220 F. Supp. 3d 704
E.D. Va.2016Background
- Realvirt, LLC lost before the PTAB and filed a §145 district-court action; the Court ordered Realvirt to pay the PTO $103,259.52 in "expenses of the proceedings."
- The judgment comprised $54,804.90 for expert witness and deposition expenses and $48,454.62 for attorneys’ fees.
- Realvirt appealed the October 27, 2016 order to the Federal Circuit and moved to stay payment pending appeal.
- Realvirt argued it would suffer irreparable financial harm if forced to pay now and sought a stay of the full amount; the PTO opposed and alternatively sought a bond for the judgment.
- The central legal question on appeal (and for the stay) is whether 35 U.S.C. § 145 authorizes recovery of attorneys’ fees as "expenses of the proceedings."
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether to stay payment of the §145 judgment pending appeal | Stay whole judgment; otherwise irreparable financial harm and appeal raises a novel issue about attorneys’ fees | Opposes full stay; requests bond or denies stay | Partial stay granted: attorneys’ fees portion ($48,454.62) stayed; plaintiff must post bond for remaining expenses ($54,804.90) |
| Whether §145 authorizes attorneys’ fees as recoverable "expenses" | §145 does not clearly preclude attorneys’ fees; Federal Circuit has not addressed the issue here | PTO maintained §145 permits collection of expenses, and the court previously awarded fees | Court found this is an unresolved Federal Circuit question; likelihood of success on merits for fees is sufficiently plausible to justify a stay of the fees portion |
| Whether plaintiff will suffer irreparable harm absent a stay | Payment now would cause irreparable financial injury | PTO argued collection interest and finality weigh against stay | Court found plaintiff showed some evidence of irreparable financial injury, supporting a stay of the fees portion |
| Whether a bond should be required while staying part of the judgment | Sought stay without full bond | PTO sought bond for security of collection | Court balanced interests and required bond for the non-fee portion to protect PTO’s collection rights |
Key Cases Cited
- Nken v. Holder, 556 U.S. 418 (2009) (sets four-factor stay framework)
- United States v. Fourteen Various Firearms, 897 F. Supp. 271 (E.D. Va. 1995) (clarifies likelihood-of-success standard for stays)
- Alexander v. Chesapeake, Potomac & Tidewater Books, Inc., 190 F.R.D. 190 (E.D. Va. 1999) (district courts may impose partial bonds to preserve status quo pending appeal)
- Realvirt, LLC v. Lee, 220 F. Supp. 3d 695 (E.D. Va. 2016) (opinion addressing §145 expenses and attorneys’ fees)
- Narikwest, Inc. v. Lee, 162 F. Supp. 3d 540 (E.D. Va. 2016) (related §145 litigation addressing attorneys’ fees)