Betty Frison invented a product related to hair weaving and subsequently entered into an agreement with Davison Design to promote her product. The agreement required that the parties arbitrate any dispute. After believing Davison Design misrepresented the financial gain that she would realize from the product, Frison initiated arbitration against Davison Design, pursuing a claim under the American Inventors Protection Act.

Frison received an award of more than $13,000 in damages and $10,000 in attorneys’ fees. Davison Design then filed an application in federal court under sections 10 and 11 of the Federal Arbitration Act to vacate or modify the award. The U.S. District Court for the Western District of Pennsylvania denied Davison Design’s application, and Frison sought additional attorneys’ fees for successfully upholding the arbitration award. The district court rejected Frison’s request, and Frison appealed.

On appeal, Frison argued that the attorneys’ fees provision of the American Inventors Protection Act entitled her to fees for upholding the arbitration award. Relying on the “American Rule,” which provides that each party bear its own attorneys’ fees unless a statute or contract provides otherwise, the Third Circuit found that Frison did not have a basis in statute or contract to recover fees for successfully defending the arbitration award. Although the fee-shifting provision of the American Inventors Protection Act allows the recovery of attorneys’ fees “in a civil action against the invention promoter,” the Third Circuit held that this action was brought by the invention promoter not under the American Inventors Protection Act for damages, but under the Federal Arbitration Act to vacate or modify an arbitration award.

Accordingly, the Third Circuit found that the district court did not err in denying Frison’s request for additional attorney’s fees.

Davison Design & Development Inc. v. Frison, No. 19-2045 (3d Cir. Aug. 11, 2020).