Thursday, October 14, 2021

Energy Heating case: inequitable conduct and attorneys' fees

The outcome:

On remand on the issue of attorneys’ fees (following an affirmed judgment of patent unenforceability due to inequitable conduct), the district court found this case exceptional under 35 U.S.C. § 285 and entered judgment awarding fees to Energy Heating, LLC, Rocky Mountain Oilfield Services, LLC, Marathon Oil Corporation, and Marathon Oil Company (collectively, “Appellees”). Heat On-The-Fly, LLC and Super Heaters North Dakota, LLC (collectively, “HOTF”)1 now appeal the district court’s exceptionality determination. We affirm.

Specifically, the court found by clear and convincing evidence that the patent would not have issued but for HOTF’s deliberate decision to withhold information from the Patent and Trademark Office (“PTO”)—information about substantial on-sale and public uses of the claimed invention well before the patent’s critical date, and that it withheld with an intent to deceive. The jury, for its part, found that HOTF tortiously interfered with Energy’s business. It awarded damages for that conduct. See J.A. 312–13. The jury also found, by clear and convincing evidence, that HOTF represented in bad faith that it held a valid patent (although the jury found that HOTF did not commit the torts of deceit or slander). J.A. 312–13. The district court subsequently denied attorneys’ fees under § 285.3 After trial, HOTF appealed the judgments of inequitable conduct and tortious interference, the summary judgments of obviousness and no direct infringement, and the construction of disputed claim terms. Appellees cross-appealed the district court’s denial of attorneys’ fees under § 285. As to HOTF’s appeal, we affirmed the judgment that the ’993 patent is unenforceable due to inequitable conduct and therefore declined to reach the remaining patent issues raised by HOTF. Energy Heating, 889 F.3d at 1296. We also affirmed the judgment of tortious interference. Id. As to Appellees’ cross-appeal, we vacated the district court’s denial of attorneys’ fees under § 285 because the court’s opinion left us “unsure as to whether the court’s basis for denying attorneys’ fees rests on a misunderstanding of the law or an erroneous fact finding” and remanded the issue to the district court for reconsideration. Id. at 1307–08.


But, as HOTF notes, see Reply Br. 21–22 Appellees’ request is premature under Federal Circuit Rule 47.7, which requires here that “the application must be made within thirty (30) days after entry of the judgment or order denying rehearing, whichever is later,” Fed. Cir. R. 47.7(a)(2) (emphasis added); see Vidal v. U.S. Postal Serv., 143 F.3d 1475, 1481 (Fed. Cir. 1998). Accordingly, we decline to consider the merits of Appellees’ request



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