Thursday, May 23, 2013

“Hyper-Aggressive” Settlement Posturing No Basis for Attorneys’ Fee Award

The court denied defendant's motion for sanctions under 28 U.S.C. § 1927 based on plaintiff's settlement strategy which included a settlement demand 90 times more than plaintiff's expert's damages estimate. "[T]he court struggles to understand plaintiff‘s tactic of increasing its damages demands and pursuing a very aggressive negotiation posture after a largely adverse claims construction by the court. . . . [B]ecause the law does not place any obligation on parties to settle their cases, the court is not prepared to sanction plaintiff for, effectively, declining to enter into serious settlement discussions at that point. Reality is sanction enough: defendants called plaintiff‘s bluff and plaintiff will receive nothing from this litigation except a lot of bills to pay. Similarly, the court will not sanction plaintiff‘s counsel. Hyper-aggressive settlement posturing is not, strictly speaking, a behavior that 'multiplies the proceedings' – it merely prevents the proceedings from coming to an early end."

NorthMobileTech LLC v. Simon Property Group, Inc., 3-11-cv-00287 (WIWD May 21, 2013, Order) (Conley, J.).

The court denied defendant's motion for attorneys' fees under 35 U.S.C. § 285 based on plaintiff's settlement conduct. "[Defendant] points to [plaintiff's] settlement conduct, specifically that [plaintiff] settled early with several defendants for amounts that [defendant] asserts reflect [plaintiff's] goal of obtaining nuisance settlements. . . . [Plaintiff's] settlement pattern raises some eyebrows but because its positions were not entirely baseless, its attempts to settle claims early in the litigation for costs lower than the amounts of a defense are not sufficient, alone, to find subjective bad faith."

Site Update Solutions LLC v. Accor North America Inc., et. al., 5-11-cv-03306 (CAND May 21, 2013, Order) (Grewal, M.J.).

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