Smart Options, LLC c. Jump Rope, Inc., No. 12 C 2498, Slip Op. (N.D. Ill. Feb. 11, 2013) (St. Eve, J.).

Judge St. Eve granted defendant Jump Rope’s Fed. R. Civ. P. 11 motion for sanctions in this patent case.  The Court previously granted Jump Rope summary judgment of noninfringement and plaintiff Smart Options appealed to the Federal Circuit.  As an initial matter, the Court held that while Smart Options’ notice of appeal divested the Court of jurisdiction generally, the Court retained jurisdiction over Jump Rope’s Rule 11 motion.

The Court previously held that Jump Rope did not infringe because it did not sell options to purchase items at a later date.  Instead, Jump Rope sold the immediate ability to go to the front of a line for an event or location.  Smart Options could have ascertained that inexpensively by downloading Jump Rope’s free app and purchasing a jump.  Instead, Smart Options provided generalized descriptions of it investigations, including reviewing Jump Rope’s website Terms of Use.  And Smart Options’ patent claims require paying an “option fee” to acquire an “option” to purchase something.  Furthermore, faced with Jump Rope’s explanation that it did not infringe at the outset of the case via Jump Rope’s Rule 11 motion, Smart Options continued to prosecute its case and still did not buy a “jump.”

Smart Options’ reliance upon Judge Lefkow’s constructions in a similar case did not protect Smart Options.  Lefkow did not construe “option.”  And the construction of “option” Smart Options allegedly used as part of its Rule 11 investigations was inexplicably different than the construction Smart Options advanced before the PTO and before Judge Lefkow.

The Court, therefore, granted Jump Rope’s Rule 11 motion and awarded Jump Rope its reasonable attorney’s fees and costs for defending the case and for the Rule 11 motion giving Jump Rope leave to file a petition setting out and supporting its fees and costs.