New York Times

WASHINGTON — The Supreme Court on Wednesday heard arguments in two cases that some technology companies hope will address what they say are abusive and coercive lawsuits brought by “patent trolls,” or companies that buy patents not to use them but to collect royalties and damages.

The first argument, on when courts should make the losing side pay the other’s legal fees, quickly turned into what Justice Anthony M. Kennedy called “a search for adjectives.” Even justices who were inclined to agree that shifting legal fees may be an appropriate way to address abuses seemed to despair at the prospect of drafting a verbal formula that lower court judges could apply sensibly.

“Is there a difference between ‘meritlessness’ and ‘objectively baseless’?” Justice Kennedy asked, in the first of many such questions from the bench. “I’m not quite sure what words we’re going to give to the district court.”

The case was brought by a maker of exercise equipment against a smaller competitor, accusing it of violating a patent. The smaller company, Octane Fitness, won after paying $1.3 million in legal fees. It asked lower courts to order the larger company, Icon Health & Fitness, to reimburse it.

Federal patent law allows such fee shifting in “exceptional cases.” The United States Court of Appeals for the Federal Circuit, a specialized court in Washington that hears patent cases, interpreted that to set a high bar. Fees may be awarded, it has said, if the suit in question was “brought in subjective bad faith” and “is objectively baseless.”

Rudolph A. Telscher, a lawyer for Octane Fitness, asked for a more relaxed standard, but the formulations he offered did not seem to satisfy all of the justices.

He tried “meritless.” But Justice Antonin Scalia responded that all losing suits are by definition without merit. “Don’t you have to add something to ‘meritless’?” he asked.

Another attempt, “unreasonably weak,” fared no better. “You’ve got to give me something tighter than that,” he said.

The Federal Circuit’s standard, Mr. Telscher said, amounted to “absolutely no foundation, of zero merit.” The standard he proposed, he said “suggests something lesser than frivolousness.”

Justice Kennedy proposed “without substantial merit” before noting that “we’re playing around with words again.”

Mr. Telscher said he would be satisfied with “ ‘without substantial merit,’ ‘unreasonably weak’ or ‘low likelihood of success.’ “

He also endorsed “gross injustice.” But Chief Justice John G. Roberts Jr. said that standard sounded very hard to meet.

Justice Elena Kagan agreed. “ ‘Gross injustice,’ I mean that’s really, really exceptional. That sounds like ‘shocks the conscience.’ That sounds like something you’ve never seen happen in the litigation system ever.”

Roman Martinez, a lawyer for the federal government, argued in support of Octane Fitness, saying he would enter “the battle of the adjectives.” He proposed “ ‘an objectively unreasonable litigating position’ or ‘objectively unreasonable arguments.’ “

Carter G. Phillips, a lawyer for Icon Health & Fitness, said the current standard was effective and that potentially abusive patent litigations are already deterred by the fees companies must bear to mount suits and by the risk that their own patents will be held invalid.

Mr. Telscher urged the justices to be practical and reject a standard so extreme that the winning side always bears its legal fees.

He noted that some of the nation’s largest technology companies had filed briefs supporting his client in the case, Octane Fitness v. Icon Health & Fitness, No. 12-1184. (The New York Times Company also submitted a brief urging the court to revise the current approach to legal fees in patent cases. It said the current system exposed it and other companies “to infringement claims that, despite their lack of merit, impose enormous legal costs and divert” their “attention from the business of innovation to the management of litigation.”)

“These are companies with a self-interest in a strong patent system,” Mr. Telscher said. “They have patents; they sue. And yet they are here telling this court to not pick an extreme standard.”

The justices also heard arguments in a related case, Highmark v. Allcare Health Management System, No. 12-1163. It concerned the standard the Federal Circuit should use to review fee awards by trial judges in patent cases. The argument had a provisional quality, as the court’s decision in it will depend in large part on how it decides the first case.