Highmark, Inc. v. Allcare Health Management System, Inc. (12-1163)

argument 12-1163

Highmark, Inc. v. Allcare Health Management System, Inc.

Supreme Court of the United States 49 min 5 speakers 8 chapters transcribed 7 days ago official recording ↗
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What is the Supreme Court’s main question about the proper standard of review in Highmark v. Allcare?

John G. Roberts 0:01
We'll hear argument next in Case 12-1163, Highmark v. All Care Health Management System. Mr. Cattell. MR.
Donald B. Verrilli Jr. 0:09
Thank you, Mr. Chief Justice, and may it please the Court. The Federal Circuit applied a de novo without deference standard to objective baselessness in Section 285 cases. That was wrong for three reasons. First, this Court has already held that a unitary abuse of discretion standard should be applied in closely analogous cases in the Pierce and Cooter cases. Those cases, like this one, were ancillary appeals over attorneys' fees concerning the supervision of litigation, which is precisely what Section 285 addresses. Second, the text of the Act, and in particular its key words, may and exceptional cases, imbued district courts with discretion. Indeed, up until this case, that was the way the Act applied for 60 years.
Donald B. Verrilli Jr. 0:55
And third, the other factors this Court has looked to such as a lack of law clarifying benefits, the positioning of the decision maker, efficiency in avoiding distortion, cut in favor of unitary abuse of discretion review. For those reasons, the case for such review is even stronger here than it was in Pierce and Cooter.

Why does the Court argue that a unitary abuse‑of‑discretion standard should apply instead of de novo review?

Donald B. Verrilli Jr. 1:14
In Pierce and Cooter, this Court looked to — in Pierce, for example, this Court looked to EJA and determined that even though the text of the statute didn't compel a result, nonetheless, unitary abuse of discretion review was the appropriate standard. And here —
John G. Roberts 1:31
How does abuse of discretion work with respect to a pure legal question?
Donald B. Verrilli Jr. 1:36
I think this Court answered that both in Pierce and Cooter. It said if it's a truly pure legal question, then it is a — that it is — that there isn't deference given to that in that circumstance. Now, here the question presented is objective baselessness. And in the context of Section 285 determinations, that kind of retrospective look Was the attorney acting reasonably or not? Pierce and Cooter both say that's something that is always context-dependent. It always depends on the facts.
Anthony M. Kennedy 2:06
Well, could you explain that to me a little bit, Mr. Katyal, in a case in which the district court just uses an erroneous claim construction? You would concede that that's a pure legal question, so that would be an abuse of discretion? We would not, Your Honor. So
Donald B. Verrilli Jr. 2:21
certainly on the merits, if the question of claim construction went up to the Federal Circuit, as it did here, for example, in 2009, the question there would be there would be no deference under the Federal Circuit's precedent, most recently Friday in the Lightning Ballast case. But when the question is a 285 question, the retrospective look, and objective baselessness of which claim construction
Anthony M. Kennedy 2:43
forms a part. JUSTICE KAGAN. No, but I guess my first question was just if the district court says here's the appropriate claim construction and in saying that it's wrong, is that a legal question?

How do the Pierce and Cooter cases influence the argument about review standards for Section 285?

Donald B. Verrilli Jr. 2:57
MR. Yes. As it goes up to the Federal Circuit under existing precedent, they treat that as a legal question. We think this Court's decision in Markman suggests otherwise. It said it was a mixed question, a mongrel question of law and fact. And so if the Court were ever to get into that ultimate question on the merits, we think that the Markman analysis would control. But here the question is a 285 question.
Anthony M. Kennedy 3:20
Okay. So let's just assume for a moment that an erroneous claim construction would be a mistake of law. Let's just assume that. And I understand you say that there's a question. But if that's right, why is it not also true that a judge's statement that a litigant is that a litigant's claim construction was unreasonable is not a similar mistake of law.
Donald B. Verrilli Jr. 3:42
MR. For exactly the reason that I think Pierce says, which is the question in a retrospective attorney fee case is not what was the law. It's rather was the position that the party took reasonable. And so, for example, in Pierce — The question was, under a certain statute, EJA, do the words shall and authorized, do they mean mandatory? And Justice White in dissent said, that's a pure legal question. That's something courts of appeals deal with all the time.

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