Date of Verdict: June 23.
Court and Case No.: U.S.D.C.M.D.Pa. No. 3:02-CV-0134.
Judge: A. Richard Caputo.
Type of Action: Patent litigation.
Injuries: Patent infringement.
Plaintiffs Counsel: Kathryn L. Clune, Crowell & Moring, Washington, D.C.; Robert J. Tribeck, Rhoads & Sinon, Harrisburg.
Defense Counsel: Alan M. Anderson, Alan Anderson Law Firm, Minneapolis.
Comment: A company that was previously found to be in contempt of a federal judge’s order to stop selling patent-infringing electrical wire connectors has been ordered to pay the plaintiff patent holder about $1.5 million in attorney fees after the parties could not reach an agreement on an appropriate amount.
The court also ordered the defendant, Bridgeport Fittings, to pay plaintiff Arlington Industries nearly $500,000 in lost profits, $34,000 in prejudgment interest and more than $280,000 in litigation costs.
According to court documents, U.S. District Judge A. Richard Caputo of the Middle District of Pennsylvania found in March 2013 that Bridgeport was in contempt of a confession of judgment and injunction that permanently enjoined the company from “directly or indirectly making, using, selling, offering for sale or importing” connectors that infringed on one of Arlington’s patents or inducing others to do the same.
Caputo instructed the parties at the time to “attempt to resolve the questions of lost profits and attorney fees amicably.”
But, in a 28-page opinion issued June 23, Caputo said the parties were unable to reach an agreement, so they were then instructed to submit evidence of lost profits Arlington incurred as a result of Bridgeport’s patent infringement along with evidence of reasonable attorney fees and expenses.
Caputo said June 23 that Arlington was able to show that it was entitled to nearly $500,000 in lost profits by meeting all three prongs of the two-supplier theory.
Under the two-supplier theory, according to Caputo, a party must show that there are only two suppliers in a relevant market and that it had the capacity to make the sales that went to the patent.
A party must also demonstrate the amount of profit it would have derived if it had made those sales, Caputo said.
Caputo did, however, reject Arlington’s assertion that it was entitled to about $2.4 million in attorney fees, based on Washington, D.C., rates, rather than Middle District of Pennsylvania rates.
According to Caputo, Arlington argued that it was exempt from the general rule that attorney fees be calculated based on the prevailing hourly rates in the venue where the litigation was brought because it was forced to retain as lead counsel highly specialized patent litigators with institutional knowledge of the case from Washington, D.C.-based Crowell & Moring.
But Caputo said Arlington offered no evidence that it made an effort to find lead counsel in the Middle District and noted that the company did hire Harrisburg patent attorney Robert J. Tribeck as local counsel.
Caputo further reasoned that Crowell & Moring did not need to be lead counsel to provide institutional knowledge of the case, as that information could have been passed on through mere consultation.
“I hasten to add this is not about who Arlington can retain as counsel, but rather what the opposing party is required to pay that retained counsel,” Caputo said.
The parties had vastly different opinions as to what the going rates are for attorneys in the Middle District, according to Caputo.
While Bridgeport’s expert, Wilkes-Barre, Pa.-based attorney Bruce J. Phillips, said the prevailing rate for plaintiffs counsel in the Middle District is between $220 and $300 per hour, Arlington relied on the 2009 Middle District case Broadcast Music v. It’s Amore, in which attorney fees were calculated at $575 per hour.
Caputo, however, said Broadcast Music was not applicable because the fee request in that case was unopposed and the rate was based on the prevailing rate in Philadelphia, where the attorney practiced.
Instead, Caputo found that the appropriate rate with which to calculate Kathryn L. Clune of Crowell & Moring’s fees was $450 an hour, despite it being higher than Tribeck’s actual hourly rate.
“Even though we are applying the forum rate in this case and Mr. Tribeck’s rate represents the going rate for a patent lawyer in the Middle District, the fact is that Ms. Clune has extensive experience which is greater than Mr. Tribeck’s,” Caputo said. “Thus, a rate in the Middle District higher than Mr. Tribeck’s is justified.”
Tribeck said he charged Arlington a reduced hourly rate of $375 to $395 per hour, according to Caputo.
Caputo set Tribeck’s rate at $375 per hour, rejecting Bridgeport’s assertion that it should be $275 per hour because the matter Tribeck worked on was a “‘mere motion for contempt.’”
Counsel for Bridgeport, Alan M. Anderson, declined to comment. Clune could not be reached.
— Zack Needles, of the Law Weekly •