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Patent Plaintiff Must Pay Defendant's Fees in 'Internet of Things' Claim

By William Vogeler, Esq. on June 08, 2017 | Last updated on March 21, 2019

A federal appeals court said a patent plaintiff must pay its opponent's attorneys' fees because the plaintiff willfully ignored pre-existing descriptions of its claimed invention.

In Rothschild Connected Devices Innovations v. Guardian Protection Services, the Federal Circuit Court of Appeals said the plaintiff and its attorney did not prove the basis for the claim before filing the infringement case. In addition, the court considered evidence that the plaintiff was a vexatious litigant who had filed 58 similar cases only to settle most of them before trial for the cost of defense.

"Rothschild's continued assertions that its patent extends to products simply because they are configured using the Internet... are risible rather than simply unreasonable," Judge Haldane Robert Mayer wrote in a strongly worded concurring opinion.

Internet Mixer

The case arose based on the plaintiff's "090 patent" claim, the court said. The patent described a method to "enable a user to customize products containing solids and fluids by allowing a server on the global computer network, e.g.,the Internet, to instruct the hardware mixing the solids and fluids of the user's preferences for the final mix."

The plaintiff sued ADS Security, which provides home security systems through the internet, for violating the patent. The company responded with a motion to invalidate the patent and a demand that Rothschild pay its attorneys' fees.

Rothschild then moved to dismiss the case, but ADS opposed the motion and asked the court for its fees. ADS said the plaintiff had filed scores of lawsuits to "exploit the high cost to defend complex litigation and extract nuisance value settlements."

Judge Rodney Gilstrap declined to award attorneys' fees, saying that the plaintiff's motion to withdraw was "reasonable" and that the patent-holding company had advanced "facially plausible arguments" the invention was patentable.

Stupid Patent of the Month

On appeal, the Fourth Circuit disagreed. The panel said the judge abused his discretion, given that the plaintiff had no factual foundation for its claim before suing ADS.

"This suit never should have been filed, and ADS deserves to be fully compensated for the significant attorneys' fees it has incurred," Mayer wrote.

Mayer, citing a Washington Times report that lampooned the invention, said Rothschild was "suing everyone who connects to the internet." The Electronic Frontier Foundation called the "internet drink mixer" the "Stupid Patent of the Month."

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