Patent Assignment Agreement Providing Outcome-Based Compensation to Fact Witness Does Not Justify Award of Attorney Fees ​

Following claim construction and a stipulated judgment of noninfringement, the court denied defendants' motion for attorney fees under 35 U.S.C. § 285 because plaintiff's litigation tactics were not exceptional. "Defendants rely on the compensation arrangement in the Agreement with [a third party], coupled with Plaintiff’s initial disclosures identifying certain principals from [the third party] as fact witnesses, to argue that Plaintiff has agreed to pay fact witnesses to testify and the payment is contingent on the outcome of the case. However, the Agreement involves assignment of the Patent, not an agreement to pay fact witnesses to testify, and the witnesses identified included the inventor. . . . [T]he Agreement provides for [the third party] to be compensated based on the outcome of a patent infringement lawsuit and requires cooperation from [the third party]. The Agreement’s compensation arrangement is not so out of the ordinary to make this case exceptional."

Rembrandt Gaming Technologies, LP v. Boyd Gaming Corporation, et al, 2-12-cv-00775 (NVD March 31, 2017, Order) (Du, USDJ)