Patent Damages
3Nov/10Off

Lost Profits damages ruled too speculative on JMOL

InputOutput Inc et al v Sercel I (E.D. Tex.)

The jury granted lost profit damages of over $25M.  The Court was presented with JMOL and New Trial motions on damages, which the Court analyzed using Fifth Circuit standards, but unlike i4i, the Court relied on New Trial standards that allowed for weighing the evidence.

The lost profit theory was a little differently structured than most.  The Plaintiff was contractually bound to a single customer – RXT – and therefore could not prove that it would have made the sales that Defendant made.   Instead, the Plaintiff argued that but for the infringement, the Plaintiff would have made additional sales to RXT.  The jury agreed, and awarded damages based on this theory.

The Court held, however, that the evidence did not support this theory, because the only evidence of record showed that RXT was in dire financial condition and did not have the resources to make any additional purchases from the Plaintiff.  A further purchase would have been RXT’s sixth, but the uncontradicted evidence was that RXT’s fourth system sat idle for all of 2008.

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