Supreme Court Unanimously Overrules the Federal Circuit’s Fee-Shifting Framework in Patent Cases

Today, the Supreme Court issued two unanimous decisions that considerably relax the standard for awarding attorney’s fees against plaintiffs who bring meritless patent suits. These decisions are timely given the ongoing debate in Congress regarding the inclusion of a “fee-shifting” provision in the pending patent reform legislation.

Under 35 U.S.C. § 285, a district court has discretion to award attorney’s fees to a prevailing party in a patent case if the court determines that the case is “exceptional.” Under the standard crafted in Brooks Furniture Manufacturing., Inc. v. Dutailier International, Inc., attorney’s fees previously were awarded against the patentee only if the suit was (1) objectively baseless, and (2) brought in subjective bad faith, absent misconduct during litigation or inequitable conduct before the Patent and Trademark Office.

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