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When is a patent claim so outrageous that attorney’s fees must be awarded? | Ars Technica

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The Federal Circuit rule is that a lawsuit must be "objectively baseless," with clear and convincing evidence of "subjective bad faith."

In the words of the judge in the Octane case, for a case to be exceptional, "the plaintiff's case must have no objective foundation, and the plaintiff must actually know this." The Federal Circuit also found that Octane's win wasn't fee-worthy.

Octane went ahead and asked the Supreme Court to change the rule. The current standard is "near-impossible for an accused infringer to meet no matter the unreasonableness of the litigation" and "serves as no deterrent to the assertion of spurious claims."

"If you're trying to get a district court judge, looking at complex patent documents and opposing expert reports, to find that someone's case has zero merit and was brought in bad faith—that's an impossible standard," Telscher said in an interview with Ars. "You've got to show that the plaintiff brought a 'zero merit' case, and they knew that's what they were doing."

In Telscher's view, the Federal Circuit has read in requirements that aren't in the law. Instead, district courts should consider "the totality of the circumstances," he said. "When there are facts that suggest abuse of the patent system, that should be considered. The court should act to prevent gross injustice to a defendant."

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