Professional Real Estate Investors, Inc. v. Columbia Pictures Industries, Inc

In Professional Real Estate Investors, Inc. v. Columbia Pictures Industries, Inc., 508 U.S. 49 (1993), the court outlined a two part test to define sham litigation. First, the lawsuit must be objectively baseless in the sense that no reasonable litigant could realistically expect success on the merits. Id., 60. Second, "the court should focus on whether the baseless lawsuit conceals an attempt to interfere directly with the business relationships of a competitor . . . through the use of the governmental process -- as opposed to the outcome of that process -- as an anticompetitive weapon . . . ." Id., 60-61. The Court specifically addressed probable cause in a WICP claim. 508 U.S. at 60-63. It explained that the initial inquiry was whether the action was "objectively baseless in the sense that no reasonable litigant could realistically expect success on the merits." Id. at 60. The Court then determined that "only if challenged litigation is objectively meritless may a court examine the litigant's subjective motivation." Id.