{"id":2298,"date":"2018-11-19T12:30:55","date_gmt":"2018-11-19T17:30:55","guid":{"rendered":"https:\/\/patents.harnessip.com\/?p=2298"},"modified":"2018-12-09T12:43:00","modified_gmt":"2018-12-09T17:43:00","slug":"reasonable-royalty-cannot-include-non-infringing-activities","status":"publish","type":"post","link":"https:\/\/patents.harnessip.com\/?p=2298","title":{"rendered":"Reasonable Royalty Cannot Include Non-Infringing Activities"},"content":{"rendered":"\n

In Enplas Display Device Corporation v. Seoul Semiconductor Company, Ltd.<\/a>, [2016-2599](November 19, 2018), the Federal Circuit affirmed the district court\u2019s judgment that claim 20 of U.S. Patent No. 6,007,209 and the asserted claims of U.S. Patent No. 6,473,554 are not anticipated; affirmed the district court\u2019s denial of\u00a0JMOL of no inducement; but reversed the denial of JMOL that the damages\u00a0award was not supported by substantial evidence, and remanded.\u00a0 The \u2019209 and \u2019554 patents are directed to methods of back lighting display panels, particularly LED displays used in televisions, laptop computers, and other electronics.<\/p>\n\n\n\n

On the anticipation of the \u2018209 patent, Emplas argued that because an inventor of the \u2018209 patent testified that the prior art reference did not exclude mounting light sources as required by the claim, there was an issue of fact for the jury.\u00a0 The Federal Circuit disagreed, saying that this was not enough for anticipation.\u00a0 Anticipation requires that a single reference disclose each and every element of the claimed invention, while at most, the testimony suggests that the reference could have been modified to include light sources on the bottom wall.\u00a0 The Federal Circuit said that \u201cPrior art that must be modified to meet the disputed claim limitation does not anticipate the claim.\u201d<\/p>\n\n\n\n

On the anticipation of the \u2018554 patent the Federal Circuit noted that it came down to conflicting expert testimony about the prior art,\u00a0 and that \u201cwhen there is conflictingtestimony at trial, and\u00a0the evidence overall does not make only one finding on the point reasonable, the jury is permitted to make credibility determinations and believe the witness it considers more\u00a0trustworthy.\u201d\u00a0 Because the jury\u2019s verdict was based upon the reference itself as well as expert testimony, it was supported by substantial evidence.<\/p>\n\n\n\n

On the issue of induced infringement, the Federal Circuit noted that in order to succeed on a claim of inducement, the patentee must show, first that there has been direct infringement,\u00a0and second that the alleged infringer knowingly induced infringement and possessed specific intent to encourage another\u2019s infringement.\u00a0 Mere knowledge of infringement is insufficient. Liability for inducement can only attach if the defendant knew of the patent and knew as\u00a0well that the induced acts constitute patent infringement.\u00a0 Although the text of \u00a7271(b) makes no mention of intent, the Court infers that at least some intent is required, so both specific intent and action to induce infringement must be proven.<\/p>\n\n\n\n

Although it was a close case, the Federal Circuit concludedthat there was substantial evidence whereby both Enplas\u2019 knowledge and intent to induce infringement could be reasonably found.\u00a0 The Federal Circuit noted that Enplas also did not dispute that it was informed that the product it manufactured, co-developed, and sold to SSC was covered by SSC\u2019s patents, and that Enplas knew its customers sold televisions in the US and other countries.\u00a0 SSC had sent Enplas a pre-suit letter,informing it that SSC had found infringing lenses made with Enplas parts in televisions sold in the United States.\u00a0Further Enplas provided its customers with product\u00a0specifications that recommended infringing configurations for its accused lenses.\u00a0 The Federal Circuit said that it has held that providing instructions to use a product in an infringing manner is\u00a0evidence of the required mental state for inducing infringement.<\/p>\n\n\n\n

Enplas argued that this evidence did not establish that it knew<\/em> its lenses would be incorporated in U.S. televisions and that in any event mere knowledge was not enough to establish specific intent. The Federal Circuit agreed that mere knowledge of possible infringement is not enough, there was circumstantial evidence that would allow a jury to reasonably find that Enplas had knowledge of the patents and of its customers\u2019 infringing activity and that it intended to induce their infringement, and affirmed the denial of JMOL.<\/p>\n\n\n\n

Finally on the issue of damages, Enplas argued that the only evidence supporting the $4 million award was testimony from SSC\u2019s damages expert that explicitly and improperly included non-infringing devices in the royalty calculation.\u00a0 Enplas filed a Daubert motion regarding this testimony, that the district court deferred, and a motion in limine regarding this testimony, which the district court denied.\u00a0 SSC\u2019s expert testified that the parties would have negotiated a premium freedom to operate\u201d license to avoid the need to test and negotiate licenses for additional or future potentially infringing lenses that Enplas might sell, and to determine this\u00a0premium that Enplas would pay, SSC\u2019s expert assessed the volume of sales of all non-accused\u00a0lenses made by Enplas, which the expert estimated from Enplas\u2019 website.<\/p>\n\n\n\n

The Federal Circuit agreed with Enplas, noting a reasonable royalty cannot include activities that do not constitute patent infringement, as patent damages are limited to those \u201cadequate to compensate for the infringement.\u201d <\/p>\n","protected":false},"excerpt":{"rendered":"

In Enplas Display Device Corporation v. Seoul Semiconductor Company, Ltd., [2016-2599](November 19, 2018), the Federal Circuit affirmed the district court\u2019s judgment that claim 20 of U.S. Patent No. 6,007,209 and the asserted claims of U.S. Patent No. 6,473,554 are not … Continue reading →<\/span><\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[42,48],"tags":[],"class_list":["post-2298","post","type-post","status-publish","format-standard","hentry","category-anticipation","category-damages"],"post_mailing_queue_ids":[],"_links":{"self":[{"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=\/wp\/v2\/posts\/2298","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=2298"}],"version-history":[{"count":1,"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=\/wp\/v2\/posts\/2298\/revisions"}],"predecessor-version":[{"id":2299,"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=\/wp\/v2\/posts\/2298\/revisions\/2299"}],"wp:attachment":[{"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=2298"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=2298"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=2298"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}