The U.S. Supreme Court will hear arguments this month — including from a St. Louis attorney — that will attempt to clarify the standard for awarding attorneys’ fees in patent infringement litigation.
Arguments in Octane Fitness v. ICON Health and Fitness are on Feb. 26. The question at hand is whether the federal circuit standard for determining awards of attorneys’ fees for accused infringers who prevail improperly takes discretion from district courts and encourages plaintiffs to file spurious claims.

The case has garnered national attention because the decision likely will have wide ramifications for so-called “patent trolls, ” companies or people patenting technologies with no intention of using them for anything but fodder for lawsuits. Fifteen parties have filed amicus briefs in the case, including the U.S. government.
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The case began when ICON Health and Fitness sued Octane Fitness, claiming infringement on a mechanism in an elliptical workout machine. Both companies manufacture exercise equipment. ICON is based in Logan, Utah, and Octane is in Minneapolis.
In the U.S. District Court for the District of Minnesota, the judge granted Octane’s motion for summary judgment, finding that its design did not infringe on ICON’s. However, Octane sought and was denied attorneys’ fees. ICON appealed the summary judgment, and Octane cross-appealed the decision on attorneys’ fees.
By statute, patent appeals go before the U.S. Court of Appeals for the Federal Circuit, which unanimously upheld the summary judgment in favor of Octane while upholding the denial of a fee award. The fee amount is $2 million.
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The federal circuit can award attorneys’ fees to prevailing parties in “exceptional” cases, according to 35 U.S. Code 285, from 1952. In some cases, there are clear procedural abuses or rule violations, but in other cases it is not as clear-cut.
In 2005, the federal circuit set up a test for exceptionality in Brooks Furniture Manufacturing v. Dutailier International. In that case, where a patented chair design was at issue, the court created a two-pronged standard: If the case was filed in subjective bad faith, and if the claim was objectively baseless, courts could award fees to prevailing parties.
Harness Dickey attorneys Kara Fussner, standing on left, and Steven Holtshouser, in the middle of group on right, chat with Washington University law students before the moot court appearance of their colleague Rudy Telscher in a patent case that he will argue before the U. S. Supreme Court. Washington University 2nd year law students Zach McMichael and Ellen Cheong chat with Fussner as Holtshouse chats with Christopher and Paul Foryt, 1L.
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Washington University law students Chris Weber, 1st year, and 2nd year students Zach McMichael and Ellen Cheong discuss the intricacies of this case with Harness Dickey attorney Kara Fussner.
Harness Dickey attorney Steven Holtshouser, center, discusses the patent case his firm is arguing before the U.S. Supreme Court with Washington University law students Christopher Clayton and Paul Foryt at the law school. The school hosted a moot court session for the Harness Dickey team, led by attorney Rudy Telscher, as they prepare their case.
Rudolph A. Telscher, of Harness, Dickey & Pierce in Clayton, gathers his thoughts before a moot court session at Washington University School of Law earlier this month to prepare for his upcoming case at the U.S. Supreme Court.
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Harness Dickey lead attorney, Rudy Telscher, right, and Washington University Law School professor D. Bruce La Pierre chat before the moot court session. Telscher and his team were there to practice his patent case before a live audience and a panel of judges, represented by Washington University Law School professors.
Harness Dickey lead attorney, Rudy Telscher, center and his team Steven Holtshouser and Kara Fussner chat with Washington University Law School professor D. Bruce La Pierre chat before the moot court session.
Harness Dickey lead attorney, Rudy Telscher, on right, accepts law firm partner Joe Walsh's good luck handshake before his moot court session at Washington University Law School.
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Washington University law professor Kevin Collins introduces the case to be argued to the students, faculty and guests at the Washington University auditorium.

Washington University School of Law professors, from left, Mary Perry, Charles Burson, Bruce LaPierre, Pauline Kim and Neil Richards hear Telscher’s arguments. Law professors Scott Baker and Greg Magarian also served as panelists.
U.S. District Judge Audrey Fleissig poses a challenge to Telscher during an open session where he asked for feedback from the audience after his moot court appearance.
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Telscher, center, meets with members of his legal team and attendees of Wednesday’s moot court session at Washington University School of Law. Telscher said that the questions were “moderately hostile” with panelists talking over him and cutting him off — excellent preparation for the Supreme Court, he said.
Telscher’s daughter, Natalie, 12, offers to take a picture of Michael Xuhui, left, with her father after the moot court session. Xuhui, a Washington University School of Law graduate, teaches law in China. Natalie’s friend Molly Griesedieck, also 12, stands at right.
According to its brief, Octane holds that filing a case with a “low likelihood of success” should be enough for a judge to award fees.
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“It’s an impossible standard, ” Telscher said in an interview last week. “Even if I’m Google and you’ve got a bad case and I litigate, I’m not going to get my fees.” He said that for patent trolls, the economy of scale involved in filing against scores of defendants with little threat of fees makes it worthwhile.
Telscher said there only have been two cases in district courts where prevailing defendants have collected fees since Brooks in 2005: Highmark Inc. v. Allcare Management Systems Inc., which is also up for review by the Supreme Court; and Taurus IP, LLC v. DaimlerChrysler Corp. This is the first time the Supreme Court is interpreting Rule 285, Telscher said.

It’s also the first time before the high court for all four members of the Harness Dickey team: attorneys Telscher, Kara R. Fussner, Steven E. Holtshouser and Daisy Manning. The firm came to represent the Minnesota-based Octane because the company had purchased patent insurance. The insurance company recommended Harness Dickey to Octane.
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ICON, in its brief, said that what Octane is asking for is better left to Congress, and that the Patent Act is clear.
“If Congress wants to craft a different rule for trolls or other non-practicing entities, it of course may attempt to do so. But the Court should not do it for Congress, ” ICON’s brief reads.
Efforts to reach ICON’s team were unsuccessful. Counsel of record Larry R. Laycock, of Israelsen & Wright in Salt Lake City, did not return messages, and a staffer for Carter G. Phillips, at Sidley Austin in Washington, D.C., said that Phillips was traveling and unavailable for comment.
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