The Price of Principled Dissent: Fee-Shifting as a Deterrent to Legitimate Critique of Patent Doctrine

by Dennis Crouch

In re PersonalWeb Techs, — F.4th — (Fed. Cir. Nov 3, 2023)

A few years ago, I published an article along with Homayoon Rafatijo explaining our perspective of how the Federal Circuit has improperly extended the Kessler doctrine in cases like PersonalWeb Tech.  Law school classes teach two types of preclusion: res judicata and collateral estoppel. The Kessler doctrine is an additional patent-specific preclusion doctrine that the Federal Circuit applies against patentees in certain patent situation.  The basics of the doctrine is that it applies like non-mutual collateral estoppel to bar future litigation of infringement claims. But in PersonalWeb, the Federal Circuit removed some of the key safeguards of collateral estoppel — such as requiring that the issue have been actually litigated and decided  in a first case prior to precluding further litigation of the issue in a different context and against different parties. We spent a lot of time researching the history of the doctrine and its creation in the early 1900s and then walked through how the historical expansion the “claim” via notice pleading as well as expansion of non-mutual issue preclusion overtook any original justification for the doctrine.  Our article had some legs and was also awarded the ShookHardy & Bacon LLP Excellence in Research Award.  The Gov’t brief  in the subsequent Supreme Court petition did agreed that the Federal Circuit had improperly extended the doctrine.  Unfortunately, the Supreme Court denied certiorari in the case.

I was surprised to see today that in a 2-1 decision, the Federal Circuit thought so little of our argument (and the SG brief) that it determined PersonalWeb’s lawsuit was objectively baseless — thus serving as a basis for an exceptional case finding and attorney fee award of $5 million to the accused infringers.

I’ll begin with Judge Dyk’s dissent that sets out the problem:

The majority’s opinion rests on the remarkable proposition that PersonalWeb’s arguments were objectively baseless (and supported a fee award) despite the Solicitor General’s agreeing that those very same arguments were correct. The majority’s opinion effectively awards fees for a lack of success, which is not an appropriate use of section 285, and will likely chill legitimate advocacy.

Dyk, J. in Dissent.  The majority opinion authored by Judge Reyna and joined by Judge Lourie defended the Federal Circuit’s caselaw and appears to reject any notion that the Federal Circuit has expanded the doctrine beyond its original bounds.  Notably, the Federal Circuit did not contend with any of the arguments suggested either in our article or the SG brief.  The majority also did not explain its effective conclusion that the SG brief was itself objectively baseless.

The Federal Circuit’s newest decision PersonalWeb is concerning. By penalizing reasonable legal arguments and showing little regard for scholarly critique or even the Solicitor General’s briefing, the majority opinion signals an overt hostility towards rethinking existing patent doctrine and legitimate litigation that endeavors to challenge existing law.

37 thoughts on “The Price of Principled Dissent: Fee-Shifting as a Deterrent to Legitimate Critique of Patent Doctrine

  1. 8

    Didn’t the Sup. Ct. just pass up an opportunity in a denied DuPont cert petition to attack collateral estoppel, over objections by J. Thomas? Is it distinguish able from the Kessler doctrine that the Federal Circuit applies against patentees in certain patent situations?

  2. 7

    Reyna and Lourie. Why am I not surprised to hear that those two got something so wrong?

    1. 7.1

      What I heard about Reyna is that his judicial philosophy is NOT that the Federal Circuit should generate a harmonious patent legal system that encourages innovation. Rather, his philosophy is to just decide cases and let the chips fall where they may. In other words, he doesn’t care about the long-term impact of his decisions.

      He’s a ‘just let me do my job; I don’t care about the consequences’ kind of guy.

      1. 7.1.1

        As long as they agree with my desired outcome, Judges should always be outcome-driven.


          LOL – while you may have suggested that in jest, the one that you at times chime in with (in agreeement) — Malcolm — acts as if that is an expectancy, and then is astounded when different Ends are chosen for the same (lack of proper) Means.

      2. 7.1.2

        That is my impression as well. Moreover, Reyna (and others) feel that it is perfectly reasonable for the appellate court to decide the substantive issues in all patent cases. That is not the role of an appellate court. They don’t have the benefit of a 1-2 week trial where the evidence is presented and witnesses testify. Also, in this system, only the wealthy elite can access the justice system, as time and cost are the functions that filter out disputes that reach the 12 judges at the Federal Circuit. Hundreds of others are chewed up and spat out by the procedure. Instead, the appeals court should limit their review to clear errors of law, leaving to stand the vast majority of lower court decisions. Then we would all have a chance to participate in the patent system.



  3. 6

    This case seems to be a pattern of the Federal Circuit to create rulings that prevent litigation on the merits for a easy black letter rule that clears their docket, i.e. judicial sloth. For example; Festo with overbroad prosecutory history estoppel, KSR correcting the CAFC’s black letter ruling that a motivation to combine must be printed somewhere explicitly, and now Kessler doctrine precluding litigation on the merits and denying due process. Bottom line: the CAFC needs to be filled with judges who are qualified patent practitioners that care about patent law and not liberal art/non-technical lawyers who couldn’t get Senate confirmation.

    1. 6.1

      Sadly, Lourie was a patent practitioner.

  4. 5

    Note that the prior TX decision Kessler Doctrine was far from the only, nor necessary, grounds for this unusually large sustained award of “exceptional case” attorney fees in this case. The adequate listed others are:
    “(2) PersonalWeb frequently changed its infringement positions to overcome the hurdle of the day;
    (3) PersonalWeb unnecessarily prolonged this litigation after claim construction foreclosed its infringement theories;
    (4) PersonalWeb’s conduct and positions regarding the customer cases were unreasonable; and
    (5) PersonalWeb submitted declarations that it should have known were not accurate.”

    1. 5.1

      In other words, even if Personal Web had even briefed and argued overthrowing the CAFC’s Kessler doctrine? [only validly accomplished en banc anyway] it would not have changed the outcome here.

    2. 5.2

      Yes, this was the subject of my comment 1 below. Maybe some (probably very small) portion of the fees might have been reduced had PW successfully argued the Kessler issue but the majority of the shifted fees here aren’t punishment for PW’s failure on that front. The lesson here is that PW should have dropped its rotten case early on rather than “zealously” pursue the basement-level legal “strategies” that got them worse than nowhere.

      1. 5.2.1

        The dissent lays out why this was not a rotten case on the Kessler issue. And, states that whatever portion of exceptional fee attributable to the interpretation on Kessler should be removed.

        “In short, I am at a loss to understand how making an
        argument that the Solicitor General agreed was correct
        and that was a matter of first impression in our court can
        lead to an award of fees. The Kessler argument was not
        objectively baseless, and the district court’s fee award included fee amounts directed only to the Kessler issue. The
        portion of the district court’s fee award attributable to the
        Kessler argument cannot stand. While I agree that in other
        respects a fee award was proper, a remand is appropriate
        because the district court improperly awarded fees based
        on PersonalWeb’s Kessler argument.”


          the district court’s fee award included fee amounts directed only to the Kessler issue

          Thanks. I missed that part of the dissent. I wish the majority had said more in response.

    3. 5.3

      The SG’s brief also argued that PersonalWeb’s claims should have been precluded regardless, without any need for the Kessler doctrine. See pp. 16-17. link to

      The majority’s reasoning is hard to follow. I can’t tell if they mean to say that the SG’s argument and the Crouch/Rafatijo argument are clearly wrong, or if they mean to say that this case isn’t really about the limits of the Kessler doctrine. The dissent sounds persuasive. I wish the majority had done more to answer it.

  5. 4

    Bad plaintiffs make bad law. Judge Reyna and Lourie and others on the Federal Circuit do not understand that their case law punishing patent assertion entities has foreclosed small operating companies from competing against incumbents who infringe.

    1. 4.1

      You know what makes bad law?

      The nigh incessant propaganda as to somehow it being “bad” to be ‘not practicing’ in light of the actual “negative right” of what a patent is.

      We simply have had WAY too much “0h N0es” drum beat.

      1. 4.1.1


      2. 4.1.2

        and in perfect timing to exemplify this point:

        link to

        Wherein even the ‘lesser’ propaganda term of Patent Assertion Entity is taken to task.

        The fundamentals MUST be understood.
        The fundamentals MUST be embraced.

    2. 4.2

      “..punishing patent assertion entities has foreclosed small operating companies from competing against incumbents who infringe”
      ?? First, most PAE’s do not, and do not need to, get themselves fiscally punished like this for this kind of trial conduct. This and most other case law is not different for PAEs. Secondly, most PAEs are suing to collect money for themselves on patents which they have acquired, not defending any company from competition, not suing to defend any other companies patents, and not getting injunctions because PAEs are not product competitors.
      [In contrast to the far more desirable benefit to small companies of law firms that can get litigation financing and can sue on a contingent fee basis on behalf of small company’s valid patents.]

      1. 4.2.1

        ^^^ THIS is a flavor of the propaganda (somehow, ‘must make’ is entwined with the negative right nature of what a patent is).



          Are you are objecting to PAEs not getting injunctions? Money is all that a PAE is seeking. The law that injunctions are for those who cannot be fully compensated by money damages is hundreds of years old, as the Sup. Ct. noted in overruling CAFC case law on nearly automatic injunctions for patent infringement. Companies making patented products should not be selling their patents to PAEs if they want to restrain competition with their products.


            The law that injunctions are for those who cannot be fully compensated by money damages is hundreds of years old
            The Constitution refers to “securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries.” Exclusive right is exclusive right — regardless of whether one is practicing the invention or not.


              “Exclusive right is exclusive right”



                But Malcolm is not anti-patent….

                (As has attempted to gaslight)


            The law that injunctions are for those who cannot be fully compensated by money damages is hundreds of years old, as the Sup. Ct. noted in overruling CAFC case law on nearly automatic injunctions for patent infringement

            Very much wrong for reasons I have provided numerous times in great detail.

            The law of equity is concerned first and foremost with making the aggrieved as whole as possible.

            “Money” is NOT the best way of doing that when one recognizing the nature of the transgression.

            The notion of “making” does not cut it and conflates more than it helps – by a mile.


              The “law” of equity is concerned first and foremost with whatever the custom of the sitting court may be, and is most certainly not in making the aggrieved as whole as possible.

              Equity demands that the aggrieved be made as whole as possible without undue harm to the transgressor. In other words, equity is a two-way street, and thus if there can be a first principle of equity, it would turn on proportionality.

              In products with thousands of components, an injunction may be proportionate, or it may not be.

              Terrain blah blah blah


                Your “terrain” reference only shows your CHOICE in 1gn0rance – There is in fact a first and foremost factor. This is not to say that there are not other factors. Additionally, I invite you (again) to take a look at HOW the Congress shared its Constitutionally granted authority across branch lines – and discuss with our attorney (since you refuse to recognize what I plainly tell you) what that sharing entailed, and why those words are dispositive.

                Climb down from your peak of Mount S.


                To help you out, marty, this is the explicit point that the Legislative Branch is sharing its Constitutionally appointed power with the Judicial Branch (I have added some emphasis).

                Make sure that you ask your attorney about the strict scrutiny that comes with power shared between the branches.

                35 U.S.C. 283 Injunction.
                The several courts having jurisdiction of cases under this title may grant injunctions in accordance with the principles of equity TO PREVENT THE VIOLATION OF ANY RIGHT SECURED BY PATENT, on such terms as the court deems reasonable.

                The conditions of the application of power are controlling.

                1. The statute need not- would not- enumerate that a court may grant injunctions in accordance with the principles of equity outside of the patent right, because that power is inherent in function of the judiciary.

                  The conditions of being a judge are controlling. I think it may be you who needs some continuing education credits.

  6. 3

    One of the rare occasions in which Dyk got it right.

    1. 3.1

      Had the same thought.

      More like these, Judge Dyk. More like these please.

    2. 3.2

      You know what they say about blind squirrels?? Lol.

  7. 2

    Reap what you sow.

    The simians have been fire-hose trained only too well to despise patents, and the (historic) “The only valid patent is one that has not yet appeared before us” has come home to roost.

  8. 1

    If PersonalWeb’s hands were otherwise clean this might have turned out differently. But it sounds like their Kessler doctrine “challenge” was part of a pattern of aggressive behavior. In short, I wouldn’t give up yet.

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