CAFC-DCTAugust 19, 2026·24-2226·Affirmed-in-part and dismissed-in-part; costs awarded to Volkswagen.
VDPP, LLC v. Volkswagen Group of America, Inc.
U.S. District Court for the Southern District of Texas
Holding
The Federal Circuit affirmed dismissal without leave to amend because VDPP’s proposed amended complaint was futile: it sought pre-suit damages but did not plausibly plead compliance with § 287 by VDPP’s licensees. The court also affirmed the § 285 fee award and dismissed the counsel-sanctions appeal for lack of jurisdiction because counsel did not timely notice an appeal in his own name.
Why It Matters
Patent owners seeking pre-suit damages must account for licensee marking, including licenses created through settlement agreements, and counsel must separately and timely appeal sanctions entered against counsel personally.
Full Summary
VDPP, LLC v. Volkswagen Group of America, Inc.
The Federal Circuit affirmed dismissal without leave to amend because VDPP’s proposed amended complaint was futile: it sought pre-suit damages but did not plausibly plead compliance with § 287 by VDPP’s licensees. The court also affirmed the § 285 fee award and dismissed the counsel-sanctions appeal for lack of jurisdiction because counsel did not timely notice an appeal in his own name.
Patent owners seeking pre-suit damages must account for licensee marking, including licenses created through settlement agreements, and counsel must separately and timely appeal sanctions entered against counsel personally.
Affirmed-in-part and dismissed-in-part; costs awarded to Volkswagen.
VDPP’s proposed amended complaint alleged only that it was a non-practicing entity with no products to mark and that all statutory requirements and conditions precedent were met; the court treated those statements as legal conclusions insufficient under Twombly.
The court held that VDPP’s eleven settlement agreements granting licenses to the asserted patent triggered the need to plead reasonable efforts to ensure licensee compliance with § 287, notwithstanding that the licenses settled litigation and did not include admissions of infringement.
The district court did not abuse its discretion in finding the case exceptional under § 285 based on objectively unreasonable positions, failure to disclose relevant settlement agreements, repeated litigation errors, and a pattern of low-value settlement-driven litigation.
The Federal Circuit rejected the argument that § 285 fees require independently sanctionable conduct; Octane permits fees based on the totality of unreasonable litigation conduct.
The sanctions issue was dismissed because the notices of appeal named only VDPP as appellant; counsel’s name appeared only in identifying an order, which did not satisfy Rule 3’s jurisdictional requirement.
damages infringement attorney fees / sanctions standing / jurisdiction precedential
damages infringement attorney fees / sanctions standing / jurisdiction precedential
damages attorney fees / sanctions standing / jurisdiction
Key Points
- VDPP’s proposed amended complaint alleged only that it was a non-practicing entity with no products to mark and that all statutory requirements and conditions precedent were met; the court treated those statements as legal conclusions insufficient under Twombly.
- The court held that VDPP’s eleven settlement agreements granting licenses to the asserted patent triggered the need to plead reasonable efforts to ensure licensee compliance with § 287, notwithstanding that the licenses settled litigation and did not include admissions of infringement.
- The district court did not abuse its discretion in finding the case exceptional under § 285 based on objectively unreasonable positions, failure to disclose relevant settlement agreements, repeated litigation errors, and a pattern of low-value settlement-driven litigation.
- The Federal Circuit rejected the argument that § 285 fees require independently sanctionable conduct; Octane permits fees based on the totality of unreasonable litigation conduct.
- The sanctions issue was dismissed because the notices of appeal named only VDPP as appellant; counsel’s name appeared only in identifying an order, which did not satisfy Rule 3’s jurisdictional requirement.