Mistake – Even “Costly Mistake” – Does Not Justify Section 285 Attorneys’ Fee Award

The court denied defendant's motion for more than $200,000 in attorneys' fees under 35 U.S.C. § 285 where plaintiff dismissed its case after learning that the patent-in-suit it acquired from its parent company was subject to a terminal disclaimer but was not under common ownership. "The [patent-in-suit] could not stand on its own two feet. It was subject to a terminal disclaimer requiring that it have common ownership with [another] patent in order to be enforceable. . . . [A]bout eighteen months before the start of this litigation, [plaintiff's parent] assigned the [patent-in-suit] to [plaintiff], with [the parent] retaining the [other] patent. . . . [M]istakes, even costly mistakes, happen. It is the simplest explanation of what happened here, and therefore the most likely. Second, there was nothing worthwhile to be gained by splitting the ownership of the patents, and a lot to lose by doing so. Third, the reaction to [defendant's] e-mail [notifying plaintiff of the disclaimer issue] was an extremely prompt 'fold.'. . . While there might be circumstances where the prompt 'fold' could be interpreted as recognition that the 'jig was up,' that is not what it looks like to me here."

Parallel Iron LLC v. EMC Corporation, 1-11-cv-00799 (DED November 2, 2012, Order) (Andrews, J.).