IP Law Daily, PATENT—Fed. Cir.: District court’s denial of attorney fees affirmed in floor mats patent infringement lawsuit, (Mar 23, 2026)

By Carolin Dennis, B.Sc., LL.B., LL.M.

The district court properly denied attorney fees for prevailing party in a patent infringement case regarding floor matting as the circumstances did not support an exceptional case finding.

In a non-precedential disposition, the U.S. Court of Appeals for the Federal Circuit has affirmed a California district court’s decision declining a motion for attorney fees filed by Incstores LLC (Incstores) in a patent infringement lawsuit filed by Parallax Group International, LLC (Parallax). The Federal Circuit determined that there was no error in the district court’s analysis (Parallax Group International, LLC v. Incstores LLC, No. 24-1798 (Fed. Cir. Mar. 20, 2026)).

Background. Parallax was the owner of U.S. Patent No. 9,289,085 (’085 patent) and U.S. Patent No. D543,764 (D764 patent), directed to dual-color interlocking floor mats. Both patents named Bruce Thrush as the inventor. Parallax sued Incstores for infringement of the ’085 patent and the D764 patent. Incstores filed requests for ex parte reexamination at the USPTO against both patents. In June 2017, the district court granted summary judgment of invalidity for the D764 patent based on a 35 U.S.C. § 103 challenge in view of the EVAHWCG reference but denied summary judgment of invalidity for the ’085 patent. On March 21, 2018, the district court sua sponte stayed the case pending the resolution of the ongoing ex parte patent reexaminations. In May 2021, a patent examiner issued a final rejection of the D764 patent claims based on Wu in combination with D’Luzansky that Incstores did not appeal. Moreover, in September 2021, the Federal Circuit affirmed the Patent Office’s rejection of all claims in the ’085 patent in view of Koffler in combination with other references.

As both patents were invalidated, the district court entered judgment in favor of Incstores on August 31, 2022. However, Incstores filed a motion for attorney’s fees, supported by an inequitable conduct defense. The court still conducted a bench trial on September 26, 2023 for Incstores’s inequitable conduct claim, because it was relevant to Incstores’s motion for an exceptional case finding and attorney’s fees under 35 U.S.C. § 285. The district court denied Incstores’s motion for attorney’s fees. In denying Incstores’s motion, the district court found that (1) Parallax was not liable for inequitable conduct, and (2) the circumstances did not support an exceptional case finding. Incstores timely appealed.

Inequitable conduct. Incstores contended that Parallax’s counsel, Mr. Robert Fish’s inaccurate statements to the Patent Office require a finding that Mr. Fish specifically intended to deceive the agency. Incstores also requested that the Federal Circuit re-do the district court’s witness credibility analysis in light of an alleged discrepancy in Mr. Fish’s testimony. The district court found that Mr. Fish credibly testified that (1) he was unaware of either D’Luzansky or Chang when he filed the preliminary amendment, and (2) he did not disclose the two references when he learned of them because he did not consider them material to the novelty or nonobviousness of the design. The district court also noted that the Patent Office relied upon a different reference, Wu, as the primary reference to cancel the D764 patent claim during reexamination, rather than either D’Luzansky or Chang. This choice by the Patent Office reasonably supported Mr. Fish’s personal view that those references were not material, and in turn the district court’s finding that Mr. Fish lacked a specific intent to deceive. Therefore, the Federal Circuit saw no error in the district court’s findings.

Incstores also challenged Mr. Fish’s overall credibility by highlighting certain allegedly inconsistent statements that he made relating to his role during the litigation’s pre-filing investigation. However, the Federal Circuit found that the district court noted the discrepancy and reasonably determined, based on the totality of the circumstances, the district court did not err in its credibility analysis.

Exceptional case. Under 35 U.S.C. § 285, a district court has the discretion, in “exceptional cases,” to award reasonable attorney’s fees to a prevailing party in a patent litigation. Incstores argued that the district court’s failure to make an exceptional case finding was in error because Parallax argued contradictory positions depending on whether validity or infringement of the ’085 patent was at issue. The Federal Circuit noted that Incstores cherry-picks statements from Mr. Thrush and compares them to disclosures in the ’085 specification written by his counsel. The district court carefully took these statements into account. In addressing potential gaps between ’085 patent disclosures and statements by Mr. Thrush, the district court, among other things, noted Mr. Thrush’s explanation. The Federal Circuit found that Incstores’s dispute lies in differences between testimony from a layman inventor and his counsel, and these minor differences do not amount to an exceptional case. Accordingly, the Federal Circuit found no error in the district court’s analysis.

Therefore, the district court’s decision was affirmed.

The Case is No. 24-1798.

Judge: Chen, R.

Attorneys: John David Van Loben Sels (Sideman & Bancroft LLP) for Parallax Group International, LLC. Matthew A. Pequignot (Pequignot & Myers LLC) for Incstores LLC.

Companies: Parallax Group International, LLC; Incstores LLC

Cases: Patent FedCirNews USPTO