Mary Elle Fashions, Inc. v. Jasco Products Company LLC

Filing 38

MEMORANDUM AND ORDER: IT IS HEREBY ORDERED that the Amended Motion of Plaintiff, Meridian Electric, to Dismiss All Claims 25 is GRANTED and this case is dismissed with prejudice.IT IS FURTHER ORDERED that the Motion of Plaintiff, Meridian Electri c, to Dismiss All Claims 23 is DENIED as moot.IT IS FURTHER ORDERED that Defendant Jasco Products Company LLCs Conditional Opposition to Meridian Electrics Motion to Dismiss and Cross Motion for Attorneys Fees and Costs 31 is GRANTED in part and DENIED in part. Jascos request for fees is denied and its request for costs is granted. In accordance with Local Rule 54-08.03, Jasco shall timely file with the Court a verified bill of costs using Court-approved Form AO-133. Signed by District Judge Rodney W. Sippel on 2/4/16. (ARL)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
EASTERN DIVISION
MARY ELLE FASHIONS, INC.,
d/b/a MERIDIAN ELECTRIC,
Plaintiffs,
vs.
JASCO PRODUCTS CO., LLC,
Defendant.

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Case No. 4:15 CV 855 RWS

MEMORANDUM AND ORDER
Plaintiff Mary Elle Fashions, Inc., doing business as Meridian Electric (“Meridian”)
brought this patent infringement suit against defendant Jasco Products Co., LLC (“Jasco”)
alleging that Jasco was infringing on its LED night light replacement bulb design patent. Jasco
filed counterclaims seeking a declaratory judgment that its product did not infringe the Meridian
patent and seeking attorney’s fees and costs under 35 U.S.C. § 285. Meridian now moves to
voluntarily dismiss all claims in this case with prejudice because “it now appears that Jasco made
some sales of the Accused Device [] to Walmart more than one year prior to Meridian’s filing of
its application for the Patent.” [#24] at 3. Jasco does not oppose the dismissal of the patent
infringement claims, but does oppose the dismissal of its counterclaims for attorney’s fees and
costs, and Jasco cross-moves to recover those fees and costs. This case is not an “exceptional”
case and attorney’s fees will not be assessed against Meridian. Consistent with statutory
authority, the Federal Rules of Civil Procedure, and this Court’s local rules, however, Jasco is
awarded costs as a prevailing party.
Legal Standard
Section 285 of the Patent Act authorizes a district court to award attorney's fees in patent
litigation. It provides that “[t]he court in exceptional cases may award reasonable attorney fees

to the prevailing party.” 35 U.S.C. § 285. “This text is patently clear. It imposes one and only
one constraint on district courts' discretion to award attorney's fees in patent litigation: The
power is reserved for ‘exceptional’ cases.” Octane Fitness, LLC v. ICON Health & Fitness, Inc.,
134 S. Ct. 1749, 1755-56, 188 L. Ed. 2d 816 (2014). 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.” Id. at 1756. By definition, “exceptional” cases are “uncommon,”
“rare,” or “not ordinary.” Id. “District courts may determine whether a case is ‘exceptional’ in
the case-by-case exercise of their discretion, considering the totality of the circumstances.” Id.
Federal Rule of Civil Procedure 54(d) provides, in relevant part, “Unless a federal statute,
these rules, or a court order provides otherwise, costs—other than attorney's fees—should be
allowed to the prevailing party.” Rule 54(d)(1). “A prevailing party is presumptively entitled to
recover all of its costs.” Thompson v. Wal-Mart Stores, Inc., 472 F.3d 515, 517 (8th Cir. 2006)
(internal citation omitted). “To rebut the presumption that the prevailing party is entitled to
recover all of its costs, the district court must provide a rationale for denying the prevailing
party's claim for costs.” Id. (internal citation omitted). Title 28 U.S.C. § 1920 sets out the types
of costs that may be awarded to the prevailing party.
Discussion
A. Attorney’s Fees
I first address Jasco’s cross-motion for attorney’s fees and costs. Jasco argues that it
should be awarded attorney’s fees because “Meridian (1) ignored Jasco’s pre-litigation
statements regarding invalidating prior sales of the Accused Product; (2) filed this lawsuit in the
face of Jasco’s prior sales; (3) continued to prosecute its desperate case undeterred by growing
evidence; and (4) has finally moved to voluntarily dismiss its case now that the mound of
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evidence is too high for even Meridian to ignore.” ECF [#27] at 2. Jasco argues that Meridian
knew or should have known that Jasco had sold its competing product since 2008, which was
two years before Meridian filed for its design patent and therefore means that the design patent is
invalid or Jasco does not infringe. See 35 U.S.C. § 102(b). Jasco sets out details of the parties
communications prior to the filing of this suit and during litigation showing that Jasco provided
Meridian with statements affirming and documentation of its prior sales. And while Meridian
now seeks dismissal of this suit, Jasco argues that its reaction was not prompt enough and that
Meriden acted in bad faith in pursuing its claims in the face of the prior sales evidence.
Having reviewed the parties’ briefs, supporting documents, and the relevant authority, I
cannot say that this is an exceptional case justifying the award of attorney’s fees. The timeline of
events set out in the parties briefs and, in particular, in Meridian’s memorandum in opposition to
Jasco’s cross-motion for fees and costs, see ECF [#32], shows that Meridian had sufficient
support for its claims at the time it brought suit and during the pendency of the suit. Meridian
possessed, for example, its presumptively valid patent for its own night light replacement blub at
the time the suit was filed. Patent No. D653,364; 35 U.S.C. § 282. Meridian has also shown
that, although Jasco produced some evidence after the suit was filed suggesting that it had made
prior sales, the evidence did not conclusively show that its suit was meritless, especially in light
of certain contradictory information in Meridian’s possession. For example, Meridian had
emails and statements from the relevant buyer at Walmart that suggested that no other light bulbs
of this particular kind had been sold by Walmart in the relevant time period. See Christenson
statement, Ex. D to Corwin Declaration, ECF [#36-4].
Moreover, once Meridian was presented with more conclusive evidence of Jasco’s prior
sales, it was diligent in moving to dismiss this case. On October 30, 2015, Jasco provided
Meridian with the Consumer Testing Laboratories, Inc. (“CTL”) reports from 2008 and 2009 that
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had been prepared for Walmart of its prior sales, which suggest that Walmart was selling the
Jasco product as early as 2008. Meridian’s counsel then reviewed and responded to the CTL
reports in early November with follow up questions. Then, on December 10, 2015, Jasco’s
counsel inspected the Jasco light bulb that Meridian had in its possession and discovered that it
was stamped with a 2008 copyright date.1 That same day, Meridian filed its motion to dismiss
this case with prejudice. One week later, Meridian amended its motion to include a covenant not
to sue.2
Considering the totality of the circumstances, I cannot say that this case was exceptional,
uncommon, or rare. See Octane Fitness, LLC v. ICON Health & Fitness, Inc., 134 S. Ct. 1749,
1755-56, 188 L. Ed. 2d 816 (2014). Proof of prior sales is a common defense to a claim of
patent infringement, and it is not the exceptional case where the defendant is successful in such a
defense. Nor was Meridian’s response to the information gathered during discovery
exceptionally prolonged or otherwise out of the ordinary. As a result, I will deny Jasco’s request
for attorney’s fees.
B. Costs
Jasco also moves for costs to be awarded pursuant to 28 U.S.C. § 1920 and FRCP 54(d).
“A prevailing party is presumptively entitled to recover all of its costs.” Thompson v. Wal-Mart
Stores, Inc., 472 F.3d 515, 517 (8th Cir. 2006) (internal citation omitted). When a party
unilaterally seeks dismissal of an action pursuant to FRCP 41(a)(2), as is the case here, the
opposing party is often regarded as the prevailing party for purposes of an award of costs. See

Meridian’s previous counsel possessed a Jasco lightbulb at the time it filed suit, which it referenced in
its cease and desist letter. But Meridian represents that it had since lost that lightbulb, and the one it had
in its possession at the time of the December 10, 2015 inspection (which was stamped with the 2008
copyright date) had only been provided to counsel by Meridian the day before, and Meridian’s counsel
had not opened the package or seen that copyright date until Jasco’s counsel inspected the lightbulb.
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Additionally, at the time of Meridian’s motion to dismiss, this action had only been pending for
approximately six months, and it appears that it has not progressed beyond the initial phases of discovery,
with no depositions or expert analyses having been done.
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Power Mosfet Techs., L.L.C. v. Siemens AG, 378 F.3d 1396, 1416 (Fed. Cir. 2004) (“[t]he
dismissal of a claim with prejudice [] is a judgment on the merits”).
Meridian briefly argues that I should deny Jasco’s request for costs because Jasco could
have avoided the expense of litigation by providing Meridian with evidence of its prior sales
before this suit was filed and in response to the cease and desist letter. I am not persuaded that
the presumption of a cost award should be overcome in this case. As a result, I will grant Jasco’s
request for certain costs pursuant to 28 U.S.C. § 1920. In accordance with Local Rule 54-08.03,
Jasco shall timely file with the Court a verified bill of costs using Court-approved Form AO-133.
C. Motion to Dismiss
Finally, I address Meridian’s motion to dismiss. As noted above, Meridian moves to
dismiss all claims with prejudice, and it has filed a covenant not to sue in which it covenants not
to sue Jasco or its agents for any claim of infringement concerning the accused products in this
action. Jasco does not oppose the motion to the extent it seeks dismissal of the patent claims,
including its own counterclaims. For this reason and the reasons stated above, I find that
dismissal of the patent claims and Jasco’s counterclaim for fees is proper under FRCP 41(a)(2).
As a result, Meridian’s motion to dismiss will be granted and these claims will be dismissed with
prejudice.
Accordingly,
IT IS HEREBY ORDERED that the Amended Motion of Plaintiff, Meridian Electric, to
Dismiss All Claims [25] is GRANTED and this case is dismissed with prejudice.
IT IS FURTHER ORDERED that the Motion of Plaintiff, Meridian Electric, to Dismiss
All Claims [23] is DENIED as moot.
IT IS FURTHER ORDERED that Defendant Jasco Products Company LLC’s
Conditional Opposition to Meridian Electric’s Motion to Dismiss and Cross Motion for
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Attorney’s Fees and Costs [31] is GRANTED in part and DENIED in part. Jasco’s request for
fees is denied and its request for costs is granted. In accordance with Local Rule 54-08.03, Jasco
shall timely file with the Court a verified bill of costs using Court-approved Form AO-133.

RODNEY W. SIPPEL
UNITED STATES DISTRICT JUDGE
Dated this 4th day of February, 2016.

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