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Hurdles remain for $52 million patent verdict

By: Jack Zemlicka, [email protected]//February 17, 2012//

Hurdles remain for $52 million patent verdict

By: Jack Zemlicka, [email protected]//February 17, 2012//

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A $52 million federal jury verdict won by a small Middleton firm is the largest patent infringement award in the history of the Western District and could triple in the coming weeks.

The jury on Wednesday found that California-based Life Technologies Inc. willfully infringed on patents tied to cell authentication owned by Madison-based Promega Corp.

“Rarely does the issue of willfulness get to trial,” said Promega attorney Jim Troupis, of Troupis Law Office, Middleton. “But here I think the jury understood that the defendant wasn’t licensed to be selling the products.”

Western District Judge Barbara Crabb now has the option to increase the verdict amount to as much as $156 million.

But some say a shift in the interpretation of patent case law could be a roadblock to enhanced damages and could potentially lead to an overturning on appeal of the willfulness ruling.

“It’s not a sure thing,” said Madison patent attorney John Skilton, of Perkins Coie LLP. “The U.S. Court of Appeals for the Federal Circuit has made it very difficult for willful infringement enhancement issues to survive.”

Attorneys for Life Technologies did not immediately return calls seeking comment.

Patty Zamora, Life Technologies’ senior manager of corporate communications, said the company is considering its options in light of the verdict, including post-trial motions and appeals.

Skilton said the Federal Circuit’s 2007 decision in In re Seagate Technology LLC, raised the bar for proving willful infringement claims. The decision gave federal trial courts and the appellate court the ability to determine “objective recklessness,” which means courts require more proof from plaintiffs that the infringer knowingly violated patent rights.

The objective standard is in addition to a subjective test, which placed less of a burden of proof on the plaintiff, by the court to determine if the infringer knew or should have known it was violating the patent.

Seagate, a California-based developer of computer hard-drive technology, successfully defended a patent infringement suit filed by New York-based Convolve Inc. for illegal use of software at the Massachusetts Institute of Technology.

While the Federal Circuit hasn’t tracked the number of cases since Seagate in which willfulness findings were overturned, Skilton said, the objective standard can be difficult to meet, especially in big money cases.

The Promega case involved a dispute over unauthorized use of patents used to compare DNA samples in forensic and paternity tests.

In November, Crabb ruled Promega’s patents for the cell authentication were valid and that Life Technologies was guilty of infringement.

According to the verdict, between Aug. 29, 2006, and the end of January 2012, Life Technologies sold $707,618,247 worth of cell authentication kits, and approximately $70 million were in violation of a licensing agreement with Promega, according to the verdict.

“The court will re-evaluate the case,” Skilton said. “It’s big dollars, so it will get the attention of the Federal Circuit.”

Troupis acknowledged the objective standard could be a hurdle but said evidence used at trial proved that Life Technologies knowingly continued to infringe on the patent, even after Crabb made her ruling in November.

During the two-week trial, Troupis said, he went live online in front of the jury and Crabb to buy one of the cell authentication kits from Life Technologies and illustrate the company continued to illegally sell the kits.

“There was not much of a defense at that point,” Troupis said, “to the idea that they didn’t understand they were in violation of the patents.”

Within the next month, Troupis said, he will submit briefs to Crabb.

“Willfulness is such a rare finding you have to prove by clear and convincing evidence,” he said, “that most people had assumed that you automatically treble the damages.

“But in recent years, what we’re observing is it may not be as automatic as it once was.”

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