Footnote two is a contender for funniest Supreme Court footnote this term.
Kirtsaeng bought low-cost foreign edition textbooks in Thailand and resold them to students in the U.S. In 2013 the Supreme Court held that Kirtsaeng could invoke the Copyright Act’s “first-sale doctrine,” 17 U.S.C. 109(a), as a defense to the publisher’s copyright infringement claim. Kirtsaeng then sought more than $2 million in attorney’s fees from the publisher under the Act’s fee-shifting provision. The Second Circuit affirmed denial of Kirtsaeng’s application, reasoning that Wiley had taken reasonable positions during litigation. A unanimous Supreme Court vacated. When deciding whether to award attorney’s fees under 17 U.S.C. 505, a court should give substantial weight to the objective reasonableness of the losing party’s position, while still taking into account all other relevant circumstances. Precedent has identified several non-exclusive factors for courts to consider, e.g., frivolousness, motivation, objective unreasonableness, and the need in particular circumstances to advance considerations of compensation and deterrence. Putting substantial weight on the reasonableness of a losing party’s position is consistent with the objectives of the Copyright Act, but courts must take into account a range of considerations beyond the reasonableness of litigating positions. Because the district court “may not have understood the full scope of its discretion,” the Court remanded for consideration of other relevant factors.
Ninth Circuit reminds us that it already has decided that it is not bound to apply Octane Fitness’ (134 S. Ct. 1749) definition of “exceptional” in the context of the Lanham Act’s fee-shifting provision. Rather than evaluate ‘exceptional’ under a ‘totality of circumstances’ test, the Ninth Circuit will look to whether there was ‘malicious, fraudulent, deliberate or willful’ infringement.
Noting the similarity between the language of Section 285 of the Patent Act, the Fifth Circuit extends Octane Fitness to cover Section 1117(a) of the Lanham Act as to what constittutes an exceptional case for purposes of awarding attorney’s fees. Departing from the standard that ‘exceptional’ means a case that is brought in bad faith, Octane Fitness looks to the ordinary meaning of exceptional, namely uncommmon, rare, not ordinary, unusual, special and not run-pf-the-mill.
Plaintiff sues its licensee. Licsensee prevails, brings motions for fees and costs, alleging that plaintiff had brought this litigation as a ploy to re-negotiate the license. It alleged that plaintiff had brought similar litigation against another licensee in order to ‘re-negotiate’ license, brought mertiless discovery, brought meritless dilution claim, abandoned ADR process, made meritless defense of venue trasnfer motion and never produced evidence on material elements of its claims. Also, defendant established that plaintiff acted in bad faith with regard to its unfair competition claim. Held:
The fact that the jury did not find that [plaintiff] had proven those claims by a prepondernece of evidence does not lead to the conclusion that they were necessarily brought in bad faith. Further, the jury’s finding of bad faith on the unfair competition claims is irrelevant here, as the relevant inquiry is whether [plainitff]’s litigation tactics were premised on bad faith, and not whether its pre-Complaint conduct in preventing [defendant] from using the [Marks] in certain ways was done in bad faith.
Motion for fees was denied (however costs were awarded).
Decision Farberware Costs Exceptional