After losing a patent dispute case, plaintiff Checkpoint System was ordered to pay the attorneys’ fees and costs of defendants Sensormatic Electronics Corp. and All-Tag Security. U.S. District Judge Petrese B. Tucker of the Eastern District of Pennsylvania found the case to be exceptional and filed in bad faith. In such bad-faith litigation, the U.S. Code provides for the award of attorneys’ fees. Rather than contesting the reasonableness of the attorneys’ rates or the time they spent on the case, Checkpoint’s objections focused on which tasks were properly reimbursable by the company.
Award of Attorneys’ Fees
All-Tag: The court ordered Checkpoint to pay $2.43 million; including $1.61 million in attorneys’ fees, $191,000 in expenses, $634,000 in prejudgment interest and $35.98 per day in post-judgment interest.
Sensormatic: Checkpoint was ordered to pay $4.15 million in addition to a $91,000 sum previously paid. These costs included approximately $3 million in legal fees, $337,000 in expenses, $806,000 in prejudgment interest and $55.63 per day in post-judgment interest.
In total, Checkpoint was ordered to pay both defendants $6.5 million in attorneys’ fees and costs.
The court did, however, reject a $50,000 litigation success fee, finding the fee unreasonable because it was not billed for actual work performed, but was linked to the outcome of the case. Judge Tucker classified this fee as a form of duplication of compensation already paid, which is impermissible.
Checkpoint sought to have a combined $1.1 million excluded from the defendants’ fee recovery because the costs consisted of work done for litigation in which the defendants lost. However, the court ruled that the defendants would not have had to incur such costs if Checkpoint hadn’t filed in bad faith.