Trebling of jury verdict for ongoing royalty

On September 30, Judge Ward in the Eastern District of Texas entered an Order regarding supplemental damages following a jury verdict for Mondis against Innolux. At trial, the jury had awarded a 0.5% royalty for monitors and 0.75% royalty for televisions. For the ongoing royalty, however, the Court set the rate at 1.5% for monitors and 0.75% for televisions. The Court noted both Paice and Amado had stated that an ongoing royalty is within the discretion of the Court, and there is no agreed-upon methodology for determining the royalty. Judge Ward essentially followed what had been done in Affinity Labs, which was to perform a "new" Georgia-Pacific analysis, using the jury's verdict as a starting point and then adjusting the GP factors up or down as appropriate to account for differences between the pre-trial hypothetical negotiation date and the post-trial hypothetical negotiation date. While most of the factors stayed the same, or close to the same, in the Court's opinion, there was a substantial shift in the commercial success of the patented invention between the 2005 date relied upon by the jury and the 2011 date used by the Court - e.g., several licenses by the patentee, increase in the market for the infringing functionality, etc. Based on these findings, the Court bumped the 0.5% royalty for monitors up to 0.75%. Thereafter, the Court examined the import of willfulness to determine if - and by how much - to multiply the 0.75% rate. The Court held that any adjudged infringer, even if it planned to appeal, would meet the "reckless" standard, even if not the "intentional" or "knowing" standard. The Court noted it was in a difficult position to rate the strength of Innolux's appeals, but that by definition it would have to believe that Innolux's appeals would fail - otherwise, the Court would have granted Innolux's post-trial motions. The Court was disturbed by what it believed to be a disrespectful comment to a Chinese newspaper about the patent process, and accounted for that as well. In the end, the Court doubled the 0.75% rate to come to a final ongoing royalty of 1.5%.