Source: https://anticipatethis.wordpress.com/category/litigation-commentary/
Timestamp: 2019-04-20 07:22:41+00:00

Document:
Octane Fitness, LLC v. ICON Health and Fitness, Inc. and Highmark, Inc. v. Allcare Health Mgmt. Sys. Inc.
The determination of whether a case is “exceptional” under the attorney fee-shifting provision of The Patent Act is left to a broad discretion of the District Court.
In two slip opinions rendered April 29, 2014, SCOTUS addressed issues regarding awarding attorneys fees under 35 U.S.C. § 285 to prevailing parties in “exceptional” patent infringement cases. Under 35 U.S.C. § 285, a District Court is authorized to award attorney’s fees to prevailing parties in “exceptional cases.” The CAFC had used a Brooks Furniture standard defining an “exceptional case as one which involves “material inappropriate conduct” or is both “objectively baseless” and “brought in subjective bad faith.” Under the Brooks Furniture standard, an exceptional case must be established by clear and convincing evidence.
In the opinion delivered by Justice Sotomayor, the Court, in a 9-0 decision, construed the term “exceptional” in its plain and ordinary meaning and held that exceptional means “uncommon,” “rare,” and “not ordinary.” The Court held that the CAFC has applied too rigid of a standard in determining whether a case is an exception case and rejected the Brooks Furniture standard.
According to Justice Sotomayor, the § 285 statute is “patently clear” and imparts flexibility on the District Court to decide whether a case is exceptional. Octane, slip op. at 7. “[A]n ‘exceptional’ case is simply one that stands out from others with respect to the substantive strength of a party’s litigating position (considering both the governing law and the facts of the case) or the unreasonable manner in which the case was litigated.” Id. at 7-8. Therefore, the intent of the statute only requires that the litigation present either subjective bad faith or exceptionally meritless claims. Additionally, the Court held that a preponderance of the evidence standard is the appropriate standard to use to establish entitlement of fees, rather than a clear and convincing evidence standard. Id. at 11.
In this opinion, also delivered by Justice Sotomayor, the Court used the Octane case as precedent to unanimously hold that “an appellate court should apply an abuse-of-discretion standard in reviewing all aspects of a district court’s § 285 determination.” Highmark, slip op. at 5.
The Octane opinion can be found here and the Highmark opinion can be found here.
Note: The holdings in these cases, relaxing the standard required for district courts to determine whether a case is “exceptional” may aid in thwarting certain “patent trolls” from asserting patent claims that are meritless or brought in bad faith. Stay tuned to see how these rulings affect the litigation process, the legislative process regarding patent reform, and if the holdings will actually send the trolls back under the bridge or if the trolls will just find another way out.
Alice Corp. v. CLC Bank Int’l: Notable Quotes from the Oral Arguments.
The link to the transcript for the March 31, 2014 oral arguments before the SCOTUS in Alice Corp. v CLC Int’l can be found here.
Background: Alice Corporation, petitioner, owns the four patents-in-suits which are directed toward a computerized trading platform for the execution of a previously agreed-upon exchange, known as “settlement.” The inventions include electronically maintained accounts for each party in the settlement and after receiving transactions from each party, the computer system effects the exchange. The United States District Court for the District of Columbia declared each of Alice’s patents invalid for not defining patent-eligible subject matter. The U.S Court of Appeals for the Federal Circuit affirmed the decisions, in an en banc rehearing.
Issue: Whether claims to computer-implemented inventions – including claims to systems and machines, processes, and items of manufacture – are directed to patent-eligible subject matter within the meaning of 35 U.S.C. § 101 as interpreted by this Court.
Importance of Design Patents in the Recent Apple-Samsung Litigation.
An interesting article at Forbes yesterday, on the increasing importance of design patents for technology companies. Highly suggested read.
Scheduled SCOTUS Oral Arguments in Bilski v. Kappos – November 9, 2009.
Oral arguments in Bilski v. Kappos are scheduled for today, November 9, 2009. Previous AT! coverage of Bilski here, here, here, and here.
Further details on Bilski v. Kappos may be found via the SCOTUS Wiki here. A transcript of the oral arguments will follow, as soon as available.

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