Wednesday, March 16, 2011

Attorney Fees Under Section 285

  • “Absent misconduct in conduct of the litigation or in securing the patent, sanctions may be imposed against the patentee only if both (1) the litigation is brought in subjective bad faith, and (2) the litigation is objectively baseless.”

  • “The standard for establishing that a claim is ‘objectively baseless’ under section 285 is identical to the objective recklessness standard for enhanced damages and attorneys’ fees against an accused infringer for § 284 willful infringement actions under In re Seagate Technology, LLC, 497 F.3d 1360 (Fed. Cir. 2007). Thus, ‘objective baselessness’ depends not on the state of mind of the party against whom fees are sought, but instead on an objective assessment of the merits of the challenged claims and defenses.”

  • “Unless an argument or claim asserted in the course of litigation is so unreasonable that no reasonable litigant could believe it would succeed, it cannot be deemed objectively baseless for purposes of awarding attorney fees under section 285.”

  • “A district court has discretion to award reasonable attorney fees to a prevailing party in a patent case if the court determines that the case is ‘exceptional.’”
    “Absent litigation misconduct or misconduct in securing the patent, a district court can award attorney fees under § 285 only if the litigation is both: (1) brought in subjective bad faith; and (2) objectively baseless.”

  • “While it is clear that defeat of a litigation position, even on summary judgment, does not warrant an automatic finding that the suit was objectively baseless, here the record supports the district court’s finding that [the patentee] pursued objectively baseless infringement claims.”

  • “This finding [of litigation misconduct] provides a separate and independent basis for the court’s decision to award attorney fees. Indeed, it is well-established that litigation misconduct and unprofessional behavior may suffice, by themselves, to make a case exceptional under § 285.”

  • “A district court has inherent authority to impose sanctions in the form of reasonable expert fees in excess of what is provided for by statute. [Citing Takeda Chem. Indus., Ltd. v. Mylan Labs., Inc., 549 F.3d 1381, 1391 (Fed. Cir. 2008).] Use of this inherent authority is reserved for cases where the district court makes a finding of fraud or bad faith whereby the very temple of justice has been de-filed. Accordingly, not every case that qualifies as exceptional under § 285 will also qualify for sanctions under the court’s inherent power.”

Tuesday, March 15, 2011

False Marking

The Federal Circuit giveth, the Federal Circuit taketh away. After creating a cottage industry of qui tam suits claiming false marking a little over a year ago, the Federal Circuit has tried to stop the bleeding by holding that "Fed. R. Civ. P. Rule 9(b)’s particularity requirement applies to false marking claims under § 292." IN RE BP LUBRICANTS USA INC. [ORDER] . Granting a writ of mandamus, the court noted that:

  • "[A] complaint must in the § 292 context provide some objective indication to reasonably infer that the defendant was aware that the patent expired."

  • "Because the relator’s complaint here provided only generalized allegations rather than specific underlying facts from which we can reasonably infer the requisite intent, the complaint failed to meet the requirements of Rule 9(b)."

such a requirement moves the law toward, though not completely to, the proposed amendments in Congress that would allow only "a person who has suffered a competitive injury" to bring a claim for false marking.


  • “A false marking claim requires an intent to deceive the public … and sounds in fraud….”

  • “A party alleging fraud must ‘set forth more than the neutral facts necessary to identify the transaction.’”

  • “Because these policy concerns apply equally to websites as to traditional articles of manufacture or design, and because websites may both embody intellectual property and contain identifying markings, this court holds that websites can qualify as unpatented articles within the scope of § 292.”