Tag Archives | damages

Patent Damages: Compensatory Damages From Sale of a Business with Infringing Products

Lost profits and royalties are not the only way to measure patent damages. In Minco Inc. v. Combustion Eng’g, Inc., 95 F.3d 1109, 1120 (Fed. Cir. 1996), the Federal Circuit recognized that a patent owner might have been entitled to damages resulting from a third parties’ purchase of the infringer’s business, if it had proven that the infringing products were an important factor in the sale.

Patent owner Minco sought damages arising from defendant infringer CE’s sale of its fused silica business to a third party. Minco sought as damages the difference between the sale price of CE’s Business and an expert valuation of CE’s business without the infringing kilns. Minco argued that if CE had not infringed, the third party would have purchased Minco’s business instead of CE’s.

The court recognized …

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Patent Damages: Reasonable Royalty

A reasonable royalty for the infringer’s use of the invention is one way to measure damages for patent infringement (others include lost profits and established royalties).

A reasonable royalty is a amount determined by a court to result from a hypothetical negotiation between the patent owner and the infringer. The hypothetical negotiation attempts to determine the royalty that the reasonable parties would have agreed to had they successfully negotiated an agreement just before infringement began. Wordtech Sys. v. Integrated Networks Sols., Inc., 609 F.3d 1308, 1319 (Fed. Cir. 2010).  This necessarily involves a degree of approximation and uncertainty.

Courts often consider the Georgia-Pacific factors in determining a reasonable royalty. Those factors are:

1. The royalties received by the patentee for the licensing of the patent in suit, proving …

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Patent Damages: Established Royalty

An established royalty is one way to measure damages for patent infringement (others include lost profits and reasonable royalties).

When the patent owner has licensed its patent for comparable acts to those engaged in by the infringer, those prior licenses may define an established royalty rate. The federal circuit has said “When the patentee has consistently licensed others to engage in conduct comparable to the defendant’s at a uniform royalty, that royalty is taken as established and indicates the terms upon which the patentee would have licensed the defendant’s use of the invention.” Monsanto Co. v. McFarling, 488 F.3d 973, 979 (Fed. Cir. 2007).

For prior negotiated royalties to provide an established royalties they need to be: (1) paid or secured before the present infringement, (2)  paid by …

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Patent Damages: Lost Profits

A patent infringer is liable to a patent owner for damages adequate to compensate the patent owner for infringement, but no less than a reasonable royalty for the use made of the invention by the infringer. 35 USC 284.

Traditionally, there are three ways of measuring compensatory damages for patent infringement: (1) lost profits, (2) established royalty, or (3) a reasonable royalty. Today I’m going to discuss lost profit damages.

Lost Profits

In order to recover lost profits, the patent owner must “show ‘causation in fact,’ establishing that ‘but for’ the infringement, he would have made additional profits.” Wechsler v. Macke Int’l Trade, Inc., 486 F.3d 1286, 1293 (Fed. Cir. 2007). The “but for” causation asks, if the infringement had not occurred, would the patent owner made the alleged …

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Four Factor Test for Determining the Article for Total Profit Damages in Apple v. Samsung

USD0618677_fig1In a 2016 decision in Samsung v. Apple, the Supreme Court determined that the relevant “article of manufacture” for calculating total profits damages for design patent infringement could be either (1) the product (e.g. the Samsung phone) sold to a customer or (2) a component of that product.

Previously, the “article of manufacture” for calculating total profits damages for design patent infringement was the entire product sold to a customer. The profits to the entire product are usually likely to be greater than profits to a component of the entire product.

The case was sent back to the trial court and a new trial was ordered on damages. In October 2017, the trial court ruled that a four factor test would be used to determine what is the article of manufacture for …

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Total Profit Damages on Entire Product or Component for Design Patent Infringement

USD0593087_Fig1In 2007, Apple released its first generation iPhone. After Apple released its iPhone, Samsung released as series of smartphones “that resembled the iPhone.” In 2011, Apples sued Samsung alleging various infringement claims, including that Samsung’s smartphones infringed Apple’s D593,087, D618,677, and D604,305 design patents. A jury awarded Apple $399 million in damages for design patent infringement, the entire profit Samsung made from its sale of the infringing smartphones.

Samsung appealed arguing “that the profits awarded should have been limited to the infringing ‘article of manufacture’—for example, the screen or case of the smartphone—’not the entire infringing product’—the smartphone.” The court of appeals rejected that argument reasoning that “’limit[ing] the dam- ages’ award was not required because the ‘innards of Samsung’s smartphones were not sold separately from their shells as distinct articles of …

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Know When to Stop Wasting Money on Trademark Litigation

MoneyWasteYou need to know when to stop wasting money on trademark litigation. Here is a case where the plaintiff should have stopped on day two of the lawsuit, but didn’t.

Dr. Tartell and Dr. Mandel jointly practiced medicine until 2011, when they split their practice and went separate ways. The break up was contentious.

After the break up, Dr. Mandrel (1) registered six domain names using some variation of Dr. Tartell’s name, redirecting some to Dr. Mandrel new website, and (2) purchased Google AdWords keyword for Dr. Tartell name, which caused Dr. Mandell’s website to appear as an advertisement whenever someone searched with those terms on Google.

Tartell filed suit against Dr. Mandell including claims for cybersquatting, false designation of origin, and unfair competition (all trademark law related claims).

The day …

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