Issue 05/19 | June 13, 2005
Jury Determination of Willfulness Upheld Notwithstanding Later Procurement of Counsel’s Opinions

While an infringer’s failure to obtain timely legal advice can not serve as a basis for an adverse inference of willfulness post-Knorr-Bremse, other actions and conduct are properly considered by a jury in determining whether the infringer discharged its obligation under the duty of care.

In Imonex Services, Inc., V.W.H. Munzprufer Dietmar Trenner Gmbh, et al., No. 04-1262,-1290 (Fed. Cir. May 23, 2005), the federal circuit affirmed a district court’s order granting a new trial where a first trial resulted in a damages verdict based on insufficient evidence. The federal circuit also affirmed the denial of defendants’ JMOL motions as well as an enhanced damages award where the case was exceptional.

A jury awarded Imonex $10.4 million based on its finding that its ’280 and ’349 patents (directed to coin selectors used on laundry machines) valid, enforceable and willfully infringed. Because the verdict was based on insufficient evidence, a second trial was ordered and resulted in a lower damages award of $1.3 million and an attorneys’ fees award to Imonex. Imonex appealed the order granting a second trial and Munzprufer appealed the denial of its JMOL motion for noninfringement as well as the enhanced damages award.

On appeal, the federal circuit affirmed the denial of JMOL of noninfringement because, under fifth circuit law, there existed a legally sufficient evidentiary basis for the jury to find as it did. Affirming the finding of willfulness, the federal circuit found Munzprufer’s duty of care was triggered by (1) Imonex’s display of its products at trade shows, (2) the widespread distribution of literature depicting the patented products, and (3) Imonex’s correspondence with defendants’ employees about the use of patented devices in the defendants’ products. Notwithstanding Munzprufer’s procurement of opinions of counsel in defense of willfulness, substantial evidence supported the jury’s willfulness determination (though that evidence is not described). Attorneys’ fees were properly awarded where defendants continued to sell adjudged infringing products between the first and second trials.

Finally, the federal circuit affirmed the exclusion of testimony relating to the entire market value rule based on the district court’s determination that the proposed testimony regarding the patented features bore no relationship to the basis for customer demand for the laundry machines as a whole.

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To discuss these topics further, please feel free to contact the author Michael R. Dzwonczyk, (mdzwonczyk@sughrue.com), at Sughrue Mion, PLLC in Washington DC, USA.

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