In Arctic Cat Inc. v. Bombardier Recreational Prods. Inc., the Federal Circuit held that the patent owner Arctic Cat was not entitled to recover damage for Bombardier's watercraft steering control patent infringement occurring before the filing of the complaint, because Arctic Cat and its licensee failed to mark the patented product as required by 35 USC § 287.
Note this resulted in a $28 million reduction in Arctic Cat's $46 million judgment.
It should be noted marking is only required if the patent owner makes a product. It's also a patent owner rather than licensee obligation. Further, a non-practicing entity, or a patent owner asserting method claims, can be awarded damages up to six years prior to the filing of the complaint under 35 USC § 286. In this case, the Federal Circuit held no damages could be recovered for infringing products sold after the sale of unmarked products ceased and before filing of the patent infringement complaint.
Copyright © 2020 Robert Moll. All rights reserved.
Showing posts with label damages. Show all posts
Showing posts with label damages. Show all posts
Sunday, February 23, 2020
Thursday, January 30, 2020
OC Register - Cal Tech wins $1.1 billion patent infringement case against Apple, Broadcom
Another huge damage award for US patent infringement:
Yesterday, a jury awarded $1.1B in damages for Apple and Broadcom's infringement of Caltech's U.S. Patent Nos. 7,116,710, 7,421,032 and 7,916,781.
For details see OC Register article Cal Tech wins $1.1 billion patent infringement case against Apple, Broadcom.
Copyright © 2020 Robert Moll. All rights reserved.
Yesterday, a jury awarded $1.1B in damages for Apple and Broadcom's infringement of Caltech's U.S. Patent Nos. 7,116,710, 7,421,032 and 7,916,781.
For details see OC Register article Cal Tech wins $1.1 billion patent infringement case against Apple, Broadcom.
Copyright © 2020 Robert Moll. All rights reserved.
Sunday, January 14, 2018
Supreme Court - WesternGeco LLC v. ION Geophysical Corp. - International Damages
On January 12, 2018, the U.S. Supreme Court granted a petition for certiorari in WesternGeco LLC v. ION Geophysical Corp.
The issue to be considered is whether the Federal Circuit erred in holding that lost profits arising from prohibited combinations occurring outside of the United States are categorically unavailable in cases in which patent infringement is proven under 35 U.S.C. § 271(f).
As a reminder, 35 U.S.C. § 271(f) states "Whoever without authority supplies or causes to be supplied in or from the United States all or a substantial portion of the components of a patented invention, where such components are uncombined in whole or in part, in such manner as to actively induce the combination of such components outside of the United States in a manner that would infringe the patent if such combination occurred within the United States, shall be liable as an infringer."
Copyright © 2018 Robert Moll. All rights reserved.
The issue to be considered is whether the Federal Circuit erred in holding that lost profits arising from prohibited combinations occurring outside of the United States are categorically unavailable in cases in which patent infringement is proven under 35 U.S.C. § 271(f).
As a reminder, 35 U.S.C. § 271(f) states "Whoever without authority supplies or causes to be supplied in or from the United States all or a substantial portion of the components of a patented invention, where such components are uncombined in whole or in part, in such manner as to actively induce the combination of such components outside of the United States in a manner that would infringe the patent if such combination occurred within the United States, shall be liable as an infringer."
Copyright © 2018 Robert Moll. All rights reserved.
Monday, December 12, 2016
US Supreme Court - Apple v. Samsung - Reverses Apple's Award of $399M for Infringement of Apple's Design Patents
In Samsung Electronics Co. Ltd. v. Apple Inc., the US Supreme Court reversed the Federal Circuit's $399 million award to Apple for Samsung's infringement of Apple's design patents.
As background a design patent is limited to "any new, original and ornamental design for an article of manufacture." 35 USC 171. A design patent seeks to protect appearance. When infringement occurs a design patent holder may elect infringer's profits as a remedy. This is sought when profits exceed a reasonable royalty. US patent law states one who "applies the patented design ... to any article of manufacture ... shall be liable to the owner to the extent of his total profit ... but the owner shall not twice recover the profit made from the infringement." 35 USC 289.
Before the Federal Circuit Samsung had argued Apple's design patent applied to the case, while Apple argued it applied to the entire phone. The Federal Circuit agreed the "article of manufacture” was the entire phone, which, of course, includes hardware and software having considerable value.
Based on Samsung's petition for certiorari the Supreme Court agreed to consider the question: Where a design patent is applied to only a component of a product, should an award of infringer's profits be limited to those profits attributable to the component?
Before the Supreme Court Samsung argued the Federal Circuit held a district court need not exclude unprotected functional features from a design patent's protected ornamental scope and a design-patent holder is entitled to an infringer's entire profits from sales of any product found to contain a patented design without regard to the design's contribution to that product's value or sales, resulting in an award in profits far beyond the value of any inventive contribution.
The Supreme Court was persuaded and held Apple’s patented design applied to the case rather than the entire phone and more broadly stated the "article of manufacturer" may mean not the end product (i.e., phone) sold to consumers but a component of the end product.
The Supreme Court's decision to reverse an award based on Samsung's profit on its entire phone makes sense because to hold otherwise ignores the value of the hardware/software. What's missing in this decision, however, is guidance on how to determine the value of the case. I think the court should determine that value in light of the fact people give importance to how a smartphone looks, which of course is why more than Apple chose to go with the patented design.
Also see my related post: Supreme Court - Apple v. Samsung - SCOTUS Blog - Justices cautious about resolving Samsung-Apple dispute over design of cell phones.
Copyright © 2016 Robert Moll. All rights reserved.
As background a design patent is limited to "any new, original and ornamental design for an article of manufacture." 35 USC 171. A design patent seeks to protect appearance. When infringement occurs a design patent holder may elect infringer's profits as a remedy. This is sought when profits exceed a reasonable royalty. US patent law states one who "applies the patented design ... to any article of manufacture ... shall be liable to the owner to the extent of his total profit ... but the owner shall not twice recover the profit made from the infringement." 35 USC 289.
Before the Federal Circuit Samsung had argued Apple's design patent applied to the case, while Apple argued it applied to the entire phone. The Federal Circuit agreed the "article of manufacture” was the entire phone, which, of course, includes hardware and software having considerable value.
Based on Samsung's petition for certiorari the Supreme Court agreed to consider the question: Where a design patent is applied to only a component of a product, should an award of infringer's profits be limited to those profits attributable to the component?
Before the Supreme Court Samsung argued the Federal Circuit held a district court need not exclude unprotected functional features from a design patent's protected ornamental scope and a design-patent holder is entitled to an infringer's entire profits from sales of any product found to contain a patented design without regard to the design's contribution to that product's value or sales, resulting in an award in profits far beyond the value of any inventive contribution.
The Supreme Court was persuaded and held Apple’s patented design applied to the case rather than the entire phone and more broadly stated the "article of manufacturer" may mean not the end product (i.e., phone) sold to consumers but a component of the end product.
The Supreme Court's decision to reverse an award based on Samsung's profit on its entire phone makes sense because to hold otherwise ignores the value of the hardware/software. What's missing in this decision, however, is guidance on how to determine the value of the case. I think the court should determine that value in light of the fact people give importance to how a smartphone looks, which of course is why more than Apple chose to go with the patented design.
Also see my related post: Supreme Court - Apple v. Samsung - SCOTUS Blog - Justices cautious about resolving Samsung-Apple dispute over design of cell phones.
Copyright © 2016 Robert Moll. All rights reserved.
Thursday, October 13, 2016
Supreme Court - Apple v. Samsung - SCOTUS Blog - Justices cautious about resolving Samsung-Apple dispute over design of cell phones
Professor Ronald Mann's blog post Justices cautious about resolving Samsung-Apple dispute over design of cell phones indicates the Supreme Court was unsettled at the oral hearing on the legal standard to apply to the $400 million damages awarded for Samsung's infringement of Apple's design patents.
The case turns on the proper interpretation of 35 USC 289 stating: "whoever during the term of a patent for a design, without license of the owner, (1) applies the patented design ... to any article of manufacture for the purpose of sale, or (2) sells or exposes for sale any article of manufacture to which such design or colorable imitation has been applied shall be liable to the owner to the extent of his total profit ...."
As Professor Mann stated: "The issue is whether the 'article of manufacture' to which the infringing design feature has been applied is the cell phone itself (as the court of appeals concluded) or some difficult-to-specify subsidiary portion of the phone, perhaps the case or exterior."
The Federal Circuit previously decided the article of manufacture is Samsung's phone, but all at the Supreme court hearing seem to agree it's too much to conclude "the article of manufacture" for calculating profits is the entire phone. We have the infringement of design patents that show the exterior screen and case. Should that infringement include the value of thousand of features in the software/hardware inside? I don't think so but it is also important to consider what drove the sale. I think just talking about how much physical structure is shown in the design patent misses this. Whatever way you come out, I think design patent damages is important to fairly resolve in an environment where injunctive relief is not awarded even when a competitor appears to have applied design patent to its product.
Copyright © 2016 Robert Moll. All rights reserved.
The case turns on the proper interpretation of 35 USC 289 stating: "whoever during the term of a patent for a design, without license of the owner, (1) applies the patented design ... to any article of manufacture for the purpose of sale, or (2) sells or exposes for sale any article of manufacture to which such design or colorable imitation has been applied shall be liable to the owner to the extent of his total profit ...."
As Professor Mann stated: "The issue is whether the 'article of manufacture' to which the infringing design feature has been applied is the cell phone itself (as the court of appeals concluded) or some difficult-to-specify subsidiary portion of the phone, perhaps the case or exterior."
The Federal Circuit previously decided the article of manufacture is Samsung's phone, but all at the Supreme court hearing seem to agree it's too much to conclude "the article of manufacture" for calculating profits is the entire phone. We have the infringement of design patents that show the exterior screen and case. Should that infringement include the value of thousand of features in the software/hardware inside? I don't think so but it is also important to consider what drove the sale. I think just talking about how much physical structure is shown in the design patent misses this. Whatever way you come out, I think design patent damages is important to fairly resolve in an environment where injunctive relief is not awarded even when a competitor appears to have applied design patent to its product.
Copyright © 2016 Robert Moll. All rights reserved.
Monday, August 15, 2016
Berkeley Center for Law & Technology - Patent Damages
Today, the Berkeley Center for Law & Technology emailed a notice and a paper on patent damages:
"On March 3, 2016, the Berkeley Center for Law & Technology hosted a day-long workshop on patent damages, one of the most important and contentious topics in patent law and policy. Organized by Professors Stuart Graham (Georgia Tech, Scheller College of Business), Peter Menell (BCLT Director and Berkeley Law), Carl Shapiro (Haas Business School at UC Berkeley), and Tim Simcoe (Boston University Questrom School of Business), the workshop brought together in-house counsel, litigators (from both the assertion and defense sides), patent licensing professionals, testifying expert witnesses, and academics (both law professors and economists).
Today, Profs. Graham, Menell, Shapiro and Simcoe issued a paper summarizing the workshop discussion, key findings, and ramifications for patent case management. The paper includes a background memo summarizing patent damages law prepared by Professors Thomas Cotter (Univ. of Minnesota Law School) and John Golden (Texas Law). The organizers welcome your feedback on this report and hope to continue a conversation with all interested parties regarding patent damages."
Copyright © 2016 Robert Moll. All rights reserved.
"On March 3, 2016, the Berkeley Center for Law & Technology hosted a day-long workshop on patent damages, one of the most important and contentious topics in patent law and policy. Organized by Professors Stuart Graham (Georgia Tech, Scheller College of Business), Peter Menell (BCLT Director and Berkeley Law), Carl Shapiro (Haas Business School at UC Berkeley), and Tim Simcoe (Boston University Questrom School of Business), the workshop brought together in-house counsel, litigators (from both the assertion and defense sides), patent licensing professionals, testifying expert witnesses, and academics (both law professors and economists).
Today, Profs. Graham, Menell, Shapiro and Simcoe issued a paper summarizing the workshop discussion, key findings, and ramifications for patent case management. The paper includes a background memo summarizing patent damages law prepared by Professors Thomas Cotter (Univ. of Minnesota Law School) and John Golden (Texas Law). The organizers welcome your feedback on this report and hope to continue a conversation with all interested parties regarding patent damages."
Copyright © 2016 Robert Moll. All rights reserved.
Monday, July 4, 2016
Supreme Court - Halo Electronics, Inc. v. Pulse Electronics, Inc.- Test for Enhanced Damages
If a district court holds you infringe a patent, just how much are you liable to pay?
35 USC 284 provides a court shall award damages adequate to compensate for the infringement, but in no event less than a reasonable royalty for the use made of the invention by the infringer, together with interest and costs as fixed by the court. But a court may increase the damages up to three times the amount found or assessed.
Sounds simple but it has been difficult to get enhanced damages since the In re Seagate decision held that a patent owner must show by clear and convincing evidence: (1) the infringer acted despite an objectively high likelihood that its actions constituted infringement of a valid patent; and (2) the risk of infringement was known or so obvious that it should have been known to the accused infringer.
Part of the reason enhanced damages were rarely awarded is the Federal Circuit required clear and convincing evidence. Another was the Federal Circuit stated objective recklessness would not be found if the infringer raises a substantial question as to the validity or non-infringement during the litigation even when the defendant was unaware of the defense while infringing. It could be argued Seagate encouraged "efficient infringement" based on the idea if and when the patent owner comes after me us we will hire smart lawyers to come up with a reasonable defense to avoid payment of more than a reasonable royalty.
In Halo Electronics, Inc. v. Pulse Electronics, Inc., the Supreme Court rejected the Seagate test entirely stating the substantive requirement for “objective recklessness” and the “clear and convincing” burden of proof were inconsistent with 35 USC 284. But again left general guidance at best. When can you expect to get more than a reasonable royalty? I would say when the court sees the defendant is not just an infringer but a "pirate." You know the kind of guy everyone hates more than a patent troll. As the Supreme Court stated awards of enhanced damages under the Patent Act over the past 180 years establish that they are not to be meted out in a typical infringement case, but are instead designed as a 'punitive' or 'vindictive' sanction for egregious infringement behavior. The sort of conduct warranting enhanced damages has been variously described in our cases as willful, wanton, malicious, bad-faith, deliberate, consciously wrongful, flagrant, indeed—characteristic of a pirate. So District courts enjoy more flexibility than the Seagate test permitted but still enhanced damages will be generally appropriate under §284 only in egregious cases.
Copyright © 2016 Robert Moll. All rights reserved.
35 USC 284 provides a court shall award damages adequate to compensate for the infringement, but in no event less than a reasonable royalty for the use made of the invention by the infringer, together with interest and costs as fixed by the court. But a court may increase the damages up to three times the amount found or assessed.
Sounds simple but it has been difficult to get enhanced damages since the In re Seagate decision held that a patent owner must show by clear and convincing evidence: (1) the infringer acted despite an objectively high likelihood that its actions constituted infringement of a valid patent; and (2) the risk of infringement was known or so obvious that it should have been known to the accused infringer.
Part of the reason enhanced damages were rarely awarded is the Federal Circuit required clear and convincing evidence. Another was the Federal Circuit stated objective recklessness would not be found if the infringer raises a substantial question as to the validity or non-infringement during the litigation even when the defendant was unaware of the defense while infringing. It could be argued Seagate encouraged "efficient infringement" based on the idea if and when the patent owner comes after me us we will hire smart lawyers to come up with a reasonable defense to avoid payment of more than a reasonable royalty.
In Halo Electronics, Inc. v. Pulse Electronics, Inc., the Supreme Court rejected the Seagate test entirely stating the substantive requirement for “objective recklessness” and the “clear and convincing” burden of proof were inconsistent with 35 USC 284. But again left general guidance at best. When can you expect to get more than a reasonable royalty? I would say when the court sees the defendant is not just an infringer but a "pirate." You know the kind of guy everyone hates more than a patent troll. As the Supreme Court stated awards of enhanced damages under the Patent Act over the past 180 years establish that they are not to be meted out in a typical infringement case, but are instead designed as a 'punitive' or 'vindictive' sanction for egregious infringement behavior. The sort of conduct warranting enhanced damages has been variously described in our cases as willful, wanton, malicious, bad-faith, deliberate, consciously wrongful, flagrant, indeed—characteristic of a pirate. So District courts enjoy more flexibility than the Seagate test permitted but still enhanced damages will be generally appropriate under §284 only in egregious cases.
Copyright © 2016 Robert Moll. All rights reserved.
Friday, February 26, 2016
Professor Ronald Mann - Justices Unsettled on Standard for Enhanced Damages in Patent Cases
Professor Ronald Mann has an interesting post: Argument aalysis: Justices unsettled on standard for enhanced damages in patent cases on the SCOTUS blog.
More specifically, the Supreme Court hearing revisits how to interpret 35 U.S.C. 284, which states "Upon finding for the claimant the court shall award the claimant damages adequate to compensate for the infringement but in no event less than a reasonable royalty for the use made of the invention by the infringer, together with interest and costs as fixed by the court. When the damages are not found by a jury, the court shall assess them. In either event the court may increase the damages up to three times the amount found or assessed."
Commentators are speculating this case will change the standard in favor of patent owners, but I think Professor Ronald Mann has a more realistic view based on the hearing that the justices are unsettled and struggling as to the standard for enhanced damages.
In my opinion, Justice Scalia "irreverent" and insightful views were missed. At least Justice Breyer's insistence that big companies are often threatening little companies with enhanced damages is an "EFF balloon" that needed to be "burst" by someone. Justice Breyer's narrow interpretation when to award enhanced damages makes it too difficult to obtain them and would encourage patent infringement by big companies.
Copyright © 2016 Robert Moll. All rights reserved.
More specifically, the Supreme Court hearing revisits how to interpret 35 U.S.C. 284, which states "Upon finding for the claimant the court shall award the claimant damages adequate to compensate for the infringement but in no event less than a reasonable royalty for the use made of the invention by the infringer, together with interest and costs as fixed by the court. When the damages are not found by a jury, the court shall assess them. In either event the court may increase the damages up to three times the amount found or assessed."
Commentators are speculating this case will change the standard in favor of patent owners, but I think Professor Ronald Mann has a more realistic view based on the hearing that the justices are unsettled and struggling as to the standard for enhanced damages.
In my opinion, Justice Scalia "irreverent" and insightful views were missed. At least Justice Breyer's insistence that big companies are often threatening little companies with enhanced damages is an "EFF balloon" that needed to be "burst" by someone. Justice Breyer's narrow interpretation when to award enhanced damages makes it too difficult to obtain them and would encourage patent infringement by big companies.
Copyright © 2016 Robert Moll. All rights reserved.
Saturday, October 31, 2015
WSJ - Supreme Court to Consider Standard for Increased Damages for Willful Infringement
The US Supreme Court opinions in the last decade have made life let's call it more challenging for patent owners. I have no reason to expect this to change soon, but now the WSJ reports the "Supreme Court is jumping back into the world of patent law, this time to decide whether to make it easier for patent holders to win increased damages when someone willfully infringes their inventions." But since it involves a chance to reverse the Federal Circuit which vacated damages for willful infringement, who knows!
See WSJ article: The Supreme Court to Consider Patent Damages, New Electricity Case
Copyright © 2015 Robert Moll. All rights reserved.
See WSJ article: The Supreme Court to Consider Patent Damages, New Electricity Case
Copyright © 2015 Robert Moll. All rights reserved.
Tuesday, January 28, 2014
Joe Mullin - Court: Google Infringed Patents, Must Pay 1.36% of Adwords Revenue
Today, in Court: Google infringed patents, must pay 1.36% of AdWords revenue, Joe Mullin reports that U.S. District Court Judge Raymond Jackson awarded Vringo the royalty it sought for Google's infringement of the Lycos patents. Last week Judge Jackson ruled that Google's design around of the Adword software was not "colorably different" from the old infringing software. Google is appealing the infringement verdict and the royalty rate decision to the Federal Circuit.
See my related articles:
Vringo v. Google - Laches Dashing Expectations - From $493M to $31M?
USPTO Confirms Validity of U.S. Patent No. 6,314,420, Which Vringo Asserts Against Google.
Copyright © 2014 Robert Moll. All rights reserved.
See my related articles:
Vringo v. Google - Laches Dashing Expectations - From $493M to $31M?
USPTO Confirms Validity of U.S. Patent No. 6,314,420, Which Vringo Asserts Against Google.
Copyright © 2014 Robert Moll. All rights reserved.
Thursday, November 21, 2013
Apple Awarded $290M for Samsung's Patent Infringement
Today, the federal jury in San Jose California awarded Apple $290 million in the retrial of part of the damages with respect to patent infringement by Samsung products. Although less than the $410 million awarded last year, with the addition of $290 million, Apple's damages total $929 million.
See FOSS Patents Retrial jury awards Apple $290 million, total damages in case against Samsung: $929 million and CNET's Jury reaches verdict in Apple v. Samsung damages retrial.
Copyright © 2013 Robert Moll. All rights reserved.
See FOSS Patents Retrial jury awards Apple $290 million, total damages in case against Samsung: $929 million and CNET's Jury reaches verdict in Apple v. Samsung damages retrial.
Copyright © 2013 Robert Moll. All rights reserved.
Saturday, September 28, 2013
US Supreme Court Certiorari - Octane Fitness v. Icon Health and Fitness - Exceptional Cases Under 35 USC 285 and Attorney Fees
On September 5, Mary Dwyer of the SCOTUS Blog stated the petition of the day relates to the Federal Circuit's nonprecedential decision in Octane Fitness v. Icon Health and Fitness. If the Supreme Court takes the case, it may increase the likelihood that a losing patent assertion entity case is held exceptional under 35 USC 285 resulting in an attorney fee award.
The issue is framed: Whether the Federal Circuit’s promulgation of a rigid and exclusive two-part test for determining whether a case is “exceptional” under 35 U.S.C. § 285 improperly appropriates a district court’s discretionary authority to award attorney fees to prevailing accused infringers in contravention of statutory intent and this Court’s precedent, thereby raising the standard for accused infringers (but not patentees) to recoup fees and encouraging patent plaintiffs to bring spurious patent cases to cause competitive harm or coerce unwarranted settlements from defendants.
See the papers, orders, and proceedings at SCOTUS blog page.
Updated October 1, 2013: Petition Granted.
Copyright © 2013 Robert Moll. All rights reserved.
The issue is framed: Whether the Federal Circuit’s promulgation of a rigid and exclusive two-part test for determining whether a case is “exceptional” under 35 U.S.C. § 285 improperly appropriates a district court’s discretionary authority to award attorney fees to prevailing accused infringers in contravention of statutory intent and this Court’s precedent, thereby raising the standard for accused infringers (but not patentees) to recoup fees and encouraging patent plaintiffs to bring spurious patent cases to cause competitive harm or coerce unwarranted settlements from defendants.
See the papers, orders, and proceedings at SCOTUS blog page.
Updated October 1, 2013: Petition Granted.
Copyright © 2013 Robert Moll. All rights reserved.
Monday, April 29, 2013
Microsoft v. Motorola - Judge Robart's FRAND Rate Setting Decision & Commentators
Last week Judge Robart of the US District Court for the Western District of Washington released Findings of Facts and Conclusions of Law setting the FRAND rate for Microsoft's infringement of two Motorola Mobility patents. The decision highlights the court's authority in setting FRAND royalty rates.
FOSS Patents and Groklaw have extensively commented on Judge Robart's 207-page findings: Mr. Mueller of FOSS Patents chortles Google lost: A closer look at the 207-page, landmark FRAND rate-setting decision in Microsoft v. Motorola. I don't share his joy, but agree Microsoft appears to have won given Motorola initially sought $4 billion and was awarded less than $1.8 million per year.
In a First, Seattle Judge Sets RAND Rate in MS v. Motorola, Groklaw denies the loss arguing that Judge Robart is in Microsoft's home court in Seattle and favors Microsoft in setting the RAND rate for a couple of Motorola SEPs, followed Motorola Mobility's methodology, and feels confident the decision will be appealed.
The detailed methodology will take time to study, but I will comment that in my observation Federal district court judges are more honorable than to simply rule in favor of the local company. And arguing the local party had the home court advantage when your company loses won't persuade many judges to reverse on appeal. A stronger argument may be the judge forced Motorola to accept rates in patent pools it hasn't joined instead of following the relevant standard's body negotiation structure.
FOSS Patents and Groklaw have extensively commented on Judge Robart's 207-page findings: Mr. Mueller of FOSS Patents chortles Google lost: A closer look at the 207-page, landmark FRAND rate-setting decision in Microsoft v. Motorola. I don't share his joy, but agree Microsoft appears to have won given Motorola initially sought $4 billion and was awarded less than $1.8 million per year.
In a First, Seattle Judge Sets RAND Rate in MS v. Motorola, Groklaw denies the loss arguing that Judge Robart is in Microsoft's home court in Seattle and favors Microsoft in setting the RAND rate for a couple of Motorola SEPs, followed Motorola Mobility's methodology, and feels confident the decision will be appealed.
The detailed methodology will take time to study, but I will comment that in my observation Federal district court judges are more honorable than to simply rule in favor of the local company. And arguing the local party had the home court advantage when your company loses won't persuade many judges to reverse on appeal. A stronger argument may be the judge forced Motorola to accept rates in patent pools it hasn't joined instead of following the relevant standard's body negotiation structure.
Although I appreciate Groklaw's coverage of IP issues, its article stretches a long way in an attempt to rebut Florian Mueller stating it would take
7,000 years at this RAND rate for Google to recoup its price paid for the
Motorola patents (Note the SEC papers do not break out the patents separate from the technology so talking about the price paid for the Motorola patents is fiction). Referring back to Groklaw, PJ notes: "Google isn't
in the 'let's sue and get a lot of money from royalties on patents' business.
That's more a Microsoft strategy. Probably because no one wants Microsoft's
products. Google does make money, though, buckets of it, because people like
Google's products. I believe that would indicate that Google knows how to make
money. Nor did they, or anyone but Florian, ever imagine that they'd get repaid
the purchase price by royalties on only two of the many patents that came with
the Motorola purchase. That wasn't the plan. It was, from what I read, defensive
in nature."
Sure Google makes great products and lots of money. And I agree that the fate of these two patents is not indicative of the strength of the Motorola portfolio, but no one wants Microsoft's products? Most everyone I know uses Apple, Google, and Microsoft products. Most have gotten value and had problems with each company's products at times. To say probably no one wants Microsoft products and suggest its strategy is to make up for it by licensing patents is not persuasive. How did Bill Gates gain and maintain his wealth? Was it by licensing patents or selling products? Beside this case is not about Microsoft's patent licensing; it's about Google's patent licensing effort.
Copyright © 2013 Robert Moll. All rights reserved.
Sure Google makes great products and lots of money. And I agree that the fate of these two patents is not indicative of the strength of the Motorola portfolio, but no one wants Microsoft's products? Most everyone I know uses Apple, Google, and Microsoft products. Most have gotten value and had problems with each company's products at times. To say probably no one wants Microsoft products and suggest its strategy is to make up for it by licensing patents is not persuasive. How did Bill Gates gain and maintain his wealth? Was it by licensing patents or selling products? Beside this case is not about Microsoft's patent licensing; it's about Google's patent licensing effort.
Copyright © 2013 Robert Moll. All rights reserved.
Monday, January 21, 2013
U.S. Design Patents - Protecting Product Appearance
Patent attorneys tend to focus on utility patents rather than design patents. Utility patents issue for "any new and useful process, machine, manufacture, or composition of matter, or any new useful improvement thereof." Design patents issue for "any new, original and ornamental design for an article of manufacture." In short, a utility patent protects a product's function while a design patent protects a product's looks.
Why do design patents get little attention? Part of the problem is the common myth that a design patent's narrow protection translates into little value. Detractors ask don't they merely prevent exact copying of the invention shown in the drawings? When assessing patentability, aren't we limited to considering ornamental features, and not able to leverage functional features contributing to performance? Can't a defendant readily design around to avoid infringement? Yes, it is hard to argue in favor of design patents, but somehow companies like to copy products that look cool. How much is that copying worth? Sometimes a lot. For example, about $500 million in damages in Apple v. Samsung was due to infringement of design patents.
Why don't they command more respect? Some patent attorneys are to blame as they raise such questions. Most patent attorneys like technical and legal challenges. We want to write a detailed document that elucidates a complex technology so even a layperson understands it, admires it, and upholds it in court. And yes we like an undertaking that can justify our legal fees!
But a design patent -- what's the challenge? It's more work than a trademark application, but isn't a design application: (1) a design application transmittal form; (2) an inventor's declaration; (3) a title; (4) a brief specification with a statement what is claimed is shown in the drawings; and (5) the drawings? Even prosecution is simple compared to utility applications. Professor Dennis Crouch recently noted in Design Patents are Still Relatively Quick "the bulk of design patents are issued within 12-months of the filing date and only a handful take more than three years to issue. As I have written before, most design patents issue without substantive rejection or amendment."
They are also inexpensive to prepare (AIPLA Economic Survey 2011 says the median price is $1500 in 2010) and prosecute: we compare the design drawings to prior drawings during prosecution. And the PTO typically allows the design application or issues rejections that can be overcome by amendment. Of course you need to foreign file within six months of filing in the USPTO, and remember the patent term runs 14 years from the issue date, soon to be 15 years.
On the other hand, I don't think one can delegate the preparation of design patents entirely to an assistant, because the scope of the protection is a legal judgment. It relates to the content of the drawings. In fact, the content matters a great deal when it comes time to determine whether or not a design patent is infringed. A design drawing should not include any superfluous information (e.g., patent owner's name). Trust me the patent owner's name won't be anywhere on the accused product. Structures that are not part of the design can be shown by broken lines to avoid unduly narrow protection. Thus, the design patent may (should) cover only a part of the entire article. For example, if you seek to protect a computer icon with a design patent, showing other icons on the same desktop is a really bad idea! Because design patents are inexpensive, protect against exact copying, and can be surprisingly valuable when the patented product looks cool, I expect many to follow Apple to get design patents to protect the way a product looks.
Copyright © 2013 Robert Moll. All rights reserved.
Why do design patents get little attention? Part of the problem is the common myth that a design patent's narrow protection translates into little value. Detractors ask don't they merely prevent exact copying of the invention shown in the drawings? When assessing patentability, aren't we limited to considering ornamental features, and not able to leverage functional features contributing to performance? Can't a defendant readily design around to avoid infringement? Yes, it is hard to argue in favor of design patents, but somehow companies like to copy products that look cool. How much is that copying worth? Sometimes a lot. For example, about $500 million in damages in Apple v. Samsung was due to infringement of design patents.
Why don't they command more respect? Some patent attorneys are to blame as they raise such questions. Most patent attorneys like technical and legal challenges. We want to write a detailed document that elucidates a complex technology so even a layperson understands it, admires it, and upholds it in court. And yes we like an undertaking that can justify our legal fees!
But a design patent -- what's the challenge? It's more work than a trademark application, but isn't a design application: (1) a design application transmittal form; (2) an inventor's declaration; (3) a title; (4) a brief specification with a statement what is claimed is shown in the drawings; and (5) the drawings? Even prosecution is simple compared to utility applications. Professor Dennis Crouch recently noted in Design Patents are Still Relatively Quick "the bulk of design patents are issued within 12-months of the filing date and only a handful take more than three years to issue. As I have written before, most design patents issue without substantive rejection or amendment."
They are also inexpensive to prepare (AIPLA Economic Survey 2011 says the median price is $1500 in 2010) and prosecute: we compare the design drawings to prior drawings during prosecution. And the PTO typically allows the design application or issues rejections that can be overcome by amendment. Of course you need to foreign file within six months of filing in the USPTO, and remember the patent term runs 14 years from the issue date, soon to be 15 years.
On the other hand, I don't think one can delegate the preparation of design patents entirely to an assistant, because the scope of the protection is a legal judgment. It relates to the content of the drawings. In fact, the content matters a great deal when it comes time to determine whether or not a design patent is infringed. A design drawing should not include any superfluous information (e.g., patent owner's name). Trust me the patent owner's name won't be anywhere on the accused product. Structures that are not part of the design can be shown by broken lines to avoid unduly narrow protection. Thus, the design patent may (should) cover only a part of the entire article. For example, if you seek to protect a computer icon with a design patent, showing other icons on the same desktop is a really bad idea! Because design patents are inexpensive, protect against exact copying, and can be surprisingly valuable when the patented product looks cool, I expect many to follow Apple to get design patents to protect the way a product looks.
Copyright © 2013 Robert Moll. All rights reserved.
Sunday, November 18, 2012
Vringo v. Google - Laches Dashing Expectations - From $493M to $31M?
The recent Vringo v. Google patent infringement case illustrates an issue that may arise for prospective licensors and licensees. In a nutshell, Vringo purchased U.S. Patent No. 6,314,420 and U.S. Patent No. 6,775,664 from Lycos, filed a lawsuit in September 2011 claiming Google's system of advertising infringed the patents, and stated it expect to recover $493 million. At the end of trial, the jury held the patents infringed and not invalid, but only awarded $31 million against Google et al. based on a 3.5% royalty rate on a 20% increase attributable to the invention.
Why didn't Vringo receive $493 million? You might think it wasn't realistic and mere saber rattling to encourage Google to settle before trial. But as I looked further, I learned Vringo assumed it would get damages for infringement from 2005 to 2011, since U.S. patent law permits damages up to six year prior to the filing of the lawsuit (i.e., September 2011).
During this trial, there was a fair amount of trading going on. On the last day of a two-week trial, Mr. Dan Ravicher disclosed he was shorting Vringo (VRNG) in Vringo vs. Google: Outcome Probabilities. In his opinion, Vringo had not established Google was aware of the patents and had failed to elicit sufficient jury sympathy to support damages of $493 million. He estimated the net present value to Vringo was $95 million.
Vringo's facts would not generate much jury sympathy. Vringo had not invented anything and had bought the patents from a search engine company that Google had passed long ago. Its press releases saying Google's revenue would go to zero and Vringo would make billions sounded of hubris. Vringo trial slides were cartoon-like. Vringo told the jury Google's SmartAdServingSystem ("Google's SmartASS") infringed the patents. For some of the slides see Mr. Mullin's article: Google infringes old Lycos patents, must pay $30 million.
Much more than lack of jury sympathy, laches reduced Vringo's damages. Under the equitable doctrine of laches defense: (1) if a patent owner unreasonably and inexcusably delays filing an infringement suit, and (2) the alleged infringer has been materially prejudiced by the delay, a patent owner cannot recover damages that occurred before the complaint was filed. The statute says Vringo could get damages up to six years prior to filing the complaint, but a judge can rule in equity to supplement statutory law to achieve a fair result.
The Vringo lawsuit had laches written all over it from the beginning. The '420 patent issued 11 years ago, November 6, 2001, and the '664 patent issued over eight years ago, August 10, 2004. Even six years of delay raises a rebuttal presumption of laches. It's true a patent owner may "burst" the presumption by producing evidence sufficient to raise an issue the delay was reasonable or excusable under the circumstances, but Vringo was unable to do it. Thus, laches precluded recovery before the complaint was filed in September 2011. A six year period of infringement was reduced to one year. I guess the judge wasn't sympathetic.
Whenever a patent is enforced near the end of its term, you must consider laches. For more about laches, I suggest the Federal Circuit's case A.C. Aukerman Co. v. R.L Chaides Construction and cases citing Aukerman.
Copyright © 2012 Robert Moll. All rights reserved.
Why didn't Vringo receive $493 million? You might think it wasn't realistic and mere saber rattling to encourage Google to settle before trial. But as I looked further, I learned Vringo assumed it would get damages for infringement from 2005 to 2011, since U.S. patent law permits damages up to six year prior to the filing of the lawsuit (i.e., September 2011).
During this trial, there was a fair amount of trading going on. On the last day of a two-week trial, Mr. Dan Ravicher disclosed he was shorting Vringo (VRNG) in Vringo vs. Google: Outcome Probabilities. In his opinion, Vringo had not established Google was aware of the patents and had failed to elicit sufficient jury sympathy to support damages of $493 million. He estimated the net present value to Vringo was $95 million.
Vringo's facts would not generate much jury sympathy. Vringo had not invented anything and had bought the patents from a search engine company that Google had passed long ago. Its press releases saying Google's revenue would go to zero and Vringo would make billions sounded of hubris. Vringo trial slides were cartoon-like. Vringo told the jury Google's SmartAdServingSystem ("Google's SmartASS") infringed the patents. For some of the slides see Mr. Mullin's article: Google infringes old Lycos patents, must pay $30 million.
Much more than lack of jury sympathy, laches reduced Vringo's damages. Under the equitable doctrine of laches defense: (1) if a patent owner unreasonably and inexcusably delays filing an infringement suit, and (2) the alleged infringer has been materially prejudiced by the delay, a patent owner cannot recover damages that occurred before the complaint was filed. The statute says Vringo could get damages up to six years prior to filing the complaint, but a judge can rule in equity to supplement statutory law to achieve a fair result.
The Vringo lawsuit had laches written all over it from the beginning. The '420 patent issued 11 years ago, November 6, 2001, and the '664 patent issued over eight years ago, August 10, 2004. Even six years of delay raises a rebuttal presumption of laches. It's true a patent owner may "burst" the presumption by producing evidence sufficient to raise an issue the delay was reasonable or excusable under the circumstances, but Vringo was unable to do it. Thus, laches precluded recovery before the complaint was filed in September 2011. A six year period of infringement was reduced to one year. I guess the judge wasn't sympathetic.
Whenever a patent is enforced near the end of its term, you must consider laches. For more about laches, I suggest the Federal Circuit's case A.C. Aukerman Co. v. R.L Chaides Construction and cases citing Aukerman.
Copyright © 2012 Robert Moll. All rights reserved.
Sunday, August 5, 2012
SHIELD - Saving High-Tech Innovators From Egregious Legal Disputes Act of 2012
In view of 35 USC 285 allowing for attorney fees in exceptional cases, Congressman DeFazio's bill: "Saving High-Tech Innovators From Egregious Legal Disputes Act of 2012" strikes me as superfluous with a highfalutin title to boot. Congressman DeFazio refers to this bill as the SHIELD Act, and proposes a patent owner of a software or hardware patent pay all litigation costs including attorney fees if a court later thinks a patent owner did not have a reasonable likelihood of succeeding. Congressman Chaffet is co-sponsoring the bill.
What about defenses that did not have a reasonable likelihood of succeeding? Should patent owners have a claim to defendant paying its attorney fees? Apparently not under the SHIELD Act.
The SHIELD bill also defines software broadly as "a process that could be implemented in a computer" regardless of whether or not computer is mentioned in the patent so this bill may have more reach than one might expect.
Congressman DeFazio talks lots about how patent trolls are harming small high tech companies in his press release here, but the language of the bill has no such limitations. "Patent trolls don’t create new technology and they don’t create American jobs,” said DeFazio. “They pad their pockets by buying patents on products they didn’t create and then suing the innovators who did the hard work and created the product. These egregious lawsuits hurt American innovation and small technology start ups, and they cost jobs. My legislation would force patent trolls to take financial responsibility for their frivolous lawsuits."
The bill not only fails to limit its application to trolls, it may prevent small businesses from pursuing rightful claims of patent infringement against a large company with greater resources to litigate even the meritious claim to death, e.g., in discovery and to apply to court for the small company to pay its costs of defense.
Congressman DeFazio's proposal fails to suggest how it squares with the American Rule: each party is responsible for paying its own attorney's fees unless a statute allows assessment of attorney fees against the other person. But such are the times. Special interests run to Congress and Congress proposes laws to placate them even when interests run contrary to many decades of court cases and 35 USC 285.
I am not expecting this bill to pass, but expect if it does it will serve well as a "big company club."
Copyright © 2012 Robert Moll. All rights reserved.
What about defenses that did not have a reasonable likelihood of succeeding? Should patent owners have a claim to defendant paying its attorney fees? Apparently not under the SHIELD Act.
The SHIELD bill also defines software broadly as "a process that could be implemented in a computer" regardless of whether or not computer is mentioned in the patent so this bill may have more reach than one might expect.
Congressman DeFazio talks lots about how patent trolls are harming small high tech companies in his press release here, but the language of the bill has no such limitations. "Patent trolls don’t create new technology and they don’t create American jobs,” said DeFazio. “They pad their pockets by buying patents on products they didn’t create and then suing the innovators who did the hard work and created the product. These egregious lawsuits hurt American innovation and small technology start ups, and they cost jobs. My legislation would force patent trolls to take financial responsibility for their frivolous lawsuits."
The bill not only fails to limit its application to trolls, it may prevent small businesses from pursuing rightful claims of patent infringement against a large company with greater resources to litigate even the meritious claim to death, e.g., in discovery and to apply to court for the small company to pay its costs of defense.
Congressman DeFazio's proposal fails to suggest how it squares with the American Rule: each party is responsible for paying its own attorney's fees unless a statute allows assessment of attorney fees against the other person. But such are the times. Special interests run to Congress and Congress proposes laws to placate them even when interests run contrary to many decades of court cases and 35 USC 285.
I am not expecting this bill to pass, but expect if it does it will serve well as a "big company club."
Copyright © 2012 Robert Moll. All rights reserved.
Monday, July 16, 2012
RIM Told to Pay $147M for Infringement of Software Patent
A federal jury found Blackberry Manufacturer RIM liable for $147 million in damages for infringing Mformation Technologies patent that describes software allowing access to cell phones for software upgrades, passwords, or data erasure on stolen phones. The royalty of $8/device for 18.4 million BlackBerrys connecting to the BlackBerry Server sounds unreasonable given royalty stacking that comes into play given the hundreds and even thousands of US patents that relate to the smartphone.
Thanks to Alan Cooper for the USA Today article: Blackberry Maker RIM loses patent suit over Software.
For a discussion on royalty stacking see Stanford Professor Lemley and UC Berkeley Professor Shapiro's Patent Holdup and Royalty Stacking.
Copyright © 2012 Robert Moll. All rights reserved.
Thanks to Alan Cooper for the USA Today article: Blackberry Maker RIM loses patent suit over Software.
For a discussion on royalty stacking see Stanford Professor Lemley and UC Berkeley Professor Shapiro's Patent Holdup and Royalty Stacking.
Copyright © 2012 Robert Moll. All rights reserved.
Wednesday, June 27, 2012
Bard Peripheral v. W.L. Gore - Judges to Decide Objective Prong of Willful Infringement
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.
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.
Monday, June 25, 2012
Apple v. Motorola Patent Case - Judge Posner Dismisses with Prejudice
On June 23, Judge Posner issued a 38-page court order dismissing with prejudice the Apple v. Motorola patent case. Apple had four patents and Motorola, now Google, had just one in the case. Perhaps because of this some concluded Google won, but dismissed with prejudice means both Apple and Google will not be able to refile complaints on these patents and products in the future. Although the dismissal is appealable, I would be surprised if the Federal Circuit reversed it.
Judge Posner rejected Apple and Motorola's damage theories due to a failure of proof not because damages were incalculable. Judge Posner faulted the experts and attorneys, and was not willing to fill the evidentiary gaps. For example, one of Apple's expert stated a particular non-infringing chip was worth "a substantial fraction" of a $14.05 chipset, but conceded he could not quantify it. That kind of gap was held up for examination and skewered. Because of gaps like this, Judge Posner concluded neither party was entitled to an injunction nor damages and the case should be dismissed with prejudice, since permitting the parties to refile to fix the damage cases would be ridiculous.
This order is worth reading. It's a sharply worded tutorial on what evidence will be expected to establish damages in a patent infringement case in the future. Specifically, it discusses reasonable royalties, injunctions, and fair reasonable and non-discriminatory (FRAND) licensing of standard essential patents.
Judge Posner noted he wouldn’t ban a product that follows an industry standard unless the party (Apple) refused to pay a fair rate: "Once a patent becomes essential to a standard, the patentee’s bargaining power surges because a prospective licensee has no alternative to licensing the patent; he is at the patentee’s mercy."
Copyright © 2012 Robert Moll. All rights reserved.
Judge Posner rejected Apple and Motorola's damage theories due to a failure of proof not because damages were incalculable. Judge Posner faulted the experts and attorneys, and was not willing to fill the evidentiary gaps. For example, one of Apple's expert stated a particular non-infringing chip was worth "a substantial fraction" of a $14.05 chipset, but conceded he could not quantify it. That kind of gap was held up for examination and skewered. Because of gaps like this, Judge Posner concluded neither party was entitled to an injunction nor damages and the case should be dismissed with prejudice, since permitting the parties to refile to fix the damage cases would be ridiculous.
This order is worth reading. It's a sharply worded tutorial on what evidence will be expected to establish damages in a patent infringement case in the future. Specifically, it discusses reasonable royalties, injunctions, and fair reasonable and non-discriminatory (FRAND) licensing of standard essential patents.
Judge Posner noted he wouldn’t ban a product that follows an industry standard unless the party (Apple) refused to pay a fair rate: "Once a patent becomes essential to a standard, the patentee’s bargaining power surges because a prospective licensee has no alternative to licensing the patent; he is at the patentee’s mercy."
Copyright © 2012 Robert Moll. All rights reserved.
Thursday, March 29, 2012
Oracle v. Google - Joint Statement Reveals A Weakened Patent Case
In August 2010, Oracle sued Google for infringement of Java patents and copyrights obtained from the Sun acquisition. Judge Alsup has set the matter for trial on April 16. Because the trial is scheduled for eight weeks, Judge Alsup has ordered Oracle and Google submit proposals to streamline the trial. In response, Oracle and Google filed the following joint statement of trial streamlining proposals in court yesterday.
I think the consensus is Google's primary risk is it may be required to pay major damages (e.g., hundreds of millions) for copyright infringement. The risk of paying major damages for patent infringement is less likely for the following reasons:
Google is faced with only two patents at trial. It used to be faced with seven US patents, but Google aggressively filed for reexamination of the patents. Only two Oracle patents survived for the trial: U.S. Reissue No. 38,104 (the '104 reissue patent) and U.S. Patent No. 6,061,520 (the '520 patent). My previous post: Patent Reexamination Has Arrived - Oracle v. Google gives details.
Google has limited past damages. Google was able to prove that Oracle and Sun had not marked any practice products so limited damage to those after Oracle gave Google notice under 35 USC 287. My previous post: Failure to Patent Mark - Losing Easy Money gives additional details.
Google is negotiating for a low ball amount for future damages. Google proposes to pay Oracle $2.7 million and 0.5% of Android revenues for the '104 reissue patent expiring in December 2012 and $80,000 and 0.015% for the '520 patent expiring in 2018. Since Google gives away Android free to handset manufacturers, revenue for this proposal may be based on Google ads and third party applications. I am not certain from the joint statement how Google intends the revenue be established, and why Oracle should accept the independent damages expert's royalty (0.015%) and unadjusted damages of a mere $80,000 for the '520 patent.
Google may win the judge's favor in agreeing to drop its invalidity defense to the '520 patent. Google had to prove invalidity by clear and convincing evidence so giving it up may not mean much: "Judge Alsup I am giving up this (difficult) defense and streamlining my case for trial, so please side with me...."
Google has preserved the defense of non-infringement. Oracle has to prove infringement by a preponderance of the evidence and this is often a potent defense for defendants.
Google is not engaging Oracle with its damage proposals. In my opinion, Oracle may be right to rebuff Google's "low ball" and go to trial. The proposed damages appear to be too low. I think everybody knows it, but this is positional bargaining 101.
Copyright © 2012 Robert Moll. All rights reserved.
I think the consensus is Google's primary risk is it may be required to pay major damages (e.g., hundreds of millions) for copyright infringement. The risk of paying major damages for patent infringement is less likely for the following reasons:
Google is faced with only two patents at trial. It used to be faced with seven US patents, but Google aggressively filed for reexamination of the patents. Only two Oracle patents survived for the trial: U.S. Reissue No. 38,104 (the '104 reissue patent) and U.S. Patent No. 6,061,520 (the '520 patent). My previous post: Patent Reexamination Has Arrived - Oracle v. Google gives details.
Google has limited past damages. Google was able to prove that Oracle and Sun had not marked any practice products so limited damage to those after Oracle gave Google notice under 35 USC 287. My previous post: Failure to Patent Mark - Losing Easy Money gives additional details.
Google is negotiating for a low ball amount for future damages. Google proposes to pay Oracle $2.7 million and 0.5% of Android revenues for the '104 reissue patent expiring in December 2012 and $80,000 and 0.015% for the '520 patent expiring in 2018. Since Google gives away Android free to handset manufacturers, revenue for this proposal may be based on Google ads and third party applications. I am not certain from the joint statement how Google intends the revenue be established, and why Oracle should accept the independent damages expert's royalty (0.015%) and unadjusted damages of a mere $80,000 for the '520 patent.
Google may win the judge's favor in agreeing to drop its invalidity defense to the '520 patent. Google had to prove invalidity by clear and convincing evidence so giving it up may not mean much: "Judge Alsup I am giving up this (difficult) defense and streamlining my case for trial, so please side with me...."
Google has preserved the defense of non-infringement. Oracle has to prove infringement by a preponderance of the evidence and this is often a potent defense for defendants.
Google is not engaging Oracle with its damage proposals. In my opinion, Oracle may be right to rebuff Google's "low ball" and go to trial. The proposed damages appear to be too low. I think everybody knows it, but this is positional bargaining 101.
Copyright © 2012 Robert Moll. All rights reserved.
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