Prepared by Cislo & Thomas LLP Attorney Mark D. Nielsen, Ph.D.
1. In what is a curious opinion from the Federal Circuit in light of another recent Federal Circuit opinion, the Court held that a voluntary dismissal without the need for a court order under Fed.R.Civ.P. 41 (a)(1)(A)(i), which is without prejudice, is not a final judgment having judicial imprimatur that changes the positions of the parties such that one party can be deemed the “prevailing party,” and thus move for attorneys’ fees. Perhaps the distinction from the previous Federal Circuit opinion is whether or not the dismissal is with or without prejudice.
2. In yet another opinion on attorneys’ fees in patent cases from the Federal Circuit (and I will spare you all the full procedural history, which is also a civil procedure nerd’s dream), the Court vacated and remanded the denial of an attorneys’ fees motion in a situation where the case had been stayed pending successful inter partes reviews (IPR). The lower court in the District of Delaware held that the defendants that were successful in the IPRs was not a “prevailing party” under 35 U.S.C. 285 for purposes of awarding attorneys’ fees in the district court litigation. It stated that, “success in a different forum is not a basis for attorneys’ fees” in district court. The Federal Circuit, however, vacated that ruling and remanded the matter to the district court finding that a defendant is deemed a “prevailing party” where it successfully rebuffed, through the successful IPRs, a patent owner’s attempt to enforce its patents through litigation and thereby alter the legal relationship between the parties. More specifically, the Federal Circuit held that a successful IPR that results in dismissal of infringement litigation does render the defendants as “prevailing parties” that may be entitled to an award of attorneys’ fees if the case is proven to be “exceptional.” The remand is to determine if the case is exceptional such that fees are warranted. Interestingly, the prevailing defendants asked the Federal Circuit to rule that fees from the IPRs should also be recoverable in its fee motion. The Federal Circuit expressed some doubt about that argument, but remanded the case before deciding the issue. So, that will be a determination to watch going forward, as It could open the floodgates going forward should the district court award fees from the IPR to the prevailing defendants.
3. In another opinion from the very active Federal Circuit, the Court reversed a decision from the District of Massachusetts invalidating a patent directed to improving cardiac monitoring technology under Section 101/Alice. While the reversal is encouraging for the pro-patent crowd, perhaps the more interesting dispute in the 2-1 panel opinion is the issue of whether prior art should be reviewed in the context of a Section 101/Alice analysis to determine whether a particular practice is conventional or the like. This is an important issue, but it also raises concerns. Prior art should not be the basis for invalidity under Section 101, as Sections 102 and 103 of the Patent Act are there for that purposes. If, however, the prior art is to be considered to understand if the technology or methodology in question is conventional, and limited to that purposes, perhaps it makes sense. It is a potential slippery slope. So, while Judge Dyk, in dissent, raises an interesting point, he also stated that, “the language of the panel opinion is likely to sow confusion for both the district court and the bar,” which has to be one of the more myopic comments in the sense that all the Section 101/Alice jurisprudence has done is sow confusion for courts and the bar. The Federal Circuit’s denial of rehearing en banc in Athena v. Mayo that produced nine (9) different “opinion” from the Court is all the evidence we need for such a point. As such, a fresh push for Section 101 reform and clarity should be made at some point soon.