Remedies Attack1

1)Should the court grant an Injunction?

  1. Permanent injunctions (eBay v. MercExchange)
  • A permanent injunction is one that is raised after a final judgment of infringement and no invalidity or unenforceability.
  • A patent owner seeking a permanent injunction must satisfy the following factors:

(1)That it has suffered an irreparable injury;

-Brand name damage, decreased market share, increased notoriety of accused infringer in field, patentee’s only product and infringement will stifle his/her ability to succeed in the market

(2)That remedies available at law, such as monetary damages, are inadequate to compensate for that injury;

-Discuss factors above (essentially combine the two)

(3)That, considering the balance of hardships between the plaintiff and defendant, a remedy in equity is warranted; and

-Consider costs each has endured, consider if accused “stole” idea

(4)That the public interest would not be disserved by a permanent injunction.

-The public has an interest in ensuring valid patents are enforced as it maintains the incentives for innovation.

-However, we do not want to deprive the public of a critical product the patentee is not able to produce in large quantities.

  1. Preliminary injunctions (Apple v. Samsung)
  • A preliminary injunction is entered before trial with a goal of protecting the rights of the parties during pendency of the infringement suit.
  • A patentee/plaintiff must establish the following:

(1)A reasonable probability of success on the merits;

-Can the patentee establish infringement by a preponderance of the evidence and that the accused infringer will not be able to show invalidity or unenforceability by clear and convincing evidence?

(2)Irreparable harm to the patentee if the preliminary injunction is not granted;

(3)The balance of hardships tips in the patentee’s favor; and

(4)The impact, if any, of the injunction on the public interest.

2)Should the court award compensatory damages?

By awarding compensatory damages, the court is attempting to put the patentee is as good a position as it would have been had there been no infringement.

  1. Lost profits

1)In order to obtain damages based on lost profits the patentee must show [Panduit Corp.]:

  1. There is demand for the patented product;
  2. The absence of acceptable non-infringing substitutes; and
  3. That the patentee has the manufacturing and marketing capability; and
  4. The amount of profit the patentee would have made.

2)Can the patentee recover lost profits on lost sales of unpatented products (or those covered by patents than the one in suit) that compete with the infringing device [Rite-Hite]?

  1. The patentee proves this by establishing that the particular injury for the unpatented product was or should have been reasonably foreseeable by an infringing competitor in the relevant market, that injury is generally compensable absent a persuasive reason to the contrary.

3)Can the patentee recover damages for the lost profits they would have made, but for the infringement, on accessory items that typically would be purchased with the patent item?

  1. A patentee is entitled to such if the unpatented components function together with the patented component in some manner so as to produce a desired end product or result. The components must be analogous to components of a single assembly or be parts of a complete machine or constitute one functional unit.
  2. The rule has been extended to allow inclusion of physically separate unpatented components normally sold with the patent components.
  1. Reasonably royalties

1)A reasonable royalty has been defined as an amount which a person, desiring to manufacture and sell a patented article, as a business proposition, would be willing to pay as a royalty and yet be able to make and sell the patented article, in the market, at a reasonable profit.

2)To determine what reasonable royalties the patentee is entitled to, we create a hypothetical negotiation scenario such that the court must attempt to discern what royalty rate the patentee would have accepted at the time the infringement began and what the infringer would have accepted.

3)Some of the 15 factors to consider in the hypothetical negotiation [Georgia Pacific Corp.]:

  1. Royalties received by the patentee for the licensing of the patent in suit (established royalties);
  2. The rates paid by the licensee for the use of other patents comparable to the patent in suit;
  3. The duration of the patent in suit;
  4. The licensing of accessory items sold with the patented product;
  5. The importance of the patent in the overall product (1 of 800 patents or 1 of 3)

3)Enhanced damages and willful infringement

  1. A district court has the discretion to increase damages up to three times the amount of the compensatory award.
  2. Can the patentee show that a defendant/accused infringer acted with willfulness [In re Seagate]?

1)In order to prove willfulness, a patentee must establish that the infringer acted in an objectively reckless manner.

2)To establish willful infringement the patentee must show two things:

  1. By clear and convincing evidence, the infringer acted despite an objectively high likelihood that its actions constituted infringement of a valid patent; and
  2. That this objectively-defined risk was either known or so obvious that it should have been known to the accused infringer.