In Calculating Ongoing Royalty, Jury Finding of Infringement Strengthens the Patentee's Position in Hypothetical Negotiations

In awarding a post-verdict ongoing royalty of 5.1%, the court rejected the infringing party's contention, and the conclusion of three Eastern District of Texas cases, "that the jury’s finding of liability did not affect the applicability of the Georgia-Pacific factors. . . . [T]he Court concludes that it must assume that the jury finding of liability in this case would have strengthened [the patentee's] bargaining position had the parties negotiated a license after the jury verdict. This strengthened bargaining position would have resulted from the parties’ knowledge that [the patentee] could have forced [the] infringing product off the market for a limited period of time (creating what the parties refer to as a hold up effect)."

Boston Scientific Corp. v. Johnson & Johnson, 3-02-cv-00790 (CAND April 9, 2009, Order)