On April 29, 2014, the U.S. Supreme Court handed down two 9-0 decisions—Octane Fitness v. Icon Health & Fitness and Highmark v. Allcare Health Management System—that reversed the U.S. Court of Appeals for the Federal Circuit and liberalized the standard for the award of attorney fees to a prevailing defendant in patent litigation. These decisions are already part of the vigorous debate about the need for “reform” of the Patent Act to curb abusive lawsuits.
Section 285 of the Patent Act, which authorizes a district court to award attorney fees in patent litigation, provides in its entirety that the “court in exceptional circumstances may award reasonable attorney fees to the prevailing party.” Until 2005, the Federal Circuit, like other circuit courts, instructed trial judges to consider the totality of circumstances when making fee determinations under §285.
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