Trying to get attorney’s fees awarded more often is a double-edged sword. The default approach is to allow fees to be awarded to the prevailing party. This is, in fact, the English approach.

In the U.S. we take a different tack. Attorney’s fees are awarded more rarely because of the public policy of encouraging Plaintiffs who may not otherwise have resources to press their claims.

In other words, do we want to discourage Joe Random Inventor from bringing a claim against, say, Ford because Joe will be going against a well-funded opponent and, if not successful, may end up owing substantial amounts in attorney’s fees to the other side (plus, potentially, his own)? In the U.S. court system, the answer is no.

The Answer I think is to look at some of the more consumer-oriented statutes which allow the award of attorney’s fees. One good example is the FDCPA. However, in the patent context you may want to flip the typical script.

In the FDCPA both sides may be awarded attorney’s fees. Consumers, if successful, can basically get reasonable attorney’s fees right out. (There are limits, but it is far more common than in typical state or federal cases.) Defendant Debt Collectors, however, can only recover if they can show the claim was brought in bad faith.

Perhaps shifting the burden to where a counterclaim can be brought in a patent case. If that counterclaim is successful, then statutory attorney’s fees can be awarded per the FDCPA and some other statutes. If not, then the other side can only recover attorney’s fees with a showing that the actions of the counter-claimant were brought in bad faith (or whatever the standard is for the FDCPA and other similar-style causes of action).

Perhaps this counterclaim might be for patent troll-like behavior. In other words, the patent is not in use by the owner (other than through licensing) and the company is simply a patent-holding entity. This counter claim may be extended to declaratory actions when given a reasonable threat of litigation, with the same fee-shifting approach.

The problem is you must be careful with new causes of action. Think of what the Prendas of the legal world and the Paul Duffys might do. While patent trolls are a problem, they are enabled by lawyers who in many ways act as legal trolls. Such a cause of action may enable legal trolling behavior to too great an extent.

Another approach is to not create a cause of action, but to simply shift burdens statutorily in patent cases. The key is to avoid equivalency on behalf of the plaintiff and defendant. You want to not destroy the incentives for small players with valid claims to be able to press those claims against larger, perhaps even monopolistic, entities. So creating a new burden which allows attorney’s fees recovery may be the ideal.

For example, in a patent lawsuit, both sides follow the American rule of each side paying for their own legal fees. However, upon notice in the Answer by the Defendant, this burden can be shifted. Once notice is given of the intent to go after attorney’s fees, then the Defendant is then given the burden of pro-actively showing the other side it case has little-to-no merit.

This pro-active approach can be begun at any time up to and until the Answer stage of a lawsuit. Therefore, if a demand letter is sent, and the defending company responds with a notice of the intent to pursue attorney’s fees, and then lays out in detail the reasons why the case has little-to-no merit, then that works just as well as if it was after suit.

Once this showing has been made, then if the Defendant wins then the Defendant must be awarded reasonable attorney’s fees absent a showing by the Plaintiff, and accepted by the court, as to why some other conduct by Defendant which negates this.

Even this approach is fraught with procedural peril, however. The system might be gamed too much. Responses may lose their value as they become more standardized. It may end up resulting in inhibiting the bringing of valid claims by small players against larger players.

Ultimately, the CAFC (which I loathe, greatly) is correct that judges have the power to fee-shift already in these cases. It is a power they rarely choose to act upon, in large part for the basic policy reason stated at the beginning of this comment. (Said policy reason holding true to all types of lawsuits, not just patent ones?not inhibiting plaintiffs from bringing valid claims against well-funded adversaries with the risk of a double-whammy of attorney’s fees.)

Perhaps the easiest route is to find a way to change the Federal Rules of Civil Procedure on this, or develop precedent in each circuit which more clearly outlines ways in which judges can and should implement their fee shifting powers in these types of cases. (Each circuit, and each state, is different on when and how they fee shift.)

There is no easy answer. There are tradeoffs for each approach, and each approach can create new issues on top of some which may be unforeseen.

In short, fee shifting sounds great in theory, but it can be difficult in practice.