Stipulated Dismissal Undercuts Bid for Attorneys’ Fees

UNITED CANNABIS CORPORATION V. PURE HEMP COLLECTIVE INC.

Before Lourie, Cunningham, and Stark. Appeal from the United States District Court for the District of Colorado.

Summary: The Federal Circuit affirmed the district court’s refusal to award attorneys’ fees based on alleged inequitable conduct where the party seeking fees had stipulated to the dismissal of its inequitable-conduct counterclaim.

UCANN filed suit against Pure Hemp for patent infringement and the parties later stipulated to the dismissal of UCANN’s patent infringement claims and Pure Hemp’s counterclaim for inequitable conduct. Pure Hemp then moved for attorney’s fees on various grounds, including that UCANN’s prosecution counsel had allegedly committed inequitable conduct. The district court denied the fee motion.

The Federal Circuit found that because Pure Hemp voluntarily dismissed its counterclaim for inequitable conduct, the district court was not obligated to make any findings on the merits of that counterclaim. Further, the limited record from the district court revealed that there was a genuine dispute as to whether any inequitable conduct occurred because UCANN’s attorney stated that she believed in good faith she did not need to disclose the prior art to the PTO. Thus, the Federal Circuit affirmed the district court’s denial of attorneys’ fees.

Editor: Paul Stewart

Jamal Perry New York Bar Admission Pending