Tuesday, August 23, 2011

Hypothetical Supply Chain Involving Sale of Foreign-Bound Products to Domestic Entity Does Not Support Claim for Lost Profits

The court granted defendant's motion for summary judgment as to plaintiff's claim for lost profits. "Even though [plaintiff] does not sell products directly to customers, it claims that it could have supplied [its] devices from the United States to other [plaintiff] entities for distribution in Europe, and thus should be able to recover the 'wholesale profits' it would have made under those circumstances. . . . [Plaintiff] has come up with a fictional supply chain wherein [the] products destined for Europe could have been manufactured in the United States and then artificially funneled through [plaintiff] for no other reason than to make its lost profits claim. . . . [T]here is no evidence to suggest that the hypothetical supply chain has ever been used. The unrebutted evidence shows that 'but for' the alleged infringement, [plaintiff's] European distribution chain would have made the lost sales, not [plaintiff]."

Synthes (USA) v. Spinal Kinetics Inc., 5-09-cv-01201 (CAND August 19, 2011, Order) (Whyte, J.)

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