In The News . . . . DOJ Tries To Limit Class Counsel Fee Award In Farmer/Rancher Class Action And Federal Circuit Likely Makes It More Difficult For Patent Litigants To Reap Fee Recoveries In “Exceptional” Cases

 

Plaintiffs’ Attorneys Want $60.8 Million, But DOJ Wants to Limit Fee Recovery to $30.4 Million in Farmer/Rancher Class Action Settlement.

     As reported by Mike Scarcella in a March 21, 2001 post at The National Law Journal, class action fees are at the storm of a controversy between plaintiffs’ attorneys and Department of Justice in a class action settlement in Keepseagle v. Vilsack (D.D.C.), a Native American farmer and rancher class action. Plaintiffs’ attorneys are seeking $60.8 million in fees based upon a $27 million lodestar, while DOJ wants to limit the fees to $30.4 million (one half the request). Judge Emmet Sullivan of the U.S. District Court of the District of Columbia will be deciding this one soon.

Federal Circuit Reins in “Exceptional” Fee Recovery in Patent Cases through Recent Old Reliable v. Cornell Decision.

     In patent cases, 35 U.S.C. § 285 allows district judges to award attorney’s fees to a litigant in an “exceptional” case, where the fee-seeking party satisfies two “exacting” standards–sanctions may be imposed against the patentee only if both (1) the litigation was brought in subjective bad faith, and (2) the litigation is objectively baseless.

     Building on the its interpretation of the second element made in the earlier decision of iLOR, LLC v. Google, Inc., 2011 U.S. App. LEXIS 56, at *11 (Fed. Cir. Jan. 11, 2011), the Federal Circuit in Old Reliable Wholesale, Inc. v. Cornell Corp., No. 2010-1247 (Fed. Cir. Mar. 16, 2011) further put the clamps on fee recovery under section 285. The “objectively baseless” requirement involves a purely objective inquiry that parallels the finding that must be made with respect to willful infringement under section 284. This standard must be met whether the action is one for willful infringement or determined to be a meritless, nonwillful infringement action, with subjective considerations of bad faith playing no role in this determination.

     Using these tenets, the Federal Circuit found that the objective threshold was not satisfied, reversing an award of $183,517.11 in fees and $13,111.53 in costs against a patentee whose patent was found to be invalid.

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