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Case Blurb: Qualcomm; Awarding Attorney’s Fees and other Legal Costs for litigation misconduct in patent cases

Posted by rjbiii on September 29, 2007

Under 35 U.S.C. § 285, “[t]he court in exceptional cases may award reasonable attorney fees to the prevailing party.” 35 U.S.C. § 285 (West 2007). In patent infringement cases, the Federal Circuit has held that an award of attorney fees under Section 285 involves a two-part determination: (1) “a district court must determine whether the prevailing party has proven an exceptional case by clear and convincing evidence,” a factual determination that the Federal Circuit reviews for clear error; and (2) “if the district court finds the case exceptional, it must then determine whether an award of attorney fees is appropriate,” which the Federal Circuit reviews for abuse of discretion. Perricone v. Medicis Pharm. Corp., 432 F.3d 1368, 1380 (Fed.Cir.2006).

The Federal Circuit has further held that the trial judge is in the best position to weigh the relevant considerations for exceptional case, “such as the closeness of the case, the tactics of counsel, the flagrant or good faith character of the parties’ conduct, and any other factors contributing to imposition of punitive sanctions or to fair allocation of the burdens of litigation.” Id. “[L]itigation misconduct and unprofessional behavior are relevant to the award of attorney fees, and may suffice, by themselves, to make a case exceptional.” Waner v. Ford Motor Co., 331 F.3d 851, 857 (Fed.Cir.2003) ( quoting Epcon Gas Sys., Inc. v. Bauer Compressors, Inc., 279 F.3d 1022, 1034 (Fed.Cir.2002)).

The prevailing party may prove exceptional case in a patent infringement suit by showing: “inequitable conduct before the PTO; litigation misconduct; vexatious, unjustified, and otherwise bad faith litigation; a frivolous suit or willful infringement.” Phonometrics, Inc. v. Westin Hotel Co., 350 F.3d 1242, 1246 (Fed.Cir.2003) ( quoting Epcon Gas Sys., 279 F.3d at 1034). When the patentee is “manifestly unreasonable in assessing infringement, while continuing to assert infringement in court, an inference is proper of bad faith, whether grounded in or denominated wrongful intent, recklessness, or gross negligence.” Id. ( quoting Eltech Sys. Corp. v. PPG Indus., Inc., 903 F.2d 805, 811 (Fed.Cir.1990)).

Qualcomm Inc. v. Broadcom Corp., 2007 WL 2261799 (S.D. Cal. Aug. 6, 2007).
Full Order is found here, courtesy of K&L Gates.

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