Monday, December 1, 2014

Expert’s Failure to Apportion Damages Requires New Trial

The court granted in part defendant's motion to reconsider an earlier order denying defendant's motion for new trial and granted a new trial on damages. "[Defendant] has shown good cause for reconsideration on the issue of damages, given the Federal Circuit’s recent clarification of the law with respect to the calculation of a reasonable royalty. See Virnetx, Inc. v. Cisco Sys., Inc., 767 F.3d 1308 (Fed. Cir. 2014) . . . [Plaintiff's damages expert] was obligated to apportion the royalty solely to the patented features. [Plaintiff's expert] expressly acknowledged his royalty calculation did not include such apportionment. . . . [Plaintiff's] argument that VirnetX does not require apportionment where the expert calculates a royalty based on the 'expected harm' to the patentee overlooks the Federal Circuit’s clear directive therein that '[n]o matter what the form of the royalty, a patentee must take care to seek only those damages attributable to the infringing features" . . . Without the requisite apportionment, the jury lacked sufficient evidence on which to base its damages award, and, consequently, a new trial on the issue of damages is appropriate."
Power Integrations, Inc. v. Fairchild Semiconductor International, Inc., et al, 3-09-cv-05235 (CAND November 25, 2014, Order) (Chesney, J.)
When do district courts grant new trials on damages?

Since 2008, district courts have granted or partially granted motions for new trial on damages only eight times. In three of the cases the winning party was given the choice between remittitur or a new trial. One case was largely procedural, involving a remand from the Federal Circuit. The others focus on a lack of evidence supporting the verdict, a change in the law, or flawed expert analysis. To view the eight orders click here.

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