Articles Posted in Damages

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In this patent infringement action, Apple challenged the opinions of the plaintiff’s damage expert on several bases, including the determination of a royalty rate based on the price of third-party applications.

First, Apple contended that the expert’s, Mr. Bratic’s, “analysis is deficient and unreliable because MTEL’s technical expert categorically stated that he never evaluated any third party apps.” The district court rejected this challenge as the technical expert, Dr. Nettleton, asserted that he did, in fact, have conversations with Mr. Bratic over the course of “two, possibly three, phone calls in fact.” The district court also stated that “Apple’s complaint that Mr. Bratic is merely ‘parroting conclusions’ also fails, as even Apple acknowledges that Mr. Bratic ‘must … rely on a technical expert to support his opinion concerning the functionality of the selected third-party apps’ since he is not himself a technical expert.” Although the district court was sensitive to the “credibility concerns” raised by Apple, it stated that cross-examination was “the ideal vehicle with which to address such concerns.”
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In this patent infringement action, Adobe filed a Daubert motion seeking to exclude the plaintiff’s damage expert largely based on VirnetX, Inc. v. Cisco Sys., Inc., 2014 WL 4548722 (Fed. Cir. Sept. 16, 2014). As explained by the district court, “Adobe does not seriously challenge Mr. Yurkerwich’s qualifications as an economist. Nor does it question the fundamental approach he has taken in arriving at an estimation of the value of the royalties lost to EveryScape as a result of the alleged infringement. The “hypothetical willing buyer-willing seller” model is a standard economic tool that has been used by economists and appraisers for decades in determining the estimated value of lost economic opportunities.”

Instead, Adobe challenged that “Mr. Yurkerwich has overvalued the revenue and royalty base apportionable to Vanishing Point by considering Vanishing Point as a whole rather than segregating the incremental value added to Photoshop by the accused Clone Brush (which EveryScape claims as its proprietary invention). Adobe relies specifically on VirnetX, Inc. v. Cisco Sys., Inc., 2014 WL 4548722, at *15-18 (Fed. Cir. Sep. 16, 2014), which holds that a damages expert must attempt to apportion value specifically to the infringing features of the contested product.”
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Adrea, LLC (“Adrea”) filed a patent infringement action against Barnes & Noble, Inc., barnesandnoble.com llc, and Nook Media LLC (collectively, “B&N”), which alleged that B&N’s e-reader Nook infringed U.S. Patent Nos. 7,298,851 (“the ‘851 patent”), 7,299,501 (“the ‘501 patent”), and 7,620,703 (“the ‘703 patent”). As explained by the district court, “[t]he ‘851 patent describes systems and methods of securely distributing electronic books and other digital content to a portable viewing device, discloses an operations center for storing and transmitting electronic books and a device for viewing books, and further describes encryption processes for securing those electronic books. The ‘501 patent describes systems and methods of controlling access to electronic books, essentially a fixed-time rental system. The ‘703 patent describes devices and methods for retrieving information related to the usage context of devices and discusses embodiments where the device is configured to retrieve information about the usage context of the device without a web browser.”
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ThinkOptics, Inc. (“ThinkOptics”) filed a patent infringement action accusing several Defendants of infringing three patents: U.S. Patent Nos. 7,796,116; 7,852,317; and 7,864,159. As explained by the district court, “[t]he three patents share a common specification and are directed to systems and methods for displaying and moving a cursor on a screen using a handheld pointing device. All defendants other than Nintendo have since been dismissed. The accused products encompass Nintendo Wii consoles that operate with the Wii Remote, Wii Remote Plus, and the Wii Sensor Bar.”
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Two weeks earlier, the court excluded the expert opinion and testimony of Plaintiff Golden Bridge Technology’s (“GBT”) damages expert. Nonetheless, the court gave GBT one week to submit a new report based on a new theory. After GBT met its deadline, Apple moved to exclude the second report as well.

As explained by the court, “Apple’s motion points out several of the significant flaws in Schulze’s current report: (1) Schulze improperly and sub silencio allocated the entire value of Apple’s portfolio licenses with Ericsson and Nokia to a tiny subset of a subset of a subset of a subset of the patents and standards in those portfolios; (2) Schulze improperly tripled the per-unit rate that Apple would have paid to GBT based on purely academic articles; (3) Schulze improperly failed to compare the patent-in-suit’s technical merits to those of other standards essential patents and (4) Schulze improperly failed to allocate any value to the non-license terms of the Ericsson and Nokia agreements.”
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After the jury returned a verdict of approximately $390 million against SAP and the verdict was affirmed on appeal, the Patent Trial and Appeal Board (“PTAB”) preliminarily invalidated the patent (subject to appeal to the Federal Circuit). As a result, SAP moved to stay the execution of the judgment or, in the alternative, to vacate the judgment.
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Having obtained a $1.5 billion judgment and an ongoing royalty against Marvell, Carnegie Mello University (“CMU”) sought to liquidated the ongoing royalty amount in the Final Judgment. In response, Marvell argued that the district court made clear in its decision that such ongoing royalties are to be dealt with as a separate matter. The parties are battling over these amounts as they will impact the amount of the supersedas bond, which will be a very significant amount given the damage award.

The district court agreed with Marvell, finding that the ongoing royalties should be addressed as a separate matter and not be liquidated in the Final Judgment. “To this end, as the Court recounted in its decision of March 31, 2014, through its various post-trial motions, CMU sought supplemental damages for damages which accrued from July 2012 until the date of the initial Judgment in this case, i.e., January 14, 2013, and the Court awarded supplemental damages of $79,550,288.00, a figure which represented the supplemental damages for the infringement until that date. (Docket No. 933]).”
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After a jury returned a verdict against Marvell for patent infringement, Carnegie Mellon (“CMU”) filed several motions, including for prejudgment interest, for supplemental damages, for enhanced damages, for an ongoing, increased royalty rate triple what the jury found, and for a permanent injunction.
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In this patent infringement case, the district court received a number of motions to strike portions of expert reports and to exclude the testimony of certain experts. As stated by the district court, it received the following: “Defendants’ Motion to Strike Portions of the Expert Report and Exclude the Testimony of Richard Belgard Regarding Infringement by Systematically Reseeding Pseudorandom Number Generators” [#247 filed January 27, 2014]; plaintiffs “Motion to Exclude Testimony of Dell Expert Witness Dr. Markus Jakobsson” [#252 filed January 31, 2014]; the “Defendants’ Motion to Strike Portions of the Expert Report and Exclude the Testimony of Dr. Stephen Melvin Regarding Statistical Confidence Levels” [#254 filed February 3, 2014]; “Defendant Dell Inc.’ s Sealed Motion to Exclude the Proposed Expert Testimony of Robert Mills” [#258 filed February 5, 2014]; and plaintiffs “Sealed Motion to Exclude the Proposed Expert Testimony of Stephen Magee” [#266 filed February 13, 2014].
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Zurn Industries, Inc. (“Zurn”) moved to exclude Sloan Valve Company’s (“Sloan”) consultant witness and other testimony based on the consultant’s investigation. The patent-at-issue, U.S. Patent No. 7,607,635, entitled “Flush Valve Handle Assembly Providing Dual Mode Operation” (the “‘635 Patent”), pertains “to flush valves for use with plumbing fixtures such as toilets, and more specifically to improvements in the bushing of the actuating handle assembly that will provide for user-selectable, dual mode operation of the flush valve.” As explained by the district court, the improvement is a mechanism that allows a user to select one of two flush volumes based on the direction of actuation of the handle: a full flush volume to evacuate solid waste from the bowl or a reduced flush volume to remove liquid waste.

The district court explained that Sloan hired Leone Flosi of Quest Consultants Int’l Ltd. (“Quest”) to perform an investigation of bathrooms containing either Sloan or Zurn manual dual flush valves and handles at Sloan’s damage expert, Mr. Bero’s, direction. Specifically, Sloan hired Mr. Flosi and Quest to “assist in estimating the ratio of collateral product sales relative to manual dual-flush flushometer valves.” Mr. Bero used this data to project and calculate the profits that Sloan allegedly lost on collateral sales of unpatented products.
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