On June 16, 2016, the Supreme Court decided Kirtsaeng v. John Wiley and Sons, Inc.,
and clarified the standard district
courts should apply when exercising discretion in awarding attorney's fees to
prevailing parties in copyright suits under Section 505 of the Copyright Act
(17 U.S.C. § 505). The High Court held that while allowed to exercise its
"broad" discretion to award
attorney's fees under Section 505, a district must give substantial
weight to the objective reasonableness of the losing party's litigation
position, as well as also recognize
all other factors and criteria relevant to granting the fees.
In a unanimous opinion authored by Justice Kagan, the Court
acknowledged the open-ended discretion and leeway the district courts have
under Section 505 with no "precise rule or formula" for granting
attorney's fees. The Court pointed to its 1994 Fogerty decision where it "established several principles and
criteria to guide" the district courts' decisions under Section 505, all
in accordance with the overarching principle of asking whether the award would
serve to encourage litigation that would further the goals of the Copyright
Act. The Court noted that Fogerty established two "restrictions"
(i.e., (1) attorney's fees cannot be awarded as a matter of course and (2)
prevailing plaintiffs and prevailing defendants must be treated the same) and
" 'several non-exclusive factors' to inform a court's fee-shifting
decisions: 'frivolousness, motivation, objective unreasonableness and the need
in particular circumstances to advance considerations of compensation and
deterrence.' The Court remanded the case
stating “[W]e do not at all intimate that the District Court should reach a different
conclusion. Rather, we merely ensure that the court will evaluate the motion
consistent with the analysis we have set out—giving substantial weight to the
reasonableness of Wiley's litigating position, but also taking into account all
other relevant factors.”