SCOTUSblog: Highmark Inc. v. Allcare Management Systems, Inc. (see Octane Fitness v. Icon Health and Fitness for another case that discusses the same issue).
Argument: Feb 26 2014 (Aud.)
Background: Highmark, a Pennsylvania insurance company, filed suit against Allcare seeking a declaratory judgment of noninfringement, invalidity, and unenforceability of all claims of an Allcare patent. Allcare counterclaimed for infringement. The District Court entered final judgment of noninfringement in favor of Highmark. Highmark moved for an exceptional case finding with respect to Allcare and an award of attorneys' fees and expenses under 35 U.S.C. § 285. After reviewing the record, the District Court found the case exceptional. The Federal Circuit affirmed one § 285 claim and reversed two others, holding that a District Court’s objective baselessness determination is reviewed “without deference.” The Federal Circuit denied rehearing en banc by a vote of six to five.
Issue: The question before the Court is whether a district court’s exceptional-case finding under 35 U.S.C. § 285 (which permits the court to award attorney’s fees in exceptional cases), based on its judgment that a suit is objectively baseless, is entitled to deference.