Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_15-cv-05290/USCOURTS-cand-4_15-cv-05290-7/pdf.json

Nature of Suit Code: 830
Nature of Suit: Patent
Cause of Action: 35:271 Patent Infringement

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United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

INTERAXON INC., et al.,

Plaintiffs,

v.

NEUROTEK, LLC, et al.,

Defendants.

Case No. 15-cv-05290-KAW 

ORDER DENYING MOTION FOR 28 

U.S.C. § 1927 SANCTIONS

Re: Dkt. Nos. 124, 134

On August 8, 2016, Plaintiffs InteraXon Inc. and InteraXon U.S., Inc. (collectively, 

"InteraXon") filed a motion for recovery of excessive costs pursuant to 28 U.S.C. § 1927 against 

Defendant Jonathan D. Cowan. (Plfs.' Mot., Dkt. No. 124.) The Court deems the matter suitable 

for disposition without hearing pursuant to Civil Local Rule 7-1(b) and VACATES the hearing 

currently set for October 6, 2016. Having considered the papers filed by the parties and the 

relevant legal authority, the Court DENIES the motion, for the reasons set forth below.

I. BACKGROUND

Plaintiffs manufacture the MUSE Headband. (Compl. ¶ 4, Dkt. No. 1.) On November 18, 

2015, Plaintiffs filed the instant suit against Defendants NeuroTek, LLC, MindWaves, Ltd., and 

Dr. Jonathan D. Cowan (collectively, "Defendants") on November 18, 2015, seeking a declaration 

of non-infringement and a declaration of invalidity as to Patent No. 5,983,129 ("'129 Patent"). 

(Compl. ¶ 1.) Cowan in turn has filed a counterclaim for infringement on the '129 Patent. 

(Answer ¶ 45, Dkt. No. 63.) The corporate Defendants have not appeared in this case, and default 

has been entered as to those Defendants. (Dkt. Nos. 18, 19.)

Plaintiffs now move to recover reasonable costs and attorney's fees incurred in responding 

to various filings by Cowan, including multiple motions for sanctions and repeated attempts to 

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represent the corporate Defendants. (Mot. at 4.) Plaintiffs also request that the Court require that 

Cowan seek leave from the Court before filing any more motions. (Id. at 4-5.) Cowan filed an 

opposition on August 23, 2016. (Def.'s Opp'n, Dkt. No. 129.) Plaintiffs filed their reply on 

August 29, 2016. (Plf.'s Reply, Dkt. No. 131.)

II. STANDARD OF REVIEW

28 U.S.C. § 1927 addresses counsel's liability for excessive costs and provides: "Any 

attorney or other person admitted to conduct cases in any court of the United States . . . who so 

multiplies the proceedings in any case unreasonably and vexatiously may be required by the court 

to satisfy personally the excess costs, expenses, and attorneys' fees reasonably incurred because of 

such conduct." The Ninth Circuit has found that § 1927 sanctions may be awarded against pro se 

litigants. Wages v. IRS, 915 F.2d 1230, 1235-36 (9th Cir. 1990).

 Sanctions imposed under § 1927 require "a finding of recklessness or bad faith." Fink v. 

Gomez, 239 F.3d 989, 993 (9th Cir. 2001) (citing Barber v. Miller, 146 F.3d 242, 246 (5th Cir. 

1998) (internal quotations omitted). The Ninth Circuit has held that "[b]ad faith is present when 

an attorney knowingly or recklessly raises a frivolous argument, or argues a meritorious claim for 

the purpose of harassing an opponent." Estate of Blas v. Winkler, 792 F.2d 858, 860 (9th Cir. 

1986). To impose sanctions under § 1927, "if a filing is submitted recklessly, it must be 

frivolous." In re Keegan Mgmt. Co., 78 F.3d 431, 436 (9th Cir. 1996).

III. DISCUSSION

Plaintiffs argue that Cowan's motions for sanctions were brought in bad faith, attaching 

various e-mails in which Cowan demanded a large settlement in exchange for not filing or 

withdrawing his motions for sanctions. (E.g., Plfs.' Mot., Exhs. 5 ("I am therefore looking forward 

to a very reasonable offer that strikes a good middle ground to allow us to settle this quickly and 

avoid embarrassing your firm in front of your Clients and the Court"), 6 ("You should be putting 

some serious money on the table from both [Plaintiffs' counsel] and InteraXon to settle this before 

the CMC, when it will be too late to withdraw my Motion for Sanctions. This will not reflect well 

on your budding career in any case, but even more so if there is a huge Sanction (or two) and the

attendant publicity. I am currently taking this to the next level"), 8 ("It is time for the management 

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of [Plaintiffs' counsel] to step in and initiate an investigation, while we can still settle and I can 

quietly withdraw my Motion for Sanctions, and not file additional Motions for Sanctions").

1

) 

Plaintiffs also contend that Cowan's attempt to argue on behalf of the corporate Defendants, 

despite Judge Grewal's order that Cowan "may not file motions on their behalf," is unreasonable 

and vexatious. (Plfs.' Mot. at 11.) Cowan responds that Plaintiffs' case itself is frivolous, and that 

his prior motions for sanctions were well-founded. (Def.'s Opp'n at 7-9, 12-13.) Not so. The 

Court has already denied those motions. (Dkt. Nos. 114, 121.) Further, Cowan argues that he was 

not trying to appear on behalf of the corporate Defendants, only argue for their "interests without 

making an appearance for them." (Id. at 11.)

The Court finds that Cowan's filings were made in bad faith. With respect to Cowan's 

motions for sanctions, Cowan made clear in his e-mails that they were meant to harass Plaintiffs 

into settling, demanding larger amounts of money in exchange for withdrawing his motions for 

sanctions. (See Plfs.' Mot., Exhs. 6, 7 (stating that Plaintiffs' counsel "needed to be taught a 

further lesson about how to conduct yourselves in a Court of Law" and writing another sanctions 

motion asking for $25 million), 8 ("The more difficult you make this process, the more likely it is 

that I will spend a lot of time and effort discrediting [Plaintiffs' counsel] and InteraXon . . . . I will 

continue to communicate with you and the attorneys of record until you see the wisdom of 

engaging in a real settlement dialogue with considerable sums of money from both firms on the 

table"), 9.) As to Cowan's attempts to represent Defendants, this is – as previously stated by the 

Court – not permitted. (See Dkt. No. 45 at 2, Dkt. No. 113 at 1.) While Cowan contends that this 

Court simply failed to understand the "distinction" he was making in that he should "be allowed to 

argue for all the Defendants' interests without making an appearance for them," this is a distinction 

 

1 Cowan objects to Exhibits 4, 5, 8, and 9 as being protected under Federal Rule of Evidence 408. 

Rule 408 prohibits the use of compromise offers and negotiations "either to prove or disprove the 

validity or amount of a disputed claim or to impeach by a prior inconsistent statement or a 

contradiction." Here, Plaintiffs introduce the e-mails not to prove the merits of the claim or to 

impeach, but to showcase Cowan's behavior and why it is sanctionable. The Court therefore 

overrules Cowan's objections. In addition, the Court notes that on at least one occasion, the 

communication from Cowan was sent directly to Plaintiffs instead of to Plaintiffs' counsel. (Plfs.' 

Mot., Exh. 9.) Going forward, all communications during this litigation shall be sent to Plaintiffs' 

counsel.

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without a difference. (See Def.'s Opp'n at 11.) Cowan cannot argue on behalf of another party 

without, as a practical matter, representing them, and the corporate Defendants' interests cannot be 

represented by a non-attorney. Civil Local Rule 3-9(b); see also U.S. Commodity Futures Trading 

Comm'n v. Castillo, No. 06-2540 TEH, 2007 WL 2088372, at *1 (N.D. Cal. July 19, 2007) ("that a 

corporation must be represented by licensed counsel has been well-established by Supreme Court 

precedent and is not only a requirement of this Court's local rules").

The Court, however, exercises its discretion under § 1927 and will not impose sanctions at 

this time because Cowan is acting pro se. The Court strongly disapproves of Cowan's behavior, 

and Cowan is not to use the Court to threaten or harass Plaintiffs by filing frivolous or 

unwarranted motions. (E.g., Plfs.' Mot., Exh. 8 ("Imagine this scenario. The Judge declares that 

you have a baseless case that was never properly investigated, and finds multiple Rule 11 

violations. She penalizes you, InteraXon, and individuals from your firm several million dollars 

for your Rule 11 violations. My next move will be to write several articles for legal journals and 

OpEd pieces about how large firms take advantage of the legal system, and how this inept 

approach backfired"). Cowan is forewarned that the Court will impose sanctions should it find 

that Cowan is continuing to use the Court to harass Plaintiffs; this includes unnecessary and 

excessive discovery. (See Plfs.' Mot., Exh. 9 (listing discovery Cowan intends to conduct and 

concluding, "Ask Naseem to give you a ballpark figure as to how much you would be committing 

to spend if you don't settle")). Further, Cowan is not to attempt to represent the corporate 

Defendants in any context (including settlement2), including by making arguments on their behalf. 

The corporate Defendants must be represented by an attorney.

The Court also declines to enjoin Cowan from making any future filings without leave of 

the Court. Since the Court denied Cowan's various motions, Cowan has not filed any additional 

papers other than responses to the instant motion and a discovery letter. Should Cowan again file 

unwarranted motions, however, the Court will consider imposing a pre-filing requirement on 

 

2

The Court expects Cowan to participate in meaningful settlement negotiations on his own behalf 

before Judge Vadas, as ordered. (See Dkt. No. 100 (referring case to Magistrate Judge for 

settlement conference to be held within the next 90 days, or as soon thereafter is convenient for the 

judge).)

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Cowan.

IV. CONCLUSION

For the reasons stated above, the Court DENIES Plaintiffs' motion for § 1927 sanctions. 

Cowan is forewarned that future use of the Court to harass or threaten Plaintiffs or attempts to 

represent the corporate Defendants will subject him to sanctions. Again, the Court recommends 

that Cowan contact the Federal Pro Bono Project's Help Desk—a free service for pro se litigants—

by calling (415) 782-8982. The Court has also adopted a manual for use by pro se litigants, which 

may be helpful to Cowan. This manual, and other free information, is available online at: 

http://cand.uscourts.gov/proselitigants.

IT IS SO ORDERED.

Dated: September 28, 2016

__________________________________

KANDIS A. WESTMORE

United States Magistrate Judge

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