On March 8, 2013, the NDCA issued an opinion in Eon Corp. IP Holding LLC v. Sensus USA Inc., No. C-12-01011 EMC (EDL) (Doc. No. 657), concerning defendants’ request that plaintiff provide early disclosure of its damages contentions. One of the court’s first comments is telling: “Because the question of early damages disclosure in patent cases is a recurring and important one, the Court issues this order to explain its reasoning and guidance to the parties.” Slip op at 1.
On May 1, 2013, the Central District of California in Nano-Second Tech. Co. v. Dynaflex Int’l granted summary judgment on the issue of pre-assignment damages. The plaintiff had purchased the patent in September 2010, but the assignment was silent on whether, as part of the purchase and assignment, the prior owner transferred the right to collect past damages. The Court cited the Federal Circuit’s Arachnid case and the Supreme Court’s Moore v Marsh for the proposition that an assignment must expressly grant the assignee the right to collect damages for past infringement.
On April 19, 2013, the DNJ issued an opinion in Unicom Monitoring, LLC v. Cencom, Inc.-c1495cb07dc1, Civil Action No. 06-1166 (MLC) (Doc. No. 134). The court addressed defendant’s motion for summary judgment of no damages due to plaintiff’s failure of proof and for no injunction due to lack of damages. The court granted the motion.
In the pretrial order, plaintiff Unicom contended it would prove entitlement to reasonable royalty damages at a rate of 30% of the total revenue of Cencom’s sales of accused products. In the pretrial order, Unicom indicated it would call two fact witnesses who would testify on matters related to damages, but the pretrial order contained virtually no detail on their proposed testimony. Unicom did not identify a damages expert or submit a damages report, and it did not produce any licenses for the patent-in-suit or for comparable technology.
On April 2, 2013, the NDCA issued an opinion in Accessories Marketing, Inc. v. TEK Corporation, Case No. C 11-4773 PSG (Doc. No. 183), addressing TEK’s MIL concerning damages. One of the issues concerned the impact of lost sales by a related company on the hypothetical negotiation.
On March 1, 2013, the EDTX issued an opinion in VirnetX Inc. v. Cisco Systems, Inc., Case No. 6:10-cv-00417-LED (Doc. No. 745), granting in part and denying in part Cisco’s motion to exclude certain opinions by VirnetX’s damages expert, Roy Weinstein. The court addressed two issues: (1) whether Mr. Weinstein had accounted for the smallest salable patent practicing unit (SSU) in determining the royalty base the accused products; and (2) the acceptability of Mr. Weinstein’s reliance on the Nash Bargaining Solution (NBS) profit splitting model. The court ruled for Cisco on issue #1 and for VirnetX on issue #2.
On March 26, the Federal Circuit issued its opinion in Power Integrations v. Fairchild Semiconductor Int’l, Inc., No. 11-1218, addressing damages issues and worldwide sales. The case is linked here.
The District of Delaware in AVM Tech., LLC v. Intel Corp., Civil Action No. 10-610-RGA (D. Del. January 4, 2013), ruled on Intel’s Daubert motion to exclude the testimony of AVM’s damages expert, Larry Evans. Judge Andrews considered two issues: 1) the intersection of the entire market value rule (EMVR) and smallest salable unit, and 2) comparability of portfolio license agreements.
The Northern District of Texas in Axcess Int’l, Inc. v. Savi Tech., Inc., Case No. 3:10-cv-1033-F (N.D. Tex. January 25, 2013), ruled on defendant’s motion to exclude plaintiff’s damages expert, Dr. Scott D. Hakala, from testifying on damages. The court held a pretrial hearing and afterward considered issues related to Dr. Hakala’s expert report. Axcess submitted a supplemental document in an attempt address the court’s concern that Dr. Hakala had inadequately apportioned the royalty base to account for the smallest salable patent practicing unit and failed to give a reliable assessment of the royalty rate. The court continued the trial to permit Axcess an opportunity to address the court’s concerns and in the opinion outlined the additional requirements for Dr. Hakala’s new expert report.