Appeals Court Says Trademark Bully/HIV Denialist Must Pay Defendant's Legal Fees

from the beating-back-the-bullies dept

Almost three years ago, a team of pro bono attorneys (D. Gill Sperlein, Paul Alan Levy, Gary Krupkin and Neal Hoffman) took up the defense of Jeffrey DeShong, an HIV-positive blogger who had been served a bogus trademark infringement lawsuit by Clark Baker, a retired LAPD officer who spends his free time defending people who have hidden their HIV-positive status from sexual partners.

Baker had no legal basis for his claims, but was obviously hoping airy claims of Lanham Act violations based on URL similarities would be all that was needed to shut up a vocal critic. He was wrong. The lawsuit was tossed in the pleading stages by the district court and that decision was upheld by the Fifth Circuit Court.

What the appeals court did not address the first time around -- shifting legal fees to the vexatious litigant -- has now been addressed. The Fifth Circuit Court of Appeals, at the urging of DeShong's defense team, has taken a new approach to its standard for fee shifting in obviously bogus lawsuits. Paul Alan Levy explains:

The federal court in Dallas readily dismissed the trademark claims on the face of the complaint, then declined to retain jurisdiction over the state-law defamation claims; in that way, the trial judge avoiding having to address DeShong's anti-SLAPP motion. But even though our path to overruling the Fifth Circuit's rule got easier when the Supreme Court held, in Octane Fitness, that the term "exceptional cases" in the Patent Code is not limited to lawsuits brought in bad faith, the trial judge was unwilling to buck clear Fifth Circuit precedent: he denied our fee motion relying on the Fifth Circuit's bad faith standard. Today, however, the Fifth Circuit held that its previous bad faith standard (and its requirement of clear and convincing evidence) has been effectively superseded by the Supreme Court's ruling in Octane Fitness. Henceforth, "an exceptional case is one where (1) in considering both governing law and the facts of the case, the case stands out from others with respect to the substantive strength of a party's litigating position; or (2) the unsuccessful party has litigated the case in an 'unreasonable manner.'"

This new standard will make it easier for defendants facing SLAPP-type lawsuits to retain counsel, as there's a significantly better chance for fee awards once courts have examined the case. Levy, however, notes that this won't help much in this lawsuit, as the trademark bully filed for bankruptcy while the appeal was pending. This not only means it's highly unlikely the $50,000 in fees requested will ever make their way to DeShong's defense team, but the filing also allowed Baker to drag out the appeals process for an additional year.

This outcome doesn't help the defense team's bottom line but for free speech defenders like Paul Levy and his partners in this case, the precedent set here is the bigger win. This should act as a deterrent against future acts of censorship-via-litigation in the Fifth Circuit's jurisdiction and lays another brick on the path towards a unified judicial stance against censorship through litigation.

Filed Under: clark baker, hiv denial, jeffrey deshong, legal fees, trademark, trademark bully