NDCA Denies Plaintiff Oracle’s Motion for Interlocutory Appeal from $1.3B Copyright Verdict That Was Based on the Novel Theory (in Copyright Cases) of Hypothetical Licensing
In the largest copyright infringement verdict in history—a total of $1.3B for Oracle against SAP—a jury awarded reasonable royalty damages to Oracle based on a theory of hypothetical licensing. The court then granted SAP’s post trial motion for new trial because the it found the award of hypothetical license damages grossly excessive.
Responding to the grant of a new trial on damages, Oracle filed a motion for interlocutory appeal and identified three questions that it believed were appropriate for interlocutory review. The court repeated these questions in its order denying Oracle’s motion:
Oracle identified three questions that it believed were appropriate for interlocutory review:
1. Whether copyright damages measured by the amount a willing
buyer would have paid a willing seller for a hypothetical license to the rights
infringed are sufficiently established by evidence of: (a) the infringer’s
contemporaneous projections of the profits it would realize from use of the
rights, (b) the copyright owner’s contemporaneous evidence valuing the
business it would lose if it licensed those rights, and (c) reliable expert
testimony as to the fair market value of a hypothetical license to the rights,
based upon that evidence;
2. Whether a jury’s assessment of the fair market value of the
rights infringed may be set aside as speculative when based upon such
objective evidence; and
3. Whether a jury’s verdict falling within the reasonable range of
hypothetical license damages established by such objective evidence, may
be set aside as excessive.
The court openly wanted to grant the motion—to “obtain additional guidance from the Ninth Circuit”—but found that interlocutory appeal was not warranted under the circumstances. The court held that Oracle had not framed the issue as interlocutory review of a “controlling issue of law,” because the only such issue that arose in the case was whether hypothetical license damages are available as actual damages in copyright cases, and that issue had previously been decided in Oracle’s favor when the court denied SAP’s summary judgment motion on the issue.
The case will now proceed back to trial, and this time the jury will be asked to issue damages on long-accepted theories of copyright damages: lost profits/infringer’s profits. The court reasoned that any subsequent appeal will present the Ninth Circuit with two different verdicts to consider, the first one on hypothetical license damages and the second on lost profits/infringer’s profits.