U.S. District Judge Richard Seeborg, Northern District of California (Jason Doiy / The Recorder)
SAN FRANCISCO — Electronic Arts Inc. and Zynga Inc. won’t be getting attorney fees from Acacia Research Corp. any time soon.
As he’d foreshadowed at a hearing last week, U.S. District Judge Richard Seeborg of the Northern District of California denied fees Tuesday. Acacia subsidiary Gametek may have litigated the case aggressively, but not so unreasonably as to render the case “exceptional” under the U.S. Supreme Court’s new Octane Fitness standard, the judge said.
Seeborg had previously granted judgment on the pleadings to the gaming companies, saying Gametek had patented an abstract idea without adding its own inventive concept. But, he wrote Tuesday, that was “not necessarily a judgment on the relative strength or weakness of the patentee’s litigation position, particularly here where the critical issue of inventive concept is evolving. Nowhere does Octane suggest a shift to the ‘English Rule’ whereby a party who concludes a case on a pleading motion invariably gets his or her fees.”
Seeborg’s decision is the third from the Northern District of California denying exceptional case fees since the U.S. Supreme Court loosened the legal standard somewhat in April. Two other decisions—one from Judge Susan Illston and the other from Magistrate Judge Kandis Westmore—found the cases exceptional and awarded at least some fees.
Gametek’s patent claimed a method by which a game operator can offer additional items for purchase midgame without interrupting play. The gaming companies argued the concept dates back thousands of years, and Seeborg found it ineligible under Section 101 of the Patent Act, noting in his April order that such findings are “rare.”
Electronic Arts, Zynga, GREE International Inc. and CrowdStar then argued that the Supreme Court in Octane Fitness v. ICON Health & Fitness said a case may be “exceptional” and worthy of fee shifting if it is “‘uncommon,’ ‘rare’ or ‘not ordinary.’”
But Seeborg said he’d only been citing case law from the U.S. Court of Appeals for the Federal Circuit when he used the word “rare.” And while Gametek didn’t offer much “substantive explanation” for patent eligibility, the company “did not, however, descend to the level of frivolous argument or objective unreasonableness,” the judge wrote Tuesday.
The gaming companies also argued that Gametek had been unreasonably aggressive in pursuing the litigation. As one example, they submitted 25 emails containing threats of motions to compel discovery. But Seeborg wrote that many of those submissions were lengthy email chains that simply recycled the same threat. The threats that actually were made came only after more polite requests had been ignored, he wrote.
Gametek’s “conduct may suggest an aggressive litigation strategy,” Seeborg concluded, “but it falls short of conduct that has been found to justify fee-shifting even post-Octane.”
John Edmonds of Collins, Edmonds, Pogorzelski, Schlather & Tower argued the fee motion for Gametek. Gibson, Dunn & Crutcher partner Jason Lo argued for the gaming companies.
Contact the reporter at email@example.com.