Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_04-cv-05460/USCOURTS-cand-5_04-cv-05460-17/pdf.json

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

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Case No. C 04-5460 JF

ORDER AWARDING DAMAGES AND ATTORNEYS’ FEES FOLLOWING ENTRY OF DEFAULT JUDGMENT

(JFLC2)

*E-Filed 6/2/06*

NOT FOR CITATION

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

HITACHI GLOBAL STORAGE

TECHNOLOGIES NETHERLANDS, B.V.,

 Plaintiff,

 v.

GS MAGIC, INC., et al.,

 Defendants.

Case Number C 04-5460 JF

ORDER AWARDING DAMAGES

AND ATTORNEYS’ FEES

FOLLOWING ENTRY OF DEFAULT

JUDGMENT

On March 31, 2006, this Court entered default judgment against all Defendants and

directed Plaintiff to advise the Court whether Plaintiff would be submitting proof of damages and

a request for attorneys’ fees. On May 30, 2006, Plaintiff filed a motion seeking compensatory

damages in the amount of $23,600,000, plus enhanced damages of up to three times the

compensatory damages, as well as attorneys’ fees in the amount of $934,348.75. 

DAMAGES

Plaintiff’s request for damages is governed by 35 U.S.C. § 284, which provides in

relevant part as follows:

Upon finding for the claimant the court shall award the claimant damages

adequate to compensate for the infringement, but in no event less than a

reasonable royalty for the use made of the invention by the infringer, together with

Case 5:04-cv-05460-JF Document 115 Filed 06/02/06 Page 1 of 4
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Case No. C 04-5460 JF

ORDER AWARDING DAMAGES AND ATTORNEYS’ FEES FOLLOWING ENTRY OF DEFAULT JUDGMENT

(JFLC2)

interest and costs as fixed by the court.

When the damages are not found by a jury, the court shall assess them. In either

event the court may increase the damages up to three times the amount found or

assessed. Increased damages under this paragraph shall not apply to provisional

rights under section 154(d) of this title.

Plaintiff requests $23,600,000 in compensatory damages, which primarily represents lost profits

as a result of Defendants’ infringement and attempts to undercut Plaintiff in the market. 

Calculation of such profits necessarily involves some speculation. However, Plaintiff’s

projections are well-supported by the motion and accompanying declarations. Given the

evidence in the record that Defendants’ infringement of Plaintiffs’ rights was willful, and the fact

that Defendants defaulted in this case, the Court will draw all reasonable inferences in Plaintiffs’

favor. Accordingly, the Court will award compensatory damages in the requested amount of

$23,600,000. 

Enhanced damages of up to three times compensatory damages may be awarded when a

party is found to have willfully infringed or to have acted in bad faith. 35 U.S.C. § 284; Cyber

Corp. v. FAS Technologies, Inc., 138 F.3d 1448, 1461 (Fed. Cir. 1998). Willful infringement

does not mandate enhanced damages, however. Id. The primary consideration is the

egregiousness of the defendant’s conduct based on all the facts and circumstances. Id. 

The Court has credited all of Plaintiff’s evidence with respect to willfulness and lost

profits, and it has relied heavily on this evidence in concluding that the magnitude of requested

compensatory damages is appropriate in this case. However, in the absence of a developed

record, the Court is not inclined to enhance those damages further in reliance on the same

evidence of willfulness. Accordingly, the Court will deny the request for enhanced damages.

ATTORNEYS’ FEES

Plaintiff’s request for attorneys’ fees is governed by 35 U.S.C. § 285, which provides that

“[t]he court in exceptional cases may award reasonable attorney fees to the prevailing party.” 

When considering whether to award attorney fees under this section, a court must determine

whether there is clear and convincing evidence that the case is “exceptional” within the meaning

of the statute and, if so, whether an award of attorney fees to the prevailing party is warranted. 

Case 5:04-cv-05460-JF Document 115 Filed 06/02/06 Page 2 of 4
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Case No. C 04-5460 JF

ORDER AWARDING DAMAGES AND ATTORNEYS’ FEES FOLLOWING ENTRY OF DEFAULT JUDGMENT

(JFLC2)

Interspiro USA v. Figgiel Int’l Inc., 18 F.3d 927, 933 (Fed. Cir. 1994). “The prevailing party

may prove the existence of an exceptional case by showing: inequitable conduct before the PTO;

litigation misconduct; vexatious, unjustified, and otherwise bad faith litigation; a frivolous suit or

willful infringement.” Epcon Gas Systems, Inc. v. Bauer Compressors, Inc., 279 F.3d 1022,

1034 (Fed. Cir. 2002). “Litigation misconduct and unprofessional behavior are relevant to the

award of attorney fees, and may suffice, by themselves, to make a case exceptional.” Id. 

The Court concludes that Defendants’ willful infringement of Plaintiff’s patents, as well

as their conduct during the course of this litigation (including backing out of a settlement

agreement, ceasing communications with their attorneys and failing to retain new counsel when

ordered to do so by the Court), renders this an exceptional case within the meaning of § 285. 

While it declines to award enhanced damages for the reasons stated above, the Court concludes

that Plaintiff is entitled to recover its attorneys’ fees based upon this record. Accordingly, the

Court will award attorneys’ fees in the requested amount of $934,348.75.

ORDER

The Court HEREBY ORDERS AND ADJUDGES that Plaintiff recover from Defendants

compensatory damages in the amount of $23,600,000 pursuant to 35 U.S.C. § 284 and attorneys’

fees in the amount of $934,348.75 pursuant to 35 U.S.C. § 285.

DATED: 6/2/06

__________________________________

JEREMY FOGEL

United States District Judge

Case 5:04-cv-05460-JF Document 115 Filed 06/02/06 Page 3 of 4
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Case No. C 04-5460 JF

ORDER AWARDING DAMAGES AND ATTORNEYS’ FEES FOLLOWING ENTRY OF DEFAULT JUDGMENT

(JFLC2)

Copies of Order served on:

Counsel for Plaintiff:

Daniel E. Alberti dalberti@mwe.com, clovdahl@mwe.com

Lisa Sattler Blackburn lsattler@mwe.com, vfarias@mwe.com

Christopher Duane Bright cbright@mwe.com

Defendants:

GS Magic and GS Magicstor

30F, Fuzhong International Plaza

126 Xinhua Road

Guiyang, Guizhou, PR China 5500022

GS Magic and GS Magicstor

No. 48, Yingbin West Road

Jinyang District

Guiyang, Guizhou, PR China 550081

Riospring, Inc.

1490 McCandless Drive

Milpitas, CA 95035

Case 5:04-cv-05460-JF Document 115 Filed 06/02/06 Page 4 of 4