On March 24, 2016, I published a blog on two Supreme Court decisions that were issued in 2014 that made it easier for accused infringers to recover attorney’s fees when patent owners lose at trial. These are 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). The Supreme Court indicated that a district court should look at the totality of the circumstances when deciding whether to award a party attorney’s fees for an exceptional case.
On Oct. 24, 2016, the entire Ninth Circuit held that the same standard should apply in trademark cases under the Lanham Act when considering an award of attorney’s fees. See SunEarth Inc. v. Sun Earth Solar Power Co., No. 15-16096 and 13-17622 (9th Cir. 2016). The Ninth Circuit reasoned that the Patent Act and the Lanham Act provisions for attorney’s fees should be interpreted in tandem and concluded that the statutes were “parallel and identical.”
The opinion noted that “the Third, Fourth, Fifth and Sixth Circuits have recognized that Octane Fitness changed the standard for fee-shifting under the Lanham Act.” Id. (citations omitted). However, the opinion also noted that the Second and Seventh Circuit have not applied the new test in recent decisions. See id. (citations omitted). The Ninth Circuit decided to side with the majority of circuits in applying the new standard.
It is unclear whether the Supreme Court will have to weigh in on this issue in the future because the Second and Seventh Circuit decisions did not explicitly address the Octane Fitness decision. As a result, there is no clear split among the circuit courts, yet. The Supreme Court may not have to rule on the issue if no circuit split develops.