Amazon.com, Inc. v. Personal Web Technologies, LLC

Background

This order concerned Amazon.com, Inc., Amazon Web Services, Inc., and Twitch Interactive, Inc., which the court collectively called “Amazon,” and PersonalWeb Technologies, LLC. Amazon sought further supplemental attorney fees and costs for work performed between March 2021 and March 2023.

The underlying multidistrict patent litigation involved PersonalWeb’s patent-infringement suits against Amazon and its customers. The court had previously found the case “exceptional” under 35 U.S.C. § 285 because, among other things, PersonalWeb’s infringement claims were objectively baseless, its positions changed repeatedly, it prolonged the litigation, and some submitted declarations were inaccurate. The Federal Circuit affirmed the exceptionality finding and earlier fee awards. The court had previously entered judgment against PersonalWeb, and the parties agreed that PersonalWeb had not paid any part of that judgment.

Legal standard

Section 285 allows a court to award reasonable attorney fees to the prevailing party in an exceptional patent case. The court applied the rule that the litigation should be viewed as an “inclusive whole,” rather than separating each phase. It also applied a causation requirement: requested fees had to be fairly traceable to PersonalWeb’s exceptional conduct and could not be punitive.

The court’s analysis

Federal appeals. Amazon requested fees for defending PersonalWeb’s appeal concerning claim construction and non-infringement, including $106,291.43 that the court had previously declined to award while the appeal was pending. The court found the fees recoverable and reasonable and awarded $110,173.37.

Amazon also requested $499,017.28 for work concerning PersonalWeb’s petition for Supreme Court review of the Kessler ruling. The court found this category recoverable because the Federal Circuit had affirmed the earlier conclusion that PersonalWeb’s Kessler position was objectively baseless. But the court’s submissions did not sufficiently identify the time spent on that petition. It awarded $209,582.50, based on the work of Paul Hastings attorneys, rather than the full amount requested.

Work pursuing earlier fee awards. The court held that Section 285 permits recovery of fees incurred while pursuing attorney-fee awards, including defending the appeal of the earlier fee awards. It awarded $292,505.92 for this work and did not award an additional $52,484.70 because Amazon had not shown how many hours supported that amount.

Federal judgment enforcement. Amazon requested $1,164,436.67 for work in federal court enforcing the judgment. The work included post-judgment discovery, subpoenas, motions, responding to counsel-withdrawal efforts, document review, and court appearances. The court held that post-judgment enforcement fees can be recoverable under Section 285 when they are connected to the exceptional conduct in the case. It found that PersonalWeb’s conduct had necessitated much of Amazon’s enforcement work.

The court excluded fees for work solely related to potential alter-ego claims because those fees were not sufficiently connected to enforcing the judgment against PersonalWeb. It also excluded fees for an unsuccessful motion to compel documents from third parties because those fees were not fairly traceable to PersonalWeb. After those reductions, the court found $1,136,120.84 for 1,931 hours to be recoverable and reasonable.

State-court receivership. Amazon requested $619,053.23 for work in a California state-court receivership proceeding. The court held that Section 285 permitted recovery because PersonalWeb’s use of the receivership had required Amazon to intervene to protect and enforce its judgment. The court did not need to decide the parties’ arguments concerning Federal Rule of Civil Procedure 69 or California Code of Civil Procedure § 685.040.

The court found that $36,886.94 related to alter-ego litigation and excluded it. It also declined to award an additional $57,487.80 because Amazon’s submissions did not show where or how that amount was spent. The court awarded $562,068.23 for the remaining state-court work.

Costs and final award

The court found Amazon’s request for $193,299.37 in non-taxable costs reasonable and granted it. The court also deducted $4,048.50 for a discount Amazon received from Steptoe.

Disposition

The court granted in part and denied in part Amazon’s motion for further supplemental fees and costs. It awarded Amazon a total of $2,499,701.73, consisting of $110,173.37 for claim-construction and non-infringement appeals; $209,582.50 for the Kessler certiorari petition; $292,505.92 for pursuing fee awards; $1,136,120.84 for federal judgment enforcement; $562,068.23 for state-court receivership enforcement; and $193,299.37 in non-taxable costs, less the $4,048.50 Steptoe discount.