. Mylan Labs., Inc., 549 F.3d 1381, 1391 (Fed. Cir. 2008).
`Case Management. This complex patent MDL required a significant amount of case
`management and conference time, including coordination with the more than 80 parties in the
`MDL. The case law recognizes that this time may be not only necessary, but the most efficient
`way to coordinate work on the case. Key Bank Nat’l Ass’n v. Van Noy, 598 F. Supp. 2d 1160, 1166
`(D. Or. 2009) (noting “productive work is often accomplished in [team] meetings,” but reducing
`fees for conferences because one attorney could have performed all work in the case); Coward v.
`Robinson, 2017 WL 5195868, at 5 (E.D. Va. Nov. 9, 2017) (finding team conferences under an
`hour reasonable because “complex civil litigation necessarily entails such communication”)
`(citation omitted). The team conferences in this matter typically lasted between thirty minutes and
`an hour and were held during the most active stages of the litigation. Moreover, to ensure
`reasonableness, Amazon and Twitch have excluded entirely from the request numerous
`timekeepers that attended these conferences. Supp. Gregorian ¶ 4. The authorities cited by
`PersonalWeb do not involve complex multidistrict litigation and thus provide no relevant
`benchmark. See Supp. Br. at 10 (citing, e.g., Phigenix, 2019 WL 2579260, at *10, *16 (case staffed
`by seven partners and four associates involving only one asserted patent)).
`Non-infringement Summary Judgment. The Court’s order (Dkt. 636 at 23) noted it would
`award fees for the non-infringement summary judgment motions that were “fairly [] attributed to
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`RESPONSE OF AMAZON AND TWITCH TO
`SUPP. BR. RE REASONABLENESS OF FEES
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`Case Nos.: 5:18-md-02834-BLF;
`5:18-cv-00767-BLF; 5:18-cv-05619-BLF
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`Case 5:18-md-02834-BLF Document 646 Filed 11/16/20 Page 7 of 8
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`PersonalWeb’s conduct” after claim construction with respect to the authorization/licensing terms.
`PersonalWeb proposed reducing the $213,777.16 request to $160,332.87. Amazon and Twitch
`believe this proposal is reasonable under the Court’s prior order.
`Opposition to Rule 54(b) Motion. The Court already found that Amazon and Twitch “had
`good reasons” to oppose PersonalWeb’s motion and move for summary judgment. Dkt. 636 at 22;
`see also Dkt. 559 at 3 (“Decoupling these cases at this late stage will be contrary to the efficiencies
`desired by the parties and the Court throughout this MDL.”). These fees were necessary to avoid
`costly piecemeal appeals from the MDL and should be included in the award.
`Federal Circuit Appeals. The Court rejected PersonalWeb’s request to postpone this
`motion until appeals are resolved. Dkt. 597 at 2-3. By the same reasoning, the award should
`include the appellate fees incurred and requested in the motion. Moreover, the Federal Circuit
`recently denied the petition for rehearing that was PersonalWeb’s basis for asking the Court exclude
`these fees. See In re PersonalWeb Techs., No. 19-1918, Dkt. 135 (Fed. Cir.). This case is therefore
`unlike Phigenix, in which the Court found the appeal might be successful. 2019 WL 2579260, at
`*18. And here, regardless of the appeal regarding the Kessler doctrine, PersonalWeb’s S3 claims
`fail also under the Court’s non-infringement summary judgment ruling.
`Attorney Fee Motion. These fees are fully awardable and routinely granted. Central Soya
`Co. v. Geo. A. Hormel & Co., 723 F.2d 1573, 1578 (Fed. Cir. 1983) (§ 285 “include[s] lawyer’s
`fees for time spent on the issue of attorney fees”); see also Jean, 496 U.S. at 161-162; Drop Stop
`LLC v. Zhu, 2018 WL 1407031, at *7 (C.D. Cal. Jan. 22, 2018). Amazon and Twitch could not
`avoid this cost. PersonalWeb never offered to pay any part of their fees, and greatly increased the
`cost of this motion by asking the Court to defer ruling (after the parties had already agreed to a
`schedule (Dkt. 594)), by disclosing privileged documents selectively and thus creating discovery
`disputes and document review work (Dkts. 608, 610, 612-1 ¶ 10), and by failing to address the
`reasonableness of fees in its opposition brief resulting in this second round of briefing.
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`III. CONCLUSION
`Amazon and Twitch respectfully request that the Court award fees and non-taxable costs
`consistent with its arguments above.
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`RESPONSE OF AMAZON AND TWITCH TO
`SUPP. BR. RE REASONABLENESS OF FEES
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`6
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`Case Nos.: 5:18-md-02834-BLF;
`5:18-cv-00767-BLF; 5:18-cv-05619-BLF
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`FENWICK & WEST LLP
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`Case 5:18-md-02834-BLF Document 646 Filed 11/16/20 Page 8 of 8
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`November 16, 2020
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`Respectfully submitted,
`FENWICK & WEST LLP
`
`
`By: /s/ J. David Hadden
`
`J. DAVID HADDEN (CSB No. 176148)
`Counsel
`for AMAZON.COM,
`INC.,
`AMAZON WEB SERVICES, INC., and
`TWITCH INTERACTIVE, INC.
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`RESPONSE OF AMAZON AND TWITCH TO
`SUPP. BR. RE REASONABLENESS OF FEES
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`7
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`Case Nos.: 5:18-md-02834-BLF;
`5:18-cv-00767-BLF; 5:18-cv-05619-BLF
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