VOIT Technologies, LLC v. DEL-TON, INC.

Filing 59

ORDER granting 48 Motion for Attorney Fees. Signed by US District Judge Terrence W. Boyle on 8/3/2018. (Stouch, L.)

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF NORTH CAROLINA
WESTERN DIVISION
No. 5:17-CV-259-BO
VOIT TECHNOLOGIES, LLC,

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Plaintiff,
V.

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DEL-TON, INC.,
Defendant.

ORDER

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This cause comes before the court on defendant's motion for attorneys' fees. [DE 48].
The matter has been fully briefed and is ripe for ruling. For the following reasons, defendant's
motion is GRANTED.
BACKGROUND
Del-Ton, Inc. is a firearms manufacturer based in Elizabethtown, North Carolina. They
sell gun supplies and accessories over the internet using an online portal run by a third-party
named Volusion. Plaintiff, VOIT Technologies, LLC, filed suit in this Court on May 26, 2017-,
alleging that Del-Ton's online portal infringed on its patent, U.S. Patent No. 6,226,412. A
hearing was held before the undersigned on November 16, 2017. On January 11, 2018, this Court
granted defendant Del-Ton's motion to dismiss, finding that plaintiffs patent was invalid. DelTon then moved for an award of attorneys' fees.
DISCUSSION
The Patent Act authorizes a Court to award attorneys' fees to the prevailing party in
exceptional cases. 35 U.S.C. § 285. A case is exceptional when a party's litigation position is
particularly strong, or the case was litigated in an unreasonable manner. Octane Fitness, LLC v. ,

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ICON Health & Fitness, Inc., 134 S. Ct. 1749, 1756 (2014). District courts have discretion to
make this determination, in consideration of the totality of the circumstances. Id Factors that
indicate unreasonableness include frivolousness, motivation, objective unreasonableness, and the
need for deterrence. Id at n. 6.
Here, the Court finds that plaintiff litigated this case in an unreasonable manner and an
award of fees is appropriate, due to the need for deterrence, plaintiffs motivation, and the
frivolousness of plaintiffs case.
Plaintiffs pattern oflitigation indicates its motivation is problematic and deterrence is
warranted. Plaintiffs business model as plaintiff itself calls its motivation into question. [DE 55
at 24]. ("VOIT only sued infringers it believed could afford to pay a reasonable royalty, and in so
doing, sued entities with far superior resources than VOIT itself."). Plaintiff filed suit based on
the expired patent held invalid here 37 times in fifteen months. [DE 24-2]. Most of those cases
were resolved by settlement, some even before the filing of an answer, and this Court was the
first to rule on the validity of the patent. Id The conclusion that plaintiff was fishing for
settlements obviously follows.
Next, plaintiffs actions in this specific case show it behaved unreasonably. For example,
plaintiff filed a Notice of Settlement in Principle [DE 44], apparently without arriving at any
agreement with defendant. See [DE 45]. Additionally, in its response to defendant's motion for
fees, plaintiff expresses frustration that defendant was disinclined.to pay plaintiff to resolve the
case. [DE 55 at 25] ("Del-Ton spent over seven times as much on attorneys' fees as VOIT's
initial settlement offer."). Plaintiff claims that Del-Ton was unreasonable because it filed a
motion to dismiss "even though it knew a settlement offer from VOIT was forthcoming." [DE 55

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at 26]. It is axiomatic that a plaintiff should want a case to be heard on its merits. The fact that
plaintiff here clearly did not demonstrates that a fee award is appropriate.
Finally, plaintiffs pleadings and representations at the hearing demonstrate the
frivolousness of its case. Plaintiff was unable to explain, either in briefing or at the hearing, what
inventive concept the patent purportedly protected. This is foundational to bringing a claim for
patent infringement, and plaintiff could not do it. For these reasons, the Court finds this case is
exceptional and attorneys' fees should be awarded to defendant.
The question now is what fees are reasonable. This Court has the discretion to determine
the amount of a fee award. Mercer v. Duke Univ., 30 F. Supp. 2d 454, 466 (M.D.N.C. 2004)
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(citing Hensley v, Eckerhart, 461U.S.424, 437 (1983), abrogated on other grounds by Tex.

States Teachers Assoc. v. Garland Indep. Sch. Dist., 489 U.S 782 (1989)). To calculate an award
of attorneys' fees, the court "must first determine a lodestar figure by multiplying the number of
reasonable hours expended times a reasonable rate." Robinson v. Equifax Info Servs., LLC, 560
F.3d 235, 243 (4th Cir. 2009).
Factors to consider in determining the reasonableness of the hours and rate include: (1)
the time and labor required; (2) the novelty and difficulty of the questions; (3) the skill requisite
to perform the legal service properly; (4) the preclusion of employment by the attorney due to
acceptance of the case; (5) the customary fee; (6) whether the fee is fixed or contingent; (7) time
limitations imposed by the client or the circumstances; (8) the amount involved and the results
obtained; (9) the experience, reputation and ability of the attorneys; (10) the "undesirability" of
the case; (11) the nature and length of the professional relationship with the client; and (12)
awards in similar cases. Hensley, 461 U.S. at 430 n.3 (quoting Johnsonv. Georgia Highway

Express, Inc., 488 F.2d 714, 717-19 (5th Cir. 1974)).

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The party requesting fees bears the burden of establishing the reasonableness of the
requested rate and "must produce satisfactorily specific evidence of the prevailing market rates
in the relevant community for the type of work for which he seeks an award." Id. at 244. Other
facts may lead the court "to adjust the fee upward or downward .. ."Hensley, 461 U.S. at 434.
Defendant has submitted a declaration detailing billing information in support of its
request for attorneys' fees and costs. [DE 49-6]. Defendant seeks $128,535.00 in fees and
$716.75 in related expenses. Id. The Court has considered all the facts, the circumstances of this
litigation, as well as the declarations and affidavits submitted by defendant. [DE 49-6, 49-7]. The
Court finds the rates proposed by defendant to be reasonable for this region and under the
standards laid out by the Fourth Circuit. See Robinson, 560 F.3d at 243; Grissom v. Mills Corp.,
549 F.3d 313, 321 (4th Cir. 2008).
A fee applicant also must establish the reasonableness of the hours requested. See

Hensley, 461 U.S. at 437. After reviewing the affidavits and billing statements submitted by
plaintiffs, the Court finds that the defendant has requested a reasonable number of hours.
Defendant has demonstrated with sufficient particularity that the hours requested were properly
billable and appropriately performed by defendant's attorneys.
Plaintiff has _challenged defendant's calculation in three ways. Plaintiff argues defendant
should not recover the fees incurred in preparing the motion for bond, that more work should
have been delegated to associates, and that defendant did not comply with Local Rule 54.l(a)(l).
Each of these challenges is without merit. The motion for bond was not frivolous, the allocation
of work was not improper, and as defendant is not seeking the recovery of taxable costs, Rule
54.l(a)(l) does not apply.

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Therefore, defendant's motion to award attorneys' fees is GRANTED. The Court finds
that an award of $128,535.00 in fees and $716.75 in additional expenses is reasonable given the
extent of litigation in this matter and the

circumstanc~s

of the case. In crafting this remedy, the

Court has carefully considered what amount will compensate plaintiff for its losses without being
punitive and what is reasonable under the applicable statutes and standards.
CONCLUSION
For the foregoing reasons, defendant's motion i~ GRANTED [DE 48].

SO ORDERED, this

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day of August, 2018.

TERRENCE W. BOYLE
UNITED STATES DISTRIC

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