Tuesday, August 24, 2021

CAFC Rules that the USPTO is not Entitled to Expert Witness Fees in a Civil Action for Review of a PTAB Decision. What about the TTAB?

You will recall that in Peter v. Nantkwest, the Supreme Court unanimously upheld an en banc decision of the CAFC, ruling that the USPTO is not entitled to recover its attorney's fees in an appeal from an adverse PTAB (Patent Trial and Appeal Board) decision via a civil action under Section 145 of the Patent Statute. [TTABlogged here]. Well, last week, in Hyatt v. Hirshfeld, Appeal No. 2020-2231 et al. (Fed. Cir. August 18, 2021), the CAFC ruled that the USPTO is not entitled to recover expert witness fees in a Section 145 action. [pdf here]. What's the story on the trademark side, where the issue of recover of attorney fees under Section 1071(b) has been hanging around for several years?

In the Booking.com case, in 2019 the Fourth Circuit upheld the district court's award of attorney's fees to the USPTO in a successful appeal from a TTAB decision deeming the term BOOKING.COM to be generic for travel agency services. However, the Supreme Court in July 2020 remanded the case back to the Fourth Circuit for consideration of the attorney fee award in light of its Nantkwest decision. [TTABlogged here].

Prior History: The Fourth Circuit had followed (seemingly with reluctance) its own decision in Shammas v. Focarino, 784 F.3d 219, 225 (4th Cir. 2015) by affirming the district court's award of attorney's fees to the USPTO. Despite statutory language in Section 1017(b)(3) of the Trademark Act that is virtually identical to that of Section 145 of the Patent Statute, the Fourth Circuit confirmed that the USPTO was entitled to recover its attorney's fees. The district court had awarded the USPTO the sum of $76,873.61, which included $51,572.53 in attorney fees (i.e., USPTO personnel costs) and $21,750.000 in expert witness fees. [TTABlogged here].

Back to the Fourth Circuit: On remand from the Supreme Court, the Fourth Circuit kicked the case back down to the U.S District Court for Eastern District of Virginia "for further consideration in light of the United States Supreme Court's decision in [Peter v. Nantkwest]."

At the district court, both parties agreed that the USPTO was no longer entitled to recover the $51,472.53 previously awarded for the USPTO's personnel costs. On June 3, 2021, the district court allowed Booking.com to reduce the remainder of the award by its costs, resulting in a final award of $23,676.58, which included the USPTO's expert witness fees. [Opinion here].

In late June 2021, Booking.com asked the district court to re-consider the award in light of the anticipated CAFC ruling in Hyatt v. Hirshfeld, but the district court declined. The parties then agreed to an award of $18,676.58, and the court entered an agreed-upon order and closed the case.

Two months later, the Hyatt v. Hirshfeld decision came down.

Read comments and post your comment here.

TTABlogger comment: So where do things stand on the trademark side? Shamas v. Focarino has not been overruled by the Fourth Circuit, and the award of expert witness fees to the USPTO in Booking.com apparently will go unchallenged.

Text Copyright John L. Welch 2021.


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