Tuesday, May 29, 2012

Judge Posner Excludes Opinion of Plaintiff's Reasonable Royalty Expert for Relying Solely on Plaintiff's Technical Expert to Identify Noninfringing Alternatives

The court excluded the opinions of plaintiff's damages expert as to a reasonable royalty for plaintiff's real-time display patent because the expert based his analysis on information obtained from plaintiff's principal technical expert. "Suppose [the damages expert] had been hired by [defendant] to advise on how at lowest cost [defendant] might obtain the functionality of [the asserted patent at issue] without infringing that patent. Obviously [the damages expert] would not have gone to the patentee for that information! For it would be in the patentee’s interest to suggest a method of inventing around that was extremely costly, because the costlier the invent-around, the higher the ceiling on a reasonable royalty. . . . So. . . imagine this imaginary conversation between [plaintiff's damages expert] and [defendant], which I’ll pretend hired [the damages expert] to advise on how at lowest cost to duplicate the patent’s functionality without infringement: [Defendant]: 'What will it cost us to invent around, for that will place a ceiling on the royalty we’ll pay [plaintiff]?' [Expert]: 'Brace yourself: $35 million greenbacks.' [Defendant]: 'That sounds high; where did you get the figure?' [Expert]: 'I asked an engineer who works for [plaintiff].' [Defendant]: 'Dummkopf! You’re fired.'"

Apple, Inc. v. Motorola, Inc., et. al., 1-11-cv-08540 (ILND May 22, 2012, Order) (Posner, C.J.).

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