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Lugus IP, LLC v. Volvo Car Corp.

United States District Court, D. New Jersey

March 26, 2015

LUGUS IP, LLC, Plaintiff,
v.
VOLVO CAR CORP., and VOLVO CARS OF NORTH AMERICA, LLC, Defendants.

TOMPKINS, MCGUIRE, WACHENFELD & BARRY LLP, By: William H. Trousdale, Esq., Brian M. English, Esq., Newark, New Jersey, Counsel for Plaintiff.

Pro hac vice: THE FUISZ-KUNDU GROUP LLP, By: John R. Fuisz, Esq., Sudip Kundu, Esq., Washington, District of Columbia, Counsel for Plaintiff.

SAIBER LLC By: Arnold B. Calmann, Esq., Jakob Halpern, Esq., Newark, New Jersey, Counsel for Defendants.

Pro hac vice: LATHAM & WATKINS LLP, By: Matthew J. Moore, Esq., Jonathan D. Link, Esq., Washington, District of Columbia, Counsel for Defendants.

OPINION

JOSEPH E. IRENAS, Senior District Judge.

This Court granted summary judgment in favor of Defendants in this patent infringement case, and Defendants now move to declare the matter "exceptional" pursuant to 35 U.S.C. ยง 285 and seek an award of attorneys' fees (Defs.' Mot. Att. Fees ("DMAF"), Dkt. No. 135). Defendants Volvo Car Corporation and Volvo Cars of North America, LLC ("Defendants") contend that Plaintiff Lugus IP, LLC ("Plaintiff") brought an objectively unreasonable case in bad faith and unnecessarily caused Defendants to incur fees and costs during the litigation. (Id.) Plaintiff denies Defendants' allegations and opposes the motion but adds that even if the Court does award fees, the fees Defendants seek are not reasonable. Plaintiff has also filed a motion to stay the Court's consideration of Defendants' motion pending appeal of the Court's grant of summary judgment.[1] (Pl. Mot. Stay, Dkt. No. 141)

For the reasons below, Plaintiff's motion to stay will be DENIED and Defendants' motion to declare this matter an exceptional case and award attorneys' fees will be GRANTED.

I. Relevant Facts

Lugus originally filed its Complaint alleging infringement of U.S. Patent No. 5, 806, 926 (the "'926 patent") in the United States District Court for the Eastern District of Virginia. That Court granted Defendants' motion to transfer the matter to this Court in May 2012, and over the next two years, the parties litigated claims of direct and indirect infringement against Volvo.

The patent at issue protects "a child safety seat" envisioned for use in mass transit vehicles "that automatically converts to an adult seat when not in use by a child." Lugus IP, LLC v. Volvo Car Corp., No. 12-cv-2906 (JEI/JS), 2014 WL 2094086, at *1 (D.N.J. May 20, 2014). Plaintiff brought suit against Defendants asserting that child safety booster seats installed in certain models of Volvo's vehicles infringed upon the '926 patent.

Claim 1 of the '926 patent claims the following:

A [sic] adult vehicle seat in combination with a child safety seat for protecting a child while seated in a vehicle comprising an adult seat, a child safety seat, said child safety seat being part of said adult seat and having retracting means for automatically retracting said child safety seat into a portion of said adult seat to form part of a fully contoured adult seat when said child is not located in

said child safety seat. '926 Patent col.4 l.36-42.

The Court held a claim construction hearing to construe the terms "automatically, " "into a portion of said adult seat to form part of a fully contoured adult seat, " and "when, " and adopted the plain meaning of each term. See Lugus IP, LLC v. Volvo Car Corp., No. CIV.A. 12-2906 JEI, 2014 WL 2094086 (D.N.J. May 20, 2014).

Much of the litigation centered on the conversion of a seat from a deployed setting, designed for a child, to an undeployed setting, designed for an adult. In its Summary Judgment Opinion (quoting its Claim Construction Opinion), the Court described how Plaintiff's patented product works:

To convert from the adult setting to the deployed child setting, the undeployed seatback pivots down when an individual manually pull[s] forward and downward on that seatback. This pivoting process reveals a Yshaped safety harness with two belts, shaped to fit over a child's shoulders, in the seatback of the deployed setting. The safety harness connects through a slot in a fastener between the child's legs.
When the safety harness is engaged, the lower portion of the safety belt is held in position by the projecting end of a spring loaded plunger found underneath the seat. A T-shaped handle appears on the front end of the seat; when the T-shaped handle is pulled outward, the ...

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