Appeal Sanctions: Unsuccessful Patent Infringement Plaintiff, Losing Summary Judgment Motion Badly, And Its Counsel Are Jointly And Severally Assessed With Frivolous Appeal Sanctions Of $107,748.27

This Was A 2-1 Opinion, With A Reduction For Sanctions Motion “Fees On Fees”; Dissent Felt That Just A Weak Appeal Did Not Warrant Sanctions.

            Under Federal Rules of Appellate Procedure 38, a circuit court may award “just damages and single or double costs to the appellee” if an appeal is determined to be frivolous.  The Federal Circuit, in Pop Top Corp. v. Rakuten Kobo Inc., No. 2021-2174 (Fed. Cir. July 14, 2022) (nonprecedential order), used this rule to assess frivolous appeal sanctions of $107,748.27 against an unsuccessful patent infringement plaintiff badly losing a summary judgment motion which also did not go well on the merits appeal of the summary judgment later, as well as its counsel.  Apparently, the district court also issued Federal Rules of Civil Procedure 11 sanctions, although only the dissenting opinion alludes to this fact and that order was still under appeal. 

            Appellee then moved for attorney’s fees and double it costs of $140,964.46, inclusive of $53,216.19 in “fees on fees” for presenting the appeal sanctions motion before the Federal Circuit.  The majority of justices, in the order, granted the appeal sanctions request, but reduced it to $107,748.27, because it found that 83 hours to brief the sanctions motion as compared to 107.6 hours to respond to the appeal showed that $20,000 instead was the reasonable amount for “fees on fees.”  The sanctions award was assessed jointly and severally against plaintiff/appellant and its counsel.  The majority found the appeal frivolous based on its weakness and appellant’s misrepresentation about appellee’s position throughout the appeal.

            The dissent saw things differently, believing that even a weak appeal is something which does not justify appeal sanctions.  The dissent said this in part: “Litigation by its nature reflects the spin of advocacy, and the right of appellate review is a safeguard to the rule of law.  The judicial burden of reviewing a weak appeal or receiving one-sided argumentation does not warrant the sanction of award of attorneys’ fees.”