Thermolife International, LLC v. GNC Corporation
3:13-cv-00651
S.D. Cal.Oct 24, 2017Background
- Plaintiffs ThermoLife and Stanford sued numerous defendants (part of an 81-case filing) asserting several patents; cases were consolidated and bifurcated, with validity tried first.
- After a five-day trial on invalidity, the Court found all patents-in-suit invalid and later concluded the overall litigation was "exceptional," granting defendants' motions for attorneys’ fees under 35 U.S.C. § 285.
- Plaintiffs moved for reconsideration of the fee/order; they filed a late supplemental Woods declaration and exhibits with that motion.
- Defendants moved to strike large portions of the Woods declaration and exhibits as untimely and newly presented; the Court granted the strike as those materials could have been submitted earlier and would prejudice defendants.
- Plaintiffs argued the Federal Circuit’s Checkpoint decision was an intervening change undermining the exceptional-case finding; the Court found Checkpoint did not require reconsideration.
- The Court reviewed Plaintiffs’ challenges to its earlier findings (pre-filing investigation inadequacy, plaintiffs’ litigation pattern, and deterrence/compensation rationale) and denied reconsideration, concluding no clear error or manifest injustice.
Issues
| Issue | Plaintiffs' Argument | Defendants' Argument | Held |
|---|---|---|---|
| Whether Woods declaration exhibits (A–C, E–O) may be considered on reconsideration | Exhibits are defendants’ own labels, accurate, complete the record, and were timely enough for consideration | Exhibits were presented for the first time on reconsideration, untimely, and prejudicial | Struck the challenged portions of the Woods declaration and any parts of the reconsideration motion relying on them |
| Whether Checkpoint Systems constitutes an intervening change of law warranting reconsideration | Checkpoint narrows exceptionality, so prior exceptional finding is undermined | Prior Order applied totality of circumstances and is consistent with Checkpoint | Checkpoint does not warrant reconsideration; motion denied on this ground |
| Whether the Court clearly erred in finding Plaintiffs’ pre-filing investigation was ‘‘severely lacking’’ | Court overlooked or mischaracterized evidence (labels vs. ads, state of the art, method vs. amount issues) | Plaintiffs had opportunity to present these arguments earlier; record supports Court’s factual findings | No clear error; Court’s pre-filing investigation findings stand |
| Whether the Court erred in finding a pattern of litigation supporting exceptionality and that fees further compensation/deterrence goals | Plaintiffs dispute factual bases (sales volume, settlements, number/timing of suits, patent expirations) and contend deterrence not warranted | Defendants point to record evidence: deposition, settlement exhibits, Lex Machina data, license timing | Court found record support for its findings; awarding fees serves compensation and deterrence; reconsideration denied |
Key Cases Cited
- Carroll v. Nakatani, 342 F.3d 934 (9th Cir. 2003) (motions for reconsideration cannot introduce arguments or evidence that could have been raised earlier)
- Kona Enterprises, Inc. v. Estate of Bishop, 229 F.3d 877 (9th Cir. 2000) (reconsideration is extraordinary and may not be used to relitigate matters)
- School Dist. No. 1J v. ACandS, Inc., 5 F.3d 1255 (9th Cir. 1993) (standards for reconsideration/grounds for relief)
- Checkpoint Sys., Inc. v. All-Tag Security S.A., 858 F.3d 1371 (Fed. Cir. 2017) (motivation to enforce a patent is not improper where plaintiff had a reasonable basis to sue)
- Octane Fitness, LLC v. ICON Health & Fitness, Inc., 134 S. Ct. 1749 (2014) (district courts should consider compensation and deterrence in awarding fees under § 285)
- SFA Sys. v. Newegg Inc., 793 F.3d 1344 (Fed. Cir. 2015) (a pattern of litigation abuses can be relevant to exceptional-case determinations)