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`EXHIBIT 1
`EXHIBIT 1
`
`

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`United States Court of Appeals
`for the Federal Circuit
`______________________
`
`IN RE: PERSONALWEB TECHNOLOGIES LLC,
`-------------------------------------------------
`
`AMAZON.COM, INC., AMAZON WEB SERVICES,
`INC.,
`Plaintiffs-Appellees
`
`v.
`
`PERSONALWEB TECHNOLOGIES LLC,
`Defendant-Appellant
`
`LEVEL 3 COMMUNICATIONS, LLC,
`Defendant
`
`-------------------------------------------------
`
`PERSONALWEB TECHNOLOGIES LLC,
`Plaintiff-Appellant
`
`LEVEL 3 COMMUNICATIONS, LLC,
`Plaintiff
`
`v.
`
`TWITCH INTERACTIVE, INC.,
`Defendant-Appellee
`______________________
`
`2021-1858, 2021-1859, 2021-1860
`______________________
`
`
`

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`2
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`IN RE: PERSONALWEB TECHNOLOGIES LLC
`
`Appeals from the United States District Court for the
`Northern District of California in Nos. 5:18-cv-00767-BLF,
`5:18-cv-05619-BLF, 5:18-md-02834-BLF, Judge Beth Lab-
`son Freeman.
`
`______________________
`
`Decided: November 3, 2023
`______________________
`
`J. DAVID HADDEN, Fenwick & West LLP, Mountain
`View, CA, for Amazon.com, Inc., Amazon Web Services,
`Inc, Twitch Interactive, Inc. Also represented by RAVI
`RAGAVENDRA RANGANATH, SAINA S. SHAMILOV; TODD
`RICHARD GREGORIAN, San Francisco, CA.
`
` MICHAEL AMORY SHERMAN, Stubbs Alderton &
`Markiles LLP, Sherman Oaks, CA, for PersonalWeb Tech-
`nologies LLC. Also represented by JEFFREY F. GERSH,
`WESLEY WARREN MONROE.
`______________________
`
`Before LOURIE, DYK, and REYNA, Circuit Judges.
`Opinion for the court filed by Circuit Judge REYNA.
`Dissenting opinion filed by Circuit Judge DYK.
`REYNA, Circuit Judge.
`PersonalWeb appeals a district court award of
`$5,187,203.99 in attorneys’ fees entered against it. Person-
`alWeb argues that we should reverse the award because
`the district court erred in finding that the underlying case
`was “exceptional” within the meaning of the term under
`35 U.S.C. § 285. PersonalWeb also contends that, even if
`the case was exceptional and fees are appropriate, the dis-
`trict court erred in its calculation of the overall fee award.
`Because the district court did not abuse its discretion in
`finding this case exceptional or in calculating the total fees
`awarded, we affirm.
`
`

`

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`IN RE: PERSONALWEB TECHNOLOGIES LLC
`
`3
`
`BACKGROUND
`This is the third appeal from the same multidistrict lit-
`igation (“MDL”). See In re PersonalWeb Techs., LLC, 961
`F.3d 1365 (Fed. Cir. 2020) (“PersonalWeb I”); In re Person-
`alWeb Techs., LLC, No. 20-1566, 2021 WL 3557196 (Fed.
`Cir. Aug. 12, 2021) (“PersonalWeb II”). In 2011, Personal-
`Web sued Amazon in the Eastern District of Texas (Case
`No. 6:11-cv-658, referred to as the “Texas Action”), alleging
`that Amazon’s S3 technology infringed PersonalWeb’s pa-
`tents. PersonalWeb I, 961 F.3d at 1370. The asserted pa-
`tents1 are generally directed to what the inventors termed
`the “True Name” for data items. Id. at 1369–70. After the
`district court construed the claim terms, PersonalWeb stip-
`ulated to dismissal, resulting in the district court dismiss-
`ing with prejudice the infringement claims against Amazon
`and entering final judgment against PersonalWeb. Id.
`at 1372.
`In 2018, PersonalWeb asserted the True Name patents
`against eighty-five Amazon customers (the “customer
`cases”) across the country for their use of Amazon S3. Id.;
`Appellant Br. 4. Amazon intervened and filed a declara-
`tory judgment action against PersonalWeb “seeking an or-
`der barring PersonalWeb’s infringement actions against
`Amazon and its customers based on [the Texas Action].”
`PersonalWeb I, 961 F.3d at 1372. The customer cases and
`Amazon’s declaratory judgment action were consolidated
`into an MDL and assigned to the Northern District of Cal-
`ifornia. Id. PersonalWeb represented that if it lost its case
`against Twitch, a customer case, it would not be able to
`prevail in the other customer cases. Id. On that basis, the
`
`1 The asserted patents are U.S. Patent Nos.
`5,978,791 (the “’791 patent”); 6,928,442 (the “’442 patent”);
`7,802,310 (the “’310 patent”); 7,945,544 (the “’544 patent”);
`and 8,099,420 (the “’420 patent”) (collectively, the “asserted
`patents” or the “True Name patents”).
`
`

`

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`IN RE: PERSONALWEB TECHNOLOGIES LLC
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`district court stayed the other customer cases so that only
`the Twitch customer case and Amazon’s declaratory judg-
`ment action proceeded in parallel.2 Id.
`In the declaratory judgment action, PersonalWeb coun-
`terclaimed against Amazon, alleging that Amazon S3 in-
`fringed its True Name patents. Id. Almost a year into the
`case, PersonalWeb accused another Amazon product,
`CloudFront, of infringement. J.A. 1188–1200. Amazon
`moved for summary judgment.
`The district court granted partial summary judgment
`of non-infringement of the S3 product in favor of Amazon,
`based on the Kessler doctrine and claim preclusion. Per-
`sonalWeb I, 961 F.3d at 1373. We affirmed in Personal-
`Web I. Id. at 1376–79. The litigation continued as to
`CloudFront. PersonalWeb II, 2021 WL 3557196, at *2. The
`district court granted summary judgment of non-infringe-
`ment as to the CloudFront product in favor of Amazon and
`Twitch because, under the district court’s claim construc-
`tion, PersonalWeb conceded it could not meet its burden of
`proving infringement. Id. at *3, *6. We affirmed in Per-
`sonalWeb II. Id. at *6.
`The district court granted Amazon and Twitch’s motion
`for attorneys’ fees and costs under 35 U.S.C. § 285,3 deter-
`mining that the case was exceptional. The district court
`found that:
`(1) PersonalWeb’s infringement claims re-
`lated to Amazon S3 were objectively base-
`less and not reasonable when brought
`
`
`2 For convenience, we generally refer to the various
`cases that proceeded in this MDL as the singular “case.”
`3 35 U.S.C. § 285 provides: “The court in exceptional
`cases may award reasonable attorney fees to the prevailing
`party.”
`
`

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`IN RE: PERSONALWEB TECHNOLOGIES LLC
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`5
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`because they were barred due to a final
`judgment entered in the Texas Action;
`(2) PersonalWeb frequently changed its in-
`fringement positions to overcome the hur-
`dle of the day;
`(3) PersonalWeb unnecessarily prolonged
`this litigation after claim construction fore-
`closed its infringement theories;
`(4) PersonalWeb’s conduct and positions re-
`garding the customer cases were unreason-
`able; and
`(5) PersonalWeb submitted declarations
`that it should have known were not accu-
`rate.
`In re PersonalWeb Techs., LLC, No. 18-MD-02834-BLF,
`2020 WL 5910080, at *20 (N.D. Cal. Oct. 6, 2020) (“Deci-
`sion”). The district court calculated an award of attorneys’
`fees and
`costs
`totaling $5,401,625.06, of which
`$5,187,203.99 was attorneys’ fees. See In re PersonalWeb
`Techs., LLC, No. 18-MD-02834-BLF, 2021 WL 796356,
`at *18 (N.D. Cal. Mar. 2, 2021) (“Fees Decision I”) (finding
`“Amazon is entitled to $4,615,242.28 in fees for 9,263.43
`hours of work and $203,300.10 in non-taxable costs”); In re
`PersonalWeb Techs., LLC, No. 18-MD-02834-BLF, 2021
`WL 11113167 , at *2 (N.D. Cal. Apr. 19, 2021) (“Fees Deci-
`sion II”) (finding “Defendants are entitled to $571,961.71
`in fees for 926.92 hours of work and $11,120.97 in non-tax-
`able costs”).
`PersonalWeb appeals. We have jurisdiction under
`28 U.S.C. § 1295(a)(1).
`LEGAL STANDARD
`“The court in exceptional cases may award reasonable
`attorney fees to the prevailing party.” 35 U.S.C. § 285. To
`determine whether a case is exceptional under § 285,
`
`

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`IN RE: PERSONALWEB TECHNOLOGIES LLC
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`courts consider “the totality of the circumstances.” Octane
`Fitness, LLC v. ICON Health & Fitness, Inc., 572 U.S. 545,
`554 (2014).
`We review a district court’s exceptional-case determi-
`nation and award of fees under § 285 for abuse of discre-
`tion. See Highmark Inc. v. Allcare Health Mgmt. Sys.,
`Inc., 572 U.S. 559, 563–64 (2014). “To meet the abuse-of-
`discretion standard, the moving party must show that the
`district court has made ‘a clear error of judgment in weigh-
`ing relevant factors or in basing its decision on an error of
`law or on clearly erroneous factual findings.’” In re Rem-
`brandt Techs. LP Pat. Litig., 899 F.3d 1254, 1266 (Fed.
`Cir. 2018) (quoting Bayer CropScience AG v. Dow AgroSci-
`ences LLC, 851 F.3d 1302, 1306 (Fed. Cir. 2017)). We “give
`great deference to the district court’s exercise of discretion
`in awarding fees.” Energy Heating, LLC v. Heat On-The-
`Fly, LLC, 889 F.3d 1291, 1307 (Fed. Cir. 2018) (citation
`omitted).
`
`DISCUSSION
`PersonalWeb argues that the district court erred in
`finding this case exceptional under 35 U.S.C. § 285. Alter-
`natively, PersonalWeb contends that, even if the case was
`exceptional and an award of fees was appropriate, the dis-
`trict court erred in assessing $1,948,987.01 of the total
`$5,187,203.99 attorneys’ fees award. We first address the
`exceptionality issue.
`I. EXCEPTIONALITY
`An exceptional case is “simply one that 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.” Octane Fitness, 572 U.S. at 554.
`The district court’s exceptional-case determination was
`based on the five findings discussed above. We review each
`finding in turn.
`
`

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`IN RE: PERSONALWEB TECHNOLOGIES LLC
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`7
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`1. Objectively Baseless
`PersonalWeb contends that the district court abused
`its discretion in finding that this case was objectively base-
`less. The district court relied on the Kessler doctrine and
`claim preclusion in concluding that “PersonalWeb’s in-
`fringement claims related to the use of Amazon S3 were
`objectively baseless and clearly untenable based on estab-
`lished Federal Circuit precedent[s] and in light of the with-
`prejudice dismissal of the Texas Action.” Decision, at *8.
`PersonalWeb argues that the district court’s finding of
`objective baselessness was in error because PersonalWeb I,
`“while adverse to [it], illustrates that the reach of Kessler
`had not been a well-settled issue” and “extended Kessler to
`situations where non-infringement had not previously
`been adjudicated.” Decision, at *5 (citation omitted); see
`Appellant Br. 36–38; Reply Br. 2–3 (PersonalWeb arguing
`that the Solicitor General was invited to file a brief express-
`ing its views on whether the Kessler doctrine should have
`applied in PersonalWeb I). For claim preclusion, Personal-
`Web argues that the district court did not address its argu-
`ment on privity. Appellant Br. 34–36.
`We conclude that the district court did not abuse its
`discretion when considering Kessler in its assessment of ex-
`ceptionality.4 In Kessler, the Supreme Court reasoned
`that, after a “final judgment” of non-infringement in favor
`of the accused infringer Kessler, allowing follow-up suits
`by the patentee against Kessler’s customers over the non-
`infringing product “will be practically to destroy Kessler’s
`
`
`4 PersonalWeb’s infringement claims against Ama-
`zon S3 that were barred by Kessler occurred after the final
`judgment in the Texas Action, while its infringement
`claims against Amazon S3 that were barred by claim pre-
`clusion occurred before the final judgment of the Texas Ac-
`tion. See PersonalWeb I, 961 F.3d at 1373.
`
`

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`IN RE: PERSONALWEB TECHNOLOGIES LLC
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`judgment right.” Kessler v. Eldred, 206 U.S. 285, 289–90
`(1907); Rubber Tire Wheel Co. v. Goodyear Tire & Rubber
`Co., 232 U.S. 413, 418 (1914) (describing Kessler as having
`gone “no further than to hold it to be a wrongful interfer-
`ence with Kessler’s business to sue his customers” over the
`identical accused infringing product). In Rubber Tire, we
`reasoned that Kessler granted a “trade right” that “at-
`taches to” the non-infringing product. 232 U.S. at 419; see
`also Hart Steel Co. v. R.R. Supply Co., 244 U.S. 294, 299
`(1917) (relying on Kessler to reason that “rights once estab-
`lished by final judgment of a court . . . shall be recognized
`by those who are bound by it in every way”); Kerotest Mfg.
`Co. v. C-O-Two Fire Equip. Co., 342 U.S. 180, 185–86 & n.5
`(1952) (citing Kessler to reason that “a judgment in [the ac-
`cused infringer’s] favor bars suits against his customers”).
`Our case law is consistent with Supreme Court prece-
`dent. In MGA, Inc. v. General Motors Corp., we explained
`that the Kessler doctrine “bars a patent infringement ac-
`tion against a customer of a seller who has previously pre-
`vailed against the patentee because of invalidity or
`noninfringement of the patent.” 827 F.2d 729, 734 (Fed.
`Cir. 1987); see id. (explaining the “limited trade right” that
`attaches to the non-infringing product). In Brain Life, LLC
`v. Electa Inc., we explained that the “final judgment” in the
`first suit entitles a manufacturer to sell its product “with-
`out fear of allegations of infringement by [the patentee]—
`even when the acts of infringement occurred post-final
`judgment and even when it was third-parties who allegedly
`engaged in those acts of infringement.” 746 F.3d 1045,
`1056 (Fed. Cir. 2014).
`In SpeedTrack, Inc. v. Office Depot, Inc., we reasoned
`that the Kessler doctrine precludes a patentee who is first
`“unsuccessful” against the manufacturer from then suing
`the “manufacturer’s customers” for “only those acts of in-
`fringement that post-dated the judgment in the first ac-
`tion.” 791 F.3d 1317, 1328 (Fed. Cir. 2015); see also
`SimpleAir, Inc. v. Google LLC, 884 F.3d 1160, 1170 (Fed.
`
`

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`IN RE: PERSONALWEB TECHNOLOGIES LLC
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`Cir. 2018) (explaining that Kessler “does preclude asser-
`tions of a patent against even post-judgment activity if the
`earlier judgment held that ‘essentially the same’ accused
`activity did not infringe that patent” (citation omitted)).
`Attorneys’ fees under § 285 are not a penalty for losing
`a patent infringement suit. See Octane Fitness, 572 U.S.
`at 548. It is a form of sanction where, for example, a party
`advances an argument that is wholly unsupported by the
`law. Here, a straightforward application of Kessler barred
`PersonalWeb’s claims.5 After claim construction in the
`Texas Action, PersonalWeb stipulated to dismissal with
`prejudice of all of its claims against Amazon and its S3
`product, stating that PersonalWeb stipulates “that all
`claims” in the Texas Action should “be dismissed with prej-
`udice.” Texas Action, ECF No. 163 (June 6, 2014); Person-
`alWeb I, 961 F.3d at 1372. The district court then issued
`an order dismissing with prejudice “all claims” against Am-
`azon and its S3 product, and the district court entered final
`judgment against PersonalWeb. Texas Action, ECF.
`No. 164 (June 9, 2014); PersonalWeb I, 961 F.3d at 1372.
`It is well-settled that this final judgment operated as an
`adverse adjudication on the merits of PersonalWeb’s in-
`fringement claims. See Hallco Mfg. Co. v. Foster, 256 F.3d
`1290, 1297 (Fed. Cir. 2001) (stating that “a dismissal with
`prejudice[] is a judgment on the merits”); Hartley v. Mentor
`Corp., 869 F.2d 1469, 1473 (Fed. Cir. 1989) (“Such a judg-
`ment operates as an adverse adjudication on the merits of
`a claim.”); see also 18A Charles A. Wright et al., Federal
`Practice and Procedure § 4435 (2d ed. 2002) (“A stipulated
`
`
`5 The district court determined that although the
`“baselessness of PersonalWeb’s claims related to” Amazon
`S3 was one exceptional finding, it only played a “limited
`role” in the totality of circumstances analysis because “un-
`reasonable litigation tactics alone . . . would have been suf-
`ficient to find this case exceptional.” Decision, at *7.
`
`

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`IN RE: PERSONALWEB TECHNOLOGIES LLC
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`dismissal with prejudice operates as an adjudication on the
`merits for claim-preclusion purposes.”).
`But years later in 2018, PersonalWeb asserted the
`same patents from the Texas Action—the True Name pa-
`tents—against the same accused infringing technology
`from the Texas Action—Amazon S3. PersonalWeb I, 961
`F.3d at 1372. The only difference was that PersonalWeb
`accused Amazon’s customers of infringement. Id. Person-
`alWeb did so despite the then-existing precedent of Kessler,
`Rubber Tire, MGA Inc., Brain Life, and Speed Track all ex-
`plaining that, after a “final judgment” of non-infringement,
`follow-up suits against customers over the same allegedly
`infringing product, which receives the limited trade right,
`were precluded. On appeal, we reviewed the Texas Action
`dismissal and concluded that “PersonalWeb abandoned its
`claims against Amazon without reservation, explicit or im-
`plicit.” Id. at 1378. Relying on Kessler and other prece-
`dents, we concluded that “the judgment in the Texas case,
`pursuant to a with-prejudice dismissal, protected Ama-
`zon’s S3 product from subsequent infringement challenges,
`even when those challenges were directed at Amazon’s cus-
`tomers rather than at Amazon itself.” Id. at 1379.
`The dissent contends that PersonalWeb is being pun-
`ished for taking the wrong side of an open argument. Dis-
`sent at 2. This is incorrect. PersonalWeb wove the very
`net in which it now stands. It was PersonalWeb’s own
`broad dismissal with prejudice of “all claims” against Am-
`azon and the Amazon S3 product that led to a final judg-
`ment of non-infringement on the merits. And PersonalWeb
`agreed to the broad dismissal despite the “general princi-
`ple” that parties may reserve the “right to litigate some or
`all issues.” Hallco Mfg. Co., 256 F.3d at 1295. Personal-
`Web sought no such reservation to litigate. Then Person-
`alWeb sued Amazon’s customers, asserting the same True
`Name patents and accusing the same Amazon S3 technol-
`ogy of infringement. PersonalWeb is not being punished
`for its lack of success on its Kessler argument. Despite the
`
`

`

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`IN RE: PERSONALWEB TECHNOLOGIES LLC
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`11
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`existence of Supreme Court precedent and our case law,
`PersonalWeb previously lost on infringement and then con-
`travened its broad dismissal in order to wager a second bite
`of the apple against Amazon S3, an action tantamount to a
`“wrongful interference” with Amazon’s business with its
`customers. Rubber Tire, 232 U.S. at 419. As the Supreme
`Court has reasoned, PersonalWeb was “bound” by its “final
`judgment” that PersonalWeb stipulated to, and it is a “rule
`of fundamental and substantial justice” for courts to recog-
`nize and enforce those established rights. Hart Steel Co.,
`244 U.S. at 299 (citing Kessler, 208 U.S. at 289–90).
`The dissent also contends that we ultimately treated
`the issue of Kessler’s application to a stipulated dismissal
`as a matter of “first impression.” Dissent at 7 (emphasis
`added). This is incorrect. At the time we decided Person-
`alWeb I, existing precedents of Kessler, Rubber Tire, MGA
`Inc., Brain Life, Speed Track, and SimpleAir all explained
`that, after a “final judgment” of non-infringement, follow-
`up suits against customers over the same infringing prod-
`uct were precluded. In PersonalWeb I, we applied our case
`law to PersonalWeb’s own broad stipulation that led to an
`adverse final judgment of non-infringement. See Personal-
`Web I, 961 F.3d at 1376–79 (“We have previously addressed
`whether the Kessler doctrine precludes relitigation only of
`issues that were actually litigated in a prior action, albeit
`in slightly different contexts.”). Nor does it matter that, on
`appeal to the Supreme Court of PersonalWeb I, Solicitor
`General views were sought.6 This is a common occurrence.
`The Supreme Court, however, denied certiorari. See Brief
`for United States as Amicus Curiae, PersonalWeb Techs.,
`LLC v. Patreon, Inc., 2022 WL 1082550, at *8 (April 8,
`2022) (No. 20-1394); PersonalWeb Techs., LLC v. Patreon,
`
`
`6 The record shows that PersonalWeb brought its
`suits against Amazon’s customers before it appealed to the
`Supreme Court.
`
`

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`Inc., cert. denied, 142 S. Ct. 2707 (May 16, 2022) (No. 20-
`1394). We find no abuse of discretion in the district court’s
`Kessler analysis.
`We next turn to PersonalWeb’s contention that the dis-
`trict court did not address its argument on privity for claim
`preclusion. Appellant Br. 34–36. Privity, as the Ninth Cir-
`cuit has concluded, exists when the interests of the party
`in a subsequent action were shared with and adequately
`represented by a party in a former action. See Shaw v.
`Hahn, 56 F.3d 1128, 1131–32 (9th Cir. 1995). The district
`court concluded that “the law of claim preclusion was
`straightforward and well-settled when PersonalWeb filed
`this case.” Decision, at *5. We observed, in PersonalWeb I,
`that PersonalWeb did not dispute two of three elements of
`claim preclusion: that the “Texas case is a final judgment
`on the merits” and that “Amazon and its customers are in
`privity.” PersonalWeb I, 961 F.3d at 1374. So “[t]he sole
`basis for PersonalWeb’s challenge to the district court’s
`finding on claim preclusion [was] its contention that the
`Texas action and the customer suits involved different
`causes of action.” Id. We rejected this premise, concluding
`that claim preclusion applies because “the complaints in
`the customer cases and the complaint in the Texas case re-
`late to the same set of transactions”—alleged acts of in-
`fringement related to the Amazon S3 product. Id. at 1376.
`We hold that the district court did not abuse its discre-
`tion in finding PersonalWeb’s claims against Amazon S3
`were baseless under well-settled claim preclusion prece-
`dents. In its summary judgment opinion, the district court
`rejected PersonalWeb’s contrary arguments and held that
`Amazon and its customers were in privity because they
`“share the same interest in the unfettered use of Amazon’s
`web services, and Amazon adequately represented this in-
`terest in the Texas Action.” J.A. 3246. On appeal, Person-
`alWeb did “not challenge the district court’s determination
`that Amazon and its customers are in privity.” Personal-
`Web I, 961 F.3d at 1374.
`
`

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`IN RE: PERSONALWEB TECHNOLOGIES LLC
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`13
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`When it came to opposing Amazon and Twitch’s motion
`for attorneys’ fees, PersonalWeb argued that it diligently
`sought opinions on preclusion doctrines, not that the dis-
`trict court overlooked its privity argument. See J.A. 7884–
`7908. We decline to consider PersonalWeb’s new argument
`on appeal here. See Sage Prods., Inc. v. Devon Indus., Inc.,
`126 F.3d 1420, 1426 (Fed. Cir. 1997) (“If a litigant seeks to
`show error in a trial court’s overlooking an argument, it
`must first present that argument to the trial court.”). In
`any event, the district court has already rejected the argu-
`ment PersonalWeb makes on appeal, see J.A. 3245–55, and
`we find no reason to disturb that conclusion.
`Accordingly, PersonalWeb’s claims involving the Ama-
`zon S3 product were precluded under the Kessler and claim
`preclusion doctrines and should not have been brought.
`See Lumen View Tech. LLC v. Findthebest.com, Inc., 811
`F.3d 479, 483 (Fed. Cir. 2016) (finding infringement alle-
`gations “ill-supported” and the lawsuit “baseless”). The
`district court did not abuse its discretion when it deter-
`mined that PersonalWeb’s arguments were ill-supported
`and should not have been brought.
`2. Frequently Changing Infringement Positions
`PersonalWeb contends that the district court abused
`its discretion in finding that PersonalWeb frequently
`changed its infringement positions. The district court re-
`viewed various pleadings and express statements made by
`PersonalWeb and concluded that “PersonalWeb frequently
`changed its infringement positions to overcome the hurdle
`of the day.” Decision, at *11.
`PersonalWeb argues that the district court abused its
`discretion because PersonalWeb’s conduct constituted zeal-
`ous advocacy, explaining that its arguments about Amazon
`S3 and Ruby on Rails (described as a type of architecture
`for creating websites) “are part of the same argument.” Ap-
`pellant Br. 39–40 (emphasis omitted).
`
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`
`We hold that the district court did not abuse its discre-
`tion in concluding that PersonalWeb’s position-shifting
`supported an exceptionality determination. The record
`shows that PersonalWeb’s infringement theories involving
`Amazon S3 and Ruby on Rails were constantly changing
`throughout the case, ranging from emphasizing one, or the
`other, or both. For example, PersonalWeb contended, in its
`motion for MDL consolidation under 28 U.S.C. § 1407, that
`“each defendant’s website is alleged to use a Ruby on Rails
`architecture to develop and compile its webpage files” that
`are then uploaded to the “Amazon S3” system with “unique
`[] E-Tag[s].” J.A.7734–35. When opposing Amazon’s mo-
`tion for injunctive relief, PersonalWeb asserted that its
`“Ruby on Rails-based infringement allegations are wholly
`independent of any use of S3.” J.A. 9424 (emphasis in
`original). PersonalWeb moved to dismiss Amazon’s declar-
`atory judgment action, contending that it “has sued the
`website owners because they use a combination of the Ruby
`architecture and aspects of the HTTP web protocol . . . not
`just because they use S3.” J.A. 9455; see also J.A. 9505
`(44:1–2) (PersonalWeb representing at a hearing that “Per-
`sonalWeb’s theory of infringement revolves around Ruby
`on Rails not S3”). PersonalWeb later offered in its prelim-
`inary case management statement four infringement theo-
`ries, none of which mentioned Ruby on Rails. See J.A. 561
`(5:19–25). In the case management statement, Personal-
`Web also contended that “issues raised” in its suits be-
`tween Amazon’s customers and Amazon were not
`“identical” and did not “even substantially overlap.” J.A.
`17 (citing the preliminary case management statement).
`PersonalWeb’s briefing reflects the same shifts in the-
`ories of arguments. Compare Appellant Br. 40 (“S3 and
`[Ruby on Rails] are part of the same argument.” (emphasis
`omitted)), with Reply Br. 18–19 (“Ruby on Rails was part
`of the category 4 infringements” relevant only to the ’544
`patent), and id. at 19 (“Amazon S3 did not use Ruby on
`Rails.”). PersonalWeb defends the “vanishing” of Ruby on
`
`

`

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`IN RE: PERSONALWEB TECHNOLOGIES LLC
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`15
`
`Rails from its infringement theories, contending that it had
`to drop the ’544 patent due to the “practical effect of the
`district court’s claim construction order.” Reply Br. 20–21.
`We are unconvinced by PersonalWeb’s arguments. The
`record demonstrates that the district court’s claim con-
`struction order occurred in August 2019, which is almost a
`year after PersonalWeb had already omitted Ruby on Rails
`as part of its infringement theories in September 2018. See
`J.A. 561 (5:19–25) (preliminary case management state-
`ment); J.A. 5170–5203 (claim construction order). Person-
`alWeb’s position-shifting throughout this case extended to
`its reply brief on appeal when it sought to minimize Ruby
`on Rails despite PersonalWeb’s unqualified and express
`emphasis earlier in this case of the importance of Ruby on
`Rails. J.A. 7734–35; J.A. 9455; J.A. 9505 (44:1–2); see also
`Oplus Techs., Ltd. v. Vizio, Inc., 782 F.3d 1371, 1374–75
`(Fed. Cir. 2015) (explaining that party’s “infringement con-
`tentions were a constantly moving target”).
`We are not persuaded that PersonalWeb’s conduct was
`zealous representation. Zealous representation is the rule,
`not an exception. But zealous representation is tempered
`by the obligation of counsel to assist the court by fully and
`fairly presenting legal issues relevant to the facts of the
`case. See Allen Eng’g Corp. v. Bartell Indus., Inc., 299 F.3d
`1336, 1356 (Fed. Cir. 2002) (“Counsel must remember that
`they are not only advocates for their clients; they are also
`officers of the court.”). Exceptionality cannot hide behind
`a claim of zealous representation. PersonalWeb’s con-
`stantly changing infringement theories obfuscated the
`merits of its case and undermined its trustworthiness and
`reliability before the district court. This pattern of flip-
`flopping infringement theories “stands out from others
`with respect to the substantive strength of [PersonalWeb’s]
`litigating position” and “the unreasonable manner in which
`the case was litigated.” Octane Fitness, 572 U.S. at 554.
`
`

`

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`IN RE: PERSONALWEB TECHNOLOGIES LLC
`
`On these grounds, the district court did not abuse its
`discretion when it premised its exceptionality determina-
`tion on PersonalWeb’s frequently changing infringement
`theories.
`3. Unnecessarily Prolonged Litigation Post-Claim
`Construction
`PersonalWeb contends that the district court abused its
`discretion in finding that PersonalWeb unnecessarily pro-
`longed this case after claim construction. The district court
`reviewed the parties’ conduct post-claim construction, con-
`cluding that “PersonalWeb’s prolongation of the Twitch
`case after claim construction and its instruction to the ex-
`pert to apply PersonalWeb’s ‘interpretation’ of the [district
`court’s] claim construction were unreasonable litigation
`conduct.” Decision, at *13. We disagree with PersonalWeb.
`PersonalWeb argues that the district court abused its
`discretion because the district court expressly credited Per-
`sonalWeb’s streamlining efforts post-claim construction
`and observed that Amazon bore some responsibility for pro-
`longing this case. Appellant Br. 42–46.
`We hold that the district court did not abuse its discre-
`tion in finding that PersonalWeb engaged in unreasonable
`conduct post-claim construction that prolonged this case.
`In August 2019, the district court construed the claim
`terms (present in all remaining asserted claims) “authori-
`zation” as “a valid license” and “unauthorized or unli-
`censed” as “not compliant with a valid license.” See J.A.
`5175–81; PersonalWeb II, 2021 WL 3557196, at *1–2. Be-
`cause the accused infringing technology does not assess the
`validity of user licenses, Amazon requested that Personal-
`Web dismiss all claims against Amazon and Twitch with
`prejudice as the district court’s claim construction order
`“ma[de] clear that PersonalWeb ha[d] no viable infringe-
`ment claim.” J.A. 5218.
`
`

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