Finjan, Inc. v. Juniper Network, Inc.

Background

Finjan, Inc. sued Juniper Network, Inc. for patent infringement in September 2017, asserting several patents. The litigation proceeded in two main rounds. In the first round, Juniper won summary judgment on noninfringement of claim 1 of the ’780 patent. Finjan largely prevailed on infringement of claim 1 of the ’494 patent, but the court excluded Finjan’s damages expert under the rules governing expert testimony. At trial, the court entered judgment as a matter of law for Juniper on damages, and the jury returned a noninfringement verdict.

In the second round, Juniper prevailed without opposition on noninfringement of claim 9 of the ’780 patent for most accused products. For the remaining products, Finjan’s case failed because Finjan had not provided Juniper adequate notice under 35 U.S.C. § 287. The court later entered summary judgment of noninfringement concerning the ’154 patent. Finjan stipulated to dismissal with prejudice of all remaining patent claims. The Federal Circuit summarily affirmed aspects of both rounds.

Attorney’s-fee standard

Under 35 U.S.C. § 285, a court may award reasonable attorney’s fees to the prevailing party in an exceptional case. The court explained that a case is exceptional when, considering all the circumstances, a party’s legal and factual position is unusually weak or the case was litigated in an unreasonable manner. Losing alone is not enough.

Reasons for finding two patent assertions exceptional

The court found Finjan’s assertion of the ’494 patent exceptional. It cited Finjan’s change in infringement theory shortly before trial after discovering that its original theory covered only a small portion of Juniper’s revenue. Finjan attempted to introduce the new theory through its damages expert’s report, but the court excluded it. Finjan then presented a facts-only damages case that the court found inadequate because it did not properly allocate revenue between allegedly infringing and noninfringing product functions. The court also found that a Finjan executive gave irrelevant testimony about what Finjan would have sought in negotiations, which led to a caution and a limiting instruction to the jury.

The court also found Finjan’s assertion of the ’780 patent exceptional. After Juniper won summary judgment on claim 1 based on the meaning of the phrase “performing a hashing function,” Finjan continued litigating the substantially overlapping claim 9 and expanded the accused products. When Juniper moved for summary judgment on claim 9, Finjan did not oppose the motion for most of the accused products. For the remaining products, the court identified problems concerning patent notice, including attempts to revisit prior concessions and a mischaracterization of a favorable district court decision as having been affirmed by the Federal Circuit. The court described that mischaracterization as possibly reckless, though not necessarily intentional.

Reasons for limiting the fee request

The court rejected Juniper’s position that every part of the case was exceptional. It concluded that Finjan had the right to distinguish or challenge nonbinding earlier claim constructions. The court also emphasized that fee shifting is an exception to the usual rule that each side pays its own attorney’s fees. It declined to treat the Federal Circuit’s summary affirmance as independently supporting a complete fee award because doing so could discourage appeals. Finally, although Finjan voluntarily dismissed six patents with prejudice, the court could not conclude on this record that the delay in dismissing them was exceptional.

Disposition

The order held exceptional only Finjan’s assertion of the ’494 and ’780 patents. It awarded no fees yet because Juniper’s billing records did not separate work eligible for reimbursement from other work. Juniper was ordered to resubmit records covering only work on those two patents and using reasonable billing rates. The court stated that it might treble the deduction of inappropriate requests or deny fees altogether, and that it was considering appointing a special master to resolve remaining disputes. Judge William Alsup signed the order.