SRI Int'l, Inc. v. Cisco Sys.

SRI Int'l, Inc. v. Cisco Sys.

Opinion

 [*1325]  Stoll, Circuit Judge.

SRI International, Inc. appeals the United States District Court for the District of Delaware's denial of its motion to reinstate the jury's willfulness verdict and to reinstate the district court's award of enhanced damages. Cisco Systems, Inc. cross-appeals the district court's award of attorney fees and expenses. Because substantial evidence supports the jury's finding of willful infringement, we reverse the district court's denial of SRI's motion to reinstate the willfulness verdict. Having restored the jury's willfulness finding, [**2]  we also restore the district court's award of enhanced damages. Finally, we affirm the district court's award of attorney fees.

Background

This is the second appeal in this case. SRI filed suit in the District of Delaware alleging that Cisco infringed certain claims of U.S. Patent Nos. 6,711,615 and 6,484,203  [*1326]  (the "asserted patents"). The '615 patent is titled "Network Surveillance" and is a continuation of the '203 patent, which is titled "Hierarchical Event Monitoring and Analysis." A jury trial was held on validity, infringement, willful infringement, and damages. See SRI Int'l, Inc. v. Cisco Sys., Inc. (SRI I), 254 F. Supp. 3d 680 (D. Del. 2017). The jury found that the accused Cisco products infringed certain claims of the asserted patents and awarded a 3.5% reasonable royalty for a total of $23,660,000 in compensatory damages. The jury also found that Cisco's infringement was willful.

After trial, Cisco moved for judgment as a matter of law (JMOL) of no willful infringement and SRI moved for attorney fees and enhanced damages. Regarding the jury's willfulness finding, the district court determined that substantial evidence—including that certain Cisco employees did not read the asserted patents until their depositions, that Cisco designed the products in an infringing manner, and that Cisco instructed its customers [**3]  to use those products in an infringing manner—supported the jury's willfulness finding. Id. at 716-17.

The district court also awarded SRI attorney fees and costs. Id. at 723. The district court noted that "Cisco pursued litigation about as aggressively as the court has seen in its judicial experience" and that this litigation strategy "created a substantial amount of work for both SRI and the court, much of which work was needlessly repetitive or irrelevant or frivolous." Id. at 722-23 (footnotes omitted). In awarding fees, the district court also took into account "the fact that the jury found that Cisco's infringement was willful." Id. at 723.

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