Cost Recovery Toolbox: Exceptional Cases Under 35 U.S.C. § 285

In a recent post on this blog, fellow contributor Mike Zabel addressed how a prevailing party might recover the costs of e-discovery in litigating disputes in federal court under 28 U.S.C. § 1920. In Eon-Net LP v. Flagstar Bancorp, No. 2009-1308, 2011 U.S. App. LEXIS 15650 (Fed. Cir. July 29, 2011), the Court of Appeals for the Federal Circuit highlighted another avenue for litigants in patent cases to recover costs based on discovery violations, affirming sanctions of nearly $500,000 for litigation misconduct. Under 35 U.S.C. § 285, the court may award the prevailing party in a patent dispute reasonable attorneys fees in "exceptional cases." Plaintiff Eon-Net engaged in improper tactics and made a habit of filing nuisance infringement cases – well over one hundred of them in total – but the court began its exceptional case discussion with Eon-Net's "retention policy."