A Litigation Position May Be Objectively Unreasonable Even If the Court Denies Summary Judgment

EKO BRANDS, LLC V. ADRIAN RIVERA MAYNEZ ENTERPRISES, INC. ET. AL. 

Before Dyk, Reyna, and Hughes.  Reyna dissenting in part.  Appeal from the Western District of Washington

Summary: A litigation position that survives summary judgment does not conclusively establish the position was objectively reasonable for purposes of deciding whether the case was “exceptional.”

Eko and Adrian Rivera Maynez Enterprises (“ARM”) sued each other for patent infringement.  After a jury found ARM’s patent was invalid, the district court found ARM’s litigation position concerning validity was unreasonable and awarded attorney’s fees even though the court previously denied summary judgment on validity.  ARM appealed.

The Federal Circuit affirmed.  The Court distinguished a prior decision that stated “absent misrepresentation to the court, a party is entitled to rely on a court’s denial of summary judgment . . . as an indication that the party’s claims were objectively reasonable and suitable for resolution at trial.”  See Checkpoint v. All-Tag, 58 F. 3d 1371, 1376 (Fed. Cir. 2017).  The Court explained: “Our cases require only that the district court considers the denial of summary judgment, not that the district court always give that denial decisive weight.”  Thus, the Federal Circuit affirmed after concluding the district court properly considered the totality of circumstances, including ARM’s failure to meaningfully contest obviousness at trial.

Editor: Paul Stewart

Written by: Adam Aquino & Adam Powell