Patent Law Practice Center

Judge: Nash Bargaining Is No Solution for Patent Damages

Brandon Baum of Baum Legal and Practice Center Contributor, sent in this article discussing the “Nash 50 Percent Rule” and patentees recent attempt to use the rule to support it’s damages claim in it’s patent infringement case.  Is the Nash Bargaining Solution stronger and more defensible than the “25 Percent Rule”?

In Uniloc v. Microsoft, the Federal Circuit rejected the so-called “25 Percent Rule of Thumb” that suggested that in a hypothetical negotiation over reasonable royalties, a good starting point is to assume a profit split of 25% to the patentee and 75% to the infringer.  Although the Federal Circuit did not say it, it has been assumed by many that the problem with the 25 Percent Rule was that it gave too much to the patentee — resulting in excessive damage awards.  Indeed, it was Microsoft complaining about the use of the “Rule” on appeal, not Uniloc.

Patentees, however, are a clever and resilient bunch who always view the glass as half full.  Since the Federal Circuit found that the 25 Percent Rule was not sufficiently grounded in science, patentees sought a replacement that was stronger and more defensible — and many have turned to the Nash Bargaining Solution. The Nash Bargaining Solution is a mathematical proof of what any parent of two children knows; in a two person bargaining scenario, the optimal split that the parties will eventually agree upon is 50-50.  For this, Nash won a Nobel Prize.  ”Eureka!,” said patentees.  ”We will replace the unproven and now-rejected 25 Percent Rule with Nash’s Nobel Prize-winning 50 Percent Rule!” (more…)

Do You Have The Right To Sue: Understanding Contract Provisions In The Context Of Litigation

Written by Michael Davitz, Partner at Axinn, Veltrop & Harkrider and Practice Center Contributor, and his associates Josephine Liu and Tara Rahemba.

A patent grants the patentee the right to exclude others from making, using, selling, offering to sell or importing the patented invention into the United States.  35 U.S.C. § 271(a).  It follows that when this right to exclude is violated by an infringer, the “patentee” has the right to bring a “civil action for infringement of [its] patent,” i.e., standing to sue for patent infringement.  35 U.S.C.  § 281.

Recently, the identity of the “patentee” as defined, has been called into question.  The Federal Circuit has made it clear that nuances in the provisions and language used in patent licensing and assignment agreements can be critical in determining whether or not an inventor, licensee or assignee has standing to sue another party for patent infringement.  Slight imperfections or even subtle deviations from what was actually intended or desired by the parties can have a profound impact on their right to sue over the patent.  It is therefore imperative that practitioners are knowledgeable about the effects particular language and provisions have on a standing determination in order to ensure that their clients, whether individual inventors or corporations, licensors or licensees, preserve their right to sue for patent infringement. (more…)

How The Sausage Is Made

Written by Brandon Baum of Baum Legal and Practice Center Contributor.

You often hear that the key to being a patent trial lawyer is the ability to master complex technical concepts and communicate them to lay jurors. To comfortably act as a translator between the hard science of technology and the soft art of human understanding and common sense. The reality, however, is not quite so impressive.

Take, for example, this closing argument from the i4i vs. Microsoft case. What follows is the entirety of i4i’s discussion of infringement in its initial closing argument:

 

 

 

 

 

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Advanced Patent Prosecution Workshop: Chemical & Pharmaceutical Claim Drafting

Last week, I attended PLI’s Advanced Patent Prosecution Workshop 2011 in New York where an esteemed panel of experts offered hands-on claim drafting and amendment writing techniques.  The program was organized into four technological sections: Biotechnology, Chemical/Pharmaceutical, Electrochemical and Electronics/Computers. I attended the Chemical/Pharmaceutical segment where Michael Davitz, Partner at Axinn, Veltrop & Harkrider and Practice Center Contributor, discussed Chemical and Pharmaceutical Claim Drafting.  Here are some highlights from his presentation….

• Development of a Patent Portfolio – patent portfolio is developed in the context of a business plan and where in the life cycle the product is.
• Generic Player – differentiate product from innovator and create difficulty for competitors, other generics.
• Innovator – at what stage is the development? Integrate FDA and patent filing strategies and develop patents with an eye towards forcing infringement.
• Strategies for Early-stage and Late-stage Products
• Developing a Portfolio of both Listed and Unlistable Patents
• Start with the end-game and plan backwards (more…)

Upcoming Audio Briefings On Recent Supreme Court Decisions

The Supreme Court  has decided three cases this past month that could have a big effect on patent law.  To help you understand the significance of these decisions and their implications, PLI is offering three timely and topical One-Hour Audio Briefings.

1. June 24th – Global-Tech v. SEB: Supreme Court Holds knowledge Requirement Satisfied by Willful Blindness for Patent Infringement:  On May 31, 2011, the U.S. Supreme Court handed down its decision in Global-Tech Appliances, Inc. v. SEB S.A. In an 8–1 decision, with Justice Alito writing for the Court, the Court concluded that induced infringement requires knowledge that the induced acts constitute patent infringement, not just knowledge that it was encouraging certain acts which just happened to infringe a patent. Examining the statutory language and tracing pre–adoption case law, the Court further concluded that a defendant’s deliberate indifference to a known risk that a patent exists would not be sufficient to demonstrate knowledge, which was the Federal Circuit’s view below, but that “willful blindness,” well–established in the criminal law context, is enough to satisfy the knowledge element. Although it announced a different standard, the Court concluded that the evidence in this case easily satisfied that standard. For such a doctrine to apply, a defendant must subjectively believe that there is a high probability that a fact exists, and must take deliberate actions to avoid learning of that fact. In dissent, Justice Kennedy argued that the Court took a step too far in concluding that willful blindness is a form of knowledge, and would have required actual knowledge.  This briefing will be conducted by Peter J. Brann, a partner in the law firm of Brann & Isaacson, whose practice focuses on intellectual property litigation, R. Ted Cruz of Morgan, Lewis & Bockius LLP and counsel of record for SEB, and William Dunnegan of Dunnegan LLC and counsel of record for Global-Tech Appliances. (more…)