Judge Kinkeade Hits Investpic With $680,000 Award Of SAP’s Attorney’s Fees, Rejects SAP’s Request For $1,175/hour

On December 4, 2018, Judge Kinkeade issued an Order (available here) in SAP America v. InvestPic. SAP filed a declaratory-judgment lawsuit against Investpic seeking a declaration of non-infringement of Investpic’s patent. Investpic counterclaimed for infringement, and lost at the district court and the Federal Circuit (both of whom ruled that Investpic’s patent was invalid for failing to claim patentable subject matter). SAP sought recovery of its attorney’s fees under 35 U.S.C. § 285. Judge Kinkeade found the case exceptional in SAP’s favor, and ordered Investpic to pay SAP nearly $680,000.

Notable aspects of Judge Kinkeade’s ruling include that:

  • SAP’s original fee motion sought $614,000 in fees. The Court denied that request (without prejudice to refiling) due to SAP’s failure to provide the Court with sufficiently reliable evidence to show that its requested fees were reasonable and necessary. I discussed that prior decision here.
  • On the second go round, SAP asked for $939,000. The additional amounts were for amounts incurred by SAP between the two fee motions. SAP voluntarily removed time entries for all non-attorneys and all attorneys who worked less than 10 hours on the case.
  • The Court agreed with SAP that it was entitled to recover fees incurred after the first fee request, including fees incurred in the appeal of the case.
  • The Court rejected SAP’s request for prospective fees based on possible future appeals of the case. (SAP had sought $50,000 in the event that Investpic sought certiorari from the Supreme Court of the Federal Circuit’s decision, and $250,000 if Investpic appealed the district court’s exceptional case finding and the related award of attorney’s fees).
  • The Court rejected Investpic’s argument that the fee award must be limited to fees incurred in relation to the facts and pleadings which the Court used to find the case exceptional. The Court instead found: “Investpic’s threats of suit against SAP combined with Investpic’s failure to recognize the weaknesses in its § 101 position [] led SAP to incur all of the reasonable and necessary fees incurred in this case. For this reason, the Court finds that this is the type of case in which an award of all reasonable and necessary attorney fees is appropriate.”
  • The Court rejected SAP’s request for fees associated with (i) “the preparation of a distinct USPTO filing” (presumed to be petitions related to the patent-in-suit that were not filed) and (ii) preparing SAP’s first fee motion.
  • The Court allowed fees associated with reviewing issues presented in reexaminations of the patent-in-suit.
  • Where time was block billed, and included non-recoverable and recoverable time, the entire entry was deemed non-recoverable, as it was “impossible to determine what portion of this time” was recoverable.
  • SAP argued that its attorney rates—from $745-$1,175/hour for partners, and $405-650/hour for associates—were reasonable. The Court found that “the evidence to support such high rates is insufficient.” The Court thus reduced the fees of all partners by 35% (reducing the rates to a range of $484-$757/hour) and all associates by 15% (bringing the rates to a range of $243-$520/hour.

The Court ultimately awarded $679,420 to SAP.

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