Patent Damages
10Jul/15Off

NDCA bars negative NPE terminology; allows product revenue and settlement agreements

Posted by Chris Marchese

The Northern District of California, in Finjan, Inc. v. Blue Coat Sys., Inc., Case No. 13-CV-03999-BLF (Judge Beth Labson Freeman) (July 8, 2015), ruled on a number of motions in limine.  A few issues of interest were addressed in the order.

1Jul/15Off

Utah court allows evidence of minimum royalty payments by third parties

Posted by Chris Marchese

The District of Utah, in Waterton Polymer Products USA, LLC v. Edizone, LLC, Case No. 2:12-CV-17 TX (Judge Ted Stewart) (Nov. 6, 2014), denied the accused infringer’s motion in limine to preclude patentee’s introduction of evidence regarding minimum royalty payments by third party licensees of the patentee.

Each of the disputed license agreements were directed to the patent-in-suit and included a percentage-based running royalty and a minimum royalty amount.  The accused infringer argued that the minimum royalties were not relevant because the license agreements specifically envisioned active sales and marketing by the licensees, whereas the accused infringer alleged it endeavored not to make sales in the U.S. and made only one such sale.

29Jul/14Off

CDCA denies motion to exclude third party license, citing Apple v. Motorola

Posted by Chris Marchese

On June 11, 2014, Judge Bernal of the Central District of California issued an opinion on motions in limine, including denying Texchem’s request to exclude opinions by e.PAK’s damages expert, Lawrence Simon, concerning a third partY license.  The case is Texchem Advanced Products Inc. v. e.PAK Int’l Inc., Case No. EDCV 12-1341 JGB (SPx).  Texchem argued that the license agreement was not comparable to the hypothetical negotiation.  The court denied the motion.  The court cited the Federal Circuit’s recent opinion in Apple Inc. v. Motorola, Inc., 2014 WL 1646435 (Fed. Cir. Apr. 25, 2014).  We quote the court’s brief analysis in full:

12Mar/14Off

NDCA denies motion to strike reports for inadequate apportionment in lost profits and reasonable royalty; allows testimony on disputed licenses and offer to license

Posted by Chris Marchese

On February 21, 2014, Judge Alsup of the Northern District of California issued an opinion in Plantronics, Inc. v. Aliph, Inc., Case No. C 09-01714 WHA, in which the court denied motions to strike defendant’s damages experts on lost profits (Matthew R. Lynde) and reasonable royalty (Brian Napper).  The case was a competitor suit involving bluetooth headsets.  The opinion has several interesting issues, but the most significant is the treatment of apportionment and lost profits.  Judge Alsup, in effect, held that the Panduit test only requires proof of demand for the patented product, and thus the plaintiff need not prove demand for the patented feature, thus avoiding the entire market value rule.

1Nov/13Off

EDTX Denies Plaintiff’s MIL Seeking to Exclude Settlement Demands Made in Other Negotiations

Posted by Chris Marchese

On October 30, Judge Payne of the Eastern District of Texas issued a pre-trial order in Personalized Media Communications, LLC v. Zynga, Inc., Case No. 2:12-CV-00068-JRG-RSP (Doc. No. 213), addressing motions in limine.  PMC had filed numerous MILs, including one seeking to exclude evidence of settlement demands made in other negotiations over the same patents.  The ruling is brief, and we quote it in full:

Denied. PMC provides no reason that its demands from other negotiations on

these same patents are not relevant. Contrary to Zynga’s argument, the mere fact

that such a category is not specifically identified as a factor in Georgia Pacific

does not mean that it is wholly irrelevant or otherwise inadmissible.

This is a promising ruling for defendants facing plaintiffs who have previously licensed the patents-in-suit (or have reached prior litigation settlements).  Settlement demands from other litigations (or even parties who have previously settled out of the current litigation) may reflect numbers much smaller than the damages sought at trial against the current defendant.  Of course, the defendant will have to introduce evidence showing the comparability of the circumstances surrounding the prior settlements and the current damages case, e.g., same products at issue, similar sales volume, effective royalty rates, and other ways to demonstrate comparability.  But if this marks a trend, defendants may have a forceful weapon to inform the jury that the plaintiff’s damages figure is inflated.

30Jan/13Off

SDCA broadly construes comparable licenses and allows profit split/Nash bargaining

Posted by Chris Marchese

The SDCA in Gen-Probe Inc. v. Becton Dickinson & Co., Case No. 09-CV-2319 BEN NLS and 10-CV-0602 BEN NLS (S.D. Cal. November 26, 2012), ruled on Daubert motions by plaintiff Gen-Probe and defendant Becton Dickinson (“BD”) regarding damages issues.  The court denied both motions.

16Aug/12Off

CDCA compels production of IBM cross-licenses and outbound licenses

Posted by Chris Marchese

On August 3, 2012, in Richard C. Williamson v. Citrix Online, LLC, et al., CV 11-02409-AHM (JEMx) (C.D. Cal.), Magistrate Judge McDermott granted the plaintiff’s motion to compel defendant IBM to produce outbound licenses and cross-licenses incorporated into, or used in or with, the accused technology (web conferencing) in response to document requests and an interrogatory.  In an earlier ruling, the court denied plaintiff’s motion to compel, but had based its decision on cases cited by IBM for the first time in a supplemental memorandum to which plaintiff had not responded.  But the denial was without prejudice.  Plaintiff filed its own supplemental memorandum, responding to IBM’s supplement, and then IBM responded to plaintiff.  On further review, the court granted plaintiff’s motion to compel.

1Aug/12Off

DConn denies defendant’s MILs on EMVR and comparable licenses

Posted by Chris Marchese

On July 27, 2012, in Sargent Mf’g Co. v. Cal-Royal Prods., Inc. , Civil Action No. 3:08-cv-408 (VLB) (D. Conn.), the court considered defendant’s motions in limine (MILs) concerning lost profits and reasonable royalties.  The lost profits issue involved the non-infringing alternatives prong of the Panduit four-part test.  The reasonable royalty issues were EMVR and comparable licenses.  (The court also provides a reasonably in-depth analysis of a willfulness MIL, which is worthy reading for those interested.)

12Aug/11Off

EDTX Issues Pretrial Rulings on Reasonable Royalty and Lost Profits Damages

Posted by Chris Marchese

On May 5, 2011, Judge Charles Everingham IV of the Eastern District of Texas issued a two part opinion. In Part 1, the Court issued the following rulings related to damages: (1) carried in part and denied in part SAP’s (“defendant”) Motion to Exclude Expert Testimony; (2) granted Versata’s (“plaintiff”) Motion to Exclude Inadmissible Opinion of SAP’s Experts; and (3) denied Versata’s Motion to Strike Portions of the Rebuttal Expert Report. In Part 2 of the opinion, the Court ruled on Versata’s and SAP’s Motion in Limine to exclude testimony, evidence, or argument related to the addition of a new damages theory – lost profits.  Versata Software Inc. v. SAP America, Inc., 2:07-CV-153-CE (E.D. Tex., May 5, 2011).

8Aug/11Off

NDTX Strikes One License and Allows Another; Finds Fault in Expert’s Use of Entire Market Value Rule

Posted by Chris Marchese

On June 10, 2011, Judge Reed O’Connor of the Northern District of Texas issued an opinion granting in part and denying in part Universal Lighting Technologies’ (“defendant”) Motion to Strike, Limit, or Exclude Certain Expert Testimony.  Lighting Ballast Control, LLC, v. Phillips Electronics North America Corp, Case No. 7:07-CV-29 (N.D. Tex., June 10, 2011). Defendant had moved to strike expert testimony and report on two grounds: 1) the expert proposed royalty rates for the patent-in-suit while relying on rates from two licenses most favorable to plaintiff; and 2) the expert improperly tests or “checks” the reasonableness of his selected royalty rates using the entire market value of the accused products.