Inventor Holdings v. Bed Bath & Beyond was decided on December 8, 2017 on appeal from the District of Delaware. After the Supreme Court decided Alice, defendant BBB won judgment on the pleadings that plaintiff Inventor Holdings’ patent was invalid under Alice. BBB then moved for attorney fees. The district court granted the fees motion, holding that “following the Alice decision, [Inventor Holdings’] claims were objectively without merit.” The fee award included fees incurred during a previous § 101 appeal. Inventor Holdings appealed.
The Federal Circuit affirmed the award of attorney fees.
The district court did not abuse its discretion. The exceptionality finding was based solely on the weakness of Inventor Holdings’ post-Alice eligibility arguments and the need to “deter future wasteful litigation on similarly weak arguments.” BBB was entitled to attorney fees for two reasons. First, Inventor Holdings’ claims were “dubious even before the Alice decision.” And second, “Alice was a significant change in the law as applied to the facts of this particular case.” “[A] § 101 defense previously lacking in merit may be meritorious after Alice.” This was especially true where, as here, the claims involved “implementations of economic arrangements using generic computer technology.” “[T]here is no uncertainty or difficulty in applying the principles set out in Alice to reach the conclusion that the [asserted patent] claims are ineligible.” Given Alice, it “was [Inventor Holdings’] responsibility to reassess its case in view of new controlling law.”
The district court did not abuse its discretion in awarding appellate attorney fees. There were “obvious issues” with the asserted patent’s claims that Inventor Holdings “should have recognized post-Alice, and these issues persisted throughout the § 101 appeal.” Section 285 permits the trial court to award “fees for the entire case, including any subsequent appeals.”
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