SAN FRANCISCO — The Ninth Circuit is the wrong place to bring a sketchy false-advertising case.
On Tuesday, the appellate court upheld a $934,000 award for attorney fees and costs in a Lanham Act case, declining to reconsider its friendly standard for finding a case “exceptional.”
The court’s unpublished opinion in eMove v. SMD Software found “no legitimate evidence” that a software company serving the self-storage industry spread false statements about a competitor. The statements eMove complained about were either made only to a handful of people or weren’t clearly false, the court concluded.
And that represented “an utter failure of proof” worthy of an exceptional-case finding, the court said.
Fulbright & Jaworski partner Jonathan Franklin, representing eMove on appeal, argued that his client did not act in bad faith. Although the U.S. Court of Appeals for the Ninth Circuit doesn’t require bad faith for an exceptional-case finding, some improper motive must be shown in the Second and Eleventh circuits, he argued.
EMove “urges us to join other circuits in finding that a case cannot be considered exceptional without a finding of bad faith,” states the opinion by Judges Barry Silverman, William Fletcher and Jay Bybee. “We are unwilling to do so.”
Nor was there any hint that they would urge their colleagues to reconsider the issue en banc.
Osborn Maledon partner Eric Fraser argued the case for SMD Software.
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