Patent Damages

District of Delaware allows 13% apportionment methodology

The District of Delaware, in ART+COM InnovationPool GMBH v. Google Inc., (Judge Dyk) (May 16, 2016), denied Defendant’s motion for reconsideration, allowing Plaintiff’s apportionment theory to proceed to the jury.

Plaintiff’s expert, James Nawrocki, calculated per-session damages. Defendant argued that Mr. Nawrocki’s theory included improper categories of revenue in the royalty base and an unsupportable 13% apportionment. (slip op. at 5). With regard to the categories of revenue, Defendant argued that Mr. Nawrocki should not have started with the revenue from the entire Geo Product group. The Court said:
But, as the court previously explained, to the extent the various revenue sources rely upon an accused product like Google Earth Free in their implementation, they are properly included in a damages analysis so long as a proper apportionment is undertaken. D.I. 354 at PageID 9719. There is evidence that Google Geo, of which Google Earth is a part, improves the quality and targeting of advertising for Google across multiple products and contributes to more local queries on<>, which collectively drives advertising revenue. See D.I. 369, Ex. B at 126; Ex. H at 101. The evidence further supports the view that the products are to varying degrees interrelated. See, e.g., id. at Ex. I, 33:2-9. Mr. Nawrocki's calculation of the royalty base is "methodologically sound." DJ. 354 at PageID 9720.

(slip op. at 5)

With regard to the 13% apportionment, Defendant argued that Mr. Nawrocki’s 13% figure lacked support in the record. (slip op. at 6). The Court said:

Mr. Nawrocki's 13% figure is derived from a 2008 Google prepared business plan with projected advertising revenue for Google Earth, Google Maps, and Google Maps API. D.I. 354 at PagelD 9720. The 13% figure is further supported by other evidence in the record. See id. "Mr. Nawrocki's 13% figure may or may not be the most accurate apportionment for Google Earth's contributions to the Geo segment, but that goes to the weight and credibility of the evidence." Id. at PageID 9721. Mr. Nawrocki 's apportionment employs valid methodology and "can properly be applied to the facts at issue." Daubert v. Merrell Dow Pharm., 509 U.S. 579, 593 (1993). Though this does not reflect a decision on the weight and credibility of the evidence, Mr. Nawrocki's apportionment does not run afoul of Rule 702 of the Federal Rules of Evidence.
(slip op. at 6).

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