Summary: A U.S. Supreme Court case from a year ago, Octane, has made it possible for other companies that get sued for patent infringement to get back their legal fees when the lawsuit was meritless.
Octane Fitness has asked for $2.8 million in legal fees from the U.S. District Court for the District of Minnesota Federal Judge Ann Montgomery. This small Minnesota company has changed the rules regarding awarded attorney fees in patent litigation.
Over a year ago, the U.S. Supreme Court ruled against the U.S. Court of Appeals for the Federal Circuit’s explanation for the common award of attorney fees, calling the standard rigid and inflexible. The High Court decided that District courts should have the right to make their own decision regarding a company being entitled to having attorney fees paid back.
Over seven years ago, Octane was sued by ICON Health & Fitness for patent infringement. A lawsuit Octane called “meritless”. ICON manufactures NordikTrack and other exercise equipment. Judge Montgomery found through the evidence presented that ICON took a lot of time to find a patent of theirs that they could “throw” at Octane. They ended up on a 10-year-old patent that had not been commercialized and was “sitting on the shelf”. ICON then took the trouble to drive up Octane’s litigation costs, trying to get them to settle instead of defending their lawsuit. She called their behavior “uncommon, rare, and not ordinary”.
Three years after the initial lawsuit was filed by ICON, Octane’s motion for summary judgement was granted by the district court, citing that no infringement had occurred. Octane then requested their legal fees to be reimbursed but the district and Federal Circuit said their case was not eligible for reimbursement.
Octane then took their fight to the U.S. Supreme Court arguing that the standard was not attainable and, therefore, not right. All nine judges agreed and have now made it possible for district courts to award legal fees when the patent holder sues with no good chance of winning.
The case last year, commonly known as Octane, has made it possible for 30 other companies throughout the country to be awarded their legal fees. From 2005 to 2011, there were no fees awarded to cases where the patent holder had a weak chance of winning their lawsuit.
Source: http://www.law.com/sites/articles/2015/07/16/in-patent-case-fitness-co-wants-2-8m-in-attorney-fees/
Photo: octanefitness.com