Digest of Highmark, Inc. v. Allcare Health Mgmt. Sys., Inc., No. 2011-1219 (Fed. Cir. Sept. 5, 2014) (non-precedential). On appeal from N.D. Tex. Before Newman, Mayer, and Dyk (per curiam).

Procedural Posture: The Supreme Court vacated and remanded the CAFC’s opinion which set aside the district court’s award of attorney fees. CAFC vacated the district court’s award of attorney fees and remanded for reconsideration under the new standard articulated in Octane.

  • Exceptional Case/Attorney Fees: In Highmark (134 S. Ct. 1744), the standard of review on appeal for awards of attorney fees was changed from de novo to abuse of discretion. The abuse-of-discretion standard does not preclude the appellate court’s correction of a district court’s legal or factual error, as it is an abuse of discretion to base a ruling on an erroneous view of the law or a clearly erroneous assessment of the evidence. The Court thus remanded the case for reconsideration under Octane (134 S. Ct. 1749). In Octane, the Court rejected a two-part test for awarding attorney fees, which required that the litigation was brought in subjective bad faith and was objectively baseless, and articulated a new standard that an exceptional case exists, and warrants award of attorney fees, when the case simply “stands out from others with respect to the subjective strength of a party’s litigation position…or the unreasonable manner in which it was litigated.” The exceptional nature of a case need not be proven with clear and convincing evidence.