Digest of Integrated Tech. Corp. v. Rudolph Techs., Inc., No. 2014-1820 (Fed. Cir. Oct. 21, 2015) (nonprecedential). On appeal from D. Ariz. Before Prost, Moore, and Wallach.

Procedural Posture: On appeal for a second time, the defendants-appellants challenged, first, the district court’s determination that this case was exceptional, and, second, that they were bound by an earlier stipulation regarding the amount of attorneys’ fees owed. The CAFC affirmed the exceptionality finding, but vacated and remanded as to the amount owed.

  • Equitable Defenses—Waiver: The CAFC rejected the plaintiffs-appellees threshold argument that the defendants-appellants waived their challenges to the district court’s findings of misconduct in this appeal because they did not challenge the findings in the prior, first appeal. In the first appeal, the CAFC had vacated the district court’s fees determination because it was inextricably intertwined with the district court’s vacated willfulness finding. On remand, the defendants-appellees had disputed the misconduct-allegations under the changed landscape of the case, thus preserving their arguments for the second appeal.
  • Attorneys’ Fees—Exceptionality Finding: The CAFC affirmed the district court’s exceptionality determination, which was grounded on five independent bases supporting exceptionality. Nothing in the record indicated that the district court, in considering the totality of the circumstances, abused its discretion in finding the case exceptional under § 285.
  • Attorneys’ Fees—Amount Owed: The CAFC interpreted the parties’ stipulation, as to amount of attorneys’ fees owed, to be binding only when the defendants-appellees were liable for the entire case. As the level of liability decreased, the stipulation on amount of reasonable fees—which was tied to a greater level of liability—became inapposite. In the prior, first appeal, the CAFC had reversed the infringement finding as to certain products, vacated the willfulness finding, vacated the injunction, vacated the trebled damages, and vacated the exceptionality determination. After the first appeal, the plaintiffs-appellees had won only a portion of their original case. Accordingly, the stipulation—drafted prior to the first appeal—bore no relation to the liability subsequently found. The CAFC vacated and remanded for the district court to award reasonable attorneys’ fees commensurate with the scope of the defendants-appellees’ misconduct.