Walker v. Health Int’l Corp., No. 2015-1676, 2017 U.S. App. LEXIS 246 (Fed. Cir. Jan. 6, 2017) (Before Reyna, Hughes, and Stoll, J.) (Opinion for the court, Reyna, J.)(Federal Circuit upheld district court’s award of attorneys’ fees and costs for vexatious litigation, and also sanctioned Walker and his attorneys for pursuing a frivolous appeal.).
Walker filed a patent infringement action against various defendants. Eventually, the only remaining defendant was HSN. Walker and HSN engaged in mediation which resulted in a Mediated Settlement Agreement (the Agreement), including an agreement that the action would be dismissed. Nevertheless, Walker continued to file motions, including an opposition to HSN’s Motion to Stay Deadlines based on the Agreement, and a motion to file an amended complaint. During the 3-months leading up until final dismissal, HSN was forced to continue its defense. HSN ultimately filed a motion for attorneys’ fees and costs. The district court dismissed the action and awarded attorneys’ fees and costs to HSN due to Walker’s “vexatious actions” following the Agreement. Walker sought reconsideration of the dismissal and objected to the award of attorney’s fees six months later. The Court rejected Walker’s objections and Walker appealed.
On appeal, HSN filed a further motion for sanctions and requested attorneys’ fees and double costs. After Oral Argument, the Court ordered Walker to show cause why he should not be sanctioned.
The Court upheld the district court’s award of attorneys’ fees and costs, finding ample support in the record for Walker’s vexatious conduct, and no legitimate reason for Walker to continue litigating after the Agreement. Further, Walker’s arguments on appeal mischaracterized clear authority on the courts’ ability to award attorneys’ fees.
The Court also sanctioned Walker and his attorneys for pursuing a frivolous appeal and awarded attorneys’ fees and costs. Walker raised new arguments which made baseless ethical accusations against opposing counsel. Additionally, many times during the lawsuit and the appeal, Walker attempted to frustrate the settlement agreement while prolonging litigation and mischaracterized clear legal authority. Therefore, the Court exercised its discretion to sanction Walker and his counsel and award fees and costs to HSN.
Proceeding with aggressive litigation tactics after a final settlement, including efforts to challenge the settlement and amend the complaint may result in district court sanctions, including attorneys fees, and pursing such positions on appeal may be considered frivolous and subject to further sanctions.