The US Court of Appeals for the Federal Circuit affirmed attorneys’ fees awards against EscapeX IP, LLC, finding the case “exceptional” under 35 U.S.C. § 285, and upheld sanctions under 28 U.S.C. § 1927 based on counsel’s reckless litigation conduct. EscapeX IP, LLC v. Google LLC, Case No. 24-1201 (Fed. Cir. Nov. 25, 2025) (Taranto, Stoll, Stark, JJ.)
EscapeX brought suit against Google in the Western District of Texas, alleging that Google’s YouTube Music product infringed its patent directed to systems for generating artist-specified dynamic albums. After Google pointed out that the accused features were absent from YouTube Music and later demonstrated that the accused “Auto-Add” feature predated the patent’s priority date, EscapeX amended its complaint to list the correct product and refused to dismiss the case.
Shortly after EscapeX sued Google, its patent was invalidated under § 101 in a separate litigation. EscapeX did not appeal that ruling, and Google requested that EscapeX dismiss the case. In response, EscapeX filed what it characterized as a “joint stipulation of dismissal,” which Google contested because it had not agreed to such a filing. Google moved for attorneys’ fees under § 285, arguing that EscapeX had filed frivolous claims and unreasonably prolonged the litigation. The district court agreed, awarding Google its fees.
EscapeX then filed a Rule 59(e) motion to amend the judgment, attaching declarations from its CEO and an engineer to show pre-suit diligence. The district court denied the motion, finding that the evidence was not “newly discovered” and the motion was frivolous. Google successfully sought additional fees and sanctions under § 1927, resulting in an additional $63,525 jointly and severally against EscapeX and its attorneys. EscapeX appealed.
The Federal Circuit affirmed the district court decisions and found no abuse of discretion. The Court concluded that the record supported the finding that EscapeX had not conducted any pre-suit investigation and that the case was “frivolous from the start.” This conclusion was also supported by Google’s early, detailed warnings against filing the suit and EscapeX’s general nonresponsiveness.
Regarding the Rule 59(e) motion, the Federal Circuit agreed that the declarations were not “newly discovered evidence” because they were always within EscapeX’s control and knowledge. The Court rejected arguments of “manifest injustice,” which were not raised in district court and had no merit.
Finally, the Federal Circuit affirmed the sanctions under § 1927, finding that EscapeX’s counsel acted recklessly by filing a frivolous motion that multiplied proceedings. The Court noted that zealous advocacy does not excuse filing baseless motions. The Court upheld Google’s fees and sanctions in their entirety, with costs related to the appeal also awarded to Google.
