Capella Photonics, Inc. v. Cisco Systems, Inc.

Background

Capella Photonics brought patent-infringement claims against four defendants involving two patents. One defendant petitioned the Patent Trial and Appeal Board (PTAB) for inter partes review, a process for challenging patent claims. The PTAB determined that all of Capella’s claims identified in its preliminary infringement contentions were invalid, and the Federal Circuit affirmed. The Patent and Trademark Office later issued certificates canceling the specified claims. The opinion states that this effectively eliminated all claims asserted in the case, although other claims in the patents were not adjudicated by the PTAB.

Capella filed reissue applications and sought to extend the stay and amend its infringement contentions. The court denied those requests. Capella then moved to dismiss its claims without prejudice as moot and for lack of subject-matter jurisdiction. The defendants opposed dismissal with prejudice and asked for judgment in their favor, prevailing-party status, and statutory costs. On September 6, 2019, the court dismissed Capella’s claims without prejudice, dismissed Ciena’s counterclaims without prejudice, and denied the defendants’ request to be declared prevailing parties and awarded statutory costs.

Motion for Relief

The defendants sought relief from the September 6 order under Federal Rule of Civil Procedure 60(b)(6). That provision allows relief from a final order for another reason that justifies relief, but the court explained that it is narrowly applied and requires extraordinary circumstances.

The defendants relied on the Federal Circuit’s October 9, 2019 decision in B.E. Technology, L.L.C. v. Facebook, Inc. In that case, the Federal Circuit held that a defendant could be a prevailing party after a case was dismissed as moot following cancellation of the asserted patent claims. The court concluded that the decision likely would have led it to rule differently on prevailing-party status and represented at least a clarification of previously unsettled law.

The court evaluated factors concerning whether a change in law justified reopening the earlier order. The defendants filed their motion shortly after the B.E. Technology decision, and neither side identified a change in legal position based on reliance on the earlier order. The motion was filed relatively soon after the dismissal, and the connection between the earlier order and B.E. Technology was direct. The court found the diligence factor weighed slightly against relief because the defendants had not sought reconsideration, appealed, or notified the court about the related decision or its pending appeal. The court found the comity factor inapplicable because this patent case did not involve a federal habeas challenge to a state conviction.

Extraordinary Circumstances and Costs

Despite several factors favoring relief, the court found that the circumstances were not extraordinary enough to justify reopening the order. The defendants characterized the requested relief as a minor correction and did not identify consequences beyond the ability to seek statutory costs and potentially attorney’s fees. The court concluded that being denied statutory costs did not amount to the extreme hardship or injustice required to disturb the finality of the earlier order.

Disposition

The court DENIES the defendants’ Motion for Relief and declines to award statutory costs. The order disposes of Docket No. 227.