patent infringement: proving royalty...
TRANSCRIPT
Patent Infringement: Proving Royalty Damages Leveraging EMVR, Apportionment, Alternatives to the 25 Percent Rule, and Royalty Stacking
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THURSDAY, MAY 23, 2013
Presenting a live 90-minute webinar with interactive Q&A
Krista F. Holt, President & CEO, GreatBridge Consulting, Washington, D.C.
John M. Skenyon, Principal, Fish & Richardson, Boston
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Proving Reasonable Royalty Damages
▪ Attorney’s Responsibility (not the expert’s)
– Follow what the CAFC views as the current damages law
– Introduce the specific evidence that matches up with that law
– Anticipate where the CAFC is going to be by the time for appeal
6
Pay Close Attention To The Clues
▪ 1978 – Panduit Corp v Stahlin Bros.
– 6th Circuit case on lost profits
– Judge Markey sitting by designation
– Judge Markey later becomes Chief Judge of CAFC in 1982
▪ 2009 & 2010 – Cornell v Hewlett-Packard; IP Innovation v
Red-Hat
– District court cases (NY & TX) on reasonable royalty damages
– Judge Rader sitting by designation
– Judge Rader later becomes Chief Judge of CAFC in 2010
▪ 2010 – Judge Rader criticizes the 25% rule at an oral argument
9
Reasonable Royalty Damages -- Judge Rader
▪ Cornell v Hewlett-Packard, 609 F. Supp. 2nd 279 (2009)
– EMVR wrong (not the proper royalty base)
– Patentee’s expert excluded (post trial)
▪ IP Innovation v Red Hat, 705 F. Supp. 2nd 687 (2010)
– EMVR wrong (no evidence of customer demand for patented
feature)
– Licenses wrong (no relation to patented invention)
– Patentee’s expert excluded (pre-trial)
10
Georgia-Pacific v. U.S. Plywood
(The most famous case no one has read)
▪ Not a damages approach in itself
▪ Lists 15 factors which are a non-exclusive list of possible
relevant evidence as to reasonable royalty damages
Has your expert read the factors?
Does your expert really follow the factors?
▪ If your expert wants to rely on something that is not literally a
GP factor:
Bad idea to try to force fit the evidence into a GP factor
Additional evidence re relevance will be necessary
11
Only Two Georgia-Pacific Factors Deal With
Licenses
▪ Georgia-Pacific factor 1:
‒ “The royalties received by the patent owner for licensing
the patent in suit, proving or tending to prove an
established royalty”
▪ Georgia-Pacific factor 2:
– “The rates paid by [the infringer] for use of other patents
comparable to the patent-in-suit”
12
No Georgia-Pacific Factor Deals With
Third Party Licenses
▪ Georgia-Pacific factors 1 and 2:
– Routinely incorrectly used to rely on licenses between companies not
involved in the lawsuit
▪ Georgia-Pacific specifically held to third party licenses to be
irrelevant.
“Bare data as to royalty rate and cursory information to the nature of a
particular [third party] license (is) gravely deficient in probative value” on the
issue of reasonable royalty damages.
Georgia-Pacific v U.S. Plywood, 318 F.Supp. 1116, 1140
13
The CAFC Starts Looking Closely At
“Licensing Evidence” In 2009
▪ Lucent v Gateway, 580 F.3rd 1301 (Fed. Cir. 2009)
– $358 million dollar damages award vacated
– No evidence that the licenses relied on involved similar
technology to patented invention
• This is really the same basis as the holding in the Georgia-Pacific
case re third party licenses
▪ ResQNet.com v Lansa, 594 F.3rd 860 (Fed. Cir. 2010)
– Damages award vacated
– No evidence that the licenses relied on involved similar
technology to patented technology
• The patentee’s expert relied on bundled licenses not including the
patent-in-suit as “evidence” under GP factor 1.
14
The CAFC Cracks Down
▪ Lucent v Gateway, 580 F.3rd 1301 (Fed. Cir. 2009)
– Lump sum award is not supported by licenses with running
royalties without additional proof
▪ Laser Dynamics v Quanta, 694 F.3rd 51 (Fed. Cir. 2012)
& Whitserve v Computer Packages, 694 F.3rd 10 (Fed. Cir.
2012)
– Damages awards vacated
– Running royalty not supported by lump sum licenses without
additional proof
15
The CAFC Cracks Down
▪ Wordtech v Integrated Net., 609 F.3rd 1308 (Fed. Cir. 2010)
– Damages award vacated
– Lump sum award is not supported by lump sum licenses without
proof relating to: 1) number of licensed products anticipated by actual
lump sum licenses; 2) the nature of those products; 3) how the lump
sum was calculated
▪ Finjan v Secure Comp., 626 F.3rd 1197 (Fed. Cir. 2010)
– Damages award affirmed
– CAFC rejects infringer’s reliance on a license for the patent-in-suit
for failure to account for economic circumstances of contracting
parties (which were not comparable to that of the parties in the
litigation)
16
The CAFC and Daubert
▪ Laser Dynamics v Quanta, 694 F.3rd 51 (Fed. Cir. 2012)
Prohibits patentee’s expert from testifying on running royalty theory
on remand
▪ ePlus, Inc. v Lawson Software, 700 F.3rd 509 (Fed. Cir, 2012)
– District court’s exclusion of expert affirmed
• Licenses relied on were for multiple patents including cross licenses
• Licenses relied on pre-dated the hypothetical negotiation date by years
• Licenses relied on were in settlement of litigation
17
▪ The “25% Rule”:
‒ Set by intra-company licenses involving unspecified products sold in
foreign markets
– Licenses included multiple patents, trademarks, knowhow and
copyrights
– Licenses were exclusive and territorially restricted
– Profits were 20% of sales and royalty was 5% = “25% of profits”
– Attempted support:
• 1500 licenses from 15 industries
• Each industry had an average royalty (for unknown products) from about 8% to
over 40%
• If you “average the average rates” for all industries it comes to about 25%
The “25% Rule” Was Never Relevant
18
Royalties Based On The “25% Rule”
▪ i4i Limited v Microsoft, 589 F.3rd 831 (Fed. Cir. 2010)
‒ The patentee’s expert relied on:
• A third-party “benchmark” stand-alone product to set the defendant’s
projected profit on a feature of WORD
• A survey with 46 responses
• The “25% rule” resulting in a $96/unit royalty
• Adjustment for GP factors to $98/unit royalty
‒ The CAFC affirms saying that the patentee’s damages expert
relied on Georgia-Pacific but the royalty rate was really set before
that
‒ The CAFC says it cannot consider the evidence because no JMOL
motion but it could have ordered a new trial
19
▪ Uniloc v Microsoft, 632 F.3rd 1292 (Fed. Cir. 2011)
– The ‘25% Rule” is as a matter of law fundamentally flawed.
– It is inadmissible under Daubert and the Federal Rules of
Evidence
• “[T]here must be a basis in fact to associate the royalty rates used in prior
licenses to the particular hypothetical negotiation at issue in the case. The
25 percent rule of thumb as an abstract and largely theoretical construct
fails to satisfy this fundamental requirement. The rule does not say
anything about a particular hypothetical negotiation or reasonable royalty
involving any particular technology, industry, or party.”
The 25% Rule Goes Down
20
Settlement Licenses
▪ Rule 408 of the Federal Rules of Evidence
– Evidence offering to compromise a claim is not admissible to
prove the amount of the claim
▪ CAFC usually finds such settlement agreements have
little weight (only a few listed here):
– Deere v Intern. Harvester, 710 F.2nd 1551 (Fed. Cir. 1983)
– Hanson v Alpine Valley, 718 F.2nd 1082 (Fed. Cir. 1983)
– Laser Dynamics v Quanta, 694 F.3rd 51 (Fed. Cir. 2012)
– Whitserve v Computer Packages, 694 F.3rd 10 (Fed. Cir.
2012)
21
Settlement Licenses
▪ ResQNet.com v Lansa, 594 F.3rd 860 (Fed. Cir. 2010)
– Erroneously cited by several district courts as holding that
settlement agreements involving the patent-in-suit are the most
relevant to reasonable royalty damages
– This was not a holding in ResQNet
• The ResQNet court merely said that the one settlement license for the patent-in-
suit in that case seemed far more relevant than the bundled licenses (not
including the patent) that the patentee’s expert relied on. The CAFC did not
rely on the settlement license
• The CAFC in LaserDynamics v Quanta, 694 F.3rd 51 (Fed. Cir. 2012) correctly
described this portion of ResQNet as being “limited” in scope and
circumstances, and held that the settlement agreement in its case was the “least
relevant” and an abuse of the district court’s discretion to admit it
– It is likely to be a bad mistake to set up a damages case based on
settlement agreements regardless of your district court’s view
22
Entire Market Value Rule
▪ Entire Market Value Rule:
– Can obtain damages on entire product even though patent only
covers a part of the entire product
– Can obtain damages on unpatented items if patented item and
unpatented items are physically part of the same machine or
constitute a functional unit
– Rite-Hite Corp v Kelley, 56 F.3rd 1538 (Fed. Cir. 1995) (en banc)
∙ But the patented feature must be the basis for the customer demand for the
entire product
23
The CAFC Looks Closely At EMVR Support
▪ Lucent v Gateway, 580 F.3rd 1301 (Fed. Cir. 2009)
‒ Damages vacated because no evidence of customer demand
▪ Uniloc v Microsoft, 632 F.3rd 1292 (Fed. Cir. 2011)
‒ Damages vacated because no evidence of customer demand
▪ Imonex v W.H. Munzprufer, 408 F.3rd 1374 (Fed. Cir. 2005)
‒ Affirmed district court’s exclusion of EMVR because no
evidence of customer demand
▪ LaserDynamics v Quanta, 694 F. 3rd 51 (Fed. Cir. 2012)
‒ Affirmed district court’s exclusion of EMVR because no
evidence of customer demand
24
The CAFC Goes Further With EMVR
▪ Marine Polymer v Hemcon, 672 F.3rd 1350 (Fed. Cir. 2012)
‒ Even if the parties agree the EMVR applies, the Federal
Circuit still looks at the customer demand evidence
▪ LaserDynamics v Quanta, 694 F.3rd 51 (Fed. Cir. 2012)
– A patentee’s tactic is to use the EMVR to get the infringer’s total
sales figures before the jury. The jury thinks any “royalty” is
reasonable in view of the total sales figures.
– The CAFC holds here that disclosure of overall sales figures
cannot help but skew the damages for the jury
25
Problems With Multiple Patents
▪ Verizon v Vontage, 503 F.3rd 1295 (Fed. Cir. 2007)
– In a case with two patents, the damages issue gets remanded
because one patent is thrown out on appeal, but only a single
damages amount was awarded
▪ Other issues
– Should you ask for separate damages verdicts
– Are the damages awards actually the same?
• Same hypothetical negotiation date?
• Same infringing products?
• Any differences re damages theories?
26
Make Sure Of Your Evidence
▪ If you are going to rely on licenses, you will need additional
evidence beyond the licenses’ royalty rates
‒ Prove the technology is the same
‒ Prove the parties are in the same position
‒ Prove the format of your damages contention (e.g., lump
sum) matches up with your evidence
‒ (My suggestion: Do not rely on settlement
agreements)
▪ If you are going to rely on EMVR, you absolutely need solid
proof that customer demand for the overall product is based on
the patented feature. Otherwise, abandon this theory.
27
Preserve Your Rights
▪ Now, the CAFC will carefully review the sufficiency of the
damages evidence
– Contrast Lucent with i4i
– Properly preserve your rights
• Daubert motions
• Object or preserve your objections in the pre-trial materials and at trial
• Move for JMOL on all these issues when the other side rests at trial
• Move for JMOL post-trial on all the damages issues
28
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Patent Infringement: Proving Royalty Damages
May 23, 2013
Krista Holt
29
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Agenda
1. Daubert Risks and Opportunities
2. Apple v. Motorola
3. Patent Surveys
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Daubert Risks and Opportunities Guidelines
The Following Are Guidelines For Admitting Scientific Expert Testimony:
• Testimony must be based upon sufficient facts or data
• Testimony must be the product of reliable principles and methods
• The witness must apply the principles and methods reliably to the facts of the case
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Daubert Risks and Opportunities Daubert Case Law
Daubert Standard - Rule Of Evidence Governing The Admissibility Of Expert Witness Testimony
Relevant Case Law
• Daubert v. Merrell Dow Pharmaceuticals
• Kumho Tire Co. v. Carmichael
32
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Daubert Risks and Opportunities Success Rates of Daubert/ Rule 702 Challenges
33
Source: PwC Daubert Challenges to Financial Experts, 2012
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Success Rate of Daubert Challenges To Financial Expert Witnesses, By Case Type (2000-2012)
34
Daubert Risks and Opportunities Financial Expert Witness Daubert Success Rate
Source: PWC, “Daubert challenges to financial experts: A Yearly Study Of Trends and Outcomes”
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Daubert Risks and Opportunities How To Best Utilize Damage Experts
Qualifications For Experts
• Evaluate potential expertise required for testimony
• Do a background check using Daubert Tracker
• Review the expert’s curriculum vitae and any relevant testimony and publications
• Discuss billing rates
35
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Daubert Risks and Opportunities How To Best Utilize Damage Experts
Scope Of Work For Testifying Expert
• Budget
• Interviews with client
• Fact finding through discovery
• Damage modeling
• Drafting report
• Back-up book preparation
• Deposition preparation
• Depositions
• Trial
36
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Agenda
1. Daubert Risks and Opportunities
2. Apple v. Motorola
3. Patent Surveys
37
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38
Is Expert Testimony “Sufficiently Reliable”?
• Preponderance of evidence standard
• Burden falls to party tendering expert
Focus of Daubert Analysis: Methodology
• Disabling problems
• Insufficient grounding in the facts of the case
• Weak or flawed conclusions not sufficient to satisfy Daubert – subject to
cross-examination
Apple v. Motorola Judge Posner’s Daubert Framework
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Apple v. Motorola Stricter Application of Kumho Standard
From Kumho Tire Co. v. Carmichael, 526 U.S. 137, 152 (1999)
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40
Apple v. Motorola Stricter Application of Kumho Standard
From May 22, 2012 Opinion and Order in Apple v. Motorola (No.1:11-cv-08540)(N.D. IL.)
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41
Apple v. Motorola Patent Infringement But No Damages?
Plaintiff who cannot prove damages should not expect a court to speculate
on the proper award. Vastly different estimates of damages by the experts
for the plaintiff and defendant are evidence that the damages amounts are
nothing more than speculation and guesswork.
“Apple's damages expert . . . estimates that a reasonable royalty (covering the
period up until the trial) would be a lump sum of $14 million. In other words, he differs with
[defendants’ damages expert] by a factor of 140. The size of the disparity is a warning sign.
Either one of the experts is way off base, or the estimation of a reasonable royalty is
guesswork remote from the application of expert knowledge to a manageable issue within
the scope of that knowledge.”
“I am mindful that a degree of speculation is permitted in calculating damages . .
. But if an expert witness fails to conduct a responsible inquiry that would have been feasible
to conduct, his failure cannot be excused by reference to the principle that speculation is
permitted in the calculation of damages…”
Apple, Inc. v. Motorola, Inc., 2012 WL 1959560 (N.D. Ill. May 22, 2012)
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On June 7, 2012, Judge Posner tentatively dismissed the jury trial, noting that neither party had put forward sufficient evidence establishing monetary damages:
“I have tentatively decided that the case should be dismissed with prejudice because neither party can establish a right to relief. I may change my mind.”
Judge Posner later denied injunctive relief:
“Apple’s case for injunctive relief flunks the irreparable injury, balance of hardships, and public interest standards of eBay.”
Apple, Inc. v. Motorola, Inc., (June 22, 2012 Order)
Lesson Learned: Get Your Damages Case In Order
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Apple v. Motorola Judge Posner Tentatively Dismisses Jury Trial
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43
Apple v. Motorola The “Hypothetical Consulting Engagement”
What if Damages Expert Was Hired by Defendant on Eve of
Infringement?
• Defendant faced with dilemma – wants to incorporate feature without
infringing plaintiff’s patent
• Options
o Design-around
o License from plaintiff
o Abandon feature
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44
Apple v. Motorola The “Hypothetical Consulting Engagement”
Defendant’s Expectations in “Hypothetical Engagement”
• Would not rely on patent holder’s employees/consultants
o Biased
• Would not rely on defendant’s employees/consultants
o Wouldn’t pay the consultant for what I already know
• Reasonable degree of certainty
• All options considered
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Agenda
1. Daubert Risks and Opportunities
2. Apple v. Motorola
3. Patent Surveys
45
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46
Patent Surveys Demand and Usage Surveys
Use of Survey Data Endorsed
• “[C]onsumer surveys designed to determine the value of a particular feature or
property of a consumer product are a common and acceptable form of evidence in
patent cases. Such a survey might well have dispelled the uncertainty . . .”
• “[Apple’s expert] has provided no evidence on which to base an estimate of a
reasonable royalty for that program, let alone for the subprogram applicable only to
the Kindle application. So far as it appears, the only evidence that could be provided
would be consumer‐survey evidence; it is much too late for Apple to be permitted to
conduct a survey.”
• “[Apple’s expert] provided no estimate of how many such ignorant consumers there
are, still another question that could be answered within the limits of tolerable
uncertainty by a competently designed and administered consumer survey.”
Apple, Inc. v. Motorola, Inc., 2012 WL 1959560 (N.D. Ill. May 22, 2012)
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Patent Surveys Demand And Usage Surveys
“In sum, Cornell did not provide any more evidence for its consumer demand argument than the type of evidence this court found insufficient during [Plaintiff’s expert’s] Daubert hearing…. Cornell did not offer any customer surveys or other data to back these predictive claims.”
“Simply put, Cornell’s failure to connect consumer demand …to the claimed invention…undermined any argument for applicability of the entire market value rule.”
Cornell v. Hewlett-Packard, N.D.N.Y. (2009) Judge Rader sitting by designation
47
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Patent Surveys Used To Address Patent Issues
Surveys Could Potentially Be Used To Assess: • Panduit Factor #1 - Demand o Is the patented feature the main driver of sales?
o Is the patented feature even known to customers?
o What concessions (distance, price, etc.) Would customers be willing to accept to obtain the patented feature?
• Panduit Factor #2 - Alternatives o What do customers consider to be alternatives to the patented product or
feature?
o Do customers consider these alternatives to be acceptable? If so, under what circumstances? If not, why not?
o Which product(s) would customers purchase if the infringing device was not available?
o What are the price sensitivities of demand for the patented product and any alternatives?
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Patent Surveys Used To Address Patent Issues
Surveys Could Potentially Be Used To Assess: • Panduit Factor #3 - Manufacturing Capacity
o Do the plaintiff’s suppliers have sufficient capacity to support an incremental increase in sales volume?
• Panduit Factor #3 - Marketing Capacity
o Are the defendant’s customers aware of the plaintiff’s products?
o Do customers consider the plaintiff’s and the defendant’s products to be comparable? On what basis?
o What do customers consider to be the distinguishing features of the two parties’ products?
o Would customers buy from either the plaintiff or the defendant? If not, why not?
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Patent Surveys Used To Address Patent Issues
Potential Questions Addressed Through Surveys May Include:
• Georgia-Pacific Factor #5:
o Do customers consider the plaintiff and the defendant (as well as third-party
alternative providers) to be competitors for their business?
• Georgia-Pacific Factor #6:
o Are purchasers of the patented product influenced to buy other (non-patented)
products from the same seller as a result of purchasing the patented product?
• Georgia-Pacific Factor #8:
o What are the usage rates of this product?
o How much more would customers be willing to pay for the patented feature?
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Patent Surveys Used To Address Patent Issues
Potential Questions Addressed Through Surveys May Include:
• Georgia-Pacific Factor #9:
o What products do customers consider to be similar in purpose to the patented
product?
o How do previous products compare to the patented product?
o Do customers consider those similar products to be acceptable alternatives?
• Georgia-Pacific Factor #10:
o What benefits do customers perceive from the use of the patented products?
o Which of the benefits identified by customers do they associate with the
patented feature?
51
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Patent Surveys Used To Address Patent Issues
Potential Questions Addressed Through Surveys May Include:
• Georgia-Pacific Factor #13:
o Would customers be willing to purchase the alleged infringer’s product without the feature? If so, would a price concession be necessary?
o What features other than the patented feature are important to the customer?
o What are the relative weights of importance of those features?
o What do customers say about the value of the patented feature compared with other features identified as important to the purchase decision?
o What relative impact does each of the features have on the customers’ purchase decision?
52
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Patent Surveys Types Of Surveys And Their Applications
Usage Survey
• Determines the extent to which a patented attribute might be used
Demand Survey
• Determines the extent to which consumers demand the patented feature and would
not buy the product without that feature
Conjoint Survey
• Determines consumer preferences by means of selecting between product
combinations possessing (or not) patented features and other marketable features
• Can include price as a feature, which can be used to determine relative value
between different features
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Patent Surveys Have The Courts Accepted A Conjoint Statistical Analysis?
Oracle America, Inc. v. Google, Inc., 2012 WL 850705 (N.D. Cal. Mar. 13, 2012)
• The court granted defendant's motion to exclude plaintiff's
damages expert's use of another expert's conjoint analysis to
determine market share.
• Consumer surveys are not “inherently unreliable,” but may
become so when the experts (as in this case) “artificially
forced” the participants or the data to a desired outcome.
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Patent Surveys Have The Courts Accepted A Conjoint Statistical Analysis?
Oracle America, Inc. v. Google, Inc. (Order on March 1, 2012)
Specifically, the court stated –
"[Plaintiff's expert] had no reasonable criteria for choosing the four non-patented features to test; instead, he picked a low number to force participants to focus on the patented functionalities, warping what would have been their real-world considerations. . . If the conjoint analysis had been expanded to test more features that were important to smartphone buyers (instead of the four non-patented features selected for litigation purposes), then the study participants may not have placed implicit attributes on the limited number of features tested.”
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Patent Surveys Use Of A Choice Based Conjoint Survey In Litigation
Interpreting a CBC Survey: Willingness to Pay v. Demand
“The Court agrees with Samsung that evidence of ‘the price premium over the base price Samsung consumers are willing to pay for the patented features,’ PX30, is not the same as evidence that consumers will buy a Samsung phone instead of an Apple phone because it contains that feature.”
“… the survey does not measure willingness to pay for products; it measures willingness to pay for features within a particular product amongst consumers who have already purchased the particular product… To establish a causal nexus, Apple would need to show not just that there is demand for the patented features, but that the patented features are important drivers of consumer demand for the infringing products."
Apple Inc. v. Samsung Electronics Co. Ltd. et al, CV-01846-LHK (N.D. Cal. Dec. 17, 2012)
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Patent Surveys Use Of A Choice Based Conjoint Survey In Litigation
In the TV Interactive Data Corp. v. Sony Corp. case, conjoint analysis was used
to estimate the “market’s willingness to pay” (MWTP) for Plaintiff’s patented
technology as an incremental benefit in Defendant’s accused products.
• The estimated MWTP was used as a baseline by Plaintiff’s other expert in his calculation of a reasonable royalty rate.
• Criticisms in Daubert motion deemed survey “fundamentally flawed and unreliable,” but Court ruled that Defendant’s criticisms were more appropriate for jury consideration.
TV Interactive Data Corp. v. Sony Corp., No. 3:10-cv-00475-JCS, 2013 WL 942473
(N.D. Cal. March 11, 2013)
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Patent Surveys Demand And Usage Surveys
Surveys Concerning Usage
i4i v. Microsoft (Fed. Cir. 2009) – Survey admitted, despite being challenged for:
• Hearsay concerns (admitted under Rule 703)
• Sufficiency of Data under Rule 702: o Low response rate (46 responses out of 988)
o Use of logical imputation to correct inconsistent answers
o Time lapse between usage and survey
• Unfair Prejudice under Rule 403
Applera v. MJ Research, 389 F.Supp.2d 344 (D. Conn. 2005) – survey admitted
Lucent Technologies v. Gateway Inc., 580 F. 3d 1301 (Fed. Cir. 2009) – survey recommended
“Consideration of evidence of usage… can… be helpful to the jury and the court in assessing whether a royalty is
reasonable… Such data might, depending on the case, come from sales projections based on past sales, consumer surveys, focus group testing, and other sources.”
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Patent Surveys Demand And Usage Surveys
The survey failed to establish the Entire Market Value Rule
rule because it did not prove that the patented technology was
the basis of demand for the software and hardware. The
survey focused only on the software and ignored the
hardware.
Mirror Worlds, LLC v. Apple, Inc., 784 F.Supp.2d 703 (E.D. Tex. 2011)
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Patent Surveys Demand And Usage Surveys
“…the surveys do not measure the value of Plaintiff’s
technology [Multiband Functionality and small size], but
merely measure the perceived consumer value of cell phones
with any internal antennas.”
“ Survey evidence purportedly demonstrating the value of
internal antennas not tied directly to Plaintiff’s [patented]
technology…must be excluded.”
Fractus, S.A. v. Samsung, et al., 2011 6:09-CV-00203-896 (E.D. Tex. Apr. 29, 2011)
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• Although there are differences dictated by individual Circuit Courts, the
basic standards for the admissibility of surveys are stated in the Reference
Manual On Scientific Evidence within the Manual For Complex
Litigation, published by the Federal Judicial Center.
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Patent Surveys Litigation Survey Design Standards
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Patent Surveys Litigation Survey Design Standards
• The population must be properly chosen and defined.
• The sample chosen must be representative of that population.
• The methodology for gathering data must be established to create
accuracy and objectivity, and the appropriate use of controls must
be instituted.
• The questions must be clear and developed so as to be result-
neutral, not leading, and not suggestive of any answer.
• The survey must be conducted by qualified persons following
proper interview procedures.
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Patent Surveys Litigation Survey Design Standards
• The process must be conducted so as to ensure objectivity (e.g. the survey
must not be conducted by persons connected with the parties or counsel or
who are aware of its purpose in the litigation).
• The data must be analyzed in accordance with accepted statistical
standards.
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Patent Surveys Addressing Hearsay Concerns
Surveys Are Probative For The Following Reasons:
• Surveys can be designed to overcome hearsay objections based upon the Rule 807 Residual Exception.
• To be admissible under this exception, the survey must be trustworthy, provide evidence of a material fact, be more probative than other evidence and be in the interest of justice to admit.
• Additionally, the adverse party must be made aware of the intent to offer the survey and apprised of the identity of the declarants (The list from which the respondents was selected is sufficient to satisfy this requirement).
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Contact Information
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Krista F. Holt President & CEO
GreatBridge Consulting, Inc. 1801 K St NW
Suite 1150 Washington, DC 20006
(202) 769-4901 [email protected]
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Disclaimer – For Illustrative Purposes Only
• This presentation has been prepared for discussion purposes only in connection with this educational presentation. Illustrative scenarios were prepared to encourage group participation and discussion. None of the material contained in this presentation represents the views or opinions of Fish and Richardson or GreatBridge Consulting, Inc.
• This presentation is not intended to be used in litigation. As stated above, the context of this presentation is educational and not specific to any particular litigation. Because each litigation is specific to its own facts and circumstances; it would be unwise and even misleading to take a passage of static words or slides from this presentation and assume that it can be applied to a particular circumstance without applying reasoned judgment to the specific facts and circumstances of the situation.
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