An Award of Attorneys Fees and Costs Under 35 U S C 285 Does Not Preclude Sanctions Pursuant to the Court S Inherent Authority

Written by: Ashley C. Morales and Brandon G. Smith

PS PRODUCTS INC. V. PANTHER TRADING CO. INC.

Before Moore, Stoll, and Cunningham. Appeal from the Eastern District of Arkansas.

Summary: Section 285 does not prohibit an award of deterrence sanctions under the court’s inherent authority.

PSP sued Panther for alleged infringement of a design patent. Panther filed motions to dismiss for failure to state a claim and improper venue. In response, PSP moved to voluntarily dismiss the case with prejudice, which the court granted. After the dismissal, Panther moved for attorney fees and costs as well as a monetary deterrence sanction.  The district court granted the motion and ordered PSP to pay a $25,000 deterrence sanction under the court’s inherent power. PSP appealed the deterrence sanction, and Panther requested attorney fees and costs for defending the appeal.

The Federal Circuit affirmed the award for sanctions but declined to award attorneys’ fees. The Federal Circuit held the district court did not clearly err by both awarding attorneys’ fees and imposing a deterrence sanction because Section 285 does not preclude a district court from separately imposing sanctions under another authority. The Federal Circuit also held PSP’s continued presentation of meritless infringement and venue arguments did not make the appeal frivolous as argued, and thus declined to award attorneys’ fees for the appeal.

Editor: Sean Murray