Patent Damages Articles

On February 24, 2020, VirnetX announced the U.S. Supreme Court denied Apple’s petition for a writ of certiorari. Apple had asked the High Court to consider the Federal Circuit’s claimed misguided use of prior license agreements to calculate patent infringement damage awards without satisfying the Supreme Court’s precedent that an apportionment between patented and non-patented features of multi-component products be performed in every case.

Using the United States Courts’ annual Federal Judicial Caseload Statistics, Hampton IP looked at the number of copyright, patent, and trademark cases filed in federal district court and the percent of cases that reached trial annually over the last decade—March 31, 2010, through March 31, 2019.

On December 27, 2019, Apple Inc. petitioned the U.S. Supreme Court for a writ of certiorari asking the High Court to consider what Apple claims is the Federal Circuit’s misguided use of prior license agreements to calculate patent infringement damage awards without satisfying the Supreme Court’s precedent that an apportionment between patented and non-patented features of multi-component products be performed in every case.

In 2018, the Court of Appeals for the Federal Circuit issued two decisions. Both dealt with apportionment between patented and non-patented elements of multi-component products when calculating reasonable royalty damages.

In an endeavor to determine a reasonable royalty for an infringed patent, damage experts using a hypothetical negotiation should carefully consider other license and settlement agreements.

In Apple Inc. v. Samsung Electronics Co., the United States Supreme Court looked at design patents for the first time in more than a century.

The United States Court of Appeals for the Federal Circuit affirmed in its September 29, 2015, Nordock, Inc. v. Systems, Inc.decision that damage experts should not apportion “total profit” in design patent infringement cases under 35 U.S.C. §289.

On August 30, 2012, the United States Court of Appeals for the Federal Circuit issued its Laser Dynamics, Inc. v. Quanta Computer, Inc. opinion, which addressed the Entire Market Value Rule (“EMVR”) and other damage issues.

The United States Court of Appeals for the Federal Circuit’s January 4, 2011 Uniloc USA, Inc. v. Microsoft Corporation decision made (as a matter of law) the 25 percent rule of thumb a flawed tool for determining a baseline royalty rate in a hypothetical negotiation. The Uniloc decision also cast light on the Federal Circuit’s latest thinking regarding application of the entire market value rule.

Title 35, Section 284 of the United States Code, often referred to as the patent statute, states that patent infringement damages should be in an amount adequate to compensate the patent holder for the defendant’s infringement of the patent-at-issue, but in no event less than a reasonable royalty for the use of the invention.

On January 4, 2011, the Federal Circuit found the “25% Rule” to be inadmissible as a basis for reasonable royalty damages in its Uniloc USA v. Microsoft opinion.