The Supreme Court issued two decisions in 2014 that made it easier for accused infringers to recover attorney’s fees when patent owners lose at trial. See Octane Fitness, LLC v. ICON Health & Fitness, Inc., __ U.S. __, 134 S. Ct. 1749 (2014); Highmark Inc. v. Allcare Health Mgmt. Sys., __ U.S. __, 134 S. Ct. 1744, 1747 (2014). I mentioned these two decisions in my Nov. 5, 2015 blog post, when I addressed the possibility that proposed legislation for patent reform could include “fee-shifting” provisions.
TheOctane Fitness Decision Makes It Easier for a District Court to Award Attorney’s Fees in Patent Cases
As I indicated in my Nov. 5, 2015 blog, the governing statute authorizes courts to award the prevailing party their attorney’s fees in a patent case when it is an “exceptional case.” The statute does not define what constitutes an exceptional case, so various courts developed a framework for determining whether a case was “exceptional” by considering various factors over the years.
The Supreme Court in Octane Fitness reviewed the framework and determined that it was too restrictive.
The decision has had a significant impact on the awarding of attorney’s fees. A May 13, 2015, guest blog posting on Dennis Crouch’s “Patently-O” blog stated that district courts awarded fees at a rate that “is at least two times greater than the fee-shifting award rate in previous years.”
The Highmark Decision Makes It More Likely That a District Court’s Decision to Award Attorney’s Fees Will not be Overturned by an Appellate Court
The Highmark decision concerned another issue relating to the award of attorney’s fees – the amount of discretion that an appellate court must give to the ruling of a lower court when the lower court awards attorney’s fees or decides not to award attorney’s fees. The Supreme Court determined that it should give a district court considerable discretion on this issue. This means that when a district court decides that a case is an exceptional case, an appellate court is not very likely to overturn that decision.