Eighth Circuit says Neb. AG's patent troll appeal not frivolous

ST. LOUIS (Legal Newsline) - A federal appeals court has ruled that Nebraska Attorney General Jon Bruning did not file a frivolous appeal over an order he issued against a Texas law firm representing patent trolls.

Patent trolls are companies that purchase groups of patents without an intent to market or develop a product. The companies then target other businesses with lawsuits alleging infringement of the patents they bought.

Judge Joseph Bataillon for the U.S. District Court for the District of Nebraska ruled in September that Bruning's order, which barred Farney Daniels LLP from sending demand letters, violated Activision TV Inc.'s rights under both the U.S. Constitution and federal patent law.

"The court is deeply concerned about the ability of the attorney general to issue cease and desist orders, prior to the conclusion of the investigation, prior to any negative findings, prior to any hearings, and prior to permitting submission of documents and evidence by the Farney Daniels law firm," the ruling stated.

Bataillon also found Bruning did not produce any evidence of wrongdoing by Activision or Farney Daniels in sending letters to Nebraska companies notifying them of their infringement of Activision's patents.

Soon after the ruling, the attorney general released a statement saying he would not be "intimidated or deterred" and appealed to the U.S. Court of Appeals for the Eighth Circuit.

The appeal was later dismissed.

In a November motion with the Eighth Circuit, Activision argued that Bruning's appeal was "entirely frivolous" and wanted to be awarded attorneys' fees for the appeal.

"Notwithstanding being told repeatedly that jurisdiction with this appeal is properly with the U.S. Court of Appeals for the Federal Circuit, the appellants persisted in maintaining their appeal in this court, despite being cautioned by appellee that it would file a motion to dismiss, and then later seek its fees and costs for having to unnecessarily file the motion," the company wrote.

In a December response to the motion, Bruning argued his appeal was filed with the Eighth Circuit "with the utmost confidence that questions of jurisdiction, standing, and evidentiary objections are most appropriately resolved here."

"The claims against appellants and this appeal do not touch on any issues of patent law whatsoever. Thus, the Federal Circuit would never have jurisdiction over this appeal," the attorney general wrote.

"Despite this, appellee continues to protract this litigation through filings, which include gross inaccuracies and outright mischaracterizations. Accordingly, the court should reject appellee's motion for designation of frivolous appeal and award of fees and costs."

In a short, one-paragraph order, the Eighth Circuit sided with Bruning.

"The motion for designation of frivolous appeal and for an award of attorneys fees and costs pursuant to Federal Rule of Appellate Procedure 38 has been considered and is denied," the Dec. 30 order stated.

From Legal Newsline: Reach Jessica Karmasek by email at patents@legalnewsline.com.

More Stories