Drinker Biddle Sees Federal Circuit Affirm Award of Attorneys’ Fees Based on Demonstration that Case Was Exceptional

Drinker Biddle & Reath LLP obtained affirmation from the Federal Circuit of a district court’s award of attorneys’ fees for firm client Vital Pharmaceuticals, Inc. Vital and 70 other defendants had been accused of patent infringement by a patent owner and its licensee. Most of the defendants settled, but Vital and two other defendants refused and instead obtained a judgment that the asserted patent claims were invalid. The question of infringement was never addressed by the district court.

Frank DiGiovanni, Curt Lambert, and Thatcher Rahmeier subsequently convinced the district court that the case was “exceptional” under the Patent Statute based on the plaintiffs’ insufficient pre-filing investigation, which resulted in the assertion of frivolous claims, and thus the district court awarded Vital its attorneys’ fees.

In the appellate decision, the Federal Circuit recognized that awarding fees based on an issue that was not litigated before the district court “is an unusual basis for fees and we have emphasized the wide latitude district courts have to refuse to add to the burdens of litigation by opening up issues that have not been litigated but are asserted as bases for a fee award.” Nonetheless, the Federal Circuit affirmed, reasoning that “we have been given no persuasive reason for holding that such a basis for fees is a legally impermissible one.”