Second court recommends awarding legal fees to defendant hit with patent troll’s lawsuit
Update: On August 9, 2017, District Court Judge Rosenberg rejected Shipping & Transit's objections to the Magistrate Judge's report and recommendation awarding fees. The court ordered Shipping & Transit to pay $36,317.50 plus interest in attorneys' fees to Lensdiscounters.com.
A court in the Southern District of Florida has recommended (PDF) that prolific patent troll Shipping & Transit LLC pay a defendant’s legal costs. This is the second court in less than a week to find Shipping & Transit’s patent litigation suit “exceptional” for purposes of awarding legal fees to a defendant.
The latest finding comes out of Shipping & Transit LLC v. Lensdiscounters.com, a case originally filed by Shipping & Transit just over a year ago, but not lasting nearly that long. When at an early hearing it came out there were serious defects in Shipping & Transit’s case, Shipping & Transit immediately sought to end the lawsuit. Lensdiscounters opposed letting Shipping & Transit run away without consequences. Lensdiscounters told the court its belief that Shipping & Transit had failed to investigate infringement before filing its lawsuit and that Shipping & Transit’s patents were invalid. It argued it should be awarded the cost it incurred in defending against Shipping & Transit’s infringement claim.
In a report signed on July 10, a magistrate judge agreed (PDF). The court found Shipping & Transit’s explanation for why it believed it had a case of infringement worth pursuing to be “flawed.” Instead, it appeared to the court that “likely,  from the inception, [Shipping & Transit] never intended to litigate its patent infringement rights” and “it appears that [Shipping & Transit] brought this case merely to elicit a quick settlement from Defendant on questionable patents.” With respect to Shipping & Transit’s “questionable patents,” the court noted that despite Shipping & Transit filing over 300 cases in Florida alone, the court “could not find one case  where the substantive issue of patent validity was reached.” Instead, Shipping & Transit “routinely and promptly” dismissed cases “to end any inquiry” any time the validity of its patents was challenged. These facts lead the judge to recommend that the court order Shipping & Transit to pay Lensdiscounters’ legal fees.
Because this report is from a magistrate judge, it still needs to be confirmed by the District Court judge. However, it represents yet another finding by a court that Shipping & Transit’s patent infringement lawsuits are exceptional and should lead to an award of fees to defendants targeted by Shipping & Transit. This latest decision from Florida, along with the similar order (PDF) from California, have Shipping & Transit’s death knell bell tolling across the country.