A determination of willful infringement may greatly increase the damages. Under 35 USC 284, a judge has discretion to increase damages up to three times to deter patent infringement.
In Seagate, the Federal Circuit defines a test for willful infringement that requires clear and convincing evidence (1) that the infringer acted despite an objectively high likelihood that its actions constituted infringement of a valid patent, and (2) that the infringer had knowledge (or should have known) of this risk.
In Bard Peripheral v. W.L. Gore, the Federal Circuit determined that a judge should decide the first prong: whether the infringer acted despite an objectively high likelihood that its actions constituted infringement of a valid patent.
In the past, a jury would decide willfulness, but the Bard defendant asserted a judge should determine whether the infringer's actions constituted an objectively high-likelihood of infringement.
The Federal Circuit agreed stating:
After reviewing the Supreme Court's precedent in similar contexts, as well as our own, we conclude that simply stating that willfulness is a question of fact over-simplifies the issue. While the ultimate question of willfulness based on an assessment of the second prong of Seagate may be a question of fact, Seagate also requires a threshold determination of objective recklessness. That determination entails an objective assessment of potential defenses based on the risk presented by the patent. Those defenses may include questions of infringement but also can be expected in almost every case to entail questions of validity that are not necessarily dependent on the factual circumstances of the particular party accused of infringement.
In considering the standard applicable to the objective prong of Seagate, it can be appreciated that "the decision to label an issue a 'question of law,' a 'question of fact,' or a 'mixed question of law and fact' is sometimes as much a matter of allocation as it is of analysis." Miller v. Fenton, 474 U.S. 104, 113-14 (1985). When an "issue falls some-where between a pristine legal standard and a simple historical fact, the fact/law distinction at times has turned on a determination that, as a matter of sound administration of justice, one judicial actor is better positioned than another to decide the issue in question." Id. at 114; see also Markman v. Westview Instruments, Inc., 517 U.S. 370, 388 (1996) (applying this test to determine that claim construction is best left to the judge).
We believe that the court is in the best position for making the determination of reasonableness. This court therefore holds that the objective determination of recklessness, even though predicated on underlying mixed questions of law and fact, is best decided by the judge as a question of law subject to de novo review.
Thus, judges' gatekeeper role on willful infringement should help to prevent excessive damage awards in the future.
Copyright © 2012 Robert Moll. All rights reserved.