Patent Damages

CAFC grants new trial – Royalty base can be total sales, but the royalty rate must be properly apportioned

Posted by Liz Ranks

The United States Court of Appeals for the Federal Circuit, in Exmark Manuf. Co. Inc. v. Briggs & Stratton Power Prods. Grp, LLC, 879 F.3d 1332 (Fed. Cir. Jan. 2018) on appeal from the District of Nebraska, before Judges Wallach, Chen, and Stoll, with Judge Stoll writing the opinion, issued an order regarding apportionment, vacating the jury’s $24,280,330 compensatory damages verdict, which had been doubled upon a finding of enhanced damages for willful infringement.  The court held “that the district court erred in denying a new trial on damages” and “abused its discretion by limiting the evidence relevant to damages to prior art that had been commercialized.”  The court held that it was not wrong for the expert to use the royalty base as the sales price of the entire mower, but the opinion was fatally flawed because it did not properly tie the royalty rate to the facts of the case, “plucking the 5% rate out of nowhere.”


Southern District of New York ordered new trial on damages

The Southern District of New York, in Adrea, LLC v. Barnes & Noble, Inc., et al., 13 Civ. 4137 (Judge Rakoff) (February 24, 2016), ordered a new trial on damages.  At trial, the jury found that Defendants infringed two of the three asserted patents, and awarded Plaintiff $1.33 million in lump sum, compensatory damages.  After trial, the Court found that one of the two patents was invalid.  Since the jury did not allocate its damages award between the two patents, the Court requested letter briefing from the parties on how to allocate the damages award and whether a new trial on damages was necessary.  (slip op. at 1 – 2).