Power Integrations, Inc. v. Fairchild Semiconductor International, Fed. Cir. (July 3, 2018)
Patent damages law can be fairly complex—so much so that Daubert motions against damages experts are filed in nearly every case. These motions often accuse damages experts of overreaching by failing to properly apportion damages or misapplying the entire market value rule (“EMVR”). On Tuesday, the Federal Circuit’s opinion in Power Integrations, Inc. v. Fairchild Semiconductor International attempted to clarify these aspects of the patent damages analysis, vacating the jury’s $139.8 million damages award in the form of a reasonable royalty.
A patentee seeking damages for the sale of a multicomponent (or multifunction) product must typically take several steps to ensure that any alleged damages have been properly apportioned to exclude the value provided by the product’s noninfringing aspects. First, the royalty base has to be determined on the smallest saleable patent practicing unit. Second, that reduced royalty base needs to be apportioned to reflect only the value attributable to the patented technology. A royalty based on the value of the entire multicomponent product will likely yield much higher damages, but such a royalty can be recovered only if the plaintiff satisfies the very strict requirements of the EMVR.
Illulmina, Inc. v. Natera, Inc., Case No. 18-cv-01662-SI (N.D. Cal. June 26, 2018 Order Denying Motion to Dismiss).
Confirming that the difficulty in interpreting 35 U.S.C. § 101 in order to determine which subject matter is patentable is not limited to abstract ideas, Judge Illston of the Northern District of California grappled with the problem of identifying unpatentable natural phenomena.
Pursuant to the two-step test established by the Supreme Court in Mayo Collaborative Servs. v. Prometheus Labs., Inc., 566 U.S. 66, 70 (2012) and enshrined in Alice Corp. Pty. v. CLS Bank Int’l, 134 S. Ct. 2347, 2354 (2014), a patent claim is unpatentable if it is both directed to a patent-ineligible concept and fails to recite additional elements that transform the nature of the claim into a patent-eligible application by reciting an inventive concept. READ MORE
Order Reversing-In-Part, Vacating-In-Part, and Remanding, Altaire Pharmaceuticals, Inc. v. Paragon Bioteck, Inc., Appeal No. 2017-1487 (Fed. Cir. May 2, 2018) (Judge Evan J. Wallach)
Occasionally, a company may file a proceeding before the Patent Trial and Appeal Board (the “PTAB”), not with respect to its current use and practice of the contested patent, but for its potential future practice of the patent. For example, a company may seek inter partes review (“IPR”) of a patent it does not use or infringe upon, purely for the purpose of clearing a pathway to use the patented technology several years down the line, before spending substantial resources to develop a product using that technology. READ MORE
En Banc Decision Remanding to Panel for Consideration of Merits of Petitioner’s Time-Bar Appeal, Fed. Cir. (January 8, 2018)
The Federal Circuit, sitting en banc, found that the decision of the Patent Trial and Appeal Board (“PTAB”) as to whether a petition for inter partes review (“IPR”) is barred as untimely may indeed be appealed. Wi-Fi One, LLC v. Broadcom Corp., No. 2015-1944 (Fed. Cir. Jan. 8, 2018) (en banc). This overrules the panel in Achates Reference Publishing Inc. v. Apple Inc., 803 F. 3d 652 (Fed. Cir. 2015). READ MORE