Month: January 2019

Enplas Display Device Corp., et al. v. Seoul Semiconductor (Decided, November 19, 2018)

Although not considered “precedential,” the opinion by the Federal Circuit in this matter merits closer review. Often, damages experts are heard to discuss “freedom to operate” as a consideration at the hypothetical negotiation. The idea of freedom to operate is that one takes a license and then enjoys the freedom to practice any claim in the patent in any existing product and any future product.

The reason this becomes a relevant consideration is because any reasonable licensee would prefer to conduct one negotiation to allow the two companies to walk away and pursue business in any manner the licensee sees fit. This was the analytic approach Defendant’s expert took to damages in this matter, offering an opinion as to the “premium” that might be paid to afford freedom to operate.

The CAFC disagreed. The statutory language specifically states that a royalty rate should be “adequate to compensate for the infringement.” The language is not “adequate to compensate for any use of the patented technology.”

Arguments seeking to link a lump-sum construct to a broader freedom to operate were found unpersuasive, because the estimate relied on non-accused products.

This Enplas opinion is a gentle reminder that the hypothetical negotiation is not a real negotiation, but rather a fake one: one that didn’t happen and one that would never have happened. The CAFC reminded the district court that a damages expert does not enjoy freedom to operate in a manner that includes damages greater than the amount adequate to compensate for infringement.

A2C Year In Review – 2018

A2C has been busy with client matters for several months. As anyone functioning in commercial litigation knows, work can be “dead,” “slow,” “busy” or “insane.”

We’ve been “insane.” As soon as the meter moves back toward “busy” or below, we will become regularly active here again. Promise.

In the meantime, when we started this project, we had no idea what interest others might have in its content. None. Zip. Zero. We would ask ourselves, “Does anyone really care about damages?” The motivation was to make available more broadly commentary that heretofore had been distributed privately through email. The larger goal is to develop an online clearinghouse for damages-related analysis.

What have we learned about interest in our first year? We are going to share the numbers. We posted 42 entries in 2018. The generic data-tracker attached to the website indicates that the blog enjoyed 1,211 visitors, who registered 2,195 views. (To answer a privacy concern, “No, we do not possess any personal information about anyone who visits.”) Does that constitute “a lot” of traffic? For a hyper-niche blog? We will let others decide, but we confess that it is more than we would have guessed back when we launched. So, we are happy with that.

The most surprising thing we’ve learned since launch is the international interest in the blog. We never foresaw interest beyond the United States. But such interest exists, and below is the available information we possess about the location of visitors to the blog.

May your practice (and ours…) prove “busy” in 2019!