Motion for Attorneys’ Fees in Patent Infringement Case does not Invoke the Seventh Amendment Right to a Jury

September 2017

 

AIA America Inc. v. Avid Pharmaceuticals, 2016-2647 (Fed. Cir. Aug. 10, 2017)

In AIA America, the Federal Circuit held that a party to a patent infringement suit does not have the right to a jury trial under the Seventh Amendment when the other party moves for attorneys’ fees.

AIA America was formed by a number of researchers from Imperial College London. The researchers grew disgruntled, believing their work on Alzheimer’s genetic mutations was being undervalued by the school, and hatched a scheme to funnel research and results to a colleague, Dr. Mullan, at University of South Florida. Patents to the resulting inventions falsely named Dr. Mullan as the sole inventor. Dr. Mullan assigned his rights to AIA America, with each school wrongly believing that the other school owned the rights to the invention.

After AIA America sued Avid on the patents, the scheme came to light.  The case was dismissed due to AIA America’s lack of standing because neither Imperial nor USF had intentionally waived their ownership rights in the invention. After the trial, Avid moved for attorneys’ fees, which the court assessed at $4 million. AIA America appealed, asserting that it was entitled to have a jury decide the issue of fees.

The Federal Circuit affirmed, finding that the assessment of attorneys’ fees in a patent case does not invoke the right to a jury trial. The Seventh Amendment extends the right to a jury trial only to cases involving legal, as opposed to equitable, rights. The court concluded that awarding fees to the prevailing party is an equitable remedy, as it does not go directly to the merits of the case.

Though AIA America argued that questions of state of mind or intent must be presented to a jury, the court pointed out that 18th century courts of equity regularly decided such issues. AIA America also argued that the district court erred in assessing fees by making factual findings on issues not considered by the jury. The Federal Circuit disagreed, noting that while the district court could not make findings contrary to the jury’s, it could engage in fact-finding on issues not considered by the jury.

Key Takeaway: A party to a patent infringement suit does not have a right to have a jury decide an award of attorneys’ fees under 35 U.S.C. § 285.