Thursday, June 27, 2013

Expert’s Concession That Inferior Products May Capture Market Share Does Not Undermine Lost Profits Analysis

The court denied defendant's post-trial motion for judgment as a matter of law that plaintiff was not entitled to lost profits. "[Defendant] argues that [plaintiff's damages expert] was obligated to conduct a study reconstructing the marketplace to support his estimate of lost profits. Instead, [the expert] simply assumed that [plaintiff] would have captured 50% of [defendant's] sales, with the remainder being diverted to other market participants with unacceptable, but nonetheless competitive, products. [Defendant] contends that [the expert's] assumption of a 50% capture rate does not constitute sound economic proof and does not satisfy the Panduit test. . . . [The expert's] failure to conduct an empirical market analysis does not undermine the jury’s findings. [His] cautious estimate that [plaintiff] would have captured 50%, rather than 100%, of [defendant's] sales absent [defendant's] infringement merely accounts for the possibility that competing products might experience some commercial success even if inferior to the patented tool in critical respects. [Plaintiff's expert's] prudent concession that inferior products might still capture some sales due to market realities is not inconsistent with the [Panduit Corp. v. Stahlin Bros. Fibre Works, Inc., 575 F.2d 1152 (6th Cir. 1978)] analysis."

Illinois Tool Works Inc. v. MOC Products Company, Inc., 3-09-cv-01887 (CASD June 24, 2013, Order) (Sammartino, J.).

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