Wednesday, April 2, 2014

Vishnubhakat on attorney fee awards in U.S. patent cases

While we await (1) the U.S. Supreme Court's rulings in two pending cases, Octane Fitness and Highmark, on the issue of awards of attorneys' fees under section 285 of the U.S. Patent Act (see my post on the oral arguments here), and (2) possible action on the part of Congress to amend section 285 so as to make awards of attorneys' fees more common, Saurabh Vishnubhakat's paper What Patent Attorney Fee Awards Really Look Like, 63 Duke L.J. Online __ (forthcoming 2014) (available here) provides some useful empirical findings on the current lay of the land.  Here is the abstract:
This essay gives an empirical account of attorney fee awards over the last decade of patent litigation. Given the current attention in legislative proposals and on the Supreme Court’s docket to more liberal fee shifting as a check on abusive patent litigation, a fuller descriptive understanding of the current regime is of utmost importance to forming sound patent litigation policy. Following a brief overview of judicial experience in patent cases and trends in patent case filing, this study presents analysis of over 200 attorney fee award orders during 2003-2013.

The study confirms the commonsense view that plaintiffs have tended to receive attorney fee awards more often than defendants have, but that such awards have been larger when defendants did receive them. Notably, observed attorney fee awards have been an order of magnitude lower than estimated. Attorney fee awards also vary, in magnitude and distribution, according to the technology area of the patents involved in the dispute. Finally, patent attorney fee awards often follow systematic calculation and discounting with explanatory discussion, reflecting a pattern of fact-intensive evaluation by district judges of such awards.
(For Dennis Crouch's earlier post on this paper on Patently-O, see here.)  Based on his analysis of data from the DocketNavigator litigation research service, Mr. Vishnubhakat reports, among other things, that plaintiffs were the recipients of 153 (70.8%) of the 216 section 285 district court fee awards over the relevant time period, which seems consistent with Octane Fitness's complaint that fee awards tend to go disproportionately to plaintiffs; but that the median award for defendants was substantially higher ($109,466, versus $46,354 for plaintiffs).  Mr. Vishnubhakat also surmises that, based on the cost of patent litigation as reported in AIPLA's annual reports, district judges may be applying discounting (a phenomenon observed in some other countries that award fees on a more routine basis, see here). (I wonder what percentage of patent infringement cases litigated to judgment resulted in section 285 fee awards over the relevant time period--in other words, 216 is what percentage of the total?  I would guess it's between 5 and 7%, based on Mark Lemley's report of 3,043 cases litigated to judgment between 2000 and March 17, 2010, but it would be interesting to pin things down.)

For another recent write-up on attorney's fees, see this post on the JIPLP blog by Paul Keller and Annsley Merelle Ward on the Federal Circuit's December 2013 decision in Kilopass (which I also blogged about here.)  The Keller & Ward post is also mentioned on IPKat and PatLit; the latter also states that "JIPLP is also interested in receiving articles on this issue from jurisdictions other than the United States.  If you are thinking of writing one, please contact Sarah Harris, Commissioning Editor, at".  I'll be very interested to read the resulting articles.

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