Posts Tagged: "British Rule"

Congress and the Court: Loser-Pay Fee Shifting

U.S. patent litigation has followed the centuries-old “American Rule” under which each party to a litigation pays its own legal fees and costs, regardless whether it wins or loses the litigation. A narrow exception exists in patent cases, but only in “exceptional cases” under 35 U.S.C. § 285, such as where the losing party engaged in litigation misconduct, or if the patent was fraudulently procured, or if the losing party raised arguments that were both objectively baseless and made in bad faith. Despite the long tradition of litigants paying their own legal fees and costs, Congress has shown interest in changing the playing field and deviating from the American Rule in patent cases. This comes at a time when the U.S. Supreme Court is already considering two cases that relate to the definition of “exceptional cases” in § 285 that may well alter how this existing exception to the American Rule is applied in practice.

“Main Street” Patent Coalition Wants Patent Litigation Reform

The Main Street Patent Coalition may be the entity with the single most misleading name in the history of misleading organization names…. According to the LA Time, White Castle has 9,600 employees. How exactly is that a small business? … The corporate members of the National Restaurant Association, and the members of the National Retail Federation are some of the largest corporations in the United States. The American Gaming Association membership likewise includes some of the largest corporations in America, including several of the largest banks in the world, including Goldman, Sachs and Morgan Stanley.

Patent Reform: Will Fee-Shifting Solve the Patent Troll Problem?

Will these regulations make it less likely that a patent troll might take on a frivolous lawsuit? Perhaps, but it may also result in a higher win percentage for plaintiffs who only take sure bets to court, and those plaintiffs will be in line to obtain payment of their attorneys fees as well. Also, there’s nothing to prevent the most nefarious actors, the true trolls who only intend to reap money from patents regardless of infringement, from deciding to go bankrupt and not pay fees if they lose. Still others who are extremely well funded are likely be to able to purchase patents for pennies on the dollar, building enormous portfolios that will make the Intellectual Ventures portfolio look small in comparison. Will big-tech fight against such well funded super patent trolls? If the don’t then what good does fee-shifting do? You have to win to obtain the fees, so there is a real possibility that this legislation will not only fail to cure the problem but instead make it worse while destroying the smaller players who are the real innovators.