Id. Similarly, in Badalamenti v. Dunhams, Inc., 896 F.2d 1359, 1364-65, 13 USPQ2d 1967, 1971-72 (Fed. Cir. 1990), because the district court was silent on the exceptional case issue and fee denial, we were "unable to review the decision of the district court on this issue." Recognizing that a remand was "unfortunate", we went on to eschew any suggestion that the case be found exceptional, noting that defendant's primary basis for requesting fees had disappeared and that, even if the case be found exceptional, a denial of fees remained discretionary with the district court.

First, it permits an award of fees "where it would be grossly unjust that the winner be left to bear the burden of his own counsel which prevailing litigants normally bear." Badalamenti v. Dunham's Inc., 896 F.2d 1359, 1364 (Fed. Cir. 1990), cert. denied 498 U.S. 851, 111 S.Ct. 142, 112 L.Ed.2d 109 (1990) (quoting J.P. Stevens Co. v. Lex Tex Ltd., 822 F.2d 1047, 1052 (Fed. Cir. 1987)) (emphasis in original). Thus, under § 285, an award of attorneys' fees compensates the prevailing party for losses incurred as the consequence of the conduct of the losing party.

Their "discretion [is] informed by [their] familiarity with the matter in litigation and the interests of justice." Badalamenti v. Dunham's, Inc., 896 F.2d 1359, 1365 (Fed. Cir. 1990) (quotes and cite omitted). "[T]he decision respecting inequitable conduct is a discretionary decision to be made by the judge on his or her own factual findings. . . . Once threshold findings of materiality and intent are established, the court must weigh them to determine whether the equities warrant a conclusion that inequitable conduct occurred."

Plaintiff asserts these discrepancies are attributable to the lapse of time between the sale of the prototypes in 1981 and 82 and the preparation of the declaration in October 1984. Plaintiff states they may have been careless, negligent, or inattentive in attempting to review 2-3 year old sales records but that doesn't amount to intent to deceive. Plaintiff asserts that this is not an "exceptional case" warranting attorney's fees. Plaintiff asserts that the purpose of 35 U.S.C. § 285 is to provide the district court with the discretion to award attorneys fees where it would be grossly unjust for the winner be left to bear the burden of his counsel fees. Badalamenti v. Dunham's, Inc., 896 F.2d 1359, 1364 (Fed. Cir. 1989). Plaintiff contends that the cases cited by the defendant are distinguishable and this court should follow Western Marine Electronics v.Furuno Electric Co., Ltd., 764 F.2d 840, 842 (Fed. Cir. 1985) where the court affirmed the district court's denial of attorney's fees in an action involving the on-sale bar issue even though the district court had determined that the patentee had not been forthright in producing certain documents and that some of its interrogatory answers may have been deliberately misleading.

The purpose of section 285, unlike that of Rule 11, is not to control the local bar's litigation practices—which the district court is better positioned to observe—but is remedial and for the purpose of compensating the prevailing party for the costs it incurred in the prosecution or defense of a case where it would be grossly unjust, based on the baselessness of the suit or because of litigation or Patent Office misconduct, to require it to bear its own costs. See Badalamenti v. Dunham's, Inc., 896 F.2d 1359, 1364 (Fed. Cir. 1990); Cent. Soya Co., Inc. v. Geo. A. Hormel & Co., 723 F.2d 1573, 1578 (Fed. Cir. 1983). 1. Exceptional Case

In other words, a court may find a case exceptional if the conduct of the losing party would make it grossly unjust for the prevailing party to be left with the burden of litigation expenses. Badalamenti v. Dunham's, Inc., 896 F.2d 1359, 1364 (Fed. Cir. 1990). Because § 285 authorizes only attorney's fees, Brushstrokes's request for reimbursement of its expert witness fees falls under the general cost statute, 28 U.S.C. § 1920, and is limited by § 1821(b).

The purpose of section 285 is to provide the district court with discretion to award fees where it would be grossly unjust that the winner be left to bear the burden of his own costs of counsel which prevailing litigants normally bear. Badalamenti v. Dunham's, Inc., 896 F.2d 1359, 1364 (Fed. Cir. 1990). "The finding of `exceptional case' is one of fact, and must be made in the first instance by the district court."

The party seeking attorney fees bears the burden of proving that the case is exceptional by clear and convincing evidence. Carroll Touch, Inc. v. Electro Mechanical Sys., 15 F.3d 1572, 1584 (Fed. Cir. 1993); Badalamenti v. Dunham's Inc., 896 F.2d 1359, 1365 (Fed. Cir. 1990). If the court finds the case exceptional, the court must then exercise its discretion in determining whether attorney fees should be awarded. J.P. Stevens Co. v. Lex Tex Ltd., 822 F.2d 1047, 1050 (Fed. Cir. 1987).

First, an award of fees is designed to "to compensate the prevailing party for its monetary outlays in the prosecution or defense of the suit," Central Soya Co. v. Geo. A. Hormel Co., 723 F.2d 1573, 1578 (Fed. Cir. 1983), "where it would be grossly unjust that the winner be left to bear the burden of his own counsel which prevailing litigants normally bear." Badalamenti v. Dunham's Inc., 896 F.2d 1359, 1364 (Fed. Cir. 1990) (quotingJ.P. Stevens Co. v. Lex Tex Ltd., 822 F.2d 1047, 1052 (Fed. Cir. 1987)) (emphasis in original). Additionally, § 285 is designed to deter parties from bringing or prosecuting bad faith litigation, see Mathis v. Spears, 857 F.2d 749, 754 (Fed. Cir. 1988).

First, it "compensate[s] the prevailing party for its monetary outlays in the prosecution or defense of the suit," Central Soya Co. v. Geo. A. Hormel Co., 723 F.2d 1573, 1578 (Fed. Cir. 1983), "where it would be grossly unjust that the winner be left to bear the burden of his own counsel which prevailing litigants normally bear." Badalamenti v. Dunham's Inc., 896 F.2d 1359, 1364 (Fed. Cir. 1990) (quoting J.P. Stevens Co. v. Lex Tex Ltd., 822 F.2d 1047, 1052 (Fed. Cir. 1987)) (emphasis in original). Second, and of equal, if not greater, importance, the sanction serves to deter parties from bringing or prosecuting bad faith litigation, see Mathis v. Spears, 857 F.2d 749, 754 (Fed. Cir. 1988).