Wonderland Nurserygoods Co., Ltd. v. Thorley Industries, LLC, 2-13-cv-00387 (PAWD October 30, 2015, Order) (Hornak, J.)
Tuesday, November 3, 2015
Cost Impact Methodology for Calculating Damages Must Apportion Value of Patented Feature
The court denied plaintiff's motion to reconsider an earlier order excluding the testimony of plaintiff's damages expert and rejected plaintiff's argument that there was clear error or manifest injustice. "[Plaintiff's] primary contention is that the cost impact approach utilized by the excluded expert involves a 'reliable damages methodology.' And, indeed, on this point and to that extent, they are correct. . . . [Plaintiff's expert] analyzes the ex-post value of the patent by considering the inventory that [defendant] acquired after infringement began. Essentially, his analysis considers the value of the inventory that [defendant] would be left holding, but unable to sell, because of the patent enforcement -- and as such, the amount that [defendant] would be willing to pay for a license so that it is able to sell this acquired inventory. Herein lies the problem. [Plaintiff's expert] values this inventory in terms of whole product units, rather than the patented component features. While this makes general sense as part of an ex-post valuation, it does not adequately isolate the value of the patented feature itself."