A District Court in Texas is on the verge of overruling the U.S. Court of Appeals for the Federal Circuit on exceptional-case attorney fees.

Two Federal Circuit judges voiced serious displeasure Tuesday that U.S. District Judge Rodney Gilstrap, of the Eastern District of Texas ignored their strong hint two years ago to award fees in a patent dispute between online retailer Newegg and Acacia Research Corp. subsidiary Adjustacam Inc.

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Adjustacam is the latest round in a long-running battle between Acacia and Newegg over exceptional-case attorney fees. Newegg’s outspoken general counsel, Lee Cheng, left the company last year, but outside counsel Mark Lemley of Durie Tangri continued the fight Tuesday, with Collins, Edmonds, Schlather & Tower partner John Edmonds representing Adjustacam.

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Lemley argued Tuesday that Gilstrap willfully refused to follow the Federal Circuit’s instructions. “Judge Gilstrap didn’t conduct his own evaluation of the facts, he block quoted and cited Judge Davis’ previous determinations,” Lemley said. “He afforded no weight to this court’s opinion remanding the case, even though this court went out of its way to say it saw significant merit in the frivolousness claim.”

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Lemley urged Hughes and his colleagues to simply declare the case exceptional, but Reyna also sounded hesitant. “We have a situation here that let’s say that I would find exceptional,” he said. “But yet I’m faced with this very rigorous standard of review” on appeal.

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Lemley urged Hughes and his colleagues to simply declare the case exceptional, but Reyna also sounded hesitant. “We have a situation here that let’s say that I would find exceptional,” he said. “But yet I’m faced with this very rigorous standard of review” on appeal.