United States District Court, D. Delaware
E. Moore, Bindu A. Palapuru, Stephanie E. O'Byrne, POTTER
ANDERSON & CORROON LLP, Wilmington, DE; Chad E. Nydegger,
Brent P. Lorimer, Brittany Frandsen, WORKMAN NYDEGGER, Salt
Lake City, UT. Attorneys for Plaintiff.
G. Connolly, III, Ryan P. Newell, Mary I. Akhimien, CONNOLLY
GALLAGHER LLP, Wilmington, DE; Thomas S. Reynolds II, Alan W.
Nicgorski, John W. McCauley, Jeremy Adelson, HANSEN REYNOLDS
LLC, Milwaukee, WI. Attorneys for Defendant.
ANDREWS U.S DISTRICT JUDGE.
August 7, 2015, Plaintiff sued Defendant for infringement of
U.S. Patent No. 9, 059, 532 ("the'532 patent").
(D.I.I). I held a jury trial from April 30-May 8, 2018. (D.I.
273-278 ("Tr.")). The jury found each of the
asserted claims infringed and not invalid, and decided that
Plaintiff had proven, by a preponderance of the evidence,
that Defendant's infringement was willful. (D.I. 261). The
jury awarded Plaintiff $623, 175 in damages for
Defendant's infringement. (Id.).
before the Court are Plaintiffs Post-Trial Motions for (1)
Enhanced Damages, (2) Exceptionality and Attorneys' Fees,
(3) Pre-Judgment Interest and (4) Post-Judgment Interest
(D.I. 288) and related briefing (D.I. 292, 311, 317);
Plaintiffs Motion to Strike Evidence Outside of the Trial
Record (and to Strike Accompanying Arguments) Proffered in
Support of Defendant's Inequitable Conduct Defense (D.I.
301) and related briefing (D.I. 302, 313, 216);
Defendant's Motion for Judgment that U.S. Patent No. 9,
059, 532 is Unenforceable Under the Doctrine of Inequitable
Conduct (D.I. 289) and related briefing (D.I. 290, 300, 315);
Defendant's Renewed Motion for Judgment as a Matter of
Law of Invalidity and No. Willfulness and Alternative Motion
for a New Trial (D.I. 286) and related briefing (D.I. 287,
310, 314); and Defendant's Motion for Leave to File
Sur-Reply in Opposition to Nox's Post-Trial Motions (D.I.
Judgment as a Matter of Law
as a matter of law is appropriate if "the court finds
that a reasonable jury would not have a legally sufficient
evidentiary basis to find for [a] party" on an issue.
Fed.R.Civ.P. 50(a)(1). "Entry of judgment as a matter of
law is a 'sparingly' invoked remedy, granted only if,
viewing the evidence in the light most favorable to the
nonmovant and giving it the advantage of every fair and
reasonable inference, there is insufficient evidence from
which a jury reasonably could find liability." Marra
v. Phila. Hous. Auth, 497 F.3d 286, 300 (3d Cir. 2007)
assessing the sufficiency of the evidence, the Court must
give the nonmovant, "as [the] verdict winner, the
benefit of all logical inferences that could be drawn from
the evidence presented, resolve all conflicts in the evidence
in his favor and, in general, view the record in the light
most favorable to him." Williamson v. Consol. Rail
Corp., 926 F.2d 1344, 1348 (3d Cir. 1991). The Court may
"not determine the credibility of the witnesses [nor]
substitute its choice for that of the jury between
conflicting elements in the evidence." Perkin-Elmer
Corp. v. Computervision Corp., 732 F.2d 888, 893 (Fed.
Cir. 1984). Rather, the Court must determine whether the
evidence reasonably supports the jury's verdict. See
Gomez v. Allegheny Health Servs. Inc., 71 F.3d 1079,
1083 (3d Cir. 1995); 9B Charles Alan Wright & Arthur
R. Miller, Federal Practice and Procedure § 2524
(3d ed. 2008) ("The question is not whether there is
literally no evidence supporting the party against whom the
motion is directed but whether there is evidence upon which
the jury might reasonably find a verdict for that
the movant bears the burden of proof, the Third Circuit
applies a stricter standard. Fireman's Fund Ins. Co.
v. Videfreeze Corp., 540 F.2d 1171, 1177 (3d Cir. 1976).
To grant judgment as a matter of law in favor of a party that
bears the burden of proof on an issue, the Court "must
be able to say not only that there is sufficient evidence to
support the [movant's proposed] finding, even though
other evidence could support as well a contrary finding, but
additionally that there is insufficient evidence for
permitting any different finding." Id.
Rule of Civil Procedure 59(a)(1)(A) provides, in pertinent
part: "The court may, on motion, grant a new trial on
all or some of the issues-and to any party- .. . after a jury
trial, for any reason for which a new trial has heretofore
been granted in an action at law in federal court. . .."
Among the most common reasons for granting a new trial are:
(1) the jury's verdict is against the clear weight of the
evidence, and a new trial must be granted to prevent a
miscarriage of justice; (2) newly discovered evidence exists
that would likely alter the outcome of the trial; (3)
improper conduct by an attorney or the court unfairly
influenced the verdict; or (4) the jury's verdict was
facially inconsistent. See Zarow-Smith v. N.J. Transit
Rail Operations, Inc., 953 F.Supp. 581, 584-85 (D.N.J.
decision to grant or deny a new trial is committed to the
sound discretion of the district court. Allied Chem.
Corp. v. Daiflon, Inc., 449 U.S. 33, 36 (1980);
Olefins Trading, Inc. v. Han Yang Chem Corp., 9 F.3d
282, 289 (3d Cir. 1993). Although the standard for granting a
new trial is less rigorous than the standard for granting
judgment as a matter of law-in that the Court need not view
the evidence in the light most favorable to the verdict
winner-a new trial should only be granted where "a
miscarriage of justice would result if the verdict were to
stand" or where the verdict "cries out to be
overturned" or "shocks [the] conscience."
Williamson, 926 F.2d at 1352-53.
Patent Act gives the Court discretion to "increase the
damages up to three times the amount found or assessed."
35 U.S.C. § 284. The Court's discretion "should
be exercised in light of the considerations underlying the
grant of that discretion." Halo Elecs., Inc. v.
Pulse Elecs., Inc., 136 S.Ct. 1923, 1926
(2016). Enhanced damages are "designed as a
'punitive' or 'vindictive' sanction for
egregious infringement behavior," which is
"willful, wanton, malicious, bad-faith, deliberate,
consciously wrong, flagrant, or-indeed-characteristic of a
pirate." Id. at 1932. Enhanced damages are
"not to be meted out in a typical infringement
case." Id. A jury's finding of willful
infringement is a prerequisite to enhancement of damages, but
is not by itself sufficient. Id.
an infringer's behavior is willful, the Court may
evaluate a set of "non-exclusive" factors set forth
in Read Corp. v. Portec, Inc., to determine if
damages should be enhanced and the extent to which they
should be enhanced. 970 F.2d 816, 826-27 (Fed. Cir. 1992);
Presidio Components, Inc. v. Am. Tech. Ceramics
Corp., 875 F.3d 1369, 1382-83 (Fed. Cir. 2017), pet.
for cert, pending, No. 17-1649 (filed June 8, 2018), No.
17-1497 (filed May 1, 2018). The Read factors
include: "(1) whether the infringer deliberately copied
the ideas or design of another"; "(2) whether the
infringer, when he knew of the other's patent protection,
investigated the scope of the patent and formed a good-faith
belief that it was invalid or that it was not
infringed"; "(3) the infringer's behavior as a
party to the litigation"; "(4) [defendant's
size and financial condition"; "(5) [c]loseness of
the case"; "(6) [d]uration of defendant's
misconduct"; "(7) [r]emedial action by the
defendant"; "(8) [d]efendant's motivation for
harm"; and "(9) "[w]hether defendant attempted
to conceal its misconduct." Read Corp., 970
F.2d at 826-27.
movant must establish its entitlement to enhanced damages
under § 284 by a preponderance of the evidence.
Halo, 136 S.Ct. at 1934.
Exceptionality and Attorneys' Fees
Patent Act provides that the court "in exceptional cases
may award reasonable attorney fees to the prevailing
party." 35 U.S.C. § 285. The Supreme Court has
defined an "exceptional" case as "simply one
that stands out from others with respect to the substantive
strength of a party's litigating position (considering
both the governing law and the facts of the case) or the
unreasonable manner in which the case was litigated."
Octane Fitness, LLC v. ICON Health & Fitness,
Inc., 134 S.Ct. 1749, 1756 (2014). When considering
whether a case is exceptional, district courts are to
exercise their discretion on a case-by-case basis,
considering the totality of the circumstances. Id.
Relevant factors for consideration include
"frivolousness, motivation, objective unreasonableness
(both in the factual and legal components of the case) and
the need in particular circumstances to advance
considerations of compensation and deterrence."
Id. at 1756 n.6 (citation omitted). A movant must
establish its entitlement to attorney fees under § 285
by a preponderance of the evidence. Id. at 1758.
conduct is an equitable defense to patent infringement that,
if proved, bars enforcement of the patent."
Therasense, Inc. v. Becton, Dickinson & Co., 649
F.3d 1276, 1287 (Fed. Cir. 2011) (en banc). "To prevail
on the defense of inequitable conduct, the accused infringer
must prove that the applicant misrepresented or omitted
material information with the specific intent to deceive the
a case involving nondisclosure of information, clear and
convincing evidence must show that the applicant made a
deliberate decision to withhold a known material
reference." Id. at 1290 (citing Molins PLC
v. Textron, Inc., 48 F.3d 1172, 1181 (Fed. Cir. 1995))
material, withheld information must be "but-for"
material, meaning that the "PTO would not have allowed a
claim if it had been aware of the information.
Therasense, 649 F.3d at 1291. Courts evaluating
materiality must "apply the preponderance of the
evidence standard and give the claims their broadest
reasonable interpretation." Id. at 1291-92.
Plaintiffs Post-Trial Motions for (1) Enhanced Damages, (2)
Exceptionality and Attorneys' Fees, (3) Pre-Judgment
Interest and (4) Post-Judgment Interest
argues that the Read factors support an award of
enhanced damages. (D.I. 292 at 3-20; D.I. 317 at 1 -8).
Defendant argues the opposite. (D.I. 311 at 9-20).
first factor, "whether the infringer deliberately copied
the ideas or design of another," supports enhancement of
damages. Plaintiff presented evidence that Defendant sent
Plaintiffs commercial product to Defendant's Chinese
manufacturer, and told the manufacturer to copy Plaintiffs
product. (Tr. 302:24-303:10, 289:1-22; PTX0046 at 4).
Furthermore, Defendant's director of marketing described
the accused product as the "Nox knock off."
does not deny that it copied Plaintiffs product. Rather,
Defendant argues that Plaintiff "cannot satisfy its
burden under Read Factor 1 . . . simply by
pointing to pre-issuance conduct." (D.I. 311 at 9-10).
However, as I instructed the jury, "[d]eliberate copying
of the commercial product of the patent owner before issuance
of the patent. . . can be evidence of willfulness to the
extent it demonstrates [Defendant's] state of mind after
the '532 patent issued and after [Defendant] became aware
of it." (D.I. 259 at 33). Defendant "deliberately
copied the ideas [and] design" of Plaintiff, and
continued to produce copied belts after receiving notice of
the '532 patent's existence. (D.I. 287 at 24). This
action supports enhancement of damages. That Defendant's
deliberate copying pre-dates the patent does not negate this
finding, but does reduce its weight.
second factor, "whether the infringer, when he knew of
the other's patent protection, investigated the scope of
the patent and formed a good-faith belief that it was invalid
or that it was not infringed," does not support
enhancement of damages. In the face of evidence that it
copied the commercial embodiment of the '532 patent and
continued to produce copies after receiving notice of the
patent's existence, Defendant presented no evidence
during the jury trial that it possessed a good-faith belief
that the patent was invalid. Defendant tried to elicit such
evidence from its damages expert, Richard Bero. (Tr.
561:4-24). However, Plaintiff objected to Defendant's
effort. (Id.). I sustained Plaintiffs objection,
stating that "trying to get what [Defendant] thought
about whether or not the patent was invalid or not by having
Mr. Bero testify about it is improper." (Tr.
617:23-618:15). I also stated, "There's actually no
evidence in the record that the jury could use [to show that
Defendant] thought the patent was invalid."
(Id.). During the subsequent inequitable conduct
trial, however, Defendant presented evidence that it
challenged the validity of the European counterpart to the
'532 patent before the '532 patent issued. (Tr.
996:16-1000:4; DTX1025). Accordingly, even though Defendant
knew that it was copying the commercial embodiment of the
'532 patent almost immediately upon the patent's
issuance, it can be inferred that Defendant did so with a
good-faith belief that the patent was invalid.
third factor, "the infringer's behavior as a party
to the litigation," is neutral. Plaintiff argues that
Defendant engaged in litigation misconduct. (D.I. 292 at
6-10). In support of its argument, Plaintiff points to
several actions taken by Defendant. Plaintiff notes that
Defendant "conceded infringement" after Plaintiff
"had spent the time and resources to brief summary
judgment and prepare for argument on the motion." (D.I.
292 at 6 (citing D.I. 71, 59:25-63:8; D.I. 72-73)). Plaintiff
also argues that Defendant "maintain[ed] a large number
of invalidity theories until the eve of trial," and
represented to the Court that it did not intend to file a
petition for inter partes review, but later did so.
(D.I. 292 at 7 (citing D.I. 235-1, p. 185; D.I. 121)).
Plaintiff further notes that Defendant demanded that
Plaintiffs CEO Petur Halldorsson return from Iceland for the
bench trial on inequitable conduct, and argues that this