NDCA bars negative NPE terminology; allows product revenue and settlement agreements


The Northern District of California, in Finjan, Inc. v. Blue Coat Sys., Inc., Case No. 13-CV-03999-BLF (Judge Beth Labson Freeman) (July 8, 2015), ruled on a number of motions in limine. A few issues of interest were addressed in the order. First, the court granted plaintiff's motion to prevent use of the terms "patent troll" or "patent assertion entity." The court did note, however, that other courts have allowed "patent assertion entity." Slip op. at 3 note 1 (citing Digital Reg, 2014 WL 4090550, at *12; HTC Corp. v. Tech. Properties Ltd., No. 5:08-CV-00882-PSG, 2013 WL 4782598, at *4 (N.D. Cal. Sept. 6, 2013)). But this court declined to allow use of the term because (1) it carries "negative connotations similar to the term 'patent troll,'" and (2) there were disputes as to whether plaintiff was solely an assertion entity. Slip op. at 3 note 1.

Second, the court granted in part defendant's motion to exclude testimony about its financial size, market capitalization, acquisition costs, overall revenue for the company, and total revenues for the accused products. The court agreed with defendant that its financial size, market cap, and overall revenue were of "little probative value and would unfairly prejudice Defendant by skewing 'the damages horizon for the jury, regardless of the contribution of the patented component to this revenue.'" Slip op. at 7 (quoting Uniloc USA, Inc. v. Microsoft Corp., 632 F.3d 1292, 1320-21 (Fed. Cir. 2011)). However, the court allowed plaintiff to use accused product revenues and acquisition valuations because that information is relevant and probative if properly apportioned. Id. (citing Apple, Inc. v. Samsung Electronics Co., No. 11-CV-01846-LHK, 2014 WL 549324, at *7 (N.D. Cal. Feb. 7, 2014)).

Third, the court allowed three settlement agreements into evidence, finding that two of them had overlapping patents and the third concerned similar technology. "So long as the jury is provided evidence of these similarities and differences so that they may consider the relevance of the challenged settlement agreements for themselves, the agreements may properly be admitted into evidence." Slip op. at 8 (citing Virnetx, Inc. v. Cisco Sys., Inc., 767 F.3d 1308, 1331 (Fed. Cir. 2014)).