  United States Court of Appeals
      for the Federal Circuit
              __________________________

                  HIGHMARK, INC.,
                   Plaintiff-Appellee,
                           v.
  ALLCARE HEALTH MANAGEMENT SYSTEMS,
                   INC.,
            Defendant-Appellant.
              __________________________

                      2011-1219
              __________________________

   Appeal from the United States District Court for the
Northern District of Texas in case no. 03-CV-1384, Judge
Terry Means.
              __________________________

         ON PETITION FOR PANEL REHEARING
                            AND
      ON PETITION FOR PANEL REHEARING AND
             REHEARING EN BANC
            __________________________

    CYNTHIA E. KERNICK, Reed Smith LLP, of Pittsburgh,
Pennsylvania, filed a combined petition for panel rehear-
ing and rehearing en banc for plaintiff-appellee and a
response to defendant-appellant’s petition for panel
rehearing. With her on the petition and response were
JAMES C. MARTIN, KEVIN S. KATONA and THOMAS M. POHL.
HIGHMARK   v. ALLCARE HEALTH                                2


    DONALD R. DUNNER, Finnegan, Henderson, Farabow,
Garrett & Dunner, LLP, of Washington, DC, filed a peti-
tion for panel rehearing for defendant-appellant and a
response to plaintiff-appellee’s combined petition for
rehearing. With him on the petition and response was
Erik R. Puknys, of Palo Alto, California. Of counsel on
the petition and response was Dan S. Boyd, The Boyd
Law Firm, P.C., of Dallas, Texas.
              __________________________

 Before RADER, Chief Judge, NEWMAN, MAYER, LOURIE,
 BRYSON, LINN, DYK, PROST, MOORE, O’MALLEY, REYNA,
            and WALLACH, Circuit Judges.
PER CURIAM.
DYK, Circuit Judge, with whom NEWMAN, Circuit Judge,
joins, concurs in the denial of the petition for rehearing en
banc.
MOORE, Circuit Judge, with whom RADER, Chief Judge,
O’MALLEY, REYNA, and WALLACH, Circuit Judges, join,
dissents from the denial of the petition for rehearing en
banc.
REYNA, Circuit Judge, with whom MOORE, O’MALLEY, and
WALLACH, Circuit Judges, join, dissents from the denial of
the petition for rehearing en banc. RADER, Chief Judge,
joins in Parts I–II of the dissent.
                        ORDER
    A petition for panel rehearing was filed by Defendant-
Appellant Allcare Health Management Systems, Inc.
(“Allcare”), and a response thereto was invited by the
panel and filed by Plaintiff-Appellee Highmark, Inc.
(“Highmark”). A combined petition for panel rehearing
and rehearing en banc was also filed by Highmark, and a
3                             HIGHMARK   v. ALLCARE HEALTH


response thereto was invited by the court and filed by
Allcare.
    The petitions for panel rehearing and responses were
referred to the panel that heard the appeal, and thereaf-
ter the petition for rehearing en banc and the response
were referred to the circuit judges who are authorized to
request a poll of whether to rehear the appeal en banc. A
poll was requested, taken, and failed.
    Upon consideration thereof,
IT IS ORDERED THAT:
    (1) The petitions of Allcare and Highmark for
panel rehearing are denied.
    (2) The petition of Highmark for rehearing en
banc is denied.
     (3) The mandate of the court will issue on December
13, 2012.

                                  FOR THE COURT


    December 6, 2012              /s/ Jan Horbaly
         Date                     Jan Horbaly
                                  Clerk




    *   Judge Mayer did not participate in the decision
regarding rehearing en banc. Judge Linn assumed senior
status November 1, 2012 after participating in the deci-
sion regarding rehearing en banc.
  United States Court of Appeals
      for the Federal Circuit
               __________________________

                   HIGHMARK, INC.,
                    Plaintiff-Appellee,
                             v.
  ALLCARE HEALTH MANAGEMENT SYSTEMS,
                   INC.,
            Defendant-Appellant.
               __________________________

                       2011-1219
               __________________________

   Appeal from the United States District Court for the
Northern District of Texas in case no. 03-CV-1384, Judge
Terry Means.
              __________________________

DYK, Circuit Judge, with whom NEWMAN, Circuit Judge,
joins, concurring in the denial of the petition for rehearing
en banc.


   We agree that rehearing en banc is properly denied.
We write briefly to respond to the dissents.
                              I
    Section 284, 35 U.S.C., allows the award of enhanced
damages at the conclusion of a patent case based on a
finding of willful infringement. In re Seagate Tech., LLC,
497 F.3d 1360, 1368 (Fed. Cir. 2007) (en banc); see also
HIGHMARK   v. ALLCARE HEALTH                               2


Beatrice Foods Co. v. New England Printing & Litho-
graphing Co., 923 F.2d 1576, 1578 (Fed. Cir. 1991) (col-
lecting cases). Section 285, 35 U.S.C., allows the award of
attorneys’ fees at the conclusion of the case, against either
a patentee or an accused infringer, if the court finds the
case “exceptional.” Following the Supreme Court’s deci-
sion in Professional Real Estate Investors, Inc. v. Colum-
bia Pictures Industries, Inc. (“PRE”), 508 U.S. 49 (1993),
we have long held that the standard for both inquiries is
the same, and that it requires a dual determination that
the position of the sanctioned party is (1) objectively
unreasonable, and (2) asserted in subjective bad faith.
See, e.g., Old Reliable Wholesale, Inc. v. Cornell Corp., 635
F.3d 539, 543-44 (Fed. Cir. 2011); iLOR, LLC v. Google,
Inc., 631 F.3d 1372, 1377 (Fed. Cir. 2011); Seagate, 497
F.3d at 1370-71; Brooks Furniture Mfg., Inc. v. Dutailier
Int’l, Inc., 393 F.3d 1378, 1381 (Fed. Cir. 2005).
    We all agree that the ultimate decision to award en-
hanced damages and attorneys’ fees (once the predicate
tests have been satisfied) is committed to the district
court’s discretion, and that the district court’s findings on
the bad faith component are subject to review for clear
error. See Highmark, Inc. v. Allcare Health Mgmt. Sys.,
Inc., 687 F.3d 1300, 1310 (Fed. Cir. 2012). The dissents
also seem to agree that the objective reasonableness
determination should be made by the court, not the jury.
The question on which we divide is whether that determi-
nation should be subject to de novo review, as this court
held in Bard, and as this panel (following Bard) held here.
See Bard Peripheral Vascular, Inc. v. W.L. Gore & Assocs.,
Inc., 682 F.3d 1003, 1005 (Fed. Cir. 2012).1 In particular,


    1   Bard’s clarification of Seagate’s objective prong
was authorized by an en banc order granting rehearing
“for the limited purpose of authorizing the panel to revise
3                               HIGHMARK   v. ALLCARE HEALTH


the question in this case is whether claim construction,
which is a question of law in a merits determination, see
Cybor Corp. v. FAS Techs., Inc., 138 F.3d 1448, 1454-55
(Fed. Cir. 1998) (en banc), should nonetheless be treated
as something else in an objective reasonableness determi-
nation.
    That such legal questions invoke de novo review is
clear. Our cases based the objective reasonableness
standard directly on the Supreme Court’s decision in
PRE, 508 U.S. at 60-63. PRE held that litigation could
not be sanctioned unless a suit was objectively baseless,
and objective baselessness requires a probable cause
determination. Id. at 62. PRE also held that “[w]here, as
here, there is no dispute over the predicate facts of the
underlying legal proceeding, a court may decide probable
cause as a matter of law.” Id. at 63. Under PRE, the
reasonableness of a legal position in the context of a
probable cause determination is itself a question of law,
as the Supreme Court has recently confirmed. See Scott
v. Harris, 550 U.S. 372, 381 n.8 (2007) (once the relevant
facts are determined and inferences drawn “in favor of the
nonmoving party to the extent supportable by the record,
the reasonableness of Scott’s actions . . . is a pure question
of law”); see also Stewart v. Sonneborn, 98 U.S. 187, 194
(1878) (“[P]robable cause is a question of law in a very
important sense . . . . Whether the circumstances alleged
to show it probable are true, and existed, is a matter of
fact; but whether, supposing them to be true, they amount
to a probable cause, is a question of law.”) (internal quota-
tion marks omitted). Judge Moore’s suggestion that PRE
did not decide what it explicitly decided is not well taken.


the portion of its opinion addressing willfulness.”       En
Banc Order No. 2010-1510 (Fed. Cir. June 14, 2012).
HIGHMARK   v. ALLCARE HEALTH                              4


And Judge Moore cites no authority for the proposition
that under PRE, a determination of probable cause for
legal arguments is not subject to de novo review.
                               II
    Judge Moore, Judge Reyna, and Judge Mayer in his
panel dissent, urge that both this decision and Bard are
inconsistent with our prior authority. This is incorrect.2
More fundamentally, they assert that the de novo stan-
dard is inconsistent with the Supreme Court’s decisions in
Cooter & Gell v. Hartmarx Corp., 496 U.S. 384 (1990), and
Pierce v. Underwood, 487 U.S. 552 (1988), which dealt
with the standard of review for awards of attorneys’ fees
under Rule 11 and the Equal Access to Justice Act
(“EAJA”). But those cases arose in quite different con-
texts, and are no basis for reading sections 284 and 285 as
requiring deference to district courts on the objective
reasonableness issue.
   First, the language of sections 284 and 285 does not
mandate deference to the district court’s discretion on

     2  None of our prior opinions involved a dispute be-
tween the litigants as to whether objective recklessness is
a question of law to be reviewed de novo on appeal.
Because this issue was never discussed, prior cases are
not binding precedents on this point. See Brecht v. Abra-
hamson, 507 U.S. 619, 631 (1993) (“[S]ince we have never
squarely addressed the issue, and have at most assumed
the applicability of the . . . standard . . . we are free to
address the issue on the merits.”); Nat’l Cable Television
Ass’n v. Am. Cinema Editors, Inc., 937 F.2d 1572, 1581
(Fed. Cir. 1991) (opinions that appear to apply a standard,
but “with little or no analysis,” are “not precedent to be
followed in a subsequent case in which the issue arises”);
see also Boeing N. Am., Inc. v. Roche, 298 F.3d 1274, 1282
(Fed. Cir. 2002) (collecting cases).
5                              HIGHMARK   v. ALLCARE HEALTH


questions of law. To the contrary, section 285 was
amended to replace an open-ended discretionary stan-
dard, and to restrict the discretion in the district courts.
Section 285, as originally enacted, provided that the
district court “may in its discretion award reasonable
attorney[s’] fees.” Patent Act of Aug. 1, 1946, ch. 726, 60
Stat. 778. The 1952 Patent Act deleted the “in its discre-
tion” language and replaced it with the “exceptional case”
standard that exists today. 35 U.S.C. § 285 (2006) (“The
court in exceptional cases may award reasonable attorney
fees to the prevailing party.”); see also Rohm & Haas Co.
v. Crystal Chem. Co., 736 F.2d 688, 691 (1984); Alan M.
Ahart, Attorneys’ Fees: The Patent Experience, 57 J. Pat.
Off. Soc’y 608, 617 n.37 (1975).
    Second, the relevant policy considerations behind sec-
tions 284 and 285 are quite different from those involved
in EAJA and Rule 11. Those provisions are addressed to
the award of attorneys’ fees, not enhanced damages, as
provided in section 284. Even as to the attorneys’ fees
provision of section 285, the considerations are different.
Rule 11 deters abusive litigation practices, Cooter & Gell,
496 U.S. at 393, and EAJA discourages the government
from initiating unjustified litigation by evening the play-
ing field, “eliminat[ing] for the average person the finan-
cial disincentive to challenge unreasonable governmental
actions.” Comm’r, INS v. Jean, 496 U.S. 154, 163 (1990).
In contrast, section 285, while it serves deterrent pur-
poses, is a primarily compensatory provision. See, e.g.,
Mathis v. Spears, 857 F.2d 749, 753 (Fed. Cir. 1988) (“The
purpose of Section 285 is to reimburse a party injured
when forced to undergo an ‘exceptional’ case.” (emphasis
omitted)). Early on, it was recognized that attorneys’ fee
awards were “not to be regarded as a penalty for failure to
win a patent infringement suit,” and should only be
allowed where it would be “grossly unjust that the winner
HIGHMARK   v. ALLCARE HEALTH                             6


. . . be left to bear the burden of his own counsel fees.”
Rohm & Haas, 736 F.2d at 691 (quoting Park-In Theatres,
Inc. v. Perkins, 190 F.2d 137, 142 (9th Cir. 1951)).
    Third, unlike sanctions under Rule 11 or attorneys’
fees under the EAJA, enhanced damages and exceptional
case findings frequently involve extraordinarily large
awards, often amounting to millions of dollars.3 High-
mark was awarded approximately $5 million in attorneys’
fees and expenses in this case. Highmark, 687 F.3d at
1308. Bard was awarded $185,589,871.02 in enhanced
damages and $19 million in attorneys’ fees and costs.
Bard Peripheral Vascular, Inc. v. W.L. Gore & Assocs.,
670 F.3d 1171, 1178 (Fed. Cir. 2012). The Supreme Court
recognized in Pierce that large fee awards “militat[ed]
against” an abuse of discretion standard: “If this were the
sort of decision that ordinarily has such substantial
consequences, one might expect it to be reviewed more
intensively.” Pierce, 487 U.S. at 563. However, the Court
concluded that this concern was unwarranted as applied
to EAJA, because at the time EAJA fee awards were

       3   For enhanced damages, see, e.g., Krippelz v.
Ford Motor Co., 667 F.3d 1261, 1264–65 (Fed. Cir. 2012)
($21 million in enhanced damages); i4i Ltd. P’ship v.
Microsoft Corp., 598 F.3d 831, 858 (Fed. Cir. 2010) ($40
million in enhanced damages); Muniauction, Inc. v.
Thomson Corp., 532 F.3d 1318, 1323 (Fed. Cir. 2008)
($38,482,008.00 in enhanced damages).

    For attorneys’ fees, see, e.g., MarcTec, LLC v. Johnson
& Johnson, 664 F.3d 907, 910 (Fed. Cir. 2012)
($4,683,653.03 in attorneys’ and experts’ fees and ex-
penses); Lazare Kaplan Int’l, Inc. v. Photoscribe Techs.,
Inc., 628 F.3d 1359, 1366 (Fed. Cir. 2010) (over $6 million
in attorneys’ fees); Takeda Chem. Indus., Ltd. v. Mylan
Labs., Inc., 549 F.3d 1381, 1385 (Fed. Cir. 2008) ($16.8
million in attorneys’ fees).
7                             HIGHMARK   v. ALLCARE HEALTH


typically only a few thousand dollars. Id.; see also Jean,
496 U.S. at 164 n.12 (“In 1989 [EAJA] awards averaged
less than $3,000 each”).
     Fourth, unlike the situation under Rule 11, the deci-
sion to award attorneys’ fees and enhanced damages to
prevailing parties under sections 284 and 285 is based on
the entire case, and does not turn on whether the pat-
entee’s position would have been reasonable at the time of
filing the complaint or pleading. See Antonious v. Spal-
ding & Evenflo Cos., 275 F.3d 1066, 1076 (Fed. Cir. 2002);
Fed. R. Civ. P. 11 advisory committee’s note, 1983.
Rather, our en banc decision in Seagate established that
objective reasonableness for enhanced damages is a single
retrospective look at the merits of the case after the
conclusion of the litigation, when there is a “prevailing
party.” See, e.g., Dominant Semiconductors Sdn. Bhd. v.
OSRAM GmbH, 524 F.3d 1254, 1264 (Fed. Cir. 2008)
(“[O]bjective baselessness requires a determination based
on the record ultimately made . . . not on the basis of
information available to the patentee at the time the
allegations were made.”). The same is true of attorneys’
fee awards under section 285 in the litigation of unmeri-
torious cases. Nor do sections 284 and 285, in these
respects, implicate supervision of the local bar, a matter
that Cooter & Gell found particularly within the expertise
of the local district court. 496 U.S. at 404.
    Fifth, appeals of enhanced damage awards and excep-
tional case findings typically come to this court either
after an appeal that resolved the merits, or in an appeal
that also involves review of the merits.4 The district

       4    E.g., Meyer Intellectual Props., Ltd. v. Bodum,
Inc., 690 F.3d 1354 (Fed. Cir. 2012); Bard, 670 F.3d 1171;
i4i Ltd. P’ship v. Microsoft Corp., 598 F.3d 831 (Fed. Cir.
2010); ICU Med., Inc. v. Alaris Med. Sys., Inc., 558 F.3d
1368 (Fed. Cir. 2009); see also Highmark, 687 F.3d 1300
HIGHMARK   v. ALLCARE HEALTH                             8


court, when it makes an objective reasonableness deter-
mination after a trial on the merits, is simply unable to
forecast what this court will decide in the merits appeal.
In this respect, it is not “uniquely positioned” to decide
the objective reasonableness question. Moreover, the
existence of appellate review on the merits before the
objective reasonableness determination significantly
mitigates the concern expressed in Pierce with “the in-
vestment of appellate energy” in de novo review. Pierce,
487 U.S. at 561; see also Cooter & Gell, 496 U.S. at 403-
04. It will not require a significant “investment of appel-
late energy” for an appellate panel that has already
addressed the merits to then determine if, under the
correct law, a litigant was objectively unreasonable.
Quite the contrary; the merits panel is typically better
situated to make that determination than the district
court, and remand for a district court’s determination of
objective reasonableness in light of the appellate merits
determination would often be wasteful. The Federal
Circuit brings to the table useful expertise. Our court
sees far more patent cases than any district court, and is
well positioned to recognize those “exceptional” cases in
which a litigant could not, under the law, have had a
reasonable expectation of success.
                            III
    Patent cases present complex legal issues. The inter-
ests of the parties, the legal system and the public are
best served if both patentees and accused infringers are
able to present reasonable legal positions without fear of
sanctions. Unlike Rule 11, section 285 provides no safe

(addressing damages after a prior merits appeal); Marc-
Tec, LLC v. Johnson & Johnson, 664 F.3d 907, 910 (Fed.
Cir. 2012) (same).
9                             HIGHMARK   v. ALLCARE HEALTH


harbor that allows a party to withdraw its case and
thereby avoid the possibility of sanctions. De novo appel-
late review of the objective reasonableness defense as-
sures uniformity in the treatment of patent litigation,
insofar as reasonableness is the governing issue. At the
same time, district courts will continue to play an impor-
tant role in determining whether the subjective good faith
prong of the applicable test has been satisfied and
whether, if the legal predicates for a sanctions award
have been satisfied, an award is desirable in a particular
case.
  United States Court of Appeals
      for the Federal Circuit
               __________________________

                   HIGHMARK, INC.,
                    Plaintiff-Appellee,
                             v.
  ALLCARE HEALTH MANAGEMENT SYSTEMS,
                   INC.,
            Defendant-Appellant.
               __________________________

                       2011-1219
               __________________________

   Appeal from the United States District Court for the
Northern District of Texas in case no. 03-CV-1384, Judge
Terry Means.

   MOORE, Circuit Judge, with whom RADER, Chief
Judge, and O’MALLEY, REYNA, and WALLACH, Circuit
Judges, join, dissenting from the denial of the petition for
rehearing en banc.
                __________________________

    Our court system has well-defined roles: the trial
court makes factual findings and the appellate court
reviews those findings with deference to the expertise of
the trial court. An exceptional case determination under
35 U.S.C. § 285 has traditionally been one of the ques-
tions of fact determined by the trial court that is review-
able only for clear error. Contrary to our precedent, the
divided Highmark panel decided that a district court’s
HIGHMARK   v. ALLCARE HEALTH                              2


exceptional case finding—based on its determination that
the infringement claims asserted at trial were objectively
baseless—is entitled to no deference and should be re-
viewed de novo. Highmark, Inc. v. Allcare Health Mgmt.
Sys., Inc., 687 F.3d 1300, 1309-10 (Fed. Cir. 2012). Be-
cause Highmark deviates from precedent, invades the
province of the fact finder, and establishes a review
standard for exceptional case findings in patent cases that
is squarely at odds with the highly deferential review
adopted by every regional circuit and the Supreme Court
in other areas of law, I dissent from the denial of rehear-
ing en banc.
                               I.
    Attorney fees may be awarded to the prevailing party
in “exceptional cases.” 35 U.S.C. § 285. The exceptional
nature of a case must be established by clear and convinc-
ing evidence. Brooks Furniture Mfg., Inc. v. Dutailer Int’l,
Inc., 393 F.3d 1378, 1382 (Fed. Cir. 2005). Absent mis-
conduct in the litigation or in securing the patent, sanc-
tions can be awarded “only if both (1) the litigation is
brought in subjective bad faith, and (2) the litigation is
objectively baseless.” Id. at 1381.
    Until Highmark, it was well established that the ex-
ceptional case determination, including objective base-
lessness, was a question of fact, subject to review only for
clear error. See, e.g., Cybor Corp. v. FAS Techs., Inc., 138
F.3d 1448, 1459 (Fed. Cir. 1998) (en banc) (“[T]he district
court must determine whether a case is exceptional, a
factual determination reviewed for clear error.”); Eon-Net
LP. v. Flagstar Bancorp., 653 F.3d 1314, 1323, 1326 (Fed.
Cir. 2011) (“[We] review the court’s exceptional case
finding for clear error. . . . [T]he district court did not
clearly err in finding that Eon-Net pursued objectively
baseless infringement claims.”); ICU Med., Inc. v. Alaris
3                             HIGHMARK   v. ALLCARE HEALTH


Med. Sys., Inc., 558 F.3d 1368, 1380 (Fed. Cir. 2009)
(affirming the district court’s exceptional case finding
because it did not clearly err by finding that certain
claims were objectively baseless); Evident Corp. v. Church
& Dwight Co., Inc., 399 F.3d 1310, 1315 (Fed. Cir. 2005)
(“Whether a case is exceptional depends on findings of
fact best left to the trial court, which we consequently
review for clear error.”). The Highmark majority is not
free to disregard binding precedent on this point—the
objectively baseless inquiry is a question of fact—and we
should give the district court deference on appeal.
    The Highmark decision relied, as did the Bard deci-
sion,1 on Professional Real Estate Investors, Inc. v. Co-
lumbia Pictures Indus., Inc. (PRE), 508 U.S. 49 (1993), to
justify this new de novo, no deference, approach to objec-
tive reasonableness. See Highmark, 687 F.3d at 1310 n.1;
Bard, 682 F.3d at 1007-08. The Highmark majority
believed that “The Supreme Court in Professional Real
    1   The Highmark decision rests in significant part on
Bard Peripheral Vascular, Inc. v. W.L. Gore & Assocs.,
Inc., 682 F.3d 1003, 1006-07 (Fed. Cir. 2012), which held
that objective recklessness in a willfulness determination
under 35 U.S.C. § 284, “even though predicated on under-
lying mixed questions of law and fact, is best decided by
the judge as a question of law subject to de novo review.”
Until Bard, both before and after In re Seagate Tech.,
LLC, 497 F.3d 1360, 1371 (Fed. Cir. 2007) (en banc), we
reviewed the willfulness issue for clear error. See, e.g.,
Powell v. Home Depot U.S.A., Inc., 663 F.3d 1221, 1229
(Fed. Cir. 2011) (“When the resolution of a particular
issue or defense is a factual matter, however, whether
reliance on that issue or defense was reasonable under
the objective prong is properly considered by the jury.”).
Bard’s holding that the objective prong “should always be
decided as a matter of law by the judge” cannot be recon-
ciled with Powell. Bard, 682 F.3d at 1006-07 (emphasis
added). For reasons similar to those discussed below, this
court should also revisit Bard en banc.
HIGHMARK   v. ALLCARE HEALTH                                4


Estate held that objective baselessness in this context is
an issue decided by the court as a matter of law.” High-
mark, 687 F.3d at 1310 n.1. With all due respect, it did
not. Objective baselessness was not even at issue in
Professional Real Estate. The parties conceded that the
litigation was not objectively baseless. PRE, 508 U.S. at
54; Columbia Pictures Indus., Inc. v. Prof’l Real Estate
Investors, Inc., 944 F.2d 1525, 1530 (9th Cir. 1991) (“PRE
does not challenge the district court’s finding that the
infringement action was brought with probable cause, i.e.,
that the suit was not baseless. Rather, PRE argues that
the copyright infringement lawsuit is a sham because
Columbia Pictures did not honestly believe that the
infringement claim was meritorious.”). PRE argued to the
Supreme Court that: “Lawsuits that are ‘not baseless’
may nevertheless fall within the sham exception where
they are pursued with indifference to their outcome and
for reasons such as directly to burden and harass a com-
petitor and thereby unreasonably restrain competition.”
Pet’r Br., PRE, 1992 WL 541279, at *13 (May 14, 1992).
The Court rejected this contention: “We left unresolved
the question presented by this case—whether litigation
may be sham merely because a subjective expectation of
success does not motivate the litigant. We now answer
this question in the negative and hold that an objectively
reasonable effort to litigate cannot be sham regardless of
subjective intent.” PRE, 508 U.S. at 57. The Supreme
Court explained: “In sum, fidelity to precedent compels
us to reject a purely subjective definition of ‘sham.’” Id. at
60.
    What the Supreme Court in Professional Real Estate
did not say is that objective reasonableness or probable
cause is always decided as a matter of law. The Court in
Professional Real Estate could decide the issue of objective
reasonableness as a matter of law was because there were
5                              HIGHMARK   v. ALLCARE HEALTH


no facts in dispute: “Where, as here, there is no dispute
over the predicate facts of the underlying legal proceeding,
a court may decide probable cause as a matter of law.” Id.
at 63 (emphasis added).2 It is thus error to state: “The
Supreme Court in Professional Real Estate held that
objective reasonableness in this context is an issue de-
cided by the court as a matter of law.” Highmark, 687
F.3d at 1310 n.1. The Highmark majority’s interpretation
of Professional Real Estate is at odds with numerous other
courts that have held, pursuant to Professional Real
Estate, that when predicate facts are in dispute, objective
reasonableness cannot be decided as a matter of law.3

    2    This is not a particularly surprising approach.
Courts often decide otherwise factual issues as a matter of
law when the underlying facts are not in dispute. This is
sometimes called summary judgment. See Fed. R. Civ. P.
56.
     3   See, e.g., Pers. Dep’t, Inc. v. Prof’l Staff Leasing
Corp., 297 Fed. App’x 773, 780 (10th Cir. 2008) (unpub-
lished) (“Supreme Court precedent [(including Profes-
sional Real Estate)] clearly contemplates that when
genuine issues of material fact exist regarding a defen-
dant’s probable cause to institute the underlying lawsuit,
summary judgment [] is improper.”); In re Relafen Anti-
trust Litig., 346 F. Supp. 2d 349, 361 (D. Mass. 2004)
(“Here, ‘the facts tending to establish the existence or
want of existence of probable cause’ were disputed, ren-
dering the question inappropriate for decision as matter
of law.” (citation omitted)); New York Jets LLC v. Cablevi-
sion Sys. Corp., No. 05 Civ. 2875(HB), 2005 WL 3454652,
at *2 (S.D.N.Y. Dec. 19, 2005) (“I cannot determine, as a
matter of law, that [prior] actions were (or were not)
objectively baseless”); In re Neurontin Antitrust Litig.,
Nos. 02-1830, 02-1731, 02-5583, 2009 WL 2751029, at *22
(D.N.J. Aug. 28, 2009) (“Furthermore, when the predicate
facts of an allegedly sham lawsuit are disputed, sham
litigation claims should not be decided by the court as a
matter of law.”); Echostar Satellite, L.L.C. v. ViewTech,
Inc., No. 07-CV-1273, 2009 WL 1668712, at *3 (S.D. Cal.
HIGHMARK   v. ALLCARE HEALTH                              6


Creating a unique standard for objective baselessness,
applicable only to patent cases, is a misinterpretation of
Professional Real Estate and is simply wrong.
                            II.
    The question of whether something is “objectively
baseless” is not unique to patent law or the Federal
Circuit. In fact, there are many instances when a court
must consider whether a litigant’s position is objectively
baseless or objectively reasonable. And in those in-
stances, the regional circuits and the Supreme Court have
consistently held that deference should be given by the
appellate court to the trial court’s conclusions.
    Indeed, in Professional Real Estate, the Supreme
Court analogized objective baselessness, or lack of prob-
able cause, to the good cause standard of Federal Rule of
Civil Procedure 11. See PRE, 508 U.S. at 65. Under Rule
11, as with objective baselessness, the district court must
determine whether a party’s position was objectively
unreasonable. Cooter & Gell v. Hartmax Corp., 496 U.S.
384, 393 (1990); see also, e.g., Morris v. Wachovia Sec.
Inc., 448 F.3d 268, 277 (4th Cir. 2006).
    In Cooter, the Supreme Court concluded that all as-
pects of a sanctions determination under Rule 11 should
be reviewed on appeal under an abuse of discretion stan-
dard. 496 U.S. at 401. The Court recognized that some
variation in the application of a standard based on rea-
sonableness, like Rule 11, is inevitable, but that the
“district court is better situated than the court of appeals
to marshal the pertinent facts and apply the fact-
dependent legal standard mandated by Rule 11.” Id. at


May 27, 2009) (concluding that because the facts were
disputed, the court could not determine as a matter of law
“whether the litigation is objectively reasonable”).
7                              HIGHMARK   v. ALLCARE HEALTH


402-03. There is no way to reconcile our court’s de novo
standard of review for objective baselessness in patent
cases with Cooter and Professional Real Estate.
    Not surprisingly, given the clear direction from the
Supreme Court, the regional circuits are unanimous that
the issue of objective reasonableness under Rule 11 is to
be reviewed deferentially by the appellate courts.4 I can
divine no reason to create a rule unique to patent cases, to
disregard such clear and wise precedent from our sister
circuits, or to disregard the Supreme Court’s precedent in
Cooter and Professional Real Estate.
    The parallels to the Rule 11 inquiry are compelling,
and in my view dispositive of how we should approach the
“objective baselessness” inquiry. But Rule 11 is not the
only situation in which courts confront objective reason-
ableness. For example, the Equal Access to Justice Act
(EAJA) awards a prevailing party costs and attorney fees

    4   See, e.g., Whitehead v. Food Max of Miss., Inc., 332
F.3d 796, 802-03 (5th Cir. 2003) (determining compliance
with Rule 11 is “an objective, not subjective, standard of
reasonableness under the circumstances” and concluding
that the “district court is better situated than the court of
appeals to marshal the pertinent facts and apply the fact-
dependent legal standard mandated by Rule 11” (citation
omitted)); see also CQ Int’l Co., Inc. v. Rochem Int’l, Inc.,
USA, 659 F.3d 53, 62-63 (1st Cir. 2011); Star Mark
Mgmt., Inc. v. Koon Chun Hing Kee Soy & Sauce Factory,
LTD., 682 F.3d 170, 177-78 (2d Cir. 2012); In re Taylor,
655 F.3d 274, 282-83 (3d Cir. 2011); Merritt v. Int’l Ass’n
of Machinists & Aerospace Workers, 613 F.3d 609, 626-27
(6th Cir. 2010); Ross v. City of Waukegan, 5 F.3d 1084,
1088-89 (7th Cir. 1993); Clark v. United Parcel Serv., 460
F.3d 1004, 1010-11 (8th Cir. 2006); G.C. & K.B. Invs., Inc.
v. Wilson, 326 F.3d 1096, 1109 (9th Cir. 2003); Dodd Ins.
Servs., Inc. v. Royal Ins. Co. of Am., 935 F.2d 1152, 1155
(10th Cir. 1991); Kaplan v. DaimlerChrysler, A.G., 331
F.3d 1251, 1255 (11th Cir. 2003).
HIGHMARK   v. ALLCARE HEALTH                                8


unless “the court finds that the position of the United
States           was        substantially          justified.”
28 U.S.C. § 2412(d)(1)(A). In Pierce v. Underwood, 487
U.S. 552 (1988), the Supreme Court analyzed the EAJA
fee-shifting provision and concluded that the “substan-
tially justified” language means “justified to a degree that
could satisfy a reasonable person,” which is “no different
from the ‘reasonable basis both in law and fact’ formula-
tion” adopted by the vast majority of the appellate courts
having addressed the issue. 487 U.S. at 565. As a result,
the Court concluded that the issue should be reviewed
under the abuse of discretion standard. The Court rea-
soned that the district court was in the best position to
make this determination:
    [D]etermining whether mixed questions of law
    and fact are to be treated as questions of law or of
    fact for purposes of appellate review . . . has
    turned on a determination that, as a matter of the
    sound administration of justice, one judicial actor
    is better positioned than another to decide the is-
    sue in question. We think that consideration
    relevant in the present context as well, and it ar-
    gues in favor of deferential, abuse-of-discretion
    review. To begin with, some of the elements that
    bear upon whether the Government’s position was
    substantially justified may be known only to the
    district court. Not infrequently, the question will
    turn upon not merely what was the law, but what
    was the evidence regarding the facts. By reason
    of settlement conferences and other pretrial ac-
    tivities, the district court may have insights not
    conveyed by the record, into such matters as
    whether particular evidence was worthy of being
    relied upon, or whether critical facts could easily
    have been verified by the Government.
9                              HIGHMARK   v. ALLCARE HEALTH




Pierce, 487 U.S. at 560 (internal quotation marks and
citations omitted).
    The same can be said about the objectively baseless
analysis in the exceptional case context. The district
court is better situated to decide whether a litigation
position was objectively baseless. Such a determination
may turn on legal positions taken, on factual support for
those positions, or both. The trial court is in the best
position to make the requisite findings and weigh them
accordingly. Like the EAJA determination, the district
court’s objective baselessness findings should be given
deference on appeal.
    Regional circuits also consider whether a prevailing
party is entitled to attorney fees under 28 U.S.C. § 1927.
In a majority of circuits, the § 1927 inquiry is objective,
just like § 285’s “objective baselessness.” See Jensen v.
Phillips Screw Co., 546 F.3d 59, 64-65 (1st Cir. 2008) (“In
this circuit, courts use a mainly objective standard for the
purpose of determining when a lawyer’s actions are
unreasonable or vexatious. . . . This focus on objective
measurement comports with the majority view across the
circuits.” (citations to cases from the Sixth, Seventh,
Eleventh, and Federal Circuits omitted)); Lee v. L.B.
Sales, Inc., 177 F.3d 714, 718-19 (8th Cir. 1999). In all
regional circuits, regardless of whether the inquiry is
objective or subjective, it is a question of fact that is
reviewed with deference.5

    5   See Jensen, 546 F.3d at 64-65; Gollomp v. Spitzer,
568 F.3d 355, 368 (2d Cir. 2009); LaSalle Nat. Bank v.
First Conn. Holding Grp., LLC XXIII, 287 F.3d 279, 288
(3d Cir. 2002); Newport News Holdings Corp. v. Virtual
City Vision, Inc., 650 F.3d 423, 443 (4th Cir. 2011); Cam-
bridge Toxicology Grp., Inc. v. Exnicos, 495 F.3d 169, 180
HIGHMARK   v. ALLCARE HEALTH                            10


    Despite all of these parallel inquiries where the re-
gional circuits and the Supreme Court have consistently
held that the objective reasonableness finding is to be
given deference on appeal, Highmark holds that our court
should review this determination de novo. There is no
reason a district court judge’s findings on objective rea-
sonableness should be reviewed without deference (de
novo) in patent cases, but given deference in all other
areas of law. There is no justification in either law or
logic for the departure that our court takes in Highmark.
                           III.
     As Judge Mayer explained in his dissent, “the ques-
tion of what constitutes reasonable conduct under varying
circumstances is a quintessentially factual issue.” High-
mark, 687 F.3d at 1321 (Mayer, J., dissenting). An objec-
tively baseless lawsuit is one in which no reasonable
litigant could reasonably expect success on the merits.
PRE, 508 U.S. at 60. The question is not whether the
litigation or positions taken in litigation are actually
meritorious but rather whether a reasonable person in
similar circumstances would have expected any chance of
success. Thus, whether a defendant’s anticipation defense
is considered “objectively baseless” depends not on
whether the defense is actually meritorious, but instead
on whether a reasonable attorney would think the defense
is completely meritless in light of the facts and circum-
stances relevant to the defense. District court judges live
with these cases, often for many years. They are better
situated to review the evidence, hear the testimony and
evaluate the parties’ conduct, behavior, and positions in



(5th Cir. 2007); Braunstein v. Ariz. Dep’t of Transp., 683
F.3d 1177, 1184 (9th Cir. 2012); Roth v. Green, 466 F.3d
1179, 1187 (10th Cir. 2006).
11                             HIGHMARK   v. ALLCARE HEALTH


the litigation.6 There is simply no reason to believe that

     6   See Eon-Net, 653 F.3d at 1324 (“When reviewing
an exceptional case finding for clear error, we are mindful
that the district court has lived with the case and the
lawyers for an extended period. Having only the briefs
and the cold record, and with counsel appearing before us
for only a short period of time, we are not in the position
to second-guess the trial court’s judgment.”); Takeda
Chem. Indus., Ltd. v. Mylan Labs., Inc., 549 F.3d 1381,
1391-92 (Fed. Cir. 2008) (Bryson, J., concurring) (“A
district judge who has lived with a case and the lawyers
for an extended period . . . is infinitely better situated
than we are to . . . assess whether the case should be
treated as exceptional and whether fees should be
awarded. Where the trial court applies the proper legal
standards and conducts a thorough review of the circum-
stances bearing upon the section 285 inquiry, there is
little room for a reviewing court to second-guess the trial
court’s judgment.”); Thomas v. Capital Sec. Svcs., Inc.,
836 F.2d 866, 873 (5th Cir. 1988) (“The trial judge is in
the best position to review the factual circumstances and
render an informed judgment as he is intimately involved
with the case, the litigants, and the attorneys on a daily
basis.”); O’Connell v. Champion Int’l Corp., 812 F.2d 393,
395 (8th Cir. 1987) (“This [Rule 11] determination . . .
rests upon and is informed by the District Court's inti-
mate familiarity with the case, parties, and counsel, a
familiarity we cannot have. Such a determination de-
serves substantial deference from a reviewing court.”);
Mendez-Aponte v. Bonilla, 645 F.3d 60, 68 (1st Cir. 2011)
(“We give deference to a district court’s decision to impose
sanctions because it is in the best position to ‘evaluate the
circumstances surrounding an alleged violation and
render an informed judgment.’” (citation omitted));
Thompson v. RelationServe Media, Inc., 610 F.3d 628, 638
(11th Cir. 2010) (“Given the district court’s familiarity
with the case and the parties, the district court is in a
better position ‘to make these [Rule 11] determinations in
the first instance, explicitly and on the record.’”); Mars
Steel Corp. v. Cont’l Bank N.A., 880 F.2d 928, 933 (7th
Cir. 1989) (en banc) (“Because the district courts have the
HIGHMARK   v. ALLCARE HEALTH                             12


we, as an appellate tribunal spending just thirty minutes
with the attorneys and having a limited record and
knowledge of the events taking place in the proceeding
below, are in a better position than the trial judge to
decide “objective baselessness.” Objective baselessness in
the § 285 context, like Rule 11, the EAJA, and §1927,
involves fact issues decided by the district court judge
that should be afforded deference on appeal.
                            IV.
    We need to avoid the temptation to label everything
legal and usurp the province of the fact finder with our
manufactured de novo review. We have done it with
claim construction, see Cybor, with willfulness, see Bard,
and now with the exceptional case, see Highmark. When
we convert factual issues, or mixed questions of law and
fact, into legal ones for our de novo review, we undermine
the uniformity and predictability goals this court was
designed to advance.
    This is not to say that these issues should be given to
the jury. The Supreme Court held that claim construction
is better decided by the district court judge. Markman v.
Westview Instruments, Inc., 517 U.S. 370, 388 (1996).
This does not, however, morph a mixed question of law
and fact into a pure legal question entitled to no deference
on appeal. Stating that something is better decided by
the judge is not the same as saying it is a matter of law.
The same is true with the objectively baseless analysis in
the willfulness context. We have concluded then when
the analysis turns on purely legal issues, the judge not

best information about the patterns of their cases, they
are in the best position to determine whether a legal
position is far enough off the mark to be frivolous or
whether an attorney conducted an adequate inquiry
under the particular circumstances of a case.”).
13                            HIGHMARK   v. ALLCARE HEALTH


the jury should be the fact finder. Powell, 663 F.3d at
1236-37. This is logical. It does not, however, convert the
issue into a legal one. For example, in deciding whether a
defendant’s claim construction position is objectively
baseless, the judge, not the jury, decides claim construc-
tion. The jury would not have heard the claim construc-
tion arguments; they are held in a Markman hearing
outside the presence of the jury. In that circumstance, it
makes no sense for the jury to decide whether arguments
it never heard were objectively baseless. The judge is
better suited to make this determination. That does not,
however, make the inquiry purely legal entitled to no
deference on appeal. Whether a district court’s claim
construction is correct on the merits is significantly
different from whether a litigant’s claim construction
position is objectively baseless. Indeed, whether a party’s
position—on claim construction, anticipation, obvious-
ness, or otherwise—is objectively baseless involves con-
sideration of not only the state of the law when the
position was advanced, but also the underlying facts and
circumstances forming the basis of the position. Objective
baselessness is a finding that should be given deference
by this court.
                     CONCLUSION
    Highmark is contrary to Supreme Court precedent,
contrary to the practice of the other circuits, and improp-
erly shifts the decision-making balance between the trial
and appellate courts. The Supreme Court reprimanded
our court not so long ago for departing from the “long
tradition of equity practice” and creating patent-law
specific rules. It is clear from Highmark that our court
has not learned this lesson. I dissent from the denial of
en banc review in this case.
  United States Court of Appeals
      for the Federal Circuit
               __________________________

                   HIGHMARK, INC.,
                    Plaintiff-Appellee,
                            v.
  ALLCARE HEALTH MANAGEMENT SYSTEMS,
                   INC.,
            Defendant-Appellant.
               __________________________

                       2011-1219
               __________________________

   Appeal from the United States District Court for the
Northern District of Texas in case no. 03-CV-1384, Judge
Terry Means.
              __________________________

REYNA, Circuit Judge, dissenting, with whom RADER,
Chief Judge, joins in parts I–II, and with whom MOORE,
O’MALLEY and WALLACH, Circuit Judges, join in full.


    I dissent from the court’s refusal to consider en banc
the proper standard of review governing exceptional case
determinations under 35 U.S.C. § 285. The majority
decision is incorrect in presuming it appropriate for us to
invade the fact finding province of the lower court.1

   1    Many of the issues I raise herein have previously
been addressed in Judge Mayer’s well-crafted dissent. I
share in full my colleague’s views in this particular case.
HIGHMARK   v. ALLCARE HEALTH                              2


Sitting as a three judge panel, the Highmark majority
shifts our standard of review from the deferential clear
error standard to de novo review when assessing whether
infringement allegations are objectively baseless. Until
now, we have treated all aspects of § 285 determinations
as issues of fact and we have repeatedly emphasized the
importance of deferring to the trial judge who is inti-
mately familiar with the litigation and has observed all
case developments—factual, legal, evidentiary, or other-
wise—before ruling on a motion for attorneys’ fees. As
explained below, this court now adopts an erroneous
approach that disregards binding precedent, misunder-
stands the deference owed to the factual findings of the
district court, and overstates the significance of § 284
authority.
                               I
    In the proceedings below, the district court awarded
an accused infringer attorneys’ fees, expert fees, and costs
after it prevailed on a motion for summary judgment of
non-infringement. See Highmark Inc. v. Allcare Health
Mgmt. Sys., Inc., 687 F.3d 1300, 1307–09 (Fed. Cir. 2012).
The award of fees followed the district court’s declaration
that the case was exceptional. Highmark, Inc. v. Allcare
Health Mgmt. Sys., Inc., 706 F. Supp. 2d 713, 738 (N.D.
Tex. 2010). The district court explained that the pat-
entee’s allegations of infringement were frivolous, id. at
727–29, and also found that the patentee impermissibly
shifted its claim construction positions throughout the
course of the proceedings, made improper arguments on
the issues of res judicata and collateral estoppel, and
made misrepresentations to the transferor court in con-
nection with a motion to transfer venue. Id. at 733–36.

See generally Highmark Inc. v. Allcare Health Mgmt. Sys.,
Inc., 687 F.3d 1300, 1319–24 (Fed. Cir. 2012).
3                               HIGHMARK   v. ALLCARE HEALTH


On appeal, this court reversed the district court’s findings
with regard to litigation misconduct and reversed the
award of attorneys’ fees for one of the two independent
claims because it determined as a matter of law that the
infringement claim was not objectively baseless.
     Our case law regarding § 285 is a well-established
“two-step process.” Forest Labs., Inc. v. Abbott Labs., 339
F.3d 1324, 1327–28 (Fed. Cir. 2003). As relevant here,
the first step is for a prevailing party to establish by clear
and convincing evidence that the case is “exceptional.” Id.
at 1327. In Brooks Furniture, we explained that a show-
ing of exceptionality can be made only if (1) the litigation
is brought in subjective bad faith, and (2) the litigation is
objectively baseless. Brooks Furniture Mfg., Inc. v. Du-
tailier Int’l, Inc., 393 F.3d 1378, 1381 (Fed. Cir. 2005)
(relying on Prof’l Real Estate Investors, Inc. v. Columbia
Pictures Indus., Inc., 508 U.S. 49, 60 (1993)). Thus, our
cases consistently required a two-prong analysis assessing
both the objective reasonableness of the losing party’s
positions and the losing party’s subjective intent.
     This court routinely reviews lower courts’ § 285 rul-
ings in patent cases, and we have consistently done so by
reversing only in instances of clear error. E.g., Eon-Net
LP v. Zimmerman, 653 F.3d 1314, 1323–24 (Fed. Cir.
2011) (“[W]e review the court’s exceptional case finding
for clear error.”); ICU Med., Inc. v. Alaris Med. Sys., Inc.,
558 F.3d 1368, 1380 (Fed. Cir. 2009) (affirming the dis-
trict court’s exceptional case findings because they were
not clearly erroneous); Nilssen v. Osram Sylvania, Inc.,
528 F.3d 1352, 1357–58 (Fed. Cir. 2008) (explaining that
the “court did not clearly err in finding [the] case excep-
tional”); see also Forest Labs, 339 F.3d at 1328 (emphasiz-
ing that this court reviews a trial “court’s factual findings,
including whether the case is exceptional, for clear er-
ror”). In reviewing for clear error, we have noted that
HIGHMARK   v. ALLCARE HEALTH                              4


district courts are owed a “high level of deference,” Wedge-
tail, Ltd. v. Huddleston Deluxe, Inc., 576 F.3d 1302, 1305
(Fed. Cir. 2009) (internal citation omitted), because
“[w]hether a case is ‘exceptional’ in accordance with 35
U.S.C. § 285, is a question of fact.” Brasseler, U.S.A. v.
Stryker Sales Corp., 267 F.3d 1370, 1378 (Fed. Cir. 2001);
see also Forest Group, Inc. v. Bon Tool Co., 590 F.3d 1295,
1304 (Fed. Cir. 2009) (discussing the determination of
whether the case is exceptional as “a question of fact”).
    The purpose underlying 35 U.S.C. § 285 is to compen-
sate a prevailing party for its monetary outlays in the
prosecution or defense of the suit. See Central Soya Co. v.
Geo. A. Hormel & Co., 723 F.2d 1573, 1578 (Fed. Cir.
1983). Congress authorized awards of attorney fees to
prevailing defendants “to enable the court to prevent a
gross injustice to an alleged infringer.” S. Rep. No. 1503,
79th Cong., 2d Sess. (1946), reprinted in 1946 U.S. Code
Cong. Serv. 1386, 1387; see also Mathis v. Spears, 857
F.2d 749, 758 (Fed. Cir. 1988). Thus, the exceptional case
determination is bound up with whether a court will
“make whole a party injured by an egregious abuse of the
judicial process.” Mathis, 857 F.2d at 758 (citing Hall v.
Cole, 412 U.S. 1, 5 (1973)).
     Against this backdrop, the two-judge Highmark ma-
jority alters the standard of review for a patent-specific
statute without accounting for the litany of precedential
decisions applying the clear error standard to the objec-
tive and subjective exceptional case inquiries. This de-
parture constitutes an issue of great importance and I
desire en banc action to examine—with the input of the
full court—whether our prior precedent should be over-
ruled. Preminger v. Sec’y of VA, 517 F.3d 1299, 1309 (Fed.
Cir. 2008) (citing Sacco v. Dep’t of Justice, 317 F.3d 1384,
1386 (Fed. Cir. 2003) (holding that a prior precedential
5                                 HIGHMARK   v. ALLCARE HEALTH


decision on a point of law cannot be overruled or avoided
unless the court sits en banc)).
                             II
     The principle of stare decisis tasks courts with abiding
by, or adhering to, decided cases. Accord Hubbard v.
United States, 514 U.S. 695, 711 (1995) (Scalia, J., concur-
ring). Stare decisis is the preferred course because it
“promotes the evenhanded, predictable, and consistent
development of legal principles, fosters reliance on judi-
cial decisions, and contributes to the actual and perceived
integrity of the judicial process.” Payne v. Tennessee, 501
U.S. 808, 827 (1991) (internal citation omitted); see also In
re Bilski, 545 F.3d 943, 993–94 (Fed. Cir. 2008), aff’d but
criticized on other grounds, Bilski v. Kappos, 130 S. Ct.
3218 (2010) (noting the judicial obligation to respect the
principles of stare decisis). The Supreme Court suggests
that governing decisions should only be set aside where
the applicable rule of law is “unworkable” or “badly rea-
soned.” Payne, 501 U.S. at 827.
     We have a duty today and every day to yield to settled
rules in our jurisprudence. Even a cursory review of our
cases reveals that we have clearly set forth a deferential
standard of review and we have routinely communicated
to litigants and lower courts that we will review all § 285
findings for clear error. Here, the established precedent
is especially wise, and should not be disturbed because it
respects the enduring balance between the trial judge and
the appellate panel in carrying out their distinct respon-
sibilities. E.g., Salve Regina College v. Russell, 499 U.S.
225, 233 (1991) (noting that established standards of
deference for appellate review of district-court determina-
tions reflects “an accommodation of the respective institu-
tional advantages of trial and appellate courts”).
HIGHMARK   v. ALLCARE HEALTH                                 6


    The Highmark decision casually sets aside binding
precedent that was neither unworkable nor badly rea-
soned. While we may be tempted to view ourselves as
best-positioned to weigh whether a given party’s claim
construction or infringement positions are objectively
reasonable, in doing so, we fallaciously presume that we
can neatly separate intertwined issues of law and fact. As
the Supreme Court teaches, however, “[m]aking such
distinctions is particularly difficult” since there is no “rule
or principle that will unerringly distinguish a factual
finding from a legal conclusion” in the context of attorney
fee awards. Cooter & Gell v. Hartmarx Corp., 496 U.S.
384, 401 (1990); see also Highmark, 687 F.3d at 1322
(Mayer, J., dissenting) (recognizing that implementing a
de novo standard of review for questions of objective
baselessness will “undoubtedly spawn unneeded litigation
over which issues in a section 285 determination are
issues of fact, which are issues of law, and which are
mixed questions of law and fact”).
    Instead of applying de novo review to a mixed ques-
tion of law and fact, I would abide by the Supreme Court’s
guidance and continue to apply the clear error standard to
a trial court’s informed judgment. See Salve Regina
College, 499 U.S. at 233 (explaining that a “deferential
review of mixed questions of law and fact is warranted
when it appears that the district court is better positioned
than the appellate court to decide the issue in question or
that probing appellate scrutiny will not contribute to the
clarity of legal doctrine”) (internal citations omitted); see
also Cooter & Gell, 496 U.S. at 402 (“[T]he district court is
better situated than the court of appeals to marshal the
pertinent facts and apply the fact-dependent legal stan-
dard mandated by Rule 11”). This path more closely
tracks the § 285 statutory goals such as deterring suits
that a district court finds are “clearly unwarranted.”
7                             HIGHMARK   v. ALLCARE HEALTH


Automated Business Cos. v. NEC Am., Inc., 202 F.3d
1353, 1355 (Fed. Cir. 2000); see also Mathis, 857 F.2d at
754, 758.
    Nowhere is the mixed nature of objective baselessness
conclusions more apparent than when courts accept the
testimony of experts to assist in making legal determina-
tions. The inherent complexity of patent cases almost
always requires expert testimony on questions of in-
fringement and validity, and this testimony certainly
bears upon whether a litigant’s position is objectively
baseless. I am persuaded that we tread too far by declin-
ing any deference to lower court conclusions that may
turn on, or be informed by, how a skilled artisan would
understand the claims.2 In my view, the judge presiding
over claim construction, summary judgment, and trial is
uniquely positioned to refer back to earlier proceedings
when parsing through whether or not a party was objec-
tively reasonable in litigating a particular claim or the
case as a whole. Even when we attempt to “look back-
wards” and “consider the record as a whole,” see High-
mark, 687 F.3d at 1310–11, this court is not on equal

    2   For example, in a situation where the objective
baselessness allegations are premised on a finding that
certain claims were insolubly ambiguous pursuant to 35
U.S.C. § 112, ¶ 2, a trial judge may dismiss all or part of
the case based on a showing that one of ordinary skill in
the relevant art could not discern the boundaries of the
claim based on the claim language, the specification, the
prosecution history, and the knowledge in the relevant
art. See Haemonetics Corp. v. Baxter Healthcare Corp.,
607 F.3d 776, 783 (Fed. Cir. 2010). In such a case, it is
entirely possible that this decision would be reached
through reliance on expert testimony. We as an appellate
court cannot adequately, if at all, assess credibility of
such testimony because the witness is not before us in
person. We should thus limit our intervention to in-
stances of clear error.
HIGHMARK   v. ALLCARE HEALTH                                8


footing with the district court in weighing determinative
facts, especially in the context of expert opinions. Salve
Regina College, 499 U.S. at 233 (recognizing a trial court’s
superior fact finding ability and demanding that due
regard be given to a trial court in judging the credibility of
the witnesses).
                             III
    I take particular issue with the majority’s overstated
reliance on developments in the willful infringement
context in order to dictate a less deferential standard of
review in deciding whether it is proper to award attor-
neys’ fees. The majority does not make even a veiled
attempt to premise its decision on applicable § 285 cases.
Instead, it manipulates two inapposite § 284 cases in
order to unnecessarily extend de novo review.3 See High-
mark, 687 F.3d at 1309.
    First, the majority quotes Bard Peripheral Vascular,
Inc. v. W.L. Gore & Assocs., 682 F.3d 1003, 1007 (Fed. Cir.
2012), which held that objective recklessness in a willful-
ness determination is subject to de novo review even
though the “ultimate question of willful infringement has
long been treated as a question of fact.” Id. at 1006–07

    3    Highmark does not incorporate the discussion in
iLOR v. Google which equated the objective baselessness
standard for enhanced damages and attorneys’ fees and
the objective recklessness standard for willful infringe-
ment actions. See iLOR, LLC v. Google, Inc., 631 F.3d
1372, 1377 (Fed. Cir. 2011). Even so, iLOR does not state
that we are departing from a clear error standard of
review for § 285. Indeed, even after we decided iLOR, we
continued to review the trial court’s objective baselessness
findings for clear error. See Eon-Net, 653 F.3d at 1324,
1326 (assessing the reasonableness of the plaintiff’s claim
construction positions under the clear error standard)
(citing iLOR, 631 F.3d at 1378–79).
9                              HIGHMARK   v. ALLCARE HEALTH


(internal citations omitted). Despite the puzzling conclu-
sion in Bard that we can transform a question of fact into
a mixed question of law and fact in order to exclude a jury
from deciding what conduct is reasonable, I am aware of
no Supreme Court or en banc authority requiring us to
apply the same standard of review for § 285 as we do in
§ 284. Even assuming Bard was correctly decided, in the
absence of a compelling reason or explanation to further
extend Bard’s directive allowing questions of fact to
masquerade as questions of law, I caution against upset-
ting the equilibrium we have achieved in reviewing excep-
tional case determinations.
    I consider the two standards of review to be distinct
questions, in part, because the posture by which the two
questions reach this court is not the same. Both before
and after our decision in In re Seagate, the question of
willful infringement4 has frequently been submitted to a
jury as a question of fact. See i4i Ltd. P’ship v. Microsoft
Corp., 598 F.3d 831, 858 (Fed. Cir. 2010) (“Here, the
question of willfulness was submitted to the jury. Micro-
soft does not dispute that the jury instructions were
proper under [Seagate].”). The same is not true in the
§ 285 context. By contrast, the exceptional case determi-
nation has always been a factual question answered by
the trial judge based on that judge’s review of objective

    4   Following In re Seagate, the § 284 inquiry has
been (1) whether there was clear and convincing evidence
that the infringer acted despite an objectively high likeli-
hood that its actions constituted infringement of a valid
patent, and (2) whether the infringer knew or should have
known of the objectively high risk. Transocean Offshore
Deepwater Drilling, Inc. v. Maersk Contractors USA, Inc.,
617 F.3d 1296, 1312 (Fed. Cir. 2010) (citing In re Seagate
Tech., LLC, 497 F.3d 1360, 1371 (Fed. Cir. 2007) (en
banc)).
HIGHMARK   v. ALLCARE HEALTH                               10


and subjective circumstances that emerged throughout
the course of the entire litigation.5 Now, as before, trial
judges are still being asked to answer a single question—
“Is this case exceptional?”—except we now refuse to give
their objective baselessness findings any deference. We
tie the trial court’s hand if we render it mute in the face of
such questions. I do not read Bard to compel a shift in
our standard of review for exceptional case issues and I
consider it unnecessary to apply two different standards
of review to answer one overriding question.
    In addition to relying on Bard, the Highmark majority
suggests that Powell v. Home Depot, 663 F.3d 1221, 1236
(Fed. Cir. 2011) supports its newly-adopted standard of
review. This reliance is misplaced because Powell’s actual
treatment of the § 285 issues is inconsistent with the
standard of review applied in Highmark. In Powell, both
§ 284 and § 285 determinations were discussed, yet
Highmark ignores that the standards of review were not
the same. See Powell, 663 F.3d at 1229. Notably, while
the Powell willful infringement discussion distinguished
when an accused infringer's reliance on a particular
defense is a question for the court instead of the jury, it
never attempted to extend this analysis to the exceptional
case discussion. See id. at 1236–37. To the contrary,

    5   The Seagate decision “left it to future cases to fur-
ther develop the application of [the willful infringement]
standard.”     497 F.3d at 1371. While I share Judge
Mayer’s concerns that Bard was wrongly decided pursu-
ant to a three judge panel unilaterally shifting the appro-
priate standard of review, see Highmark, 687 F.3d at
1321, I note that at least Bard attempted to bolster its
reasoning with a recent § 284 en banc decision. The same
is not true in the Highmark case, where the § 285 stan-
dard of review was altered without reference to binding
Supreme Court or en banc authority discussing the
unique purpose of 35 U.S.C. § 285.
11                             HIGHMARK   v. ALLCARE HEALTH


Powell affirmed all of the district court’s exceptional case
findings after reiterating our well-established clear error
review for all aspects of the exceptional case determina-
tion. Powell, 663 F.3d at 1229, 1241 (“A district court’s
finding that a case is ‘exceptional’ within the meaning of
35 U.S.C. § 285 is reviewed for clear error.”). I do not
read Powell to support the conclusion in Highmark and I
am left without any basis to determine that the majority
was justified in importing the § 284 standard of review to
exceptional case inquiries.
