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District Courts Appear to Defer, Even Post-Halo, to Juries’ Willfulness Findings

September 12, 2016

District Courts Appear to Defer, Even Post-Halo, to Juries’ Willfulness Findings

September 12, 2016

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Post-Halo, Courts across the country are dealing with jury findings of willful infringement based on pre-Halo jury instructions. To date, several district courts have held that a jury finding of willful infringement satisfies the subjective prong of willfulness left intact by Halo, and the Federal Circuit has appeared to endorse that view. WBIP, LLC v. Kohler Co., 2016 WL 3902668, at *15 (Fed. Cir. July 19, 2016) (“an infringer’s subjective bad faith alone may support an award of enhanced damages”). The reasoning of most of the courts is essentially this: if the jury was allowed to hear the evidence of willful infringement and then found willfulness even under pre-Halo instructions, then the court may proceed to the discretionary determination of whether to enhance. E.g., Imperium IP Holdings (Cayman), Ltd. v. Samsung Elecs. Co., No. 4:14-cv-371, slip op. at 11-13 (E.D. Tex. Aug. 24, 2016) (trebling damages after a jury finding of willful infringement under the pre-Halo clear and convincing evidence standard after consideration of the Read factors and “egregious infringement behavior”); Enplas Display Device Corp. v. Seoul Semiconductor Co. 2016 WL 4208236, at *5–6 (N.D. Cal. Aug. 10, 2016) (finding pre-Halo instructions are “in line with the law as it stands today”); Innovention Toys, LLC v. MGA Ent., Inc., 2016 WL 4151240, at *2 (Fed. Cir. Aug. 5, 2016) (“[T]he predicate of willful misconduct is established by the jury’s finding that MGA was subjectively willful under the second part of the Seagate standard. The jury made that finding under the clear-and-convincing-evidence standard, which is more demanding than needed.”); Arctic Cat Inc. v. Bombardier Recreational Prods., Inc., 2016 WL 4249951, at *2 (S.D. Fla. July 27, 2016) (Halo “did not impact the validity of the Judgment because . . . where both objective willfulness and subjective willfulness were found by clear and convincing evidence, a more lenient inquiry as to subjective willfulness, without the additional hurdle imposed by the objective willfulness inquiry, and by the lesser preponderance of the evidence standard, would reach the same result.”).

The author is unaware of any district court case in which a court entered a willfulness decision following a jury’s verdict on post-Halo instructions. However, the Federal Circuit, in a non-precedential decision, suggested that a jury verdict under the post-Halo standard will not change the present reasoning of many district courts—that the jury verdict is enough to move on to the discretionary enhancement exercise. Innovention Toys, LLC, 2016 WL 4151240 at *2 (“The remand in this case, therefore, is for the district court to exercise its discretion in accordance with Halo, including the emphasis on egregiousness; willful misconduct has already been established by a verdict that Halo does not warrant disturbing.”). As we see, courts are moving directly to considering whether to exercise their discretion and enhance damages under 35 U.S.C. § 285.

One notable deviation from the holdings above occurred in the Northern District of California. The court stated that it “approaches the jury finding [of willful infringement] as an advisory finding” because willful infringement is not an action triable of right by a jury. Enplas Display Device Corp., 2016 WL 4208236 at *6. The court ultimately adopted the jury’s finding, but it will be interesting to watch whether other district courts follow suit. If so, this may be the next appeal in the Seagate-Halo line.

Blog Authors

Phillip W. Goter | Associate

Phillip Goter is an Associate in the Twin Cities office of Fish & Richardson. Phillip has litigated extensively in the computer software and hardware space, including GPS, Apps, computer and network security, wireless networking, home automation, and cloud computing. Phillip...

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