Octane Fitness, LLC v. Icon Health

Background

One company that owns a patent for an elliptical machine (a major exercise-equipment maker) sued a rival manufacturer whose models were called Q45 and Q47. A federal trial court found no infringement and denied the rival’s request for attorney's fees under the Federal Circuit’s rigid Brooks Furniture test. The Federal Circuit affirmed both the no-infringement judgment and the denial of fees, and the case reached this Court.

Reasoning

The Court asked whether the Federal Circuit’s Brooks Furniture rules matched the patent-fee statute, which says only that a court “in exceptional cases may award reasonable attorney fees to the prevailing party.” The Court held that Brooks Furniture was too rigid. It said “exceptional” means uncommon or out of the ordinary and that judges should consider the totality of the circumstances. The Court rejected the requirement that a case be both objectively baseless and brought in subjective bad faith, and it rejected the Federal Circuit’s demand for proof by clear and convincing evidence.

Real world impact

The decision reverses the Federal Circuit and sends the case back for further proceedings. Going forward, district judges can more flexibly decide whether a patent case is sufficiently unusual to justify fee awards. This changes who can recover attorney fees and lowers the procedural hurdles for such awards in patent litigation.

Dissents or concurrances

Justice Scalia joined the opinion except as to three numbered footnotes; the majority opinion was joined by most other Justices.