Effective: November 29, 2000 United States Code Annotated

35 U.S.C.A. § 284 Page 1

Effective: November 29, 2000

United States Code Annotated Currentness Title 35. Patents (Refs & Annos) Part III. Patents and Protection of Patent Rights Chapter 29. Remedies for Infringement of Patent, and Other Actions (Refs & Annos) § 284. Damages

Upon finding for the claimant the court shall award the claimant damages adequate to compensate for the infringement, but in no event less than a reasonable royalty for the use made of the invention by the infringer, together with interest and costs as fixed by the court.

When the damages are not found by a jury, the court shall assess them. In either event the court may increase the damages up to three times the amount found or assessed. Increased damages under this paragraph shall not apply to provisional rights under section 154(d) of this title.

The court may receive expert testimony as an aid to the determination of damages or of what royalty would be reasonable under the circumstances.

CREDIT(S)

(July 19, 1952, c. 950, 66 Stat. 813; Nov. 29, 1999, Pub.L. 106-113, Div. B, § 1000(a)(9) [Title IV, § 4507(9)], 113 Stat. 1536, 1501A-566.)

HISTORICAL AND STATUTORY NOTES

Revision Notes and Legislative Reports

1952 Acts. Based on Title 35, U.S.C., 1946 ed., §§ 67 and 70, part (R.S. 4919 [derived from Act July 8, 1870, c. 230, § 59, 16 Stat. 207]; R.S. 4921 [derived from Act Jul 8, 1870, c. 230, § 55, 16 Stat. 206], amended (1) Mar. 3, 1897, c. 391, § 6, 29 Stat. 694, (2) Feb. 18, 1922, c. 58, § 8, 42 Stat. 392, (3) Aug. 1, 1946, c. 726, § 1, 60 Stat. 778).

The section consolidates the provisions relating to damages in R.S. 4919 and 4921 with some changes in language.

1999 Acts. Statement by President, see 1999 U.S. Code Cong. and Adm. News, p. 290.

Amendments

1999 Amendments. Pub.L. 106-113 [§ 4507(9)] added at the end of the second undesignated paragraph the following: “Increased damages under this paragraph shall not apply to provisional rights under section 154(d) of this title.”

Effective and Applicability Provisions

1999 Acts. Amendment by Pub.L. 106-113, Div. B, § 1000(a)(9) [Title IV, § 4507(9)], effective Nov. 29, 2000, and applicable to all applications filed on or after that date (including international applications designating the United States); patents resulting from an international application filed before November 29, 2000 and applications published pursuant to 35 U.S.C.A 122(b) or Article 21(2) of the treaty defined in 35 U.S.C.A § 351(a) resulting from an international application filed before November 29, 2000 shall not be effective as prior art as of the filing date of the international application, but such patents shall be effective as prior art in accordance with 35 U.S.C.A. § 102(e) in effect on November 28, 2000, and all applications complying with 35 U.S.C.A. § 371 that resulted from international applications filed on or after that date, see Pub.L. 106-113, Div. B, § 1000(a)(9) [Title IV, § 4508], as amended, set out as a note under 35 U.S.C.A. § 10.

CROSS REFERENCES

Action for infringement of patent, see 35 USCA § 281. Attorney fees awarded in action for-- Copyright infringement, see 17 USCA § 505. Patent infringement, see 35 USCA § 285. Costs of previously dismissed action, see Fed.Rules Civ.Proc. Rule 41, 28 USCA. Damages in copyright infringement action, see 17 USCA § 504. Deductions for damages sustained as result of patent infringement, see 26 USCA § 186. Effect of rule 54 on former § 67 of this title, see Fed.Rules Civ.Proc. Rule 54, 28 USCA. Fees and allowances to witnesses, see 28 USCA § 1821 et seq. Judgment and costs, see Fed.Rules Civ.Proc. Rule 54, 28 USCA. Offer of judgment, see Fed.Rules Civ.Proc. Rule 68, 28 USCA. Taxation of costs, generally, see 28 USCA § 1920 et seq. Uruguay Round Agreements contents and term of patent and remedies, see 35 USCA § 154.

LAW REVIEW COMMENTARIES

Arbitration of patent disputes: An important option in the age of information technology. Note, 4 Ford- ham Intell.Prop.Media & Ent.L.J. 599 (1993).

At the end of the second rainbow. N. Richard Powers, 7 Del.Law. 18 (1989).

Compiled legislative history of 35 U.S.C. 284: The patent compensation statute. Vincent P. Tassinari, 31 UWLA L.Rev. 45 (2000).

Federal circuit: A case study in specialized courts. Rochelle Cooper Dreyfuss, 64 N.Y.U.L.Rev. 1 (1989).

Grain Processing and Crystal Semiconductor: Use of economic methods in damage calculations will accurately compensate for patent infringement. Liane M. Peterson, 13 Fed. Circuit B.J. 41 (2003).

How to avoid increased damages and attorneys' fees: The duties of the accused infringer and the patent

owner. Kirk M. Hartung, 20 J.Marshall L.Rev. 433 (1987).

Intellectual property rights in software--A look at the basics. David R. Syrowik, 65 Mich.B.J. 292 (1986).

Law and economics of patent infringement damages. Mark A. Glick, 10 Utah B.J. 11 (March 1997).

Let the games begin: Incentives to innovation in the new economy of Intellectual Property law. Amy L. Landers, 46 Santa Clara L. Rev. 307 (2006).

Patent infringement and future lost profits damages. Christopher D. Marchese, 26 Ariz.St.L.J. 747 (1994).

Patent law developments in the United States Court of Appeals for the Federal Circuit during 1986. Douglas R. Strawbridge, Daniel W. McDonald, and R. Carl Moy, 36 Am.U.L.Rev. 861 (1987).

Quiet revolution in patents. Alfred J. Mangels, 43 J.Mo.B. 545 (1987).

Reasonable royalty damages and the ambitious patentee Georgia-Pacific revisited. Jerald E. Rosenblum, 78 J.Pat. & Trademark Off.Soc'y 581 (1996).

Recent developments in patent law--decisions by the U.S. Court of Appeals for the Federal Circuit. Gale R. Peterson and Derrick A. Pizarro, 11 Tex. Intell. Prop. L.J. 483 (2003).

Research tool patents: Judicial remedies. Donald R. Ware, 30 AIPLA Q.J. 267 (2002).

Rite-Hite Corp. v. Kelley Co.: Federal Circuit awards damages for harm done to a patient not in suit. 27 Loy.U.Chi.L.J. 665 (1996).

Software Patent Institute and the challenge of software-related patents. David R. Syrowik and Roland J. Cole, 73 Mich.B.J. 544 (1994).

The market share rule with price erosion: Patent infringement lost profits damages after Crystal. Roy J. Epstein, 31 AIPLA Q.J. 1 (2003).

Understanding and addressing the unfair dilemma created by the doctrine of willful patent infringement. William F. Lee and Lawrence P. Cogswell, III, 41 Hous. L. Rev. 393 (2004).

LIBRARY REFERENCES

American Digest System

Patents 275, 318, 319. Key Number System Topic No. 291.

RESEARCH REFERENCES

ALR Library

27 ALR, Fed. 2nd Series 151, Construction and Application of Patent Act--United States Supreme Court Cases.

97 ALR, Fed. 694, Jurisdiction of United States Court of Appeals for Federal Circuit Under 28 U.S.C.A. §§ 1292 and 1295.

91 ALR, Fed. 839, Interest on Award of Damages and Profits for Federal Copyright Infringement.

79 ALR, Fed. 532, Propriety of Ordering Separate Trials as to Liability and Damages, Under Rule 42(B) of Fed- eral Rules of Civil Procedure, in Actions Involving Patents and Copyrights.

66 ALR, Fed. 186, Factors to be Considered in Determining a “Reasonable Royalty” for Purposes of Calculating Damages for Patent Infringement Under 35 U.S.C.A. § 284.

59 ALR, Fed. 154, Willful and Deliberate Infringement as Rendering Patent Case “Exceptional” for Purposes of 35 U.S.C.A. § 285, Providing that in Exceptional Cases Court May Award Reasonable Attorneys' Fees to Pre- vailing...

41 ALR, Fed. 959, Interlocutory Appeals in Patent Cases Under 28 U.S.C.A. § 1292(A)(4).

35 ALR, Fed. 551, Laches as Defense in Patent Infringement Suit.

18 ALR, Fed. 690, Right to Jury Trial in Patent Infringement Action in Federal Court.

9 ALR 5th 63, Right to Prejudgment Interest on Punitive or Multiple Damages Awards.

6 ALR 5th 883, Release of One Joint Tortfeasor as Discharging Liability of Others Under Uniform Contribution Among Tortfeasors Act and Other Statutes Expressly Governing Effect of Release.

16 ALR 4th 11, Liability Insurance Coverage as Extending to Liability for Punitive or Exemplary Damages.

22 ALR 3rd 563, Power of Federal Courts of Appeals to Transfer Cases Between Circuits.

66 ALR 2nd 606, Assignability of Licensee's Rights Under Patent Licensing Contract.

134 ALR 1225, Comment Note.--Release of One of Two or More Presons Whose Independent Tortious Acts Combine to Produce an Injury as Releasing Other or Others.

91 ALR 884, Motion for Summary Judgment as Searching Record.

87 ALR 1205, Declaration of Rights or Declaratory Judgments.

52 ALR 197, Interest on Claim for Legal Services.

Encyclopedias

26 Am. Jur. Proof of Facts 3d 119, Lost Profits Resulting from Tortious Injury to Business.

64 Am. Jur. Proof of Facts 3d 1, Proof of Patentability and Nonpatentability of Method of Electronic Commerce.

84 Am. Jur. Proof of Facts 3d 243, Establishing Liability for Infringement of a Utility Patent.

88 Am. Jur. Proof of Facts 3d 75, Establishing Liability for Infringement of a Plant Patent.

89 Am. Jur. Proof of Facts 3d 1, Establishing the Defense of Issue Preclusion in a Subsequent Patent Infringe- ment Suit.

94 Am. Jur. Proof of Facts 3d 179, Establishing Liability of a Generic Drug Manufacturer for Inducing Patent Infringement.

96 Am. Jur. Proof of Facts 3d 1, Establishing the Defense of Patent Invalidity.

54 Am. Jur. Trials 261, Defending the Software Infringement Case.

56 Am. Jur. Trials 293, A Guide to the Federal Rules of Civil Procedure.

Am. Jur. 2d Patents § 776, Remedies and Amount of Recovery; Attorney's Fees.

Am. Jur. 2d Patents § 811, Governmental Bodies.

Am. Jur. 2d Patents § 909, Expert Testimony.

Am. Jur. 2d Patents § 960, Increased Damages for Willful Infringement.

Am. Jur. 2d Patents § 962, Accounting Procedure.

Am. Jur. 2d Patents § 963, Accounting Procedure--Award of Interest.

Forms

Federal Procedural Forms § 19:137, Complaint--To Enjoin and Recover Damages for Infringement of Patent by Receiver [28 U.S.C.A. §§ 754, 959(A), 1338(A), 1400(B), 35 U.S.C.A. § 281; Fed. R. Civ. P. 66].

Federal Procedural Forms § 52:316, Complaint--For Infringement of Patent--General Form [28 U.S.C.A. § 1338(A); Fed. R. Civ. P. 8(A), 65].

Federal Procedural Forms § 52:317, Complaint--For Infringement of Patent--Injunction and Damages--Patent Owned by Merged Corporations [28 U.S.C.A. §§ 1338(A), 1400(B); 35 U.S.C.A. §§ 271, 281, 283 to 285; Fed. R. Civ. P....

Federal Procedural Forms § 52:318, Complaint--For Infringement of Patent--Injunction and Damages--Trade Dress and Product Imitation Infringement [28 U.S.C.A. §§ 1338(A), 1400(B); 35 U.S.C.A. §§ 271, 281, 283 to 285; Fed....

Federal Procedural Forms § 52:319, Complaint--For Infringement of Patent--Inducement of Infringement [28 U.S.C.A. §§ 1338(A), 1400(B); 35 U.S.C.A. §§ 271, 281, 283 to 285; Fed. R. Civ. P. 8(A), 65].

2A West's Federal Forms § 1750, Introduction--Damages.

2A West's Federal Forms § 1755, Count for Infringement--Making Device and Shipping to Foreign Countries.

1AA West's Federal Forms § 502, Interest--General Comment.

Am. Jur. Pl. & Pr. Forms Patents § 20, Complaint in Federal Court--United States District Court--Infringement of Patent--General Form.

Am. Jur. Pl. & Pr. Forms Patents § 23, Complaint in Federal Court--United States District Court--Infringement of Patent--Against Former Employees.

Am. Jur. Pl. & Pr. Forms Patents § 24, Complaint in Federal Court--United States District Court--Infringement of Patent--For Injunction and Damages--Patent Owned by Merged Corporation.

Am. Jur. Pl. & Pr. Forms Patents § 25, Complaint in Federal Court--United States District Court--Infringement of Patent--Inducement of Infringement.

Am. Jur. Pl. & Pr. Forms Patents § 26, Complaint in Federal Court--United States District Court--By Web De- veloper--Against Internet Service Provider--For Patent Infringement--Use of Design to Facilitate Web...

Am. Jur. Pl. & Pr. Forms Receivers § 357, Complaint, Petition, or Declaration--To Enjoin and Recover Damages for Infringement of Patent by Receiver.

American Jurisprudence Legal Forms 2d § 196:54, Annotation References.

Treatises and Practice Aids

Eckstrom's Licensing in Foreign & Domestic Ops. § 4:31, Remedies--Damages.

Eckstrom's Licensing in Foreign & Domestic Ops. § 4:32, Remedies--Increased Damages.

Eckstrom's Licensing in Foreign & Domestic Ops. § 4:33, Remedies--Prejudgment Interest.

Eckstrom's Licensing in Foreign & Domestic Ops. § 8C:43, Patent Reexamination--Effect on Litigation.

Eckstrom's Licensing in Foreign & Domestic Ops. App. 8A-D, Uniform Trade Secrets Act (With Prefatory Note and Comments) Drafted by the National Conference of Commissioners on Uniform State Laws.

Eckstrom's Licensing in Foreign & Domestic Ops. § 13:29.50, Damages for Patent Infringement.

Federal Procedure, Lawyers Edition § 60:911, Remedies and Amount of Recovery.

Federal Procedure, Lawyers Edition § 60:1044, Survival of Action; Substitution of Parties.

Federal Procedure, Lawyers Edition § 60:1103, Expert Testimony.

Federal Procedure, Lawyers Edition § 60:1154, Generally; Reasonable Royalty.

Federal Procedure, Lawyers Edition § 60:1156, Increased Damages for Willful Infringement.

Federal Procedure, Lawyers Edition § 60:1157, Accounting Procedure.

Federal Procedure, Lawyers Edition § 60:1158, Accounting Procedure--Award of Interest.

Federal Procedure, Lawyers Edition § 60:1159, Costs.

Patent Damages Law and Practice § 1:1, Overview of Damages Available Under the 1952 Patent Act.

Patent Damages Law and Practice § 1:3, Overview of Basic Damages Theories--“Lost Profits” and “Reasonable Royalty”.

Patent Damages Law and Practice § 2:1, Introduction to Lost Profits.

Patent Damages Law and Practice § 3:2, Introduction--Patent Damages: “Adequate to Compensate”.

Patent Damages Law and Practice § 3:3, Introduction--Burden of Proof.

Patent Damages Law and Practice § 3:4, Analytical Approach.

Patent Damages Law and Practice § 3:9, “Willing Licensor-Willing Licensee” Fiction--Existence of an Estab- lished Royalty for the Patent in Suit--Law Before the Advent of “Reasonable Royalties”.

Patent Damages Law and Practice § 4:1, Introduction.

Patent Damages Law and Practice § 1:16, Costs.

Patent Damages Law and Practice § 1:19, Enhancement of Damages: Willful Infringement--Punitive Nature of Enhanced Damages and the Court's Discretion.

Patent Damages Law and Practice § 2:23, Proving Entitlement to Lost Profits Damages--Causation and the “But For” Standard.

Patent Damages Law and Practice § 2:74, Special Case of Future Lost Profits Damages--Raising the Evidentiary Threshold for Future Lost Profits.

Patent Damages Law and Practice § 4:26, Determining the Amount of Enhanced Damages.

Patent Damages Law and Practice § 7:12, Discovery Forms--Sample Discovery Requests from the Patent Own- er--Requests for Production of Documents and Things.

Patent Damages Law and Practice § 7:15, Discovery Forms--Sample Discovery Requests from the Patent Own- er--Interrogatories.

Patent Damages Law and Practice § 7:16, Discovery Forms--Sample Discovery Requests from the Patent Own- er--Requests for Production of Documents and Things.

Patent Damages Law and Practice § 7:20, Sample Jury Instructions for Patent Damages--Damages Instructions- -Patent Damages Instructions: General.

Patent Damages Law and Practice § 7:37, Sample Jury Instructions for Patent Damages--Damages Instructions- -Patent Damages: Reasonable Royalty.

Patent Damages Law and Practice App B1, Detailed Federal Circuit Case Summaries.

Patent Damages Law and Practice § 3:19.50, The Opinion of Qualified Experts.

Patent Damages Law and Practice § 4:13.50, Costs--Quick Summary.

Patent Law Fundamentals § 1:20, Duration of Patents.

Patent Law Fundamentals § 4:22, Remedies.

Patent Law Fundamentals § 18:18, Government Access to Privately Owned Inventions--Adjudication of Claims Against the United States for Intellectual Property Infringement.

Patent Law Fundamentals § 19:16, Patent and Invention Development Agreements--Royalties--Royalty Rates and Royalty Bases.

Patent Law Fundamentals § 20:54, Damages.

Patent Law Fundamentals § 20:55, Damages--Compensatory Damages.

Patent Law Fundamentals § 20:56, Damages--Compensatory Damages--Direct Damages--Measured by Patent Owner's Lost Profits.

Patent Law Fundamentals § 20:57, Damages--Compensatory Damages--Direct Damages--Measured by a Reas- onable Royalty.

Patent Law Fundamentals § 20:59, Damages--Compensatory Damages--Direct Damages--Measured by a Reas- onable Royalty--Hypothetical Negotiations.

Patent Law Fundamentals § 20:61, Damages--Compensatory Damages--Direct Damages--Additional Remedy in the Case of a Design Patent.

Patent Law Fundamentals § 20:63, Damages--Compensatory Damages--Interest on Damages Award.

Patent Law Fundamentals § 20:64, Damages--Exemplary (Punitive) Damages.

Patent Law Fundamentals § 20:67, Costs.

Patent Law Fundamentals § 15:128, Extension of Patent Term Due to Prosecution Delay.

Patent Law Fundamentals § 20:116, Federal Court Appellate Jurisdiction--Scope of Appellate Review.

Patent Law Fundamentals App. 4(D), Uniform Trade Secrets Act (With 1985 Amendments).

Restatement (Third) of Restitution § 42, Interference With Intellectual Property and Similar Rights.

Trade Secrets Law App A1, 1979 Uniform Trade Secrets Act: With Prefatory Note and Comments.

Trade Secrets Law App A2, State Trade Secret Statutes--Variations on the Uniform Act.

West's Federal Administrative Practice § 3930, Effect of Early Filing of Patent Application.

West's Federal Administrative Practice § 3953, Infringement--Lack of Knowledge or Intent is Immaterial.

West's Federal Administrative Practice § 3954, Infringement--Must Occur During Term of Patent.

West's Federal Administrative Practice § 3956, Infringement--Remedies.

9 Wright & Miller: Federal Prac. & Proc. § 2312, Particular Cases and Issues--Patents and Copyrights.

NOTES OF DECISIONS

I. GENERALLY 1-70 II. DAMAGES 71-210 III. COSTS 211-260

I. GENERALLY

Admissibility of evidence 35 Burden of proof 32 Causation 12 Clearly erroneous findings, review 45 Commercial success, defenses 15 Constitutionality 2 Corporations 10 Counterclaims 26 Covenants not to sue 7 Defenses 14-21 Defenses - Generally 14 Defenses - Commercial success 15 Defenses - Estoppel 16 Defenses - Failure to sue 17 Defenses - Good faith 18 Defenses - Misrepresentations 19 Defenses - Noninfringement 20 Defenses - Profits by patentee 21 Degree of proof 34 Discovery 29 Dismissal 27 Estoppel, defenses 16 Expert witnesses 37 Failure to sue, defenses 17 Good faith, defenses 18 Government liability 11 Inconsistent findings, review 46 Inferences 31 Instructions 39 Law governing 4 Law of the case 48 Misrepresentations, defenses 19 Moot questions, review 44 Nature of section 6 Noninfringement, defenses 20 Persons entitled to sue 8 Persons liable 9 Pleadings 25 Post judgment infringement 42 Power of Congress 5 Presumptions 30 Prior law 1 Prior litigation 23 Profits by patentee, defenses 21 Purpose 3

Questions of fact 38 Rehearing 40 Release 22 Remand 49 Res judicata 24 Review 43-47 Review - Generally 43 Review - Clearly erroneous findings 45 Review - Inconsistent findings 46 Review - Moot questions 44 Review - Sufficiency of evidence 47 Shifting of burden of proof 33 Stay of proceedings 41 Sufficiency of evidence 36 Sufficiency of evidence, review 47 Summary judgment 28 Survival or abatement of action 13

1. Prior law

Former §§ 67 and 70 of this title made no change in the rule of damages established in actions at law. McCune v. Baltimore & O R Co, C.C.A.3 (Pa.) 1907, 154 F. 63, 83 C.C.A. 175, certiorari denied 28 S.Ct. 255, 207 U.S. 588, 52 L.Ed. 353.

2. Constitutionality

This section, authorizing trial judge to increase damages up to three times the amount found by jury or assessed by trial judge in timely infringement action, does not deny any right to jury trial under U.S.C.A. Const. Amend. 7. Swofford v. B & W, Inc., C.A.5 (Tex.) 1964, 336 F.2d 406, 142 U.S.P.Q. 291, certiorari denied 85 S.Ct. 653, 379 U.S. 962, 13 L.Ed.2d 557, 144 U.S.P.Q. 780. Jury 31.2(1)

The provision of former § 70 of this title, which authorized increased damages, did not violate U.S.C.A. Const. Amend. 7. Filer & Stowell Co. v. Diamond Iron Works, C.C.A.7 (Wis.) 1921, 270 F. 489, certiorari denied 41 S.Ct. 533, 256 U.S. 691, 65 L.Ed. 1174.

3. Purpose

Primary purpose of compensatory damages in patent infringement action is to return patent owner to financial position owner would have occupied but for infringement. Carborundum Co. v. Molten Metal Equipment Innov- ations, Inc., C.A.Fed. (Ohio) 1995, 72 F.3d 872, 37 U.S.P.Q.2d 1169. Patents 319(1)

Patent statute provision permitting “damages adequate to compensate” provides economic redress sufficient to restore patentee to its rightful position absent infringement. King Instruments Corp. v. Perego, C.A.Fed. (Mass.) 1995, 65 F.3d 941, 36 U.S.P.Q.2d 1129, rehearing denied, in banc suggestion declined 72 F.3d 855, certiorari denied 116 S.Ct. 1675, 517 U.S. 1188, 134 L.Ed.2d 778. Patents 319(1)

The goal of assessing royalties in patent infringement cases is to place plaintiff in same position it would have

been in if patent had not been infringed. Devex Corp. v. General Motors Corp., C.A.3 (Del.) 1981, 667 F.2d 347, 212 U.S.P.Q. 643, certiorari granted 102 S.Ct. 2267, 456 U.S. 988, 73 L.Ed.2d 1283, certiorari denied 102 S.Ct. 2270, 456 U.S. 990, 73 L.Ed.2d 1285, rehearing denied 106 S.Ct. 212, 474 U.S. 890, 88 L.Ed.2d 181, affirmed 103 S.Ct. 2058, 461 U.S. 648, 76 L.Ed.2d 211, 217 U.S.P.Q. 1185. Patents 319(1)

Enhancement provision of this section is designed to permit adequate compensation for an infringement where strict legal rules would not afford it. Trio Process Corp. v. L. Goldstein's Sons, Inc., C.A.3 (Pa.) 1981, 638 F.2d 661. Patents 319(3)

The purpose of an award of damages for patent infringement is to give the plaintiff reasonable and full compensation for the loss incurred because of the infringement. Milgo Electronic Corp. v. United Business Communica- tions, Inc., C.A.10 (Kan.) 1980, 623 F.2d 645, 206 U.S.P.Q. 481, certiorari denied 101 S.Ct. 794, 449 U.S. 1066, 66 L.Ed.2d 611, 208 U.S.P.Q. 376. Patents 319(1)

Since the purpose of amendment by Act Aug. 1, 1946, c. 726, § 1, 60 Stat. 778, to former § 70 of this title which related to damages for infringement of a valid patent was only to eliminate an infringer's profit as an element of a patentee's recovery, the rules having allowed a patentee to recover his gross established royalty with interest from date payment should have been made still applied. Marvel Specialty Co., Inc. v. Bell Hosiery Mills, Inc., C.A.4 (N.C.) 1967, 386 F.2d 287, 155 U.S.P.Q. 545, certiorari denied 88 S.Ct. 1409, 390 U.S. 1030, 20 L.Ed.2d 286, 157 U.S.P.Q. 720. Patents 318(1)

Congress' overriding purpose in enacting statute setting forth standard for damages for patent infringement was to allow patent owners complete compensation. Mil-Tec USA, Inc. v. ABC Tool, Inc., M.D.Fla.1996, 939 F.Supp. 853, reconsideration denied 1997 WL 201716. Patents 319(1)

This section requiring award adequate to compensate for infringement of patent and no less than reasonable royalty for use made of invention by infringer was intended to afford fair compensation in cases where victimized patentee is unable to prove that he lost a measurable amount of profits as result of the infringement and this section provides alternative way of recovering general compensatory damages. Georgia-Pacific Corp. v. U. S. Ply- wood Corp. (State Report Title: Georgia-Pacific Corp. v. U.S. Plywood-Champion Papers Inc.), S.D.N.Y.1970, 318 F.Supp. 1116, 166 U.S.P.Q. 235, modified 446 F.2d 295, 170 U.S.P.Q. 369, certiorari denied 92 S.Ct. 105, 404 U.S. 870, 30 L.Ed.2d 114, 171 U.S.P.Q. 322. Patents 319(1)

The sole object of the provision of former § 70 of this title which related to profits was to enable the patentee to recover, by suit in equity, not only the profits made by the defendant, but also damages sustained by the patentee. Bancroft v. Acton, C.C.N.Y.1870, 2 F.Cas. 578, No. 833.

4. Law governing

Interest on amount of damages allowed in patent case, as for nonpayment of patent license royalties, should follow state rule as to legal rate. Hope Basket Co. v. Product Advancement Corp., W.D.Mich.1952, 104 F.Supp. 444, 93 U.S.P.Q. 94. Federal Courts 415

5. Power of Congress

The provision of former § 70 of this title which authorized courts of equity to increase the damages beyond the amount awarded as compensatory, was within the power of Congress. Taylor v. Ford Motor Co., N.D.Ill.1924, 2

F.2d 473.

6. Nature of section

The provisions of former § 67 of this title which permitted recovery of treble damages for infringement were remedial. Perkins Oil Well Cementing Co. v. Owen, S.D.Cal.1923, 293 F. 759.

Suit for damages for infringement of patent, past or present, was not an action for penalty, even though Congress allowed court to assess additional damages not to exceed double the amount actually suffered. Armstrong v. Al- len B. Du Mont Laboratories, D.C.Del.1955, 137 F.Supp. 659, 108 U.S.P.Q. 70. Patents 280

Former § 70 of this title, which related to damages for patent infringement, was not penal but remedial and damages contemplated may have been awarded whether wrong was intentional or unwitting. Activated Sludge v. Sanitary Dist. of Chicago, N.D.Ill.1946, 64 F.Supp. 25, 68 U.S.P.Q. 137, affirmed 157 F.2d 517, 71 U.S.P.Q. 316, certiorari denied 67 S.Ct. 970, 330 U.S. 834, 91 L.Ed. 1281, 72 U.S.P.Q. 529, rehearing denied 67 S.Ct. 1092, 330 U.S. 856, 91 L.Ed. 1297, 72 U.S.P.Q. 529, rehearing denied 67 S.Ct. 1347, 331 U.S. 866, 91 L.Ed. 1870. Patents 319(1)

7. Covenants not to sue

Whether breach of covenant not to sue for patent infringement gives rise to claim for damages is within compet- ence of federal judiciary to determine as a matter of federal law. Artvale, Inc. v. Rugby Fabrics Corp., C.A.2 (N.Y.) 1966, 363 F.2d 1002, 150 U.S.P.Q. 401. Federal Courts 429

8. Persons entitled to sue

Where valid patent claim had been infringed by defendant, patent assignee and his licensee had right to full recovery of damages and other assessable items in infringement action and were entitled to be heard on such issues as justification for increasing damages under this section, interest, costs and disbursements, and attorney's fees, all of which are proper subject for an accounting whether taken by court or master. J. R. Clark Co. v. Jones & Laughlin Steel Corp., S.D.Ind.1960, 186 F.Supp. 22, 125 U.S.P.Q. 433, affirmed 288 F.2d 279, 129 U.S.P.Q. 97, certiorari denied 82 S.Ct. 49, 368 U.S. 828, 7 L.Ed.2d 32, 131 U.S.P.Q. 498. Patents 325.11(5)

Patent infringement suit brought by licensee as assignee of all patentee's rights would not be dismissed on ground that plaintiff did not have all rights therein but was limited to a certain field and defendant had been put to unnecessary expense by reason thereof, but charge of infringement would be limited accordingly and question of expense would be considered on final event of suit as bearing upon question of costs. Woburn Degreasing Co of N J v. Spencer Kellogg & Sons, W.D.N.Y.1942, 46 F.Supp. 959. Patents 313

9. Persons liable

Nonmanagement, salaried employee of infringing corporation could not be held individually liable for infringement of patent claim regarding piston device, particularly since there had been no contention that the individual enjoyed profits or derived distinct benefits from the infringement separate from those of any other salaried employee. Wilden Pump & Engineering Co. v. Pressed & Welded Products Co., C.A.9 (Cal.) 1981, 655 F.2d 984, 213 U.S.P.Q. 282, on remand 570 F.Supp. 224, 224 U.S.P.Q. 1074. Patents 287(6)

Patent owner has a cause of action, independent from that against an infringing manufacturer, to recover profits

and damages and to restrain one who resells a product purchased from an infringing manufacturer. Triangle Conduit & Cable Co. v. National Electric Products Corporation, C.C.A.3 (Del.) 1943, 138 F.2d 46, certiorari denied 64 S.Ct. 191, 320 U.S. 784, 88 L.Ed. 471. See, also, American Chemical Paint Co. v. Thompson Chemic- al Corp., C.A.Cal.1957, 244 F.2d 64. Patents 280

Both damages and profits are recoverable from infringers, but they are recoverable on different grounds, and the recovery of profits from one joint infringer does not preclude the recovery of damages from another. Dowagiac Mfg. Co. v. Deere & Webber Co., C.C.A.8 (Minn.) 1922, 284 F. 331. Patents 327(15)

Corporate officers who willfully and knowingly participate in, induce and approve acts of patent infringement are personally liable. Thompson Tool Co., Inc. v. Rosenbaum, D.C.Conn.1977, 443 F.Supp. 559. Patents 287(6)

Where members of controlling family of infringing corporation were not found personally liable for the acts of infringement, no more than a very minor portion of the salaries and contributions to the profit-sharing accounts of the family could be attributed to infringing sales, none of payments were in excess of limits prescribed by the internal revenue laws and all were in return for services rendered to the corporation, fact that substantial financial payments were made by the corporation to the profit-sharing and pension accounts of members of the controlling family did not warrant treating the infringing corporation as a de facto partnership for purposes of awarding damages for patent infringement. Jenn-Air Corp. v. Penn Ventilator Co., Inc., E.D.Pa.1975, 394 F.Supp. 665, 185 U.S.P.Q. 410. Patents 319(1)

10. Corporations

Parent's willful patent infringement would be imputed to wholly owned subsidiary, even though parent was not party to patent infringement action against subsidiary; subsidiary's board of directors was composed of members who each held high ranking position with parent during period of infringement and subsidiary was exclusive seller of parent's products in United States. Afros S.P.A. v. Krauss-Maffei Corp., D.Del.1987, 671 F.Supp. 1458, 5 U.S.P.Q.2d 1145. Patents 287(5)

11. Government liability

In a suit for infringement of a patent against United States officers, who used the patented article only for the benefit of the United States, a decree cannot be rendered against such officers for the gains and profits which accrued to the government from the use of such article. Belknap v. Schild, U.S.Cal.1896, 16 S.Ct. 443, 161 U.S. 10, 40 L.Ed. 599. Patents 287(4); Patents 316

Owner of valid and infringed patent was entitled to reasonable and entire compensation for the unauthorized use by government. Bowser, Inc. v. U. S., Ct.Cl.1967, 388 F.2d 346, 181 Ct.Cl. 834, 156 U.S.P.Q. 406. United States 97

Where government infringer was an old customer of the patentee, it is properly deductible that the patentee, by reason of the infringement, lost the sale of his own apparatus. Waite v. U.S., Ct.Cl.1930, 69 Ct.Cl. 153, certiorari granted 51 S.Ct. 21, 282 U.S. 817, 75 L.Ed. 731, reversed 51 S.Ct. 227, 282 U.S. 508, 75 L.Ed. 494. Patents 312(1.1)

12. Causation

Prevailing patent infringement plaintiff can show “but for” causation of its damages, for purpose of recovering lost profits, by demonstrating (1) demand for patented product, (2) absence of acceptable noninfringing alternatives, (3) marketing and manufacturing capability to exploit demand, and (4) amount of profit it would have made but for infringement. Biacore v. Thermo Bioanalysis Corp., D.Del.1999, 79 F.Supp.2d 422, affirmed 30 Fed.Appx. 994, 2002 WL 418166. Patents 318(4.2)

To show that infringement caused loss of profits, patent owner may proffer evidence satisfying either four-part test, whereby it must prove demand for patented product, marketing and manufacturing capability to exploit that demand, absence of acceptable noninfringing substitutes, and amount of profit patent owner would have made, or two-supplier market test, whereby patent owner must show that infringer was only other supplier of patented product. Ristvedt-Johnson, Inc. v. Brandt, Inc., N.D.Ill.1992, 805 F.Supp. 557. Patents 318(1)

Lost profit award in infringement action requires showing that patent holder would have made sale but for infringement, i.e., causation existed, and proper evidence for computation of loss of profits; evidence that shows reasonable possibility that patent holder would have made infringing sales made by infringer will suffice, and patent holder need not prove causation as absolute certainty. Standard Havens Products, Inc. v. Gencor Indus- tries, Inc., C.A.Fed. (Mo.) 1991, 953 F.2d 1360, 21 U.S.P.Q.2d 1321, rehearing denied, rehearing in banc declined, certiorari denied 113 S.Ct. 60, 506 U.S. 817, 121 L.Ed.2d 28, on remand 810 F.Supp. 1072, 25 U.S.P.Q.2d 1949. Patents 312(10); Patents 318(1)

In patent infringement action in two-supplier market, lost profits damages may be in form of diverted sales, eroded prices or increased expenses, but patent owner must establish causation between his lost profits and infringement; patent owner's burden of proof is not absolute, but is burden of reasonable probability. Lam, Inc. v. Johns-Manville Corp., C.A.Fed.1983, 718 F.2d 1056, 219 U.S.P.Q. 670. Patents 312(10); Patents 318(3)

To be entitled to damages beyond a reasonable or established royalty, patent owner must prove his actual damages caused by illicit competition of infringer and must establish factual basis for causation, i.e., that, but for the infringer's improper acts, he would have made greater sales, charged higher prices, or incurred lower expenses. Scripto-Tokai Corp. v. Gillette Co., C.D.Cal.1992, 788 F.Supp. 439, 22 U.S.P.Q.2d 1678. Patents 319(1)

Lost profits award is appropriate only if patent owner can prove that there was reasonable probability that “but for” infringement, it would have made infringer's sales; “but for” causation may be established by proof of demand for patented product, absence of acceptable noninfringing substitutes, manufacturing and marketing capability to exploit demand, and amount of profit patent owner would have made. Kearns v. Chrysler Corp., C.A.Fed. (Mich.) 1994, 32 F.3d 1541, 31 U.S.P.Q.2d 1746, rehearing denied, in banc suggestion declined , certiorari denied 115 S.Ct. 1392, 514 U.S. 1032, 131 L.Ed.2d 244, certiorari denied 115 S.Ct. 1393, 514 U.S. 1032, 131 L.Ed.2d 244. Patents 319(1)

To recover lost profits as opposed to royalties, patent owner must prove causal relation between infringement and its loss of profits; patent owner must show that “but for” the infringement, it would have made infringer's

sales. BIC Leisure Products, Inc. v. Windsurfing Intern., Inc., C.A.Fed. (N.Y.) 1993, 1 F.3d 1214, 27 U.S.P.Q.2d 1671, rehearing denied, on remand 850 F.Supp. 224, 30 U.S.P.Q.2d 1949, reconsideration denied. Patents 318(1)

Generally accepted, though not exclusive, manner that patentee can establish “but for” causation entitling it to lost profits in infringement case is four-factor test, requiring patentee to establish: demand for patented product; absence of acceptable non-infringing substitute; patentee's manufacturing and marketing capability to exploit demand; and amount of profit patentee would have made. Stryker Corp. v. Intermedics Orthopedics, Inc., E.D.N.Y.1995, 891 F.Supp. 751, affirmed 96 F.3d 1409, 40 U.S.P.Q.2d 1065, rehearing denied , in banc suggestion declined. Patents 318(4.1)

To recover lost profits for patent infringement, as opposed to reasonable royalty, patent owner must prove causal relationship between infringement and its loss of profit; to prove such causal relationship, patent owner must show reasonable probability that but for infringement, patent owner would have made infringer's sales. GNB Battery Technologies, Inc. v. Exide Corp., D.Del.1995, 886 F.Supp. 420, affirmed 78 F.3d 605, 38 U.S.P.Q.2d 1506. Patents 318(1)

To recover damages on theory of lost profits, patentee must show that, but for infringement, it would have made infringer's sales; this requirement of causation implicates patentee's manufacturing capacity and marketing capability, desires of customers for claimed invention, relationship of invention to products sold, and other factors pertinent to particular market of parties. Micro Motion, Inc. v. Kane Steel Co., Inc., C.A.Fed. (N.J.) 1990, 894 F.2d 1318, 13 U.S.P.Q.2d 1696. Patents 318(1)

13. Survival or abatement of action

Suit for damages by patentee for prior infringement on expired patents, survived his death and could be maintained by his executrix, and consequently causes of action for injunctive process and past infringement instituted by patentee prior to his death on patent which had not expired, also survived. Armstrong v. Allen B. Du Mont Laboratories, D.C.Del.1955, 137 F.Supp. 659, 108 U.S.P.Q. 70. Patents 284

Fact that this section grants right of assessment of treble damages for infringement does not make an action on this section a penal one so that the death of a party extinguishes the right thereon. Armstrong v. Emerson Radio & Phonograph Corp., S.D.N.Y.1955, 132 F.Supp. 176, 106 U.S.P.Q. 404. Patents 280; Patents 284

14. Defenses--Generally

Existence of substantial defense to patent infringement is not per se sufficient to defeat liability for willful infringement. Knorr-Bremse Systeme Fuer Nutzfahrzeuge GmbH v. Dana Corp., C.A.Fed. (Va.) 2004, 383 F.3d 1337, 72 U.S.P.Q.2d 1560, on remand 372 F.Supp.2d 833, 76 U.S.P.Q.2d 1239. Patents 227

No recovery can be had of damages unless the plaintiff could have recovered such damages in an action at law. Van Kannell Revolving Door Co. v. Revolving Door & Fixture Co., S.D.N.Y.1920, 293 F. 261.

Where the owner of a patent has for years permitted its infringement, in a subsequent suit against another infringer he is not entitled to recover profits and damages. Marconi Wireless Telegraph Co. of America v. Nation- al Electric Signaling Co., E.D.N.Y.1914, 213 F. 815. Patents 318(1)

15. ---- Commercial success, defenses

Actual damages may be recovered, though invention has not been commercial success. Motor Player Corp. v. Pi- ano Motors Corp., D.C.N.J.1927, 19 F.2d 993. Patents 319(1)

Fact that plaintiff patentee received no royalty from license issued by him under patent did not preclude plaintiff from recovering damages for patent infringement. Abbott v. Barrentine Mfg. Co., N.D.Miss.1965, 255 F.Supp. 890, 149 U.S.P.Q. 287. Patents 319(1)

16. ---- Estoppel, defenses

Patent infringement plaintiff, having previously prevailed on infringement claim based on prior version of accused device and received reasonable royalty damages, was not collaterally estopped from asserting different hypothetical royalty rate for current infringement; infringements were different, and market conditions under which hypothetical negotiations would have taken place at start of each infringement were different. Applied Medical Resources Corp. v. U.S. Surgical Corp., C.A.Fed.2006, 435 F.3d 1356, 77 U.S.P.Q.2d 1666. Patents 327(13)

Fact that defendants, who had counterclaimed for damages as to certain patents, originally had charged plaintiff only with infringement of one patent would not estop defendants from claiming damages for infringement of second patent. Randolph Laboratories v. Specialties Development Corp., C.A.3 (N.J.) 1954, 213 F.2d 873, 102 U.S.P.Q. 140, certiorari denied 75 S.Ct. 91, 348 U.S. 861, 99 L.Ed. 678, 103 U.S.P.Q. 424, certiorari denied 75 S.Ct. 91, 348 U.S. 861, 99 L.Ed. 678, 103 U.S.P.Q. 425. Patents 310.11

17. ---- Failure to sue, defenses

Patentee which had notice of alleged infringement but notified infringer that it would do nothing in view of changes made by infringer had forfeited right to accounting and damage for past infringements by failing to sue, but its right to prevent future infringements was unaffected. Royal-McBee Corp. v. Smith-Corona Marchant, Inc., C.A.2 (Conn.) 1961, 295 F.2d 1, 130 U.S.P.Q. 377. Patents 283(1)

18. ---- Good faith, defenses

Damages may be mitigated by the innocence of the infringer where in good faith he is ignorant of existence of the patent. Corning v. Burden, U.S.N.Y.1853, 56 U.S. 252, 15 How. 252, 14 L.Ed. 683. See, also, Mowry v. Whitney, Pa.1871, 14 Wall. 434, 21 L.Ed. 858; Merriam v. Smith, C.C.Mass.1882, 11 F. 588; Hogg v. Emerson, N.Y.1850, 11 How. 587, 13 L.Ed. 824; Parker v. Corbin, C.C.Ohio 1848, Fed.Cas. No. 10,731; Bryce v. Dorr, C.C.Mich.1845, 3 McLean, 582, Fed.Cas. No. 2,070.

Mere fact that infringer brought suit to challenge validity of patent of apparatus and method for stretch-wrapping loads stacked on pallet with various polymer films was not evidence that infringer had reasonable basis for believing in right to continue allegedly infringing acts and that infringement was not willful. Kaufman Co., Inc. v. Lantech, Inc., C.A.Fed. (Ohio) 1986, 807 F.2d 970, 1 U.S.P.Q.2d 1202. Patents 312(8)

Infringement is “willful,” for purpose of obtaining increase in compensatory damages award, if infringer proceeded without reasonable belief that it would not be held liable for infringement. Chiron Corp. v. Genentech, Inc., E.D.Cal.2002, 268 F.Supp.2d 1117. Patents 319(3)

Infringers acted in good faith in attempting to design around the patent and had a reasonable basis for believing that their device was not infringing, and thus did not engage in willful infringement; it was understandable for

them to interpret one term in light of its use in the industry and they had received a verbal opinion from patent counsel that their device did not infringe. Ziggity Systems, Inc. v. Val Watering Systems, E.D.Pa.1990, 769 F.Supp. 752, reconsideration denied. Patents 227

Settlement agreement reached by patentee in other infringement cases were not relevant to willful infringement issue; patentee's desire to settle infringement claims to avoid risk of litigation did not establish alleged infringer's good-faith belief that it was not infringing patent. Century Wrecker Corp. v. E.R. Buske Mfg. Co., Inc., N.D.Iowa 1995, 898 F.Supp. 1334, on reconsideration in part. Patents 312(2)

19. ---- Misrepresentations, defenses

Evidence showed that owner of patent had made no deliberate or inexcusable misrepresentation concerning scope of decree in its favor or caused competitors to suffer serious damage so as to be deprived of right to prove damages against infringers under reference granted in original decree. H. W. Peters Co. v. MacDonald, C.C.A.2 (Conn.) 1934, 72 F.2d 670. Patents 312(6)

20. ---- Noninfringement, defenses

Owners of infringed process patent were not entitled to recover damages with respect to infringing devices sold for foreign use, use of process in foreign country not constituting infringement of process claims. Sutton v. Gulf Smokeless Coal Co., C.C.A.4 (W.Va.) 1935, 77 F.2d 439. Patents 258

21. ---- Profits by patentee, defenses

If patent was infringed, fact that patent owner had made as much as $1,700,000 since patent was granted and since owner had right to use it was not basis for denial of damages in owner's suit for infringement, for injunctive relief and for damages. Hall Laboratories, Inc. v. Samuels & Co., C.A.5 (Tex.) 1958, 261 F.2d 841, 120 U.S.P.Q. 69. Patents 319(1)

Though an infringer sustained losses on infringing sales, patentee is entitled to damages. McKee Glass Co v. H C Fry Glass Co, C.C.A.3 (Pa.) 1918, 248 F. 125, 160 C.C.A. 265.

22. Release

Where one defendant has manufactured and another defendant has sold infringing devices, they both have contributed toward the infringement and are treated as joint tort-feasors, and, thus, release of one does not release the other unless plaintiff has been fully compensated for the infringement contributed to by both. Saf-Gard Products, Inc. v. Service Parts, Inc., D.C.Ariz.1980, 491 F.Supp. 996, 206 U.S.P.Q. 976. Release 29(3)

23. Prior litigation

Evidence of prior litigation between patentee and alleged infringer was relevant to calculation of patentee's loss profit damages, to hypothetical reasonable royalty, to issue of willful infringement and to issue of nonobvious- ness in patentee's action for infringement of perimeter coated electrochromic mirror; prior suits concern alleged infringer's patent on electrochromic mirrors which were sold before patentee introduced mirror that was allegedly infringed. Donnelly Corp. v. Gentex Corp., W.D.Mich.1996, 918 F.Supp. 1126. Patents 312(2)

24. Res judicata

Where infringement action was instituted by patentees and plaintiffs entered their appearances, and judgment was rendered for the patentees, judgment did not bar plaintiffs from subsequently claiming damages for any impact of a conspiracy between the defendants because of refusal of a license as a result of the patents, even though the plaintiffs were carrying on some business in violation of the patents. Mason City Tent & Awning Co. v. Clapper, W.D.Mo.1956, 144 F.Supp. 754, 111 U.S.P.Q. 330. Patents 327(13)

25. Pleadings

In view of fact that damages recoverable by owner of patent against an infringer may have been “actual damages sustained”, or “general damages”, depending upon whether action was brought under either former § 67 or § 70 of this title, and fact that court had power in such proceedings to increase award of damages to amount not exceeding three times damages found, and to award attorneys' fees in cases where there was inequitable conduct, words in allegation and prayer of complaint for damages for infringement which in effect charged defendant with wanton and deliberate infringement, had not been subject to motion to strike, since such words might have borne upon court's exercise of discretion in matter of damages and requested attorneys' fees. Dimet Proprietary, Limited v. Industrial Metal Protectives, D.C.Del.1952, 109 F.Supp. 472, 96 U.S.P.Q. 33. Federal Civil Proced- ure 1137

26. Counterclaims

In patent infringement suit, defendants were entitled to recover under their counterclaim the damages, if any, they sustained as result of infringement notice sign displayed at trade shows by one of the plaintiffs in bad faith with intent to injure business of defendants, and as result of infringement notice letters designed to create false impression that validity of patent had been successfully litigated. Tele-Sonic Packaging Corp. v. Errich Intern. Corp., S.D.N.Y.1959, 173 F.Supp. 335, 121 U.S.P.Q. 171. Antitrust And Trade Regulation 48

Defendants in patent infringement case were not entitled to damages on their counterclaim alleging violation of Sherman Antitrust Act, §§ 1 to 7 of Title 15, in procuring settlement of an interference proceeding and entering into a license agreement where there was no showing that defendants had sustained any damages. Watson v. Heil, D.C.Md.1951, 96 F.Supp. 61, 88 U.S.P.Q. 536, reversed 192 F.2d 982, 91 U.S.P.Q. 353, on remand 97 U.S.P.Q. 334. Antitrust And Trade Regulation 983

In patent infringement suit wherein defendant filed counterclaim and answer claiming right to nonexclusive license and decree of district court was reversed by court of appeals with respect to provisions concerning basis for determining royalty, defendant was not entitled to damages for plaintiff's representation as to effect of decree entered by district court, especially where representation could not have resulted in pecuniary damage to defendant. Hazeltine Corp. v. Zenith Radio Corp., N.D.Ill.1939, 28 F.Supp. 672. Patents 319(1)

27. Dismissal

Where action for patent infringement was joined with a claim for damages predicated solely upon breach of a certain license agreement, asserting that the infringement was not only a violation of duty imposed by law but also a breach of an express obligation embodied in the agreement, the damage claim was not consistent with claim for infringement and must be dismissed. De Cew v. Union Bag & Paper Corp., D.C.N.J.1944, 57 F.Supp. 388. Federal Civil Procedure 71; Federal Civil Procedure 1791; Action 57(1); Federal Civil Pro- cedure 83; Federal Civil Procedure 1743

Where about three years had elapsed since death of special master appointed to state account in patent infringement action, defendant had been compelled to pay annual premium on bond for long period of time and changes during delay would impose burden on defendant in presenting evidence, defendant's motion to dismiss accounting proceeding would be granted if defendant would pay amount of admitted liability with costs. Trico Products Corp v. E a Laboratories, E.D.N.Y.1944, 54 F.Supp. 782. Patents 322

28. Summary judgment

Where patentee brought action against manufacturer and president thereof for infringement and summary judgment was entered on patentee's motion based on res judicata, court was required to provide in judgment for means of determination of damages by court or master as appropriate. Bros, Inc. v. W. E. Grace Mfg. Co., C.A.5 (Tex.) 1958, 261 F.2d 428, 119 U.S.P.Q. 401. Patents 322

Genuine issues of material fact existed regarding defendant's knowledge of its own potential infringement of patents and the adequacy of its disclosures to counsel, precluding summary judgment in its favor on claims of willful patent infringement. Arlington Industries, Inc. v. Bridgeport Fittings, Inc., M.D.Pa.2003, 290 F.Supp.2d 508. Patents 323.2(3)

Issues of material fact as to whether accused patent infringer reasonably relied on advice of inside counsel, and whether its request for advice from outside counsel was made in good faith, precluded summary judgment on issue of whether infringement was willful. Chiron Corp. v. Genentech, Inc., E.D.Cal.2002, 268 F.Supp.2d 1117. Patents 323.2(3)

Genuine issues of material fact existed as to whether patentee, pursuant to this section, established with reasonable probability its lost profits by reason of infringement, precluding summary judgment in favor of infringer, and refuting contention that court should rule as matter of law that appropriate measure of damages for its infringement was reasonable royalty rather than some computation of profits patentee would have had but for its misappropriation. Wilden Pump & Engineering Co. v. Pressed & Welded Products Co., N.D.Cal.1983, 570 F.Supp. 224, 224 U.S.P.Q. 1074.

29. Discovery

Defendant, guilty of patent infringement, was entitled to limit scope of inquiry so as to exclude discovery of profits gained by infringer or pecuniary advantage to defendant from use of the infringing machines since an infringer's profits are no longer an element of patentee's damages, nor could information sought have relevance to a reasonable royalty since there had been an established royalty, and inquiry should not have extended beyond it. Marvel Specialty Co., Inc. v. Bell Hosiery Mills, Inc., C.A.4 (N.C.) 1967, 386 F.2d 287, 155 U.S.P.Q. 545, certiorari denied 88 S.Ct. 1409, 390 U.S. 1030, 20 L.Ed.2d 286, 157 U.S.P.Q. 720. Patents 292.4

Numbers of prior art patents relative to nozzle structure of spray guns, collected by defendant in action challen- ging validity of paint sprayer patents, were irrelevant and immaterial to issue of defendant's counterclaim for damages for infringement, and were thus not discoverable by plaintiff after validity of challenged patents had already been established. Thomas Industries, Inc. v. Wagner Spray Tech Corp., E.D.Wis.1985, 619 F.Supp. 1280. Patents 292.4

In patent cases, where an accounting is sought, discovery of matters relating to damages may be deferred until after right to accounting is established. Green Valley Products, Inc. v. Sterwood Corp., E.D.N.Y.1969, 308

F.Supp. 700, 162 U.S.P.Q. 627. Patents 292.4

Information regarding alleged infringer's manufacturing costs, vendor communications, and customer purchases was discoverable in patent infringement action to help patent owner assess damages for alleged patent infringement, even though information was confidential trade secret. Chembio Diagnostic Systems, Inc. v. Saliva Dia- gnostic Systems, Inc., E.D.N.Y.2006, 236 F.R.D. 129. Patents 292.3(2)

Information concerning alleged patent infringer's profits from allegedly infringing products was discoverable without showing of causation of lost profits since it could reasonably lead to admissible evidence where lost profits damages were available to patent holder if it could show lost profits were caused by infringement. Na- tional Business Systems, Inc. v. AM Intern., Inc., N.D.Ill.1986, 109 F.R.D. 172, 230 U.S.P.Q. 356. Patents 292.1(1)

Generally, damages are part of issues which may be subject of plaintiff's discovery, subject to discretion of court; when patent infringement action is simple suit for damages, particularly if jury trial has been demanded, discovery as to damages is allowed prior to trial; but in patent infringement suits in which plaintiff seeks an injunction and an accounting, discovery on issue of damages is often refused until right to accounting has been determined. Fairchild Stratos Corp. v. General Elec. Co., S.D.N.Y.1962, 31 F.R.D. 301, 135 U.S.P.Q. 127. Federal Civil Procedure 1272.1; Patents 292.4

30. Presumptions

For purpose of assessing damages in patent infringement action, there is no presumption operating in the patentholder's favor that he would have made sales made by the infringer had it not been for the infringement. Milgo Electronic Corp. v. United Business Communications, Inc., C.A.10 (Kan.) 1980, 623 F.2d 645, 206 U.S.P.Q. 481, certiorari denied 101 S.Ct. 794, 449 U.S. 1066, 66 L.Ed.2d 611, 208 U.S.P.Q. 376. Patents 312(1.7)

In accounting for profits from sale of infringing device, cost of material as shown by records kept by infringer pursuant to standard cost accounting system was presumptively correct, and computations of plaintiffs, which allegedly showed actual cost but omitted material factors and were made on calendar instead of fiscal year basis were properly rejected. Perrine v. Burdick, C.C.A.8 (Minn.) 1943, 138 F.2d 861. Patents 318(3)

As respects recovery of damages for patent infringement on account of lost profits, there is no presumption that owner of patent would have sold patented devices to those who purchased the infringing articles. Oil Well Im- provements Co. v. Acme Foundry & Machine Co., C.C.A.8 (Kan.) 1929, 31 F.2d 898. Patents 312(1.7)

There is no legal presumption that, but for infringement by a defendant, complainant, which was the owner of the patent and manufacturing thereunder, would have made as many sales at the same profit as were made in a like period before the infringement, when defendant was a partner in the business, and such an assumption is too conjectural to be safely taken as the measure of damages for the infringement. Clark v. Schieble Toy & Novelty Co., C.C.A.6 (Ohio) 1917, 248 F. 276, 160 C.C.A. 354.

Where defendants acted with full knowledge, and in wanton and willful disregard, of complainant's rights, every doubt, as to damages, should be resolved against infringer. Rose v. Hirsh, C.C.A.3 (Pa.) 1899, 94 F. 177, 36 C.C.A. 132. See, also, Consolidated Rubber Tire Co. v. Diamond Rubber Co. of New York, N.Y.1916, 232 F. 475, 146 C.C.A. 469; Regina Music Box Co. v. F. G. Otto & Sons, C.C.N.J.1902, 114 F. 505.

That defendant sold to persons, not customers of licensee, does not raise presumption that such sales were lost to the licensee. Bell v. U.S. Stamping Co., C.C.S.D.N.Y.1887, 32 F. 549. Patents 312(1.1)

31. Inferences

Inference that patentee would have made all sales of stretch wrap machines but for occurrence of infringing sales approached conclusiveness where patentee proved that there was demand for patented product, that it had marketing and manufacturing capability to exploit demand, that there was absence of acceptable noninfringing substitutes, and only two suppliers of stretch wrap machines were competing in market, patentee and infringer, so that had noninfringing sales not been made, only patentee would have been able to make sales. Kaufman Co., Inc. v. Lantech, Inc., C.A.Fed. (Ohio) 1991, 926 F.2d 1136, 17 U.S.P.Q.2d 1828. Patents 312(1.7)

Patentee's ability to supply entire demand commonly warrants inference that sales by another would otherwise have come to patentee. W.S. Godwin Co. v. International Steel Tie Co., C.C.A.6 (Ohio) 1928, 29 F.2d 476. Pat- ents 318(3)

It may be inferred that patentee would have charged higher prices but for patent infringement, in calculating lost profits attributable to infringer's price competition, in market with only two viable competitors. Ristvedt-John- son, Inc. v. Brandt, Inc., N.D.Ill.1992, 805 F.Supp. 557. Patents 312(1.7)

32. Burden of proof

To recover lost profits damages for patent infringement, patent owner must show that it would have received additional profits “but for” infringement; patent owner bears burden to present evidence sufficient to show reasonable probability that it would have made asserted profits absent infringement. King Instruments Corp. v. Perego, C.A.Fed. (Mass.) 1995, 65 F.3d 941, 36 U.S.P.Q.2d 1129, rehearing denied, in banc suggestion declined 72 F.3d 855, certiorari denied 116 S.Ct. 1675, 517 U.S. 1188, 134 L.Ed.2d 778. Patents 318(2)

Patentee met its burden of showing that customers desired advantage of film-driven stretch wrap machine, as opposed to powered stretch wrap machines and conventional stretch wrap machines which it also sold, so that powered and conventional machines were not acceptable noninfringing substitutes for film-driven machine, by showing that customers chose to purchase film-driven machine instead of other machines. Kaufman Co., Inc. v. Lantech, Inc., C.A.Fed. (Ohio) 1991, 926 F.2d 1136, 17 U.S.P.Q.2d 1828. Patents 312(10)

Burden is on the infringer to persuade reviewing court that amount of award for patent infringement, or choice of accounting method, constitutes an abuse of the trial court's discretion. Paper Converting Machine Co. v. Magna-Graphics Corp., C.A.Fed.1984, 745 F.2d 11, 223 U.S.P.Q. 591, on remand 631 F.Supp. 660, 228 U.S.P.Q. 524. Patents 324.1

Where plaintiff itself uses patented process in manufacturing, damages for infringement may take form of lost profits, and burden is on plaintiff to show their amount. Devex Corp. v. General Motors Corp., C.A.3 (Del.) 1981, 667 F.2d 347, 212 U.S.P.Q. 643, certiorari granted 102 S.Ct. 2267, 456 U.S. 988, 73 L.Ed.2d 1283, certiorari denied 102 S.Ct. 2270, 456 U.S. 990, 73 L.Ed.2d 1285, rehearing denied 106 S.Ct. 212, 474 U.S. 890, 88 L.Ed.2d 181, affirmed 103 S.Ct. 2058, 461 U.S. 648, 76 L.Ed.2d 211, 217 U.S.P.Q. 1185. Patents 312(1.7); Patents 319(1)

In patent infringement action, burden was on plaintiff to show whether defendant would not have made all or

some of sales of rock bits without infringing bearing seals. Hughes Tool Co. v. G. W. Murphy Industries, Inc., C.A.5 (Tex.) 1973, 491 F.2d 923, 180 U.S.P.Q. 353. Patents 312(1.7); Patents 314(5)

Infringer, having proved actual expenditures for ordinary overhead and fair method of allocation to ascertain net profits on sales of infringing machines, carried its burden in first instance, justifying allowance for such overhead, though proper charge only should be made if it appeared on cross-examination or otherwise that ordinary overhead was not chargeable in whole or in part to infringing business. Stearns-Roger Mfg. Co. v. Ruth, C.C.A.10 (Colo.) 1936, 87 F.2d 35. Patents 312(10)

In order to recover lost profit damages, patent holder must demonstrate that there was reasonable probability that, but for infringement, it would have made infringer's sales. DSU Medical Corp. v. JMS Co., Ltd., N.D.Cal.2003, 296 F.Supp.2d 1140. Patents 318(1)

To obtain as damages profits on sales patent owner would have made absent infringement, i. e., sales made by infringer, owner must prove: (1) demand for patented product, (2) absence of acceptable noninfringing substitutes, (3) manufacturing and marketing capability to exploit demand, and (4) amount of profit he would have made. DSU Medical Corp. v. JMS Co., Ltd., N.D.Cal.2003, 296 F.Supp.2d 1140. Patents 318(4.1)

Claimant bears burden of proof on issue of damages in patent infringement suit. Mobil Oil Corp. v. Amoco Chemicals Corp., D.Del.1994, 915 F.Supp. 1333. Patents 312(1.7)

Plaintiffs seeking increased damages for willful infringement of patent bear burden of proving willfulness by clear and convincing evidence. Schneider (Europe) AG v. SciMed Life Systems, Inc., D.Minn.1994, 852 F.Supp. 813, appeal dismissed 26 F.3d 140, affirmed 60 F.3d 839, 39 U.S.P.Q.2d 1596, rehearing denied, in banc suggestion declined , certiorari denied 116 S.Ct. 520, 516 U.S. 990, 133 L.Ed.2d 427. Patents 312(1.7)

Willfulness must be proved by clear and convincing evidence in order to justify increased damages for patent infringement, with determination being made on basis of totality of circumstances. Pall Corp. v. Micron Separa- tions, Inc., D.Mass.1992, 792 F.Supp. 1298, affirmed in part, modified in part and reversed in part 66 F.3d 1211, 36 U.S.P.Q.2d 1225, rehearing denied, certiorari denied 117 S.Ct. 1243, 520 U.S. 1115, 137 L.Ed.2d 326. Pat- ents 319(3)

Burden of establishing nature and amount of fixed costs as well as their relationship to the infringing product is on defendant in an infringement action. Bergstrom v. Sears, Roebuck and Co., D.C.Minn.1980, 496 F.Supp. 476, 207 U.S.P.Q. 481. Patents 312(1.7)

In determining measure of damages for patent infringement, plaintiff has burden to prove his lost profits and then burden shifts to defendant to prove, in the case of a component part, that lost profits were attributable to un- patentable features of the device and thereupon burden shifts to plaintiff to show apportionment; if apportionment cannot be shown, plaintiff is entitled to a reasonable royalty. Universal Athletic Sales Co. v. American Gym, W.D.Pa.1979, 480 F.Supp. 408, 205 U.S.P.Q. 840. Patents 312(1.7)

On issue whether defendant's infringement of patent was willful and wanton so as to allow plaintiff to recover its attorney fees and treble damages, burden was not on defendant to prove exoneration but upon plaintiff to sub- stantiate the charge. Columbia Broadcasting System, Inc. v. Zenith Radio Corp., N.D.Ill.1975, 391 F.Supp. 780, 185 U.S.P.Q. 662, affirmed 537 F.2d 896, 192 U.S.P.Q. 68. Patents 312(1.7)

33. Shifting of burden of proof

Once patent owner establishes inference of lost profits due to infringement, burden shifts to infringer to show it is unreasonable to infer that some of all of infringing sales probably caused patent owner to suffer loss of profits. Ristvedt-Johnson, Inc. v. Brandt, Inc., N.D.Ill.1992, 805 F.Supp. 557. Patents 312(1.7)

34. Degree of proof

There can be no recovery for speculative profits and reasonable certainty that except for the infringement the profits claimed would have been realized must be shown. Boesch v. Graff, U.S.Cal.1890, 10 S.Ct. 378, 133 U.S. 697, 33 L.Ed. 787. See, also, Cornely v. Marckwald, N.Y.1889, 9 S.Ct. 744, 131 U.S. 159, 33 L.Ed. 117; Dob- son v. Dornan, Pa.1886, 6 S.Ct. 946, 118 U.S. 10, 30 L.Ed. 63; Dobson v. Hartford Carpet Co., Pa.1885, 5 S.Ct. 945, 114 U.S. 439, 29 L.Ed. 177; Jennings v. Rogers Silver-Plate Co., C.C.Conn.1901, 105 F. 967; Royer v. Shultz Belting Co., C.C.Mo.1891, 45 F. 51; Morss v. Union Form Co., C.C.Conn.1889, 39 F. 468.

Under lost profits measure of damages for patent infringement, patentee must demonstrate with reasonable probability the portion of defendant's infringing sales it would have made. Baumstimler v. Rankin, C.A.5 (Tex.) 1982, 677 F.2d 1061, 215 U.S.P.Q. 575. Patents 318(3)

In order to recover lost profits and not merely a reasonable royalty in a patent infringement action, the patentholder must demonstrate that “but for” the infringement, he would have made sales that the infringer made; in awarding lost profits, reasonable probability rather than precision is required. Milgo Electronic Corp. v. United Business Communications, Inc., C.A.10 (Kan.) 1980, 623 F.2d 645, 206 U.S.P.Q. 481, certiorari denied 101 S.Ct. 794, 449 U.S. 1066, 66 L.Ed.2d 611, 208 U.S.P.Q. 376. Patents 318(1)

In order to recover lost profits in a patent infringement action, the patentholder must advance affirmative proof of the demand for his patented product in the marketplace, the absence of acceptable noninfringing substitutes and that he had production and marketing capacity to meet the demand. Milgo Electronic Corp. v. United Busi- ness Communications, Inc., C.A.10 (Kan.) 1980, 623 F.2d 645, 206 U.S.P.Q. 481, certiorari denied 101 S.Ct. 794, 449 U.S. 1066, 66 L.Ed.2d 611, 208 U.S.P.Q. 376. Patents 312(1.7)

Damages cannot be recovered, unless there is evidence to establish a basis for such recovery. Underwood Type- writer Co. v. E.C. Stearns & Co., C.C.A.2 (N.Y.) 1915, 227 F. 74, 141 C.C.A. 622, motion denied 227 F. 1022, 141 C.C.A. 672. Patents 319(1)

Satisfaction of the “but for” rule of the lost profits measure of patent infringement damages did not require injured party to negate all possibilities that the purchasers would not have bought a different product. Broadview Chemical Corp. v. Loctite Corp., D.C.Conn.1970, 311 F.Supp. 447, 164 U.S.P.Q. 419. Patents 318(1)

Line of demarcation, which rules quality of proof required to sustain claim for damages in patent infringement suit, is between speculative and probable; reasonably predictable, not conjectural, is standard by which proof must be appraised. Georgia-Pacific Corp. v. U. S. Plywood Corp., S.D.N.Y.1965, 243 F.Supp. 500, 146 U.S.P.Q. 228. Patents 312(10)

In patent infringement cases, one suing upon patent must, in order to establish his damages, be able to separate or apportion infringer's profits between feature which infringed patent and those which did not; such evidence must be reliable and tangible and not conjectural or speculative. Reliance Molded Plastics, Inc. v. Jiffy Products,

D.C.N.J.1963, 215 F.Supp. 402, 137 U.S.P.Q. 134, affirmed 337 F.2d 857, 143 U.S.P.Q. 312. Patents 312(1.7)

Damages for patent infringement or unfair competition cannot be awarded on basis of speculation or sheer guess. Hygienic Specialties Co. v. H.G. Salzman, Inc., S.D.N.Y.1960, 189 F.Supp. 790, 128 U.S.P.Q. 79, reversed on other grounds 302 F.2d 614, 133 U.S.P.Q. 96. Patents 312(10); Antitrust And Trade Regulation 110(1)

Patent owner need not prove patent infringement damages with absolute certainty, but need only show reasonable probability that it would have made sales. Ristvedt-Johnson, Inc. v. Brandt, Inc., N.D.Ill.1992, 805 F.Supp. 557. Patents 312(10)

35. Admissibility of evidence

Letters from in-house counsel and outside counsel that its hose would not infringe patent of plaintiff were competent to show that defendant had an honest doubt as to validity of patents and as to noninfringement for purpose of determining whether damages should be increased on grounds of willful infringement. H. K. Porter Co., Inc. v. Goodyear Tire & Rubber Co., C.A.6 (Ohio) 1976, 536 F.2d 1115, 191 U.S.P.Q. 486. Patents 312(2)

Evidence of profits of the infringer and lost sales and expenses of the patentee may be considered by the court in fixing its award of damages in an infringement action. Graham v. Jeoffroy Mfg., Inc., C.A.5 (Tex.) 1958, 253 F.2d 72, 116 U.S.P.Q. 542, certiorari denied 79 S.Ct. 28, 358 U.S. 817, 3 L.Ed.2d 59, 119 U.S.P.Q. 501, rehearing denied 79 S.Ct. 117, 358 U.S. 890, 3 L.Ed.2d 118, 119 U.S.P.Q. 501. Patents 319(1)

Payments by manufacturer to owner of patent and his agent constituted “royalties” rather than “profits,” and evidence thereof was admissible in infringement suit to assist in determining reasonable royalty, where there was no partnership between manufacturer and owner of patent and his agent, manufacturer carried on entire operation of manufacture and sale, and owner's agent merely introduced patented article to the trade. General Mo- tors Corp. v. Dailey, C.C.A.6 (Mich.) 1937, 93 F.2d 938. Patents 312(2)

Where patent accounting is for damages for lost sales or of savings to user of infringing device, proof that other comparable articles were available at about same price is pertinent, but not where recovery is limited to net profits of actual sales. Stearns-Roger Mfg. Co. v. Ruth, C.C.A.10 (Colo.) 1936, 87 F.2d 35. Patents 312(2)

Profits may be proved by the actual production cost, selling price, and actual profits, as shown by the infringer's books, or by testimony of experts. Westinghouse Electric & Mfg. Co. v. Wagner Electric Mfg. Co., C.C.A.8 (Mo.) 1922, 281 F. 453, certiorari denied 43 S.Ct. 165, 260 U.S. 744, 67 L.Ed. 492. Patents 312(2)

Evidence of royalty on another patent would have no bearing. Farmers' Handy Wagon Co. v. Beaver Silo & Box Mfg. Co., C.C.A.7 (Wis.) 1919, 259 F. 270, 170 C.C.A. 338.

In ascertaining damages and profits the ordinary rules of evidence should be applied, but no arbitrary rule should be allowed to prevail over clear equities. Decker v. Smith, N.D.N.Y.1915, 225 F. 776, modified on other grounds 234 F. 646, 148 C.C.A. 412. Patents 312(3)

Evidence of the cost to a different manufacturer of making similar articles is incompetent. Robbins v. Illinois Watch Co., C.C.A.7 (Ill.) 1897, 81 F. 957, 27 C.C.A. 21.

Mere opinion evidence as to the amount of damage sustained by plaintiff cannot be considered. Lee v. Pillsbury, C.C.Minn.1892, 49 F. 747.

Where question is close, revoked or abandoned, license may be considered. Graham v. Geneva Lake Crawford Mfg. Co., C.C.E.D.Wis.1881, 24 F. 642.

Where defendant has infringed one only of several claims, it is not admissible to prove that the patent, as an entirety, was capable of producing greater profits than other inventions in use. Fischer v. Hayes, C.C.S.D.N.Y.1884, 22 F. 529. Patents 312(2)

For the purpose of estimating damages in case of infringement, a license for using the invention and the amount of the fee required, may be shown by parol testimony. Wooster v. Simonson, C.C.S.D.N.Y.1884, 20 F. 316. Pat- ents 312(2)

It is competent to prove the prices at which licenses were granted under the patent while it was in force, but not to prove prices paid for infringements already perpetrated. National Car-Brake Shoe Co. v. Terre Haute Car & Mfg. Co., C.C.Ind.1884, 19 F. 514. See, also, Cornely v. Marckwald, C.C.N.Y.1885, 32 F. 292, affirmed 9 S.Ct. 744, 131 U.S. 159, 33 L.Ed. 117; Westcott v. Rude, C.C.Ind.1884, 19 F. 830.

Rescinded contract in relation to payment of royalty is not competent evidence. Bussey v. Excelsior Mfg Co, C.C.E.D.Mo.1880, 1 F. 640, 1 McCrary 161, reversed on other grounds 4 S.Ct. 38, 110 U.S. 131, 28 L.Ed. 95.

Patent owner must first establish, as matter of evidence, foundation fact that he would have made measurable portion of infringer's sales, if infringer had not entered field, before amount of infringer's profits on these sales becomes evidentially competent, material and relevant to factual determination of patent owner's lost profits. Georgia-Pacific Corp. v. U. S. Plywood Corp., S.D.N.Y.1965, 243 F.Supp. 500, 146 U.S.P.Q. 228. Patents 312(2)

Owner of infringed patent is entitled to damages adequate to compensate him for the infringement, and profit derived by infringer from its illegal act is competent evidence to be considered with other relevant evidence in assessing adequate compensation. England v. Deere & Co., S.D.Ill.1963, 221 F.Supp. 319, 138 U.S.P.Q. 608. Pat- ents 312(2); Patents 319(1)

36. Sufficiency of evidence

Projected lost profits awarded to patent owner for effect of retailer's allegedly infringing sales of patented folding headrest upon retail market were not supported by evidence; owner's expert improperly based growth rate for sales throughout life of patent on figures from period in which headrest was first introduced to market without any economic reasoning or evidence as to why demand for product would not decrease over time and failed to account for initial large sales of headrests to retail outlets rather than consumers. Oiness v. Walgreen Co., C.A.Fed. (Colo.) 1996, 88 F.3d 1025, 39 U.S.P.Q.2d 1304, rehearing denied, in banc suggestion declined , certiorari denied 117 S.Ct. 951, 519 U.S. 1112, 136 L.Ed.2d 838. Patents 312(10)

Patentee was not entitled to award of lost profits for sale of plastic film used in patented film-driven stretch wrap machine where patentee failed to provide sufficient evidence to show that plastic film sales typically accompanied sale of machine, so that patentee failed to prove that there was demand for accessory, and patentee to provide evidence concerning amount of film sold to its customers who did purchase patented machine, so that patentee

failed to show amount of profit it would have made had it made sales. Kaufman Co., Inc. v. Lantech, Inc., C.A.Fed. (Ohio) 1991, 926 F.2d 1136, 17 U.S.P.Q.2d 1828. Patents 318(1)

Evidence, including proof that owner of patent relating to automatic machine for loading video or audio tape in- to closed cassettes was main competitor of infringer and only other company capable of manufacturing under patent claims that were infringed, supported district court's determination that infringement caused patent owner to lose sales, warranting award to patent owner of damages for lost profits. King Instrument Corp. v. Otari Corp., C.A.Fed.1985, 767 F.2d 853, 226 U.S.P.Q. 402, certiorari denied 106 S.Ct. 1197, 475 U.S. 1016, 89 L.Ed.2d 312. Patents 312(10)

There was substantial evidence in patent infringement action as to amount of patent holder's lost profits as reflected by a series of commodity statements from patent holder's record showing sales levels and gross margins for years in question on the sale of hose covered by the patents notwithstanding the loss of the original invoices. H. K. Porter Co., Inc. v. Goodyear Tire & Rubber Co., C.A.6 (Ohio) 1976, 536 F.2d 1115, 191 U.S.P.Q. 486. Patents 312(10)

Exclusive licensee, which successfully prosecuted patent infringement action, failed to establish, on the issue of damages for infringement, that it could have increased its prices on the feeders it sold by ten percent if it had not been for defendant's unlawful competition, where the licensee and the patent owner failed to offer testimony of customers or other evidence, except testimony of the owner himself, that customers would have been willing to pay more than they did for the licensee's feeders. Wahl v. Carrier Mfg. Co., Inc., C.A.7 (Ind.) 1975, 511 F.2d 209, 184 U.S.P.Q. 516. Patents 312(10)

On accounting for damages for patent infringement, statements made in infringer's advertisements as to advantages of patented improvement carried more force than belated denial of value of improvement in answer to claim for substantial damages. Enterprise Mfg. Co. v. Shakespeare Co., C.C.A.6 (Mich.) 1944, 141 F.2d 916. Patents 312(10)

In action for accounting for patent infringement, court, in determining profits from infringement, should reach degree of likelihood on which reasonable men are content to act in every day concerns of business life although there can be no mathematical certainty. Gordon Form Lathe Co. v. Ford Motor Co., C.C.A.6 (Mich.) 1943, 133 F.2d 487, certiorari granted 63 S.Ct. 1325, 319 U.S. 738, 87 L.Ed. 1697, rehearing granted 63 S.Ct. 1444, 320 U.S. 213, 87 L.Ed. 1850, certiorari denied 63 S.Ct. 1328, 319 U.S. 765, 87 L.Ed. 1715, rehearing denied 64 S.Ct. 29, 320 U.S. 810, 88 L.Ed. 490, affirmed 64 S.Ct. 257, 320 U.S. 714, 88 L.Ed. 419, rehearing denied 64 S.Ct. 434, 320 U.S. 816, 88 L.Ed. 493. Patents 318(3)

Patentee was not entitled to any monetary award for infringement of its patents describing hydrodynamic tools for cleaning pipes and channels, since it failed to establish an evidentiary foundation necessary to arrive at even a reasonably close approximation of its lost profits and failed to establish an evidentiary foundation upon which to select a reasonable royalty rate. Keg Technologies, Inc. v. Laimer, N.D.Ga.2006, 436 F.Supp.2d 1364. Patents 312(10)

Patent holder's 61.8 percent incremental cost of producing hardwound rewinders in 1978 was more reliable than 60.8 percent figure representing cost of producing softwound rewinders in 1981 and, therefore, in absence of data permitting incremental calculation for 1981 that was limited to hardwound rewinder sales, 61.8 percent cost rate for 1978 hardwound sales would generate a reasonably fair estimate of patent holder's total lost profits resulting from patent infringement. Paper Converting Mach. Co. v. Magna-Graphics Corp., E.D.Wis.1983, 576

F.Supp. 967, 220 U.S.P.Q. 1057, affirmed in part , vacated in part 745 F.2d 11, 223 U.S.P.Q. 591, on remand 631 F.Supp. 660, 228 U.S.P.Q. 524. Patents 318(3)

In appropriate circumstances an infringer's financial statements may be recast in order to reveal the true status of the profits or advantages derived by it from its infringing operations. Jenn-Air Corp. v. Penn Ventilator Co., Inc., E.D.Pa.1975, 394 F.Supp. 665, 185 U.S.P.Q. 410. Patents 319(1)

37. Expert witnesses

This section, relating to the issue of exemplary damages in patent infringement action, providing that court may receive expert testimony to aid in determination of damages, is a direction to trial judge to admit expert testimony and word “court” as used therein does not refer to judge or jury. Swofford v. B & W, Inc., C.A.5 (Tex.) 1964, 336 F.2d 406, 142 U.S.P.Q. 291, certiorari denied 85 S.Ct. 653, 379 U.S. 962, 13 L.Ed.2d 557, 144 U.S.P.Q. 780. Patents 312(2)

In proceeding to determine damages for patent infringement, testimony by principal owner of one-man corporation, drawn from his own direct and personal knowledge of his business, and derived independently of any corporate records, as to the cost of production, was admissible, notwithstanding the availability of the corporate accounts which the law required him to keep. Allen v. W. H. O. Alfalfa Mill. Co., C.A.10 (Colo.) 1959, 272 F.2d 98, 123 U.S.P.Q. 473. Evidence 158(26)

Where most of the books and records of defendant from which the number of infringing stockings sold and the manufacturing and sales cost could have been determined were deliberately destroyed by defendant after the commencement of the action, plaintiff was entitled under former §§ 67 and 70 of this title to rely on expert testimony as to the defendant's manufacturing costs. Gotham Silk Hosiery Co. v. Artcraft Silk Hosiery Mills, C.C.A.3 (Del.) 1944, 147 F.2d 209. Evidence 508

An appropriator of plaintiffs' trade secrets would not be permitted to present expert testimony tending to show that percentage of profits on products making use of the appropriated trade secret should have been attributed to the secret where it was inherently impossible for any witness to make a reliable apportionment, and where appropriator elected, before the master and before the court, to avoid or minimize any award of profits on such products by arguing failure of proof on part of plaintiffs and sought apportionment only after it was unsuccessful in its original strategy. Carter Products, Inc. v. Colgate-Palmolive Co., D.C.Md.1963, 214 F.Supp. 383, 136 U.S.P.Q. 348, 136 U.S.P.Q. 577. Evidence 527; Antitrust And Trade Regulation 430

Where proper measure of damages in patent infringement suit was a reasonable royalty because it did not appear that plaintiff lost any sales through defendant's infringement of plaintiff's patent, reasonable value of royalty on the patents infringed should be established by testimony of experts familiar with royalties paid on comparable devices. Austral Sales Corp v. Jamestown Metal Equipment Co, W.D.N.Y.1941, 41 F.Supp. 508. Patents 312(10)

38. Questions of fact

District court, when calculating damages in patent infringement action, erred in resolving factual dispute over when defendants switched from infringing to non-infringing device based on deposition and new witnesses' affidavit testimony; court should have conducted trial-type proceedings at which it would have had opportunity to assess credibility of new witnesses. Insituform Technologies, Inc. v. CAT Contracting, Inc., C.A.Fed.2004, 385

F.3d 1360, 72 U.S.P.Q.2d 1870, on remand 518 F.Supp.2d 876. Patents 319(1)

What is a reasonable royalty recoverable by patentee in infringement action wherein actual damages are not proved in question of fact. Hughes Tool Co. v. G. W. Murphy Industries, Inc., C.A.5 (Tex.) 1973, 491 F.2d 923, 180 U.S.P.Q. 353. Patents 314(5)

In measuring damages for infringement, whether profits patent licensee would have earned had it produced machines which it could have produced had it not been for infringement were to be charged with licensee's fixed overhead expenses was question of fact to be determined at hearing on damages before master and not by appellate court. General Elec. Co. v. Sciaky Bros., Inc., C.A.6 (Mich.) 1969, 415 F.2d 1068, 163 U.S.P.Q. 257. Pat- ents 322; Patents 324.5

In an action for an accounting arising out of infringements of a patent and for contempt for violation of injunction entered against defendant, issues relating to amount of damages for infringement of patent and punitive damages for contempt were questions of fact. Coleman Co. v. Holly Mfg. Co., C.A.9 (Cal.) 1959, 269 F.2d 660, 122 U.S.P.Q. 559. Patents 326(4)

Where infringer paid company which owned other patents, and which furnished blueprints for infringing machines, 10 percent of purchase price of such machines which were sold only to company's licensees, whether such payment was legitimate manufacturing expense or mere division of spoils between those engaged in joint adventure of infringement was pure question of fact for master in accounting proceeding. Stearns-Roger Mfg. Co. v. Ruth, C.C.A.10 (Colo.) 1936, 87 F.2d 35. Patents 318(6)

Whether patterns and drawings made and kept by the manufacturer of infringing machines should be regarded as items of expense on an accounting for profits, or valued as assets, is a question of fact to be determined on each case. Christensen v. National Brake & Elec. Co., D.C.Wis.1924, 10 F.2d 856. Patents 322

Question whether machine would or would not have been marketable without patented part is one of fact. West- inghouse v. New York Brake Co., C.C.A.2 (N.Y.) 1905, 140 F. 545, 72 C.C.A. 61, certiorari denied 26 S.Ct. 762, 201 U.S. 648, 50 L.Ed. 904.

Where damages cannot be assessed on the basis of a royalty, nor on that of lost sales, nor on that of hurtful competition, the proper method of assessing them is to ascertain what would have been a reasonable royalty for the infringer to have paid, and it is the legitimate province of a jury to determine this fact. Hunt Bros. Fruit-Packing Co. v. Cassiday, C.C.A.9 (Cal.) 1894, 64 F. 585, 12 C.C.A. 316. Patents 275

Whether value of invention at time of infringement was equal to the license fee subsequently established is question of fact. Wooster v. Thornton, C.C.S.D.N.Y.1886, 26 F. 274, appeal dismissed 10 S.Ct. 1074, 136 U.S. 651, 34 L.Ed. 550.

If contradiction existed between groups of witnesses or experts or inconsistencies in testimony of witnesses in determining damages for patent infringement using the royalty basis, the resolution of that conflict was for the trier. Elrick Rim Co. v. Cheek, S.D.Cal.1961, 195 F.Supp. 496, 131 U.S.P.Q. 8. Patents 319(1)

39. Instructions

Instructions on damages in patent infringement action, taken as a whole, were adequate; jury was instructed that damages had to be adequate to compensate for infringement and in no event less than reasonable royalty, that

plaintiff bore burden of proving damages, and that in determining issue of damages, law does not permit award of greater sum than monetary loss which patent owner has suffered as a result of alleged infringement. Oiness v. Walgreen Co., D.Colo.1991, 774 F.Supp. 1277, 21 U.S.P.Q.2d 1654, affirmed in part , vacated in part 980 F.2d 742, 26 U.S.P.Q.2d 1548, rehearing denied, certiorari denied 113 S.Ct. 1849, 507 U.S. 1032, 123 L.Ed.2d 473, on remand 838 F.Supp. 1420, 30 U.S.P.Q.2d 1383. Patents 314(1)

40. Rehearing

Defendants' argument that treble damages awarded in patent infringement action were out of proportion to loss actually sustained by plaintiffs and were therefore excessive, especially in light of jury's denial of exemplary damages, did not differ from those arguments raised by posttrial motions and did not warrant reconsideration. Oiness v. Walgreen Co., D.Colo.1991, 774 F.Supp. 1277, 21 U.S.P.Q.2d 1654, affirmed in part , vacated in part 980 F.2d 742, 26 U.S.P.Q.2d 1548, rehearing denied, certiorari denied 113 S.Ct. 1849, 507 U.S. 1032, 123 L.Ed.2d 473, on remand 838 F.Supp. 1420, 30 U.S.P.Q.2d 1383. Patents 323.3

41. Stay of proceedings

Reinstatement of damage verdict, following finding of patent infringement at retrial after initial judgment was reversed on appeal, was not warranted; rather, judicial economy dictated deferral of damages issues until after liability issues had been finally resolved through appeal. Cordis Corp. v. Boston Scientific Corp., D.Del.2006, 431 F.Supp.2d 461, affirmed 511 F.3d 1157, 85 U.S.P.Q.2d 1427, rehearing and rehearing en banc denied , sup- plemented 2008 WL 1777441. Patents 314(2)

Although alleged infringers' activity in the United States with respect to infringing device was temporary and de minimis, as infringers modified device in such a manner that it no longer literally infringed patent for system used in textile industry for mending yarn breaks, patent infringement action was not rendered moot, but further action as to damages as result of literal infringement would be stayed until after appellate process had been com- pleted. Spindelfabrik Suessen-Schurr, Stahlecker & Grill GmbH v. Savio S.p.A., W.D.N.C.1991, 778 F.Supp. 839. Patents 319(1)

Damages proceedings would not be stayed, against buyers of shoe insoles that infringed patent, while damage claim against seller proceeded, when both sellers and buyers were found to have infringed, and consideration of damages of buyers as well as sellers would not be unduly burdensome. Nikken, USA, Inc., C.D.Cal.2003, 2003 WL 21781149, Unreported. Patents 319(1)

42. Post judgment infringement

Award of damages for patent infringement should not have included amounts for post-judgment infringement, where infringer claimed in motion to alter or amend judgment that it had changed to noninfringing process; rather, liability for infringement after date of judgment required further proceedings, during which infringer could raise defense of non-infringement for that period. Ajinomoto Co., Inc. v. Archer-Daniels-Midland Co., C.A.Fed. (Del.) 2000, 228 F.3d 1338, 56 U.S.P.Q.2d 1332.

43. Review--Generally

Review of award of damages for patent infringement is limited to determination whether trial court has abused its discretion in choosing a method with which to compute an award. Paper Converting Machine Co. v. Magna-

Graphics Corp., C.A.Fed.1984, 745 F.2d 11, 223 U.S.P.Q. 591, on remand 631 F.Supp. 660, 228 U.S.P.Q. 524. Patents 324.5

Under this section, whether to increase or treble damage is committed to the trial court's discretion and the trial court's decision can be disturbed only upon a showing that discretion was abused. Milgo Electronic Corp. v. United Business Communications, Inc., C.A.10 (Kan.) 1980, 623 F.2d 645, 206 U.S.P.Q. 481, certiorari denied 101 S.Ct. 794, 449 U.S. 1066, 66 L.Ed.2d 611, 208 U.S.P.Q. 376. Patents 325.11(2.1)

In a patent suit between private parties, an award of increased damages is within the discretion of the trial judge and is not to be disturbed unless there is an abuse of such discretion. Leesona Corp. v. U. S., Ct.Cl.1979, 599 F.2d 958, 220 Ct.Cl. 234, 202 U.S.P.Q. 424, certiorari denied 100 S.Ct. 522, 444 U.S. 991, 62 L.Ed.2d 420, 204 U.S.P.Q. 352. Patents 319(3); Patents 324.54

Although trial court has considerable discretion in assessing damages for patent infringement, appellate court can reverse trebling of damages if abuse of discretion is shown. Yoder Bros., Inc. v. California-Florida Plant Corp., C.A.5 (Fla.) 1976, 537 F.2d 1347, 193 U.S.P.Q. 264, certiorari denied 97 S.Ct. 1108, 429 U.S. 1094, 51 L.Ed.2d 540, 200 U.S.P.Q. 65, 200 U.S.P.Q. 128. Patents 324.54

Award of treble damages for infringement of patent is in discretion of court below whose judgment appellate court may disturb only for abuse of discretion. Dixie Cup Co. v. Paper Container Mfg. Co., C.C.A.7 (Ill.) 1948, 169 F.2d 645, 78 U.S.P.Q. 222. Patents 319(3)

In patent infringement action, judgment allowing two and one-half percent of defendant's sales of device containing features of plaintiff's patent as reasonable royalty, based on exercise of sound discretion, would not be disturbed even if court of appeals, sitting as trial court, might have awarded larger percentage. Enterprise Mfg. Co. v. Shakespeare Co., C.C.A.6 (Mich.) 1944, 141 F.2d 916. Patents 324.55(1)

In action for infringing use of patented device, court's refusal to allow plaintiff treble profits was not error, in absence of showing of abuse of discretion, vested in court by former §§ 67 and 70 of this title to increase damages. Amusement Corp. of America v. Mattson, C.C.A.5 (Fla.) 1943, 138 F.2d 693, certiorari denied 64 S.Ct. 639, 321 U.S. 782, 88 L.Ed. 1074. Patents 319(3)

The amount of increase is within the discretion of the court, and where it is not such as to indicate an abuse of judicial discretion it will not be disturbed. Van Kannel Revolving Door Co. v. Uhrich, C.C.A.8 (Kan.) 1924, 297 F. 363, certiorari denied 45 S.Ct. 91, 266 U.S. 604, 69 L.Ed. 463. See, also, Electro Bleaching Gas Co. v. Vil- lage Water Co., C.C.A.Conn.1930, 45 F.2d 696; Wallace & Tiernan Co., Inc. v. City of Syracuse, C.C.A.N.Y.1930, 45 F.2d 693; Vortex Mfg. Co. v. Ply-Rite Contracting Co., D.C.Md.1929, 33 F.2d 302.

44. ---- Moot questions, review

Where patentee would be able to collect some amount, however small, if court of appeals reversed judgment of district court holding patent invalid, appeal was not moot. Carter-Wallace, Inc. v. Otte, C.A.2 (N.Y.) 1972, 474 F.2d 529, 176 U.S.P.Q. 2, rehearing denied 176 U.S.P.Q. 452, certiorari denied 93 S.Ct. 2753, 412 U.S. 929, 37 L.Ed.2d 156, 178 U.S.P.Q. 65. Federal Courts 727; Patents 324.1

45. ---- Clearly erroneous findings, review

When district court determined during accounting stage of patent infringement action that copier's machine in-

fringed, it should have made new findings as to willfulness of copier's activities after district court entered injunction against infringement of patent for automatic rewinder used in manufacture of rolls of densely wound industrial toilet tissue and paper toweling, and thus award of treble damages for infringing manufacture of machine had to be vacated. Paper Converting Machine Co. v. Magna-Graphics Corp., C.A.Fed.1984, 745 F.2d 11, 223 U.S.P.Q. 591, on remand 631 F.Supp. 660, 228 U.S.P.Q. 524. Patents 314(6); Patents 324.60

In patent infringement action, defendant failed to show why trial court holding that, for purposes of determining damages, acceptable substitutes did not exist was clearly erroneous. Central Soya Co., Inc. v. Geo. A. Hormel & Co., C.A.Fed. (Okla.) 1983, 723 F.2d 1573, 220 U.S.P.Q. 490. Patents 312(10)

District court, at accounting trial following judgment in favor of patentee in infringement suit, was not clearly erroneous in finding that patentee was entitled to an award of a 15 percent royalty rate, and such a rate was not excessive as a matter of law. Deere & Co. v. International Harvester Co., C.A.Fed.1983, 710 F.2d 1551, 218 U.S.P.Q. 481. Patents 324.55(2)

On appeal from proceeding respecting assessment of damages in patent infringement action, the award to successful patent holder must be upheld if record contains substantial evidence to support it and the findings of fact would not be set aside unless clearly erroneous. H. K. Porter Co., Inc. v. Goodyear Tire & Rubber Co., C.A.6 (Ohio) 1976, 536 F.2d 1115, 191 U.S.P.Q. 486. Patents 324.55(1)

Reviewing court, absent clear error, could not substitute its judgment for that of trial court in ruling on motion of licensee and patent owners in infringement action for increased damages that infringer had acted in good faith, absent clear error which was not found. Maloney-Crawford Tank Corp. v. Sauder Tank Co., Inc., C.A.10 (Kan.) 1975, 511 F.2d 10, 185 U.S.P.Q. 80. Patents 324.55(2)

Finding that if holder of welding system patent, which covered an impeding device facilitating longitudinal welding of steel tubes, and the patent infringer, which manufactured welding systems, including as a component an impeder embodying the patent process, had negotiated a royalty they would have agreed on a rate of $20 per kilowatt on all infringing equipment sold after issue date of patent, which royalty was 10 percent of amount infringer was found to have charged customers for right to use welding technology, was not clearly erroneous. Foster v. American Mach. & Foundry Co., C.A.2 (N.Y.) 1974, 492 F.2d 1317, 182 U.S.P.Q. 1, certiorari denied 95 S.Ct. 58, 419 U.S. 833, 42 L.Ed.2d 59, 183 U.S.P.Q. 321, rehearing denied 95 S.Ct. 648, 419 U.S. 1061, 42 L.Ed.2d 659. Patents 324.55(2)

Findings of district court that plaintiff in patent infringement action failed to meet its burden of proving that defendant would have made all or some of its sales of rock bits without infringing seals, and failed to demonstrate with reasonable probability what portion of defendant's infringing sales patentee would have made but for infringement, were not clearly erroneous. Hughes Tool Co. v. G. W. Murphy Industries, Inc., C.A.5 (Tex.) 1973, 491 F.2d 923, 180 U.S.P.Q. 353. Patents 324.55(2)

In determining amount of reasonable royalty to be paid by infringer to holder of patent on wall paneling, district judge's decisions not to allocate additional costs because holder's product required a particularly high standard of face ply; for advertising expenses, and on ground that holder's product was a specialty rather than a staple commodity, were not clearly erroneous. Georgia-Pacific Corp. v. U. S. Plywood-Champion Papers, Inc., C.A.2 (N.Y.) 1971, 446 F.2d 295, 170 U.S.P.Q. 369, certiorari denied 92 S.Ct. 105, 404 U.S. 870, 30 L.Ed.2d 114, 171 U.S.P.Q. 322. Patents 324.55(5)

Award of $23,769.37 to patentee as profit which would have been earned on boiler cleaning operations which defendant conducted in violation of court order against infringement was not clearly erroneous notwithstanding that patent covered only one of two steps in operations. Dow Chemical Co. v. Chemical Cleaning, Inc., C.A.5 (La.) 1970, 434 F.2d 1212, 167 U.S.P.Q. 513, certiorari denied 91 S.Ct. 1621, 402 U.S. 945, 29 L.Ed.2d 113, 169 U.S.P.Q. 528. Patents 326(4)

In determining damages for infringement of design patent for garment display rack, record disclosed that findings of master and district court refusing to allow defendants a credit in respect to freight on each of 125 infringing racks shipped from New York to California were not clearly erroneous. Henry Hanger & Display Fix- ture Corp. of America v. Sel-O-Rak Corp., C.A.5 (Fla.) 1959, 270 F.2d 635, 123 U.S.P.Q. 3. Patents 324.55(2)

In patent infringement action, finding of trial court that profits from infringing activities could be reasonably measured from corporate infringer's records was not so clearly erroneous as to require application of rule that where accounting practice of an infringer does not permit a separation of infringing operations from noninfringing operations court should measure damages by inclusion of infringer's entire profit as his profit from infringement. Graham v. Jeoffroy Mfg., Inc., C.A.5 (Tex.) 1958, 253 F.2d 72, 116 U.S.P.Q. 542, certiorari denied 79 S.Ct. 28, 358 U.S. 817, 3 L.Ed.2d 59, 119 U.S.P.Q. 501, rehearing denied 79 S.Ct. 117, 358 U.S. 890, 3 L.Ed.2d 118, 119 U.S.P.Q. 501. Patents 318(4.1)

District court made clear error of judgment when, in ordering new trial on issue of damages in patent infringement action, it excluded evidence of damages regarding one of accused products, given that jury found that such product infringed patent, and that alleged infringer did not challenge jury's finding of infringement nor dispute that district court inadvertently excluded evidence of damages for such product in ordering new trial. Fisher- Price, Inc. v. Safety 1st, Inc., C.A.Fed. (Del.) 2004, 109 Fed.Appx. 387, 2004 WL 1946482, Unreported, on remand 2006 WL 839398. Patents 323.3

46. ---- Inconsistent findings, review

Finding that defendant only made a profit of one percent on the infringing structures it manufactured and sold was not inconsistent with the finding that a reasonable royalty for use of the patented device would be ten percent. Wahl v. Carrier Mfg. Co., Inc., C.A.7 (Ind.) 1975, 511 F.2d 209, 184 U.S.P.Q. 516. Patents 314(6)

47. ---- Sufficiency of evidence, review

Jury's verdict, awarding approximately $375,000 in damages to owner of patents for herbicide-resistant soybean seeds, was supported by evidence and was not grossly excessive, particularly in light of the evidence of the savings farmer achieved by his infringement, the benefits to owner from requiring farmers to adhere to terms of its standard licensing agreement, and benefits conferred by the patented technology over the use of conventional seeds. Monsanto Co. v. McFarling, C.A.Fed. (Mo.) 2007, 488 F.3d 973, 82 U.S.P.Q.2d 1942, certiorari denied 128 S.Ct. 871, 169 L.Ed.2d 724. Patents 312(10); Patents 319(1)

Patentee who put on little or no satisfactory evidence of “reasonable royalty” for infringer's sale of two infringing products could not successfully appeal on ground that $10,000 damages awarded was not reasonable. Lindemann Maschinenfabrik GmbH v. American Hoist & Derrick Co., Harris Press & Shear Div., C.A.Fed. (Tex.) 1990, 895 F.2d 1403, 13 U.S.P.Q.2d 1871. Patents 312(10)

A reviewing court must affirm an assessment of damages in a patent infringement action if there is substantial record evidence to support it. Milgo Electronic Corp. v. United Business Communications, Inc., C.A.10 (Kan.) 1980, 623 F.2d 645, 206 U.S.P.Q. 481, certiorari denied 101 S.Ct. 794, 449 U.S. 1066, 66 L.Ed.2d 611, 208 U.S.P.Q. 376. Patents 324.55(1)

There was substantial evidence in patent infringement action regarding assessment of damages to support finding that infringer would have probably continued to purchase all of its hose requirements from patent holder had it not elected to infringe the patents. H. K. Porter Co., Inc. v. Goodyear Tire & Rubber Co., C.A.6 (Ohio) 1976, 536 F.2d 1115, 191 U.S.P.Q. 486. Patents 312(10)

District judge in determining amount of reasonable royalty that infringer would have to pay patent holder did not commit reversible error by giving greater weight to those factors apparent at time of hypothetical royalty negotiations than to those occurring two or more years later. Georgia-Pacific Corp. v. U. S. Plywood-Champion Pa- pers, Inc., C.A.2 (N.Y.) 1971, 446 F.2d 295, 170 U.S.P.Q. 369, certiorari denied 92 S.Ct. 105, 404 U.S. 870, 30 L.Ed.2d 114, 171 U.S.P.Q. 322. Patents 324.56

Contention of successful party in patent infringement action that master determining damages for infringement took too narrow a view of scope of patents involved and erroneously failed to find that certain articles infringed could not be sustained where file wrappers introduced by unsuccessful party to rebut successful party's new contentions before master were not before reviewing court. Hap Corp. v. Heyman Mfg. Co., C.A.1 (R.I.) 1966, 361 F.2d 329, 149 U.S.P.Q. 588. Patents 324.1

Evidence sustained finding that defendants' infringement of patent for apparatus for diffusion photocopy method was wanton and wilful. Copease Mfg. Co. v. American Photocopy Equipment Co., C.A.7 (Ill.) 1961, 298 F.2d 772, 132 U.S.P.Q. 87. Patents 312(6)

In action for damages for patent infringement, evidence supported finding that patentee had failed to prove with sufficient accuracy for judicial determination amount of damage from loss of profits it would have made on sales of patented composition but for infringement, and amount of damage from loss of additional profit on sales which would have resulted from higher prices it could, and, but for infringement, would have charged for its patented composition. Union Carbide Corp. v. Graver Tank & Mfg. Co., C.A.7 (Ind.) 1960, 282 F.2d 653, 127 U.S.P.Q. 3, certiorari denied 81 S.Ct. 692, 365 U.S. 812, 5 L.Ed.2d 691, 129 U.S.P.Q. 557, certiorari denied 81 S.Ct. 695, 365 U.S. 812, 5 L.Ed.2d 691, 128 U.S.P.Q. 557, on remand 243 F.Supp. 358, 145 U.S.P.Q. 446. Pat- ents 312(10)

Where jury's award of damages for patent infringement was excessive, because evidence in support of award was merely speculative, Court of Appeals would set amount of remittitur at amount of proven actual sales, plus inferred sales based on amount of patented products which were supposedly in alleged infringer's inventory but could not be located, multiplied by average net profit for each sale. Oiness v. Walgreen Co., C.A.Fed. (Colo.) 1996, 88 F.3d 1025, 39 U.S.P.Q.2d 1304, rehearing denied, in banc suggestion declined , certiorari denied 117 S.Ct. 951, 519 U.S. 1112, 136 L.Ed.2d 838. Patents 324.60

48. Law of the case

Decision of the Fifth Circuit, affirming liability decision of district court that individual defendants were jointly liable for damages with corporate defendant for inducing infringement, constituted the “law of the case” and, thus, would not be reconsidered by Federal Circuit on appeal of damages portion of patent infringement action,

since there was no showing that evidence for damages portion of action was substantially different from that of liability portion, that controlling authority had since made contrary decision of law applicable, or that Fifth Cir- cuit decision was clearly erroneous and would work a substantial injustice. Kori Corp. v. Wilco Marsh Buggies and Draglines, Inc., C.A.Fed.1985, 761 F.2d 649, 225 U.S.P.Q. 985, certiorari denied 106 S.Ct. 230, 474 U.S. 902, 88 L.Ed.2d 229. Courts 96(1)

49. Remand

District court on remand in patent case was not precluded under law of case doctrine from reopening record and hearing further evidence on question of willful infringement, where Court of Appeals had previously vacated judgment insofar as it denied increased damages for willful infringement and remanded for reconsideration on issue of willful infringement. State Industries, Inc. v. Mor-Flo Industries, Inc., C.A.Fed. (Tenn.) 1991, 948 F.2d 1573, 20 U.S.P.Q.2d 1738, rehearing denied. Patents 324.60

Remand was appropriate on issue of patentee's requests to increase damages awarded by jury in patent infringement suit, because trial court in denying requests apparently considered exceptional circumstances to be required to justify award of increased damages, and jury found willful or wanton infringement of patent, which ordinarily is sufficient to support an award of increased damages. Saturn Mfg., Inc. v. Williams Patent Crusher & Pulver- izer Co., C.A.8 (Mo.) 1983, 713 F.2d 1347, 219 U.S.P.Q. 533. Patents 324.60

Time and expense consumed by patent infringement action, including four appearances before court of appeals, strongly counseled against remand for a second redetermination of damages, especially since record appeared complete and sufficient for determination thereof by reviewing court itself; although court of appeals would determine appropriate level of damages it would not perform the mathematical calculations. Trio Process Corp. v. L. Goldstein's Sons, Inc., C.A.3 (Pa.) 1980, 612 F.2d 1353, 204 U.S.P.Q. 881, certiorari denied 101 S.Ct. 91, 449 U.S. 827, 66 L.Ed.2d 30, 207 U.S.P.Q. 1064, mandate clarified 638 F.2d 661. Patents 324.60

Since plaintiffs, who successfully brought patent infringement action, failed to file an affidavit of costs and failed to offer any authenticating testimony at hearing before master, and since, additionally, it did not appear that the items proposed as costs were given “careful scrutiny” or that the discretion to allow costs was “sparingly exercised with reference to expenses not specifically allowed by statute,” the case would be remanded to the trial court with directions to redetermine allowable costs in light of pertinent standards. Wahl v. Carrier Mfg. Co., Inc., C.A.7 (Ind.) 1975, 511 F.2d 209, 184 U.S.P.Q. 516. Patents 324.60

Where an earlier judgment dismissed plaintiff's claim of unfair competition but master in awarding damages did award prepatent damages and district court adopted master's opinion as corrected without referring to issue of prepatent damages and stated that defendants or some of them had improperly acquired confidential information and trade secrets of plaintiffs, court of appeals was unable to ascertain whether referee was empowered to award damages for prepatent breach of confidence or whether first judgment absolved defendants on all breach of confidence questions, and on remand district court must enter specific findings and conclusions on effect of first judgment. Cheramie v. Orgeron, C.A.5 (La.) 1970, 434 F.2d 721, 167 U.S.P.Q. 579. Federal Courts 947

In a case involving different defendants who had done different acts over a period of years and had been in and out of the complex of activities which comprised infringement, court of appeals' remanding of case to establish damages in gross and for each defendant as well was not a determination that each defendant was liable for everything, and it was improper for master to consider on remand that all defendants were liable for the full amount of damages. Cheramie v. Orgeron, C.A.5 (La.) 1970, 434 F.2d 721, 167 U.S.P.Q. 579. Patents

324.60

II. DAMAGES

Absence of proof, royalty fees 144 Acceptable substitute, lost profits 100 Accounting 80 Accounting, infringer's profits 113 Accounting period 81, 82 Accounting period - Generally 81 Accounting period - Notice of infringement 82 Actual profits, infringer's profits 114 Actual royalties, royalty fees 143 Advice of counsel, increased damages 170 Agreements 78 Apportionment of damages 163 Apportionment of profits, limitation of infringer's profits to infringement 126 Assignments 79 Bad faith, increased damages 171 Books of account, deductions from infringer's profits 130 Champerty, measure of damages 84 Collateral profits, royalty fees 145 Commingled profits, royalty fees 146 Commingling of profits, limitation of infringer's profits to infringement 127 Competitors, lost profits 101 Competitors, royalty fees 147 Computation of interest 182 Computation of profits, infringer's profits 115 Computation of profits, lost profits 102 Condition of patent holder, measure of damages 85 Cost, royalty fees 148 Costs, deductions from infringer's profits 131 Damages beyond profits 136 Damages generally 71 Deductions from infringer's profits 129-135 Deductions from infringer's profits - Generally 129 Deductions from infringer's profits - Books of account 130 Deductions from infringer's profits - Costs 131 Deductions from infringer's profits - Interest 132 Deductions from infringer's profits - Losses 133 Deductions from infringer's profits - Overhead expenses 134 Deductions from infringer's profits - Taxes 135 Deductions, increased damages 172

Deliberate infringement, increased damages 173 Design patents 77 Discretion of court 73 Discretion of court, increased damages 169 Discretion of court, treble damages 166 Due care, increased damages 174 Duty to apportion profits, limitation of infringer's profits to infringement 125 Economic slump, lost profits 103 Entire market value rule, measure of damages 86 Entire profits attributable, limitation of infringer's profits to infringement 128 Entire profits attributable, royalty fees 149 Established royalty fees 150 Exceptional contracts, royalty fees 151 Excessive damages 139 Expert testimony, royalty fees 152 Factors, royalty fees 141 Failure to bid, lost profits 104 Fees advocated by parties, royalty fees 153 Future profits, royalty fees 154 Good faith, increased damages 175 Good faith, interest 183 Improvements, infringer's profits 116 Improvements, measure of damages 87 Increased damages 168-180, 184 Increased damages - Generally 168 Increased damages - Advice of counsel 170 Increased damages - Bad faith 171 Increased damages - Deductions 172 Increased damages - Deliberate infringement 173 Increased damages - Discretion of court 169 Increased damages - Due care 174 Increased damages - Good faith 175 Increased damages - Infringer's profit 176 Increased damages - Interest 184 Increased damages - Negative effect on patentee 177 Increased damages - Particular cases 180 Increased damages - Present value of infringement 178 Increased damages - Willfulness 179 Infringer's profit, increased damages 176 Infringer's profits 112-123, 155 Infringer's profits - Generally 112 Infringer's profits - Accounting 113 Infringer's profits - Actual profits 114 Infringer's profits - Computation of profits 115 Infringer's profits - Improvements 116

Infringer's profits - Items of recoverable profits 117 Infringer's profits - Lack of infringer's profits 118 Infringer's profits - License agreements 119 Infringer's profits - Nominal damages 120 Infringer's profits - Particular cases 123 Infringer's profits - Royalty fees 155 Infringer's profits - Savings 121 Infringer's profits - Speculative profits 122 Interest 132, 181-188 Interest - Generally 181 Interest - Computation of interest 182 Interest - Deductions from infringer's profits 132 Interest - Good faith 183 Interest - Increased damages 184 Interest - Prejudgment interest 185 Interest - Review 188 Interest - Stay of action 186 Interest - Time period for interest 187 Items of recoverable profits, infringer's profits 117 Items of recoverable profits, lost profits 105 Jury determinations 74 Knowledge, measure of damages 88 Lack of infringer's profits 118 License agreements, infringer's profits 119 License agreements, royalty fees 156 License fees, measure of damages 89 Licensee profits, lost profits 106 Licensees, measure of damages 90 Limitation of infringer's profits to infringement 124-128 Limitation of infringer's profits to infringement - Generally 124 Limitation of infringer's profits to infringement - Apportionment of profits 126 Limitation of infringer's profits to infringement - Commingling of profits 127 Limitation of infringer's profits to infringement - Duty to apportion profits 125 Limitation of infringer's profits to infringement - Entire profits attributable 128 Losses, deductions from infringer's profits 133 Lost profitsLost profits - Generally 99 Lost profits - Acceptable substitute 100 Lost profits - Competitors 101 Lost profits - Computation of profits 102 Lost profits - Economic slump 103 Lost profits - Failure to bid 104 Lost profits - Items of recoverable profits 105 Lost profits - Licensee profits 106 Lost profits - Measure of damages 91 Lost profits - Measure of profits 107

Lost profits - Particular cases 111 Lost profits - Price averaging 108 Lost profits - Price reductions 109 Lost profits - Royalty fees 157 Lost profits - Services related to sales 110 Master's determinations 75 Measure of damages 83-98 Measure of damages - Generally 83 Measure of damages - Champerty 84 Measure of damages - Condition of patent holder 85 Measure of damages - Entire market value rule 86 Measure of damages - Improvements 87 Measure of damages - Knowledge 88 Measure of damages - License fees 89 Measure of damages - Licensees 90 Measure of damages - Lost profits 91 Measure of damages - Royalties 92 Measure of damages - Settlement amounts 93 Measure of damages - Time of measuring 94 Measure of damages - Trade secrets 95 Measure of damages - Unfair competition 96 Measure of damages - Unjust enrichment 97 Measure of damages - Willfulness 98 Measure of profits, lost profits 107 Negative effect on patentee, increased damages 177 Nominal damages 138 Nominal damages, infringer's profits 120 Nonuse by patentee, royalty fees 158 Notice of infringement, accounting period 82 Overhead expenses, deductions from infringer's profits 134 Particular cases, increased damages 180 Particular cases, infringer's profits 123 Particular cases, lost profits 111 Particular cases, royalty fees 162 Prejudgment interest 185 Present value of infringement, increased damages 178 Price averaging, lost profits 108 Price reductions, lost profits 109 Profits beyond damages 137 Profits generally 72 Punitive damages 164 Reasonable royalty fees 142 Restitution 189 Review, interest 188 Royalties, measure of damages 92

Royalty fees 140-162 Royalty fees - Generally 140 Royalty fees - Absence of proof 144 Royalty fees - Actual royalties 143 Royalty fees - Collateral profits 145 Royalty fees - Commingled profits 146 Royalty fees - Competitors 147 Royalty fees - Cost 148 Royalty fees - Entire profits attributable 149 Royalty fees - Established royalty fees 150 Royalty fees - Exceptional contracts 151 Royalty fees - Expert testimony 152 Royalty fees - Factors 141 Royalty fees - Fees advocated by parties 153 Royalty fees - Future profits 154 Royalty fees - Infringer's profits 155 Royalty fees - License agreements 156 Royalty fees - Lost profits 157 Royalty fees - Nonuse by patentee 158 Royalty fees - Particular cases 162 Royalty fees - Reasonable royalty fees 142 Royalty fees - Settlements 159 Royalty fees - Time of determination 160 Royalty fees - Willfulness 161 Savings, infringer's profits 121 Services related to sales, lost profits 110 Settlement amounts, measure of damages 93 Settlements, royalty fees 159 Speculative profits, infringer's profits 122 Stay of action, interest 186 Taxes, deductions from infringer's profits 135 Time of determination, royalty fees 160 Time of measuring, measure of damages 94 Time period for interest 187 Trade secrets, measure of damages 95 Treble damages 165-167 Treble damages - Generally 165 Treble damages - Discretion of court 166 Treble damages - Willfulness 167 Unfair competition, measure of damages 96 Unjust enrichment, measure of damages 97 Validity of patent 76 Willfulness, increased damages 179 Willfulness, measure of damages 98 Willfulness, royalty fees 161

Willfulness, treble damages 167

71. Damages generally

In patent nomenclature, what the infringer makes is “profits” and what the owner of the patent loses by such infringement is “damages.” Duplate Corp. v. Triplex Safety Glass Co. of North America, U.S.Pa.1936, 56 S.Ct. 792, 298 U.S. 448, 80 L.Ed. 1274. See, also, Birdsall v. Coolidge, Nev.1876, 93 U.S. 64, 22 L.Ed. 802; Mathey v. C.I.R., C.A.1, 1949, 177 F.2d 259, certiorari denied 70 S.Ct. 797, 339 U.S. 943, 94 L.Ed. 1359; Diamond Stone-Saving Mach. Co. of New York v. Brown, N.Y.1908, 166 F. 306, 92 C.C.A. 224; Wooster v. Trowbridge, C.C.N.Y.1902, 115 F. 722; Covert v. Sargent, C.C.N.Y.1890, 42 F. 298; Goodyear Dental Vulcanite Co. v. Van Antwerp, C.C.N.J.1876, 2 B. & A.Pat.Cas. 252, Fed.Cas. No. 5,600. Patents 318(1); Patents 319(1)

Patent infringement plaintiff's sending of letter during settlement negotiations, placing defendant on notice of potential infringement of subject matter contained in separate patent application, was not litigation misconduct, for purpose of awarding attorney fees, even though plaintiff had not yet filed information disclosure statement with Patent and Trademark Office and it subsequently amended application. Stephens v. Tech Intern., Inc., C.A.Fed. (Nev.) 2004, 393 F.3d 1269, 73 U.S.P.Q.2d 1369. Patents 325.11(4)

“Damages” recoverable by patent holder to compensate for infringements are compensation for pecuniary loss patent holder suffered from infringement, without regard to question whether infringer gained or lost by his unlawful acts. Stickle v. Heublein, Inc., C.A.Fed.1983, 716 F.2d 1550, 219 U.S.P.Q. 377, on remand 590 F.Supp. 630, 224 U.S.P.Q. 910. Patents 319(1)

“Damages” for patent infringement are compensation awarded patentee for legal injury, actually undergone to his rights. Miller v. Weller, C.A.3 (Pa.) 1961, 288 F.2d 438, 128 U.S.P.Q. 514, certiorari denied 82 S.Ct. 51, 368 U.S. 829, 7 L.Ed.2d 32, 131 U.S.P.Q. 499. Patents 319(1)

Only those injuries from patent infringement that are consistent with purposes of patent laws should be considered to be legally compensable. DSU Medical Corp. v. JMS Co., Ltd., N.D.Cal.2003, 296 F.Supp.2d 1140. Patents 319(1)

Phrase “damages adequate to compensate for the infringement” in this section means nothing other than compensatory damages, namely, amount, though difficult to ascertain precisely, which indemnifies plaintiff for injury and damage suffered by him. Georgia-Pacific Corp. v. U. S. Plywood Corp., S.D.N.Y.1965, 243 F.Supp. 500, 146 U.S.P.Q. 228. Patents 319(1)

Royalties which may be obtained from others using patent are the equivalent of the rents and profits of land and the word “damages” in condition of supersedeas bond cover the deprivation of a patentee of royalties under his patent. MacDonald v. Winfield Corp., E.D.Pa.1952, 104 F.Supp. 609, 92 U.S.P.Q. 354. Appeal And Error 1234(4); Patents 218(1)

Damages to the owner of a patent are the losses sustained by him in consequence of the infringement. La Baw v. Hawkins, C.C.N.J.1877, 14 F.Cas. 899, No. 7961. Patents 319(1)

72. Profits generally, damages

Recovery in trade secret or infringement cases is denominated “profits”. International Industries, Inc. v. Warren Petroleum Corp., C.A.3 (Del.) 1957, 248 F.2d 696, 115 U.S.P.Q. 104, 115 U.S.P.Q. 159, certiorari dismissed 78

S.Ct. 529, 355 U.S. 943, 2 L.Ed.2d 523. Damages 114

Profits and damages are distinct from and independent of each other and governed by different principles, and one cannot be said to be the measure of the other, nor the allowance of one to preclude recovery of the other. Westinghouse v. New York Air Brake Co, C.C.S.D.N.Y.1904, 131 F. 607, reversed on other grounds 140 F. 545, 72 C.C.A. 61, certiorari denied 26 S.Ct. 762, 201 U.S. 648, 50 L.Ed. 904. See, also, Beach v. Hatch, C.C.Mass.1907, 153 F. 763.

Plaintiffs awarded damages for misappropriation of trade secrets in a decree calling for an award of damages including profits were not entitled to an award of damages for good will or going concern value of defendant's pressurized shaving cream business based on defendant's sales of products which had incorporated plaintiff's trade secrets, in view of fact the word “profits,” as used in such decree could not be construed to include good will. Carter Products, Inc. v. Colgate-Palmolive Co., D.C.Md.1963, 214 F.Supp. 383, 136 U.S.P.Q. 348, 136 U.S.P.Q. 577. Antitrust And Trade Regulation 437

Complainant is entitled to finding of both damages and profits against infringer and has right of choice. Christensen v. National Brake & Elec. Co., D.C.Wis.1924, 10 F.2d 856. See, also, Mathey v. United Shoe Ma- chinery Corporation, D.C.Mass.1944, 54 F.Supp. 694. Patents 318(2)

73. Discretion of court, damages

Under this section governing damages award for patent infringement, awarding of damages involves subtle judicial function, and considerable attitude is allowed. John Zink Co. v. National Airoil Burner Co., Inc., C.A.Tex.1980, 613 F.2d 547. See, also Devex Corp. v. General Motors Corp., C.A.3 (Del.) 1981, 667 F.2d 347, 212 U.S.P.Q. 643, certiorari granted 102 S.Ct. 2267, 456 U.S. 988, 73 L.Ed.2d 1283, certiorari denied 102 S.Ct. 2270, 456 U.S. 990, 73 L.Ed.2d 1285, rehearing denied 106 S.Ct. 212, 474 U.S. 890, 88 L.Ed.2d 181, affirmed 103 S.Ct. 2058, 461 U.S. 648, 76 L.Ed.2d 211, 217 U.S.P.Q. 1185. Patents 319(1)

The trial judge has considerable latitude in assessing damages in a patent/infringement action. Milgo Electronic Corp. v. United Business Communications, Inc., C.A.10 (Kan.) 1980, 623 F.2d 645, 206 U.S.P.Q. 481, certiorari denied 101 S.Ct. 794, 449 U.S. 1066, 66 L.Ed.2d 611, 208 U.S.P.Q. 376. Patents 319(1)

Considerable attitude is to be afforded trial court in assessing damages in patent infringement actions. Maloney- Crawford Tank Corp. v. Sauder Tank Co., Inc., C.A.10 (Kan.) 1975, 511 F.2d 10, 185 U.S.P.Q. 80. Patents 319(1)

This section authorizing award of damages to a claimant to compensate for infringement together with interest and costs as fixed by the court was intended to grant trial court its traditional discretionary power in equity. Georgia-Pacific Corp. v. U. S. Plywood-Champion Papers, Inc., C.A.2 (N.Y.) 1971, 446 F.2d 295, 170 U.S.P.Q. 369, certiorari denied 92 S.Ct. 105, 404 U.S. 870, 30 L.Ed.2d 114, 171 U.S.P.Q. 322. Patents 319(1)

Award of damages for patent infringement was discretionary. Hartford Nat. Bank & Trust Co. v. E. F. Drew & Co., C.A.3 (Del.) 1961, 290 F.2d 589, 129 U.S.P.Q. 204, certiorari denied 82 S.Ct. 45, 368 U.S. 825, 7 L.Ed.2d 29, 131 U.S.P.Q. 498. Patents 319(1)

either known or so obvious that defendant should have known. Informatica Corp. v. Business Objects Data In- tegration, Inc., N.D.Cal.2007, 527 F.Supp.2d 1076. Patents 319(3)

Methodology of assessing and computing patent infringement damages is within sound discretion of court. Wis- consin Alumni Research Foundation v. General Elec. Co., E.D.Wis.1995, 880 F.Supp. 1266. Patents 319(1)

There is no litmus test with respect to the treatment of overhead or fixed costs in a determination of the net profit from design patent infringement, and the allowance or extent of the use of fixed expenses to offset profits is essentially within the discretion of the district court. Bergstrom v. Sears, Roebuck and Co., D.C.Minn.1980, 496 F.Supp. 476, 207 U.S.P.Q. 481. Patents 318(6)

74. Jury determinations, damages

Owner of patent for device for electronically measuring movement of caliper's slide relative to its scale did not establish overlap between market for its products and those of competitor, and thus was not entitled to jury trial on lost profit damages in its patent infringement action, given that owner's calipers were more complex product than that marketed by competitor, such that there was very little price overlap, that owner offered no direct evidence to suggest overlap among consumers buying parties' respective goods, and that competitor showed that its products were sold almost entirely outside price range in which owner's customers were likely to buy. Mitutoyo Corp. v. Central Purchasing, LLC, C.A.Fed. (Ill.) 2007, 499 F.3d 1284, 84 U.S.P.Q.2d 1001. Patents 314(5)

In patent infringement suit, in determining whether patentee was entitled to increased damages or attorney fees for bad faith infringement, trial court was bound by jury's determinations that infringer had acted in bad faith and had willfully infringed patent; however, court still had discretion to decline to award increased damages or attorney fees. Jurgens v. CBK, Ltd., C.A.Fed. (Tenn.) 1996, 80 F.3d 1566, 38 U.S.P.Q.2d 1397, rehearing denied , in banc suggestion declined. Patents 319(3)

Where plaintiff, apparently dissatisfied with size of jury verdict, sought in posttrial motion to have court recon- sider evidence and award relief based on essentially same standard which jury used, district court properly decided not to do so, in view of fact that, although it might have been better for court to require plaintiff to elect his remedy expressly prior to instructing jury, plaintiff did not object to court's procedure and was apparently satisfied to let jury determine appropriate award. Roberts v. Sears, Roebuck & Co., C.A.7 (Ill.) 1978, 573 F.2d 976, 197 U.S.P.Q. 516, certiorari denied 99 S.Ct. 179, 439 U.S. 860, 58 L.Ed.2d 168, certiorari denied 99 S.Ct. 179, 439 U.S. 860, 58 L.Ed.2d 168, 199 U.S.P.Q. 640, on remand 471 F.Supp. 372, 202 U.S.P.Q. 727. Federal Civil Procedure 2343

Jury's finding that defendants wilfully infringed and that compensatory damages should be trebled is advisory only. White v. Mar-Bel, Inc., C.A.5 (Fla.) 1975, 509 F.2d 287, 185 U.S.P.Q. 129, rehearing denied 511 F.2d 1402. See, also, Medtronic, Inc. v. Catalyst Research Corp., D.C.Minn.1982, 547 F.Supp. 401, 216 U.S.P.Q. 687. Patents 319(3)

Provision of this section that when damages are not found by jury, court shall assess them, makes apparent that Congress contemplated that damages would in some cases be determined by jury. Kennedy v. Lakso Co., C.A.3 (N.J.) 1969, 414 F.2d 1249, 163 U.S.P.Q. 136. Jury 14(11)

Claim for damages based upon charge of patent infringement is a “legal” claim for which parties are entitled to jury trial. Swofford v. B & W, Inc., C.A.5 (Tex.) 1964, 336 F.2d 406, 142 U.S.P.Q. 291, certiorari denied 85 S.Ct. 653, 379 U.S. 962, 13 L.Ed.2d 557, 144 U.S.P.Q. 780. Jury 14(1.1)

Court could award equitable relief to patent owner in form of permanent injunction or ongoing royalty for future infringement of its patent without infringing competitor's Seventh Amendment jury trial rights, after owner waived its Seventh Amendment right to jury trial during trial when it decided to not put on evidence in support of its contention that 2% would have been reasonable royalty rate and instead chose to rely on testimony about reasonable rates for other, similar patents, despite fact that its own witness had testified that every license negotiation was distinct. Boston Scientific Corp. v. Johnson & Johnson, N.D.Cal.2008, 550 F.Supp.2d 1102. Jury 14(1.1)

Patent owner waived its Seventh Amendment right to jury trial when, during trial, it decided to not put on evidence in support of its contention that 2% would have been reasonable royalty rate and instead chose to rely on testimony about reasonable rates for other, similar patents, despite fact that its own witness had testified that every license negotiation was distinct; although owner did not go so far as to state explicitly that it was waiving its right to jury trial on issue of damages, it knew that it would forego jury trial if it chose to not put on evidence. Boston Scientific Corp. v. Johnson & Johnson, N.D.Cal.2008, 550 F.Supp.2d 1102. Jury 28(5)

Whether defendant willfully infringed patent, as would support enhanced damages, was for jury, where defendant's engineer stated that they were “definitely infringing” patent, defendant's counsel stated that plaintiff had “several patents on products/processes that appear to be similar to the way our products work,” defendant re- leased product while potentially on notice of infringement, and defendant continued to infringe after suit was filed. Informatica Corp. v. Business Objects Data Integration, Inc., N.D.Cal.2007, 527 F.Supp.2d 1076. Patents 314(5)

Amount of damages suffered by buyer of corporation's subsidiary as result of corporation's failure to settle patent infringement claims against subsidiary prior to sale was issue of fact for jury in buyer's action for indemnity; buyer's damages were not liquidated, since corporation was responsible only for liability incurred prior to clos- ing, and buyer had burden of proving that amount paid for preclosing patent infringement was reasonable. Inter- national Minerals & Chemical Corp. v. Avon Products, Inc., Mo.App. E.D.1994, 889 S.W.2d 111, rehearing and/or transfer denied. Indemnity 104

Enhanced damages were not warranted in action for infringement of several patents covering high-speed coin sorting machines, despite jury's finding of willfulness, in view of evidence of legal opinions prepared for infringer by patent counsel, which district court had reserved for its own review to avoid difficulties of permitting trial counsel to testify, of infringer's attempt to design around patents, and of infringer's good faith during course of litigation. Ristvedt-Johnson, Inc. v. Brandt, Inc., N.D.Ill.1992, 805 F.Supp. 557. Patents 319(3)

After finding that hair dryers containing a nonresettable device intended to stop the flow of electricity if the dryers become immersed in water infringed patent for protective mechanism in electrically operated devices under doctrine of equivalents, reasonable jury could have awarded inventor $28,500,000, based on multiplying 77 million hair dryers by a royalty of 37 cents per unit; both number of units and reasonable royalty rate were supported by expert testimony. Gaus v. Conair Corp., S.D.N.Y.2003, 2003 WL 223859, Unreported, reversed 363 F.3d 1284, 70 U.S.P.Q.2d 1380, rehearing and rehearing en banc denied , certiorari denied 125 S.Ct. 346, 543 U.S. 927, 160 L.Ed.2d 226. Patents 319(1)

75. Master's determinations, damages

A patentee is not limited before the master determining damages for patent infringement to precise matters which have been presented to district court; broader claims for infringement may be advanced. Hap Corp. v. Heyman Mfg. Co., C.A.1 (R.I.) 1966, 361 F.2d 329, 149 U.S.P.Q. 588. Patents 322

In patent infringement suit, master's assessment of damages measured by patent owner's lost profits on sales which it would have made in absence of defendant's infringement, master's restatement of defendant's sales at 20 percent higher level to reflect higher prices for patent owner's products, and master's findings as to details of accountants' incremental cost analysis as applied to patent owner's incremental sales were not clearly erroneous. Paper Converting Mach. Co., Inc. v. FMC Corp., E.D.Wis.1977, 432 F.Supp. 907, 195 U.S.P.Q. 123, affirmed 588 F.2d 832. Patents 322

Findings made at conclusion of trial for patent infringement and misappropriation of trade secrets and at conclusion of contempt proceedings were binding upon master to whom case was referred for determination and report on damages. Carter Products, Inc. v. Colgate-Palmolive Co., D.C.Md.1963, 214 F.Supp. 383, 136 U.S.P.Q. 348, 136 U.S.P.Q. 577. Federal Civil Procedure 1893.1; Patents 322

Whether defendant whose patent had been infringed was entitled to treble damages pursuant to this section was to be considered by master in determination of damages, but findings were subject to review and final determination of court. E.J. Brooks Co. v. Stoffel Seals Corp., S.D.N.Y.1958, 160 F.Supp. 581, 117 U.S.P.Q. 91, reversed on other grounds 266 F.2d 841, 121 U.S.P.Q. 333, certiorari denied 80 S.Ct. 154, 361 U.S. 883, 4 L.Ed.2d 119, 123 U.S.P.Q. 591. Patents 314(4); Patents 319(3)

Notwithstanding omission from this section of words “or cause the same (damages) to be assessed under its direction”, which were contained in former § 70 of this title, district court still had power to refer issue of damages in infringement suit to special master. Modern Art Printing Co. v. Skeels, D.C.N.J.1954, 123 F.Supp. 426, 102 U.S.P.Q. 286, reversed on other grounds 223 F.2d 719, 106 U.S.P.Q. 8. Patents 322

Where defendant had not deliberately infringed plaintiff's patent but honestly sought to avoid infringement and succeeded in large measure, court would appoint master to determine extent, if any, of plaintiff's damages by accounting and measure of damages was reasonable royalty for such use as may have been made of invention by defendant together with interest costs to be split between parties, and attorney's fees would not be awarded. Berry Bros. Corp. v. Sigmon, W.D.N.C.1962, 206 F.Supp. 653, 134 U.S.P.Q. 283, affirmed 317 F.2d 700, 137 U.S.P.Q. 590. Patents 319(1); Patents 319(4); Patents 322; Patents 325.11(5)

76. Validity of patent, damages

Plaintiff is entitled to recover the amount of gains and profits that defendants have made by the use of his process, although he has established license fees. Tilghman v. Proctor, U.S.Ohio 1888, 8 S.Ct. 894, 125 U.S. 136, 31 L.Ed. 664. See, also, Williams v. Rome, W. & O.R. Co., C.C.N.Y.1880, 2 F. 702; Wooster v. Taylor, C.C.N.Y.1878, Fed.Cas. No. 18,041; Knox v. Great Western Quicksilver Min. Co., C.C.Cal.1878, 6 Sawy. 430, Fed.Cas. No. 7,907. Patents 318(1)

In action against licensee for infringement of patent on plastic tie strip, district court's finding that licensor was entitled to compensation in amount of $53,088.90 for its knowhow in manufacturing product, despite patent's invalidity, was not clearly erroneous. St. Regis Paper Co. v. Royal Industries, C.A.9 (Cal.) 1977, 552 F.2d 309,

194 U.S.P.Q. 52, certiorari denied 98 S.Ct. 633, 434 U.S. 996, 54 L.Ed.2d 490, certiorari denied 98 S.Ct. 633, 434 U.S. 996, 54 L.Ed.2d 490, 196 U.S.P.Q. 208. Patents 324.55(2)

On accounting for damages for patent infringement, court properly avoided commingling allowable damages from infringement of valid patent with damages from inclusion in infringing device of elements of other patents held void. Enterprise Mfg. Co. v. Shakespeare Co., C.C.A.6 (Mich.) 1944, 141 F.2d 916. Patents 319(1)

Closeness of question as to whether defendant's patent infringement was willful warranted finding that case was not exceptional, and thus that attorney fee award was not warranted. Novo Industries, L.P. v. Micro Molds Corp., S.D.Fla.2002, 239 F.Supp.2d 1282, reversed 350 F.3d 1348, 69 U.S.P.Q.2d 1128. Patents 325.11(2.1)

77. Design patents, damages

Joinder of patent infringement defendants' sole owner as defendant in his individual capacity, following finding of defendants' liability, was not abuse of discretion; owner was individually responsible for all conduct that led court to increase damages and award attorney fees. Insituform Technologies, Inc. v. CAT Contracting, Inc., C.A.Fed.2004, 385 F.3d 1360, 72 U.S.P.Q.2d 1870, on remand 518 F.Supp.2d 876. Patents 290(3)

This section providing that the court shall award claimant damages adequate to compensate for the infringement, but in no event less than a reasonable royalty for the use made of the invention by the infringer, together with interest and costs as fixed by the court, applies to design patents as well as to other patents. Henry Hanger & Dis- play Fixture Corp. of America v. Sel-O-Rak Corp., C.A.5 (Fla.) 1959, 270 F.2d 635, 123 U.S.P.Q. 3. Patents 319(1); Patents 319(4); Patents 325.1

Since in revision of former § 70 of this title by Act Aug. 1, 1946, c. 726, § 1, 60 Stat. 778, Congress restricted a utility patentee's recovery to damages alone but left undisturbed preexisting law with respect to right of a design patentee to also recover profits, the pre-1946 case law on the subject of recovery of profits by utility patentees is entitled to substantial weight in the design patent context. Bergstrom v. Sears, Roebuck and Co., D.C.Minn.1980, 496 F.Supp. 476, 207 U.S.P.Q. 481. Patents 318(1); Patents 319(1)

Former § 70 of this title was applicable to all patents, including design patents, and a successful plaintiff in such action was not limited to recovery of $250 under former § 74 of this title [now § 289 of this title] which specifically referred to design patents and provided that violator of such former section shall have been liable in amount of $250 and for excess of profits over $250 if total profits made by violator from manufacture or sale exceeded $250. Krieger v. Colby, S.D.Cal.1952, 106 F.Supp. 124, 95 U.S.P.Q. 4.

Where defendant who infringed plaintiff's valid design patent for cap which resembled a rabbit's head and face paid third person $1,000 for right to use a certain name on caps, use of design would be held to be worth as much as use of name and plaintiff would be awarded general damages of $1,000 rather than being awarded 10 percent royalty on gross sales which would be a smaller amount. Krieger v. Colby, S.D.Cal.1952, 106 F.Supp. 124, 95 U.S.P.Q. 4. Patents 319(1)

78. Agreements, damages

Manufacturer who accepted inventor's offer to disclose his invention, made with view of selling it to manufacturer, was liable for profits and damages on account of infringing devices sold by it prior to grant of patent to in-

ventor, since agreement to hold the disclosed information confidential was implied. Hoeltke v. C.M. Kemp Mfg. Co., C.C.A.4 (Md.) 1935, 80 F.2d 912, certiorari denied 56 S.Ct. 938, 298 U.S. 673, 80 L.Ed. 1395. Patents 191

79. Assignments, damages

Mere assignment of patent which does not also expressly assign right to recover damages or profits from previous infringement does not transfer right to recover such damages or profits. John L. Rie, Inc. v. Shelly Bros., Inc., E.D.Pa.1973, 366 F.Supp. 84, 181 U.S.P.Q. 157. Patents 286

No stipulation between patentee and assignee as to royalty to be charged can prevent latter from recovering from infringer, the whole profits realized. City of Elizabeth v. American Nicholson Pavement Co., U.S.N.J.1877, 97 U.S. 126, 7 Otto 126, 24 L.Ed. 1000, motion denied 24 L.Ed. 1059. Patents 318(1)

80. Accounting, damages

Proceedings to establish extent of damages for patent infringement through accounting would follow as a separate trial after liability was established. Baut v. Pethick Const. Co., M.D.Pa.1966, 262 F.Supp. 350, 152 U.S.P.Q. 212. Patents 322

An accounting for damages for infringement of valid claim of patent would await conclusion of appellate review or the expiration of the time for taking an appeal if none is taken. Gould-National Batteries, Inc. v. Gulton In- dustries, Inc., D.C.N.J.1964, 231 F.Supp. 609, 142 U.S.P.Q. 475, affirmed 361 F.2d 912, 150 U.S.P.Q. 77. Pat- ents 322

Plaintiffs were entitled to an accounting against defendants on unfair competition and trade by the defendants against the plaintiffs and to fix damages adequate to compensate for infringement and contributory infringement by defendants of plaintiffs' patents. Ibis Enterprises, Limited v. Spray-Bilt, Inc., S.D.Fla.1963, 220 F.Supp. 65, 139 U.S.P.Q. 81, reversed on other grounds 350 F.2d 99, 146 U.S.P.Q. 686. Patents 322

Where holder of patent did not buy its predecessor's inventory because it wished to enter the business of selling that inventory but merely because the predecessor wanted, as part of overall transaction, to get out of the business entirely, an award of accounting for sales of infringing, nonlicensed products could make the patentholder whole despite its claim that such an award would not represent compensation for its lost opportunity of going in- to the business of selling such devices itself. B & J Mfg. Co. v. Hennessy Industries, Inc., N.D.Ill.1979, 493 F.Supp. 1105, 206 U.S.P.Q. 542, affirmed 663 F.2d 1075, certiorari denied 102 S.Ct. 645, 454 U.S. 1086, 70 L.Ed.2d 622, 213 U.S.P.Q. 1136. Patents 319(1)

Patent holder was entitled to accounting to ascertain amount of damage sustained as result of infringement by defendant of each of four patents. Ransburg Electro-Coating Corp. v. Ford Motor Co., S.D.Ind.1965, 245 F.Supp. 308, 146 U.S.P.Q. 436. Patents 319(1)

After it has chosen an accounting method, district court is free to use its discretion in choosing charts or figures from which to determine amount of damages for infringement of patents. Paper Converting Machine Co. v. Magna-Graphics Corp., C.A.Fed.1984, 745 F.2d 11, 223 U.S.P.Q. 591, on remand 631 F.Supp. 660, 228 U.S.P.Q. 524. Patents 319(1)

One whose plans, communicated confidentially to automobile manufacturer, entered into design of new car, was

entitled to accounting of damage and profits to extent that novel features of such plans contributed to car's success and designer was harmed. Booth v. Stutz Motor Car Co. of America, C.C.A.7 (Ind.) 1932, 56 F.2d 962. Pat- ents 318(1)

In a suit involving a device connected with dog racing it has been said incidentally that the machinery of the courts must not be used directly or indirectly to require one party to account to another for profits derived from a violation of any law. Magic City Kennel Club v. Smith, C.C.A.10 (Okla.) 1930, 38 F.2d 170, certiorari granted 50 S.Ct. 410, 281 U.S. 714, 74 L.Ed. 1135, affirmed 51 S.Ct. 291, 282 U.S. 784, 75 L.Ed. 707.

That part of decree, in patent infringement action, directing an accounting to determine damages which plaintiff had suffered and profits which defendants had made by reason of defendants' infringement, would not be stricken on ground that the only possible result of carrying through the accounting would be an award of nominal damages, where facts did not absolutely rule out any possibility of substantial recovery under the decree. Kel- logg Switchboard & Supply Co. v. Michigan Bell Tel. Co., E.D.Mich.1947, 71 F.Supp. 365, 74 U.S.P.Q. 53. Patents 322

Accounting will be denied, when patentee without protest has permitted infringer slowly to build up large business. Dwight & Lloyd Sintering Co. v. Greenawalt, C.C.A.2 (N.Y.) 1928, 27 F.2d 823. Patents 318(1)

Accounting will be limited to infringing acts of manufacturing and selling patented device adjudged by decree, exclusive of contributing infringing use. Christensen v. National Brake & Elec. Co., D.C.Wis.1927, 18 F.2d 981. Patents 318(1)

Where defendants' infringement is plain, but they have denied infringement until after suit is brought, they cannot defeat complainants' right to an accounting by offering to pay royalty. Fisk v. Mahler, C.C.S.D.N.Y.1892, 54 F. 528.

81. Accounting period, damages--Generally

Damages for infringement of a reissued patent cannot be recovered for any time antecedent to the date of the reissue. Agawam Woolen Co. v. Jordan, U.S.Mass.1868, 74 U.S. 583, 19 L.Ed. 177, 7 Wall. 583. Patents 319(1)

Damages should be estimated only for the period of the infringement and not for the whole term of the patent. Suffolk Co. v. Hayden, U.S.Mass.1865, 70 U.S. 315, 18 L.Ed. 76, 3 Wall. 315. See, also, Whittemore v. Cutter, C.C.Mass.1813, 1 Gall. 478, Fed.Cas. No. 17,601. Patents 275

Holder of patent can recover only for acts of infringement committed after date of issue of patent and prior to date of expiration of patent, subject to statute of limitations. Custer v. U. S., Ct.Cl.1980, 622 F.2d 554, 224 Ct.Cl. 140, 208 U.S.P.Q. 886, certiorari denied 101 S.Ct. 565, 449 U.S. 1010, 66 L.Ed.2d 468, 208 U.S.P.Q. 88. Patents 226.10

Any relief to which plaintiff might be entitled in patent infringement suit would be confined to damages which accrued prior to date of expiration of patent. Ferment-Acid Corp. v. Miles Laboratories, Inc., C.A.7 (Ind.) 1964, 338 F.2d 586, 143 U.S.P.Q. 275. Patents 319(1)

Where a defendant was guilty of tortiously using plaintiff's trade secret for converting a dry cargo vessel to a vessel for transportation of liquefied petroleum gas, if district court found it necessary to refuse issuance of an

injunction restraining defendant from further use of such vessel, it was required to compute not only damages to date, but also to make some provision for future benefits attendant upon defendants' continued use of converted vessel. International Industries, Inc. v. Warren Petroleum Corp., C.A.3 (Del.) 1957, 248 F.2d 696, 115 U.S.P.Q. 104, 115 U.S.P.Q. 159, certiorari dismissed 78 S.Ct. 529, 355 U.S. 943, 2 L.Ed.2d 523. Damages 114

Patentor licensor who had had illegal license agreements purged itself of misuse from date that it ceased enfor- cing illegal provisions and sought to eliminate them from contract, and could recover damages for infringement from that date. Metals Disintegrating Co. v. Reynolds Metals Co., C.A.3 (Del.) 1956, 228 F.2d 885, 108 U.S.P.Q. 143. Antitrust And Trade Regulation 587(3)

Where defendants after issuance of injunction in patent infringement suit continued infringing by use of an equivalent system and thereby reaped large profits, defendants in proceeding for supplementary decree and for contempt were properly required to account for profits made from date of original decree to date of contempt decree. Textag Co. v. Hayslip, C.A.5 (Ga.) 1951, 192 F.2d 435, 91 U.S.P.Q. 283. Patents 326(4)

Former § 70 of this title having given court power to grant injunction to prevent violation of patent rights and to recover damages for infringement did not authorize recovery of damages for acts done prior to issuance of patent. Zalkind v. Scheinman, C.C.A.2 (N.Y.) 1943, 139 F.2d 895, certiorari denied 64 S.Ct. 1055, 322 U.S. 738, 88 L.Ed. 1572. See, also, Columbia & N.R.R. Co. v. Chandler, Or.1917, 241 F. 261, 154 C.C.A. 181; Lyon v. Donaldson, C.C.Ill.1888, 34 F. 789; Brodie v. Ophir Silver Min. Co., C.C.Cal.1867, 5 Sawy. 608, Fed.Cas. No. 1,919. Federal Courts 210

Where circumstances under which defendant appropriated plaintiffs' ideas involved breach of trust, royalties used as measure of damages were properly computed from time defendant appropriated plaintiffs' ideas and began to use equipment embodying those ideas rather than only from subsequent date of issuance of patents to plaintiffs. Chesapeake & O. Ry. Co. v. Kaltenbach, C.C.A.4 (Va.) 1941, 124 F.2d 375. Patents 319(1)

An assignee which had been allowed to intervene as a party plaintiff in patent infringement suit was entitled to recover damages sustained from date of its acquisition of title to patent until defendant ceased infringement. Heywood-Wakefield Co. v. Small, C.C.A.1 (Mass.) 1938, 96 F.2d 496, appeal dismissed 59 S.Ct. 54, 305 U.S. 663, 83 L.Ed. 430. Patents 286

In fixing a reasonable royalty, the period will not be considered during which the patent was freely infringed because of its supposed invalidity. Consolidated Rubber Tire Co. v. Diamond Rubber Co. of New York, S.D.N.Y.1915, 226 F. 455, affirmed 232 F. 475, 146 C.C.A. 469. Patents 318(3)

Complainant is not entitled to profits during term of contract which made defendant in effect a licensee. Schmertz Wire Glass Co. v. Western Glass Co., N.D.Ill.1913, 203 F. 1006, affirmed as modified 226 F. 730, 141 C.C.A. 486, certiorari denied 36 S.Ct. 222, 239 U.S. 648, 60 L.Ed. 485, modified 236 F. 744, 150 C.C.A. 76.

In suit by joint owners of patent, profits cannot be recovered for infringements prior to date of the joint owner- ship. Canda Bros. v. Michigan Malleable Iron Co., C.C.A.6 (Mich.) 1907, 152 F. 178, 81 C.C.A. 420. Patents 318(1)

Where the complainant has limited the period within which he claims that infringements were made, the accounting must not include a later time. Creamer v. Bowers, C.C.Del.1888, 35 F. 206. Patents 318(3)

Relevant period for ascertaining amount of damages for infringement of reissue patent for style of foot socks was date of issuance of reissue patent and patent holder was entitled to recovery based upon all infringing foot socks produced and sold after that date, but defendant's infringing foot sock production prior to that date was excluded from award of damages. Wayne-Gossard Corp. v. Moretz Hosiery Mills, Inc., W.D.N.C.1976, 447 F.Supp. 12, 199 U.S.P.Q. 87, affirmed 573 F.2d 191, 200 U.S.P.Q. 12. Patents 319(1)

Patentee could not enforce his patent for duration of period in which licenses constituted misuse in that they required payments of royalty for period beyond life of patent. Shields-Jetco, Inc. v. Torti, D.C.R.I.1970, 314 F.Supp. 1292, 166 U.S.P.Q. 397, affirmed 436 F.2d 1061, 168 U.S.P.Q. 385. Antitrust And Trade Regulation 587(3)

Under facts of case, only practicable basis for determining plaintiffs' damages by reason of infringement of their patent was delivery date of infringing devices. Miller v. Daybrook-Ottawa Corp., N.D.Ohio 1968, 291 F.Supp. 896, 158 U.S.P.Q. 635. Patents 319(1)

General rule that a plaintiff in an accounting for profits resulting from misappropriation of trade secrets may pick and choose among the accounting periods and select those which are profitable is subject to limitation that plaintiff may do so only if periods or transactions with respect to a particular product are independent of each other. Carter Products, Inc. v. Colgate-Palmolive Co., D.C.Md.1963, 214 F.Supp. 383, 136 U.S.P.Q. 348, 136 U.S.P.Q. 577. Antitrust And Trade Regulation 437

Damages for infringement could only be allowed for period following grant of patent; no damages for infringement would be allowed for period of patent misuse. Bissell Inc. v. E. R. Wagner Mfg. Co., E.D.Wis.1962, 204 F.Supp. 801, 133 U.S.P.Q. 469. Patents 319(1)

Where infringers of patent were liable for an accounting of profits, master would determine number of infringements occurring between inception of infringing practice and date of filing of complaint which must be the cut- off date. Solex Laboratories, Inc. v. Graham, S.D.Cal.1958, 165 F.Supp. 428, 118 U.S.P.Q. 438. Patents 318(3)

In patent infringement suit, where interlocutory judgment granted plaintiff was based on findings for plaintiff on both unfair competition and patent infringement, inclusion of profits prior to date of issue of patent was proper. Garreau v. Genua, D.C.Conn.1948, 88 F.Supp. 573, 85 U.S.P.Q. 155. Patents 322

Where plaintiffs' patent was infringed by defendant's device, plaintiffs were entitled to recover from defendant damages resulting from such infringement within six years of date of institution of infringement suit, not less than a reasonable royalty for defendant's making, using, or selling the invention, together with such costs and interest as might be fixed. United Specialties Co. v. Industrial Wire Cloth Products Corp., E.D.Mich.1949, 86 F.Supp. 37, 83 U.S.P.Q. 29, reversed 186 F.2d 426, 88 U.S.P.Q. 338. Patents 319(1)

Manufacturer to whom inventor had granted a license to manufacture and sell tool for which inventor had applied for a patent need not account to inventor for manufacture and sale of the tool between the date of termination of license and date of issuance of patent, since use pending application for a patent is not infringement. Fin- nerty v. Wallen, N.D.Cal.1948, 77 F.Supp. 508, 78 U.S.P.Q. 58. Patents 218(2)

In action to recover for patent infringement and unfair competition, where defendant knew when trial court denied injunction that plaintiff was not satisfied with ruling and that an appeal would be taken, defendant oper-

ated his business from that time forward at his peril and could not thereafter complain that period of accounting covered his operations both before and after such decision. Champion Spark Plug Co. v. Reich, W.D.Mo.1943, 49 F.Supp. 903. Patents 322; Antitrust And Trade Regulation 115

On question of damages to be awarded in patent infringement action, date when infringement ceased was a matter for special master's determination. Kaltenbach v. Chesapeake & Ohio Ry. Co., E.D.Va.1941, 43 F.Supp. 819, modified on other grounds 124 F.2d 375. Patents 314(4)

If well-known principles of equity require, a defendant can be made to account for actual infringement committed prior to date of patent. Tepper v. Ross, D.C.Mass.1938, 25 F.Supp. 92. Patents 316

Plaintiff whose reissue patent was infringed was entitled to accounting from date of issuance, as against defendant's contention that accounting should be restricted to period subsequent to filing of bill of complaint, where defendant did not show laches on plaintiff's part. Dykema v. Liggett Drug Co, W.D.N.Y.1937, 19 F.Supp. 313, reversed on other grounds 94 F.2d 648. Patents 322

Patent owners were entitled to damages for all of defendant's acts of infringement committed during period beginning six years prior to filing of infringement complaint and extending to date of final accounting. Holstens- son v. Webcor, Inc., N.D.Ill.1957, 150 F.Supp. 441, 112 U.S.P.Q. 463. Patents 319(1)

82. ---- Notice of infringement, accounting period, damages

District court abused its discretion in determining damages for patent infringement from date patentee gave notice to manufacturers of infringing products, rather than from date patent was issued, where infringing products were being sold on date patent was issued. Wang Laboratories, Inc. v. Toshiba Corp., C.A.Fed. (Va.) 1993, 993 F.2d 858, 26 U.S.P.Q.2d 1767, rehearing denied , in banc suggestion declined. Patents 319(1)

Where patentee made full disclosure of invention to infringer which began to use it before patent issued, but use did not begin until patentee had given full information of discovery to the public, beginning of accounting period for infringement was properly fixed at date of notice of infringement. Swan Carburetor Co. v. Nash Motors Co., C.C.A.4 (Md.) 1943, 133 F.2d 562, certiorari denied 64 S.Ct. 36, 320 U.S. 762, 88 L.Ed. 454, rehearing denied 64 S.Ct. 155, 320 U.S. 812, 88 L.Ed. 491. Patents 318(1)

Where actual notice had been given infringer that product had been patented before it had begun manufacture or sale of the infringing device, it was liable for profits and damages having covered the entire period of infringement, though patented articles had not been marked as required by former § 49 of this title [now § 287 of this title]. Oil Well Improvements Co. v. Acme Foundry & Machine Co., C.C.A.8 (Kan.) 1929, 31 F.2d 898.

Sales before notice of patent and infringement would be excluded. MacBeth Evans Glass Co v. L E Smith Glass Co, D.C.Pa.1927, 21 F.2d 553, modified on other grounds 23 F.2d 459.

When patentee fails to mark goods so as to show patent, accounting for damages will be confined to infringing acts occurring subsequent to notice of infringement. American Caramel Co. v. White, C.C.A.7 (Ill.) 1915, 234 F. 328, 148 C.C.A. 230. See, also, Lorain Steel Co. v. New York Switch & Crossing Co., C.C.N.J.1907, 153 F. 205; Ellipse Corp. v. Ford Motor Co., D.C.Ill.1978, 461 F.Supp. 1354, affirmed 614 F.2d 775, certiorari denied 100 S.Ct. 2160, 446 U.S. 939, 64 L.Ed.2d 792. Patents 319(1)

Patentee was entitled to damages for patent infringement from time when she either began marking her patented

shoe fasteners in compliance with patent statute or when she actually notified competitor of its infringement, whichever was earlier. Maxwell v. J. Baker, Inc., D.Minn.1995, 875 F.Supp. 1371, reversed 86 F.3d 1098, 39 U.S.P.Q.2d 1001, rehearing denied, in banc suggestion declined , certiorari denied 117 S.Ct. 1244, 520 U.S. 1115, 137 L.Ed.2d 327. Patents 319(1)

Date upon which notice of infringement was received should be included in period for which damages for infringement are recoverable. Miller v. Daybrook-Ottawa Corp., N.D.Ohio 1968, 291 F.Supp. 896, 158 U.S.P.Q. 635. Patents 319(1)

Plaintiff, which was successful in patent infringement action, was entitled to recover from defendant legal damages for acts of infringement occurring since date on which plaintiff gave defendant written notice of infringement and was also entitled to recover from defendant costs under this section incurred in prosecution of action. Hughes Aircraft Co. v. General Instrument Corp., D.C.R.I.1967, 275 F.Supp. 961, 155 U.S.P.Q. 5, affirmed in part , reversed in part 399 F.2d 373, 158 U.S.P.Q. 498. Patents 319(1); Patents 325.1

The earliest date for which plaintiff in a patent infringement action could claim recovery was the date it gave defendant legally effective notice of infringement. Armstrong v. Emerson Radio & Phonograph Corp., S.D.N.Y.1959, 179 F.Supp. 95, 123 U.S.P.Q. 133. Patents 319(1)

Assignee of design patent which had been held valid was entitled to injunction against further infringement and an accounting for damages from date of notice of infringement. Sel-O-Rak Corp. v. Henry Hanger & Display Fixture Corp. of America, S.D.Fla.1958, 159 F.Supp. 769, 117 U.S.P.Q. 245, affirmed 270 F.2d 635, 123 U.S.P.Q. 3. Patents 317; Patents 319(1)

In patent infringement action, accounting period was properly commenced on date when written infringement notice was given to infringer rather than on date of patent grant. Mathey v. United Shoe Machinery Corp., D.C.Mass.1944, 54 F.Supp. 694. Patents 319(1)

The plaintiff in patent infringement suit would not be entitled to damages for use of alleged infringing articles prior to time when notice of alleged infringement was given to defendant. Nagy v. L. Mundet & Son, E.D.N.Y.1938, 23 F.Supp. 543, affirmed 101 F.2d 82. Patents 319(1)

83. Measure of damages--Generally

There can be no contemporaneous sale to express the market value of an invention that derives from its novelty and patentable quality, but the absence of market value does not mean that the offender shall go quit of liability altogether, and the law will make the best appraisal that it can, summoning to its service whatever aids it can. Sinclair Refining Co. v. Jenkins Petroleum Process Co., U.S.Me.1933, 53 S.Ct. 736, 289 U.S. 689, 77 L.Ed. 1449.

As a general rule, the patentee is entitled to the actual damage sustained by reason of the infringement. Birdsall v. Coolidge, U.S.Nev.1876, 93 U.S. 64, 3 Otto 64, 23 L.Ed. 802. See, also, T. L. Smith Co. v. Cement Tile Ma- chinery Co., D.C.Iowa, 1919, 258 F. 636; Lee v. Pillsbury, C.C.Minn.1892, 49 F. 747; Laskowitz v. Marie De- signer, Inc., D.C.Cal.1954, 119 F.Supp. 541; Carter v. Baker, C.C.Cal.1871, Fed.Cas. No. 2,472; Smith v. Hig- gins, C.C.N.Y.1856, Fed.Cas. No. 13,057; Ransom v. City of New York, C.C.N.Y.18568 Fed.Cas. No. 11,573; McCormick v. Seymour, C.C.N.Y.1854, Fed.Cas. No. 8,727, affirmed 19 How. 96, 15 L.Ed. 557.

Award of $2.95 million that patentee received as compensation for infringement of its patent for inflatable support system for air mattress and the $1 million it received as compensation for trademark damages amounted to an impermissible double recovery, where patentee based both its patent and trademark damages solely on sales of the accused devices. Aero Products Intern., Inc. v. Intex Recreation Corp., C.A.Fed. (Ill.) 2006, 466 F.3d 1000, 80 U.S.P.Q.2d 1481, rehearing denied. Damages 15

To avoid perception that blatant, blind appropriation of inventions patented by individual, nonmanufacturing in- ventors is profitable, cannot-lose course of action, by basing award of damages for patent infringement on calculation of reasonable royalty rate that would have been reached by willing licensor and licensee, fact finder may consider additional factors to assist in determination of adequate compensation for infringement, including royalties received by patentee for licensing of patent in suit, opinion testimony of qualified experts, patentee's relationship with infringer, and other factors that might warrant higher damages. Maxwell v. J. Baker, Inc., C.A.Fed. (Minn.) 1996, 86 F.3d 1098, 39 U.S.P.Q.2d 1001, rehearing denied, in banc suggestion declined , certiorari denied 117 S.Ct. 1244, 520 U.S. 1115, 137 L.Ed.2d 327. Patents 319(1)

Measure of damages for patent infringement is amount which will compensate patent owner for pecuniary loss sustained because of infringement. State Industries, Inc. v. Mor-Flo Industries, Inc., C.A.Fed. (Tenn.) 1989, 883 F.2d 1573, 12 U.S.P.Q.2d 1026, rehearing denied, rehearing in banc declined, certiorari denied 110 S.Ct. 725, 493 U.S. 1022, 107 L.Ed.2d 744, on remand 17 U.S.P.Q.2d 1706. Patents 319(1)

A patent infringement is a tortious taking, entitling injured party to general damages, measured ordinarily by a fair value of what was taken, i.e., the privilege of making, using, or selling the patented article. Faulkner v. Gibbs, C.A.9 (Cal.) 1952, 199 F.2d 635, 95 U.S.P.Q. 400. Patents 226; Patents 319(1)

The amount of award to be given as damages for patent infringement is for court to determine. National Reject- ors v. A. B. T. Mfg. Corp., C.A.7 (Ill.) 1951, 188 F.2d 706, 89 U.S.P.Q. 508, certiorari denied 72 S.Ct. 51, 342 U.S. 828, 96 L.Ed. 626, 91 U.S.P.Q. 382. Patents 324.55(1)

It was the duty of the court to find for patentee with reasonable approximation that to which he was entitled, and in so doing there was no duty to exercise meticulous care to avoid a hardship on infringer. Horvath v. McCord Radiator & Mfg. Co., C.C.A.6 (Mich.) 1938, 100 F.2d 326, certiorari denied 60 S.Ct. 101, 308 U.S. 581, 84 L.Ed. 486, rehearing denied 60 S.Ct. 171, 308 U.S. 636, 84 L.Ed. 529. See, also, Saginaw Products Corp. v. Eastern Airlines, Inc., C.A.6 (Mich.)1980, 615 F.2d 1136, 205 U.S.P.Q. 105; H. K. Porter Co., Inc. v. Goodyear Tire & Rubber Co., C.A.Ohio 1976, 536 F.2d 1115; Filtex Corp. v. Amen Atiyeh, C.A.Cal.1954, 216 F.2d 443. Patents 319(1)

In determining the property loss of a patentee from infringement, each case must be controlled by the facts and circumstances peculiar to it. Horvath v. McCord Radiator & Mfg. Co., C.C.A.6 (Mich.) 1938, 100 F.2d 326, certiorari denied 60 S.Ct. 101, 308 U.S. 581, 84 L.Ed. 486, rehearing denied 60 S.Ct. 171, 308 U.S. 636, 84 L.Ed. 529. See, also, Reynolds Spring Co. v. L. A. Young Industries, C.C.A.Mich.1939, 101 F.2d 257; Clark v. Schieble Toy & Novelty Co., Ohio 1917, 248 F. 276, 160 C.C.A. 354; Lee v. Malleable Iron Range Co., D.C.Wis.1918, 247 F. 795. Patents 319(1)

The measure of damages is compensation for pecuniary loss. De Laski & Thropp Circular Woven Tire Co. v. Empire Rubber & Tire Co., D.C.N.J.1916, 239 F. 139.

If the primary measure of damages, i.e., market value, affords no criterion for the amount of loss occasioned by

infringement, general damages, based on all the facts and circumstances proved, may be allowed. U.S. Fru- mentum Co. v. Lauhoff, C.C.A.6 (Mich.) 1914, 216 F. 610, 132 C.C.A. 614.

The rule for estimating damages sustained by a patentee by an infringement varies according to the mode in which he uses his patent. Creamer v. Bowers, C.C.Del.1888, 35 F. 206.

Under either a lost profit or reasonable royalty measure of damages for infringement, the patent holder must re- construct the market to project economic results of what would have occurred had the market developed absent the infringing product or what agreement would have resulted had a hypothetical negotiation over royalty rates occurred. Rosco, Inc. v. Mirror Lite Co., E.D.N.Y.2007, 506 F.Supp.2d 137. Patents 318(4.1); Patents 319(1)

Appropriate measure of compensatory damages in patent infringement suit may be determined by one of three methods: lost profits, established royalty, or reasonable royalty; determination of lost profits or established royalty are methods of assessing actual damages suffered by patentee, and reasonable royalty is a measure of recovery intended to provide a just recovery to persons who for evidentiary or other reasons cannot prove lost profits or established royalty. Mobil Oil Corp. v. Amoco Chemicals Corp., D.Del.1994, 915 F.Supp. 1333. Patents 319(1)

In determining measure by which infringement damages are to be assessed, it is necessary to first characterize the manner in which the plaintiff used its patent rights, as if plaintiff was in business of granting royalty bearing licenses under its patent then damage sustained is the loss of royalty income, while if plaintiff chose to manufacture the patented product and to exclude all others from doing so, the damage sustained is lost profits but in cases where plaintiff has neither manufactured its patented product nor licensed others at an established royalty rate, the court must hypothesize “a reasonable royalty” upon which the parties would have agreed prior to commencement of the infringement. Saf-Gard Products, Inc. v. Service Parts, Inc., D.C.Ariz.1980, 491 F.Supp. 996, 206 U.S.P.Q. 976. Patents 318(1); Patents 319(1)

In determining measure of damages for patent infringement, test is damage to patentee and not enrichment of infringer. Universal Athletic Sales Co. v. American Gym, W.D.Pa.1979, 480 F.Supp. 408, 205 U.S.P.Q. 840. Pat- ents 319(1)

Theory of damages in patent litigation is to deny to infringer fruits of his illegal act and to restore to patentee benefits which he would have derived from his monopoly had he not been denied the infringing sales. England v. Deere & Co., S.D.Ill.1963, 221 F.Supp. 319, 138 U.S.P.Q. 608. Patents 319(1)

In accounting for damages for patent infringement, each case is controlled by its own facts, and pecuniary loss can be determined only by a reasonable approximation, and actual value of what has been appropriated is ultimate in appraisement, but if actual value can be ascertained by a reasonable apportionment of profits and damages that course should be pursued, but if it cannot be accomplished, nature of invention, its utility and advantages, and extent of use involved are to be considered in determining a reasonable royalty. Elrick Rim Co. v. Cheek, S.D.Cal.1961, 195 F.Supp. 496, 131 U.S.P.Q. 8. Patents 319(1)

Factors selected in determining damages resulting from infringement must be determined in any particular case by facts and circumstances involved, so, as a matter of fairness and equity, the plaintiff receives his injunctive relief and sufficient compensation for the wrong done, and so, defendant may not digest and retain, but must dis- gorge, his illegal gains. Hartford Nat. Bank & Trust Co. v. E.F. Drew & Co., D.C.Del.1960, 188 F.Supp. 353,

126 U.S.P.Q. 487, affirmed 290 F.2d 589, 129 U.S.P.Q. 204, certiorari denied 82 S.Ct. 45, 368 U.S. 825, 7 L.Ed.2d 29, 131 U.S.P.Q. 498. Patents 319(1)

General damages recoverable for patent infringement are the detriment suffered by plaintiffs through the infringement. Laskowitz v. Marie Designer, Inc., S.D.Cal.1954, 119 F.Supp. 541, 100 U.S.P.Q. 367. See, also, Livesay Window Co. v. Livesay Industries, Inc., C.A.Fla.1958, 251 F.2d 469, appeal denied 79 S.Ct. 121, 358 U.S. 882, 3 L.Ed.2d 111. Patents 319(1)

Since exclusive right conferred by a patent is “property” and the infringement is a tortious taking of a part of that property, the normal measure of damages for patent infringement is value of what was taken. Austral Sales Corp v. Jamestown Metal Equipment Co, W.D.N.Y.1941, 41 F.Supp. 508. Patents 319(1)

Damages may be recovered only for the proximate and not for the remote result of the infringement. McCormick v. Seymour, C.C.N.Y.1851, 15 F.Cas. 1322, No. 8726, reversed in part 57 U.S. 480, 16 How. 480, 14 L.Ed. 1024. See, also, Boesch v. Graff, Cal.1890, 10 S.Ct. 378, 133 U.S. 697, 33 L.Ed. 787; Roemer v. Simon, C.C.N.Y.1873, 31 F. 41; Smith v. Prior, C.C.Cal.1873, 2 Sawy. 461, Fed.Cas. No. 13,095; Hawes v. Washburn, C.C.N.Y.1872, 5 Pat.Off.Gaz. 491, Fed.Cas. No. 6,242; Carter v. Baker, C.C.Cal.1871, 1 Sawy. 512, Fed.Cas. No. 2,472; Stephens v. Felt, C.C.N.Y.1844, Fed.Cas. No. 13,368a.

The measure of damages for the unauthorized sale of a patented article is the difference between the cost price to the patentee and the market price when the sales were made. American Saw Co v. Emerson, C.C.W.D.Pa.1880, 8 F. 806. Patents 319(1)

All infringements within the scope of the patent infringed should be considered in determining damages. Stand- ard Brands v. Federal Yeast Corporation, D.C.Md.1930, 38 F.2d 314.

Damage award for patent infringement must be adequate to compensate for the infringement. Wisconsin Alumni Research Foundation v. General Elec. Co., E.D.Wis.1995, 880 F.Supp. 1266. Patents 319(1)

If patent owner is unable to determine amount of patent infringement damages with precision, doubts are resolved against infringer. Ristvedt-Johnson, Inc. v. Brandt, Inc., N.D.Ill.1992, 805 F.Supp. 557. Patents 312(10)

There are two different approaches toward determining measure of damages in patent infringement cases; first approach, the lost profits method, is used when record permits an accurate determination of patentee's loss; second approach, employed when actual lost profits cannot be determined, is to award damages on basis of a reasonable royalty. American Medical Systems, Inc. v. Medical Engineering Corp., E.D.Wis.1992, 794 F.Supp. 1370, 26 U.S.P.Q.2d 1081, affirmed in part , reversed in part 6 F.3d 1523, 28 U.S.P.Q.2d 1321, rehearing denied, in banc suggestion declined , certiorari denied 114 S.Ct. 1647, 511 U.S. 1070, 128 L.Ed.2d 366. Patents 318(1); Patents 319(1)

84. ---- Champerty, measure of damages

Where patent was assigned to plaintiff after all testimony in interference proceeding had been taken, under agreement whereby plaintiff paid patentee $2,500 agreeing to hold title to the letters patent in trust for the equal benefit of plaintiff and patentee, both parties agreeing to share expenses incident to the carrying out of the purpose of the agreement, plaintiff agreeing to finance the interference, and the Board of Patent Interferences exam-

iners subsequently rendered its decision in favor of patentee, there was no “champerty” for which defendant could recovery damages in plaintiff's infringement suit. Beckwith v. S.F. Bowser & Co., D.C.Mass.1943, 51 F.Supp. 788. Champerty And Maintenance 6(3)

85. ---- Condition of patent holder, measure of damages

Pursuant to statute setting forth standard for damages for patent infringement, patent owner is entitled to damages that are adequate to compensate for infringement; such damages constitute difference between patentee's pecuniary condition after infringement, and what patentee's condition would have been if infringement has not occurred. Mil-Tec USA, Inc. v. ABC Tool, Inc., M.D.Fla.1996, 939 F.Supp. 853, reconsideration denied 1997 WL 201716. Patents 319(1)

Damages to patent holder arising from infringement cannot simply be calculated in all cases by determining difference between holder's pecuniary condition after infringement and what his condition would have been if infringement had not occurred. Stickle v. Heublein, Inc., C.A.Fed.1983, 716 F.2d 1550, 219 U.S.P.Q. 377, on remand 590 F.Supp. 630, 224 U.S.P.Q. 910. Patents 319(1)

86. ---- Entire market value rule, measure of damages

“Entire market value rule” recognizes that economic value of patent may be greater than value of sales of patented part alone and has served as basis for allowing recovery of lost profits or reasonable royalty based not only on profit from patented part but also on nonpatented parts. King Instruments Corp. v. Perego, C.A.Fed. (Mass.) 1995, 65 F.3d 941, 36 U.S.P.Q.2d 1129, rehearing denied, in banc suggestion declined 72 F.3d 855, certiorari denied 116 S.Ct. 1675, 517 U.S. 1188, 134 L.Ed.2d 778. Patents 318(4.1)

Owner of patent on audio coding technology had to establish that patented features themselves produced customer demand or substantial value of product sold in order to apply entire market value rule to claim for damages in lawsuit alleging that manufacturer's software which included accused audio encoding device infringed upon audio encoding patent; although MP3 capabilities overall were commercially important feature, patent did not cover MP3 capability per se and were not critical to it, but related only to particular feature of MP3 capability. Lucent Technologies Inc. v. Gateway, Inc., S.D.Cal.2007, 509 F.Supp.2d 912, affirmed 543 F.3d 710, 88 U.S.P.Q.2d 1481. Patents 318(4.1)

Under “entire market value rule,” prevailing patent infringement plaintiff can recover lost profits damages based on entire value of accused device, even though only one feature of device infringed patent, only where patented feature is basis for customer demand. Izume Products Co. v. Koninklijke Philips Electronics N.V., D.Del.2004, 315 F.Supp.2d 589, affirmed 140 Fed.Appx. 236, 2005 WL 1606952, rehearing and rehearing en banc denied , certiorari denied 126 S.Ct. 1772, 547 U.S. 1069, 164 L.Ed.2d 516. Patents 318(4.1)

Where patentee seeks reasonable royalty damages based on value of components sold with patented apparatus, “entire market value rule” may be applied, under which, if patented and unpatented components together constitute functional unit, they are treated as components of single assembly. Micro Chemical, Inc. v. Lextron, Inc., D.Colo.2001, 161 F.Supp.2d 1187, reversed in part , vacated in part 318 F.3d 1119, 65 U.S.P.Q.2d 1695, rehearing denied. Patents 319(1)

Where prevailing patent infringement plaintiff seeks damages on components sold with patented apparatus, “entire market value rule” is applied, which permits recovery of damages based on value of plaintiff's entire ap-

paratus containing several features when patent-related feature is basis for customer demand. Biacore v. Thermo Bioanalysis Corp., D.Del.1999, 79 F.Supp.2d 422, affirmed 30 Fed.Appx. 994, 2002 WL 418166. Patents 318(4.1)

Under “Entire Market Value Rule” (EMVR), ultimate factor in determining whether nonpatented features should be included in calculating compensation for infringement is whether patentee or its licensee can normally anti- cipate sale of unpatented components together with patented components; when patents are of such paramount importance that they substantially create value of unpatented product, sale of the unpatented product may be reasonably anticipated. Site Microsurgical Systems, Inc. v. Cooper Companies, Inc., D.Del.1992, 797 F.Supp. 333, 24 U.S.P.Q.2d 1463. Patents 319(1)

Patented nipple drinker for feeding poultry created consumer demand for components of entire watering system and, in view of fact that drinkers were marketed in concert with all remaining components of the system and orders were almost always placed for complete system, sales of entire system could be considered in determining damages from infringement. Ziggity Systems, Inc. v. Val Watering Systems, E.D.Pa.1990, 769 F.Supp. 752, reconsideration denied. Patents 318(4.2)

Where patentee in addition to patented device sold unpatented component parts, and patent gave value to components, which otherwise would have been useless for the purposes involved and would not have been sold by patentee component parts properly were included in computation of lost profits upon finding that patentee's fuel transportation system had been infringed. Electric Pipe Line, Inc. v. Fluid Systems Inc., C.A.2 (Conn.) 1957, 250 F.2d 697, 116 U.S.P.Q. 25. Patents 319(1)

Patentee was not entitled to damages based on alleged lost sales of dock levelers used in connection with patented device for restraining trucks to loading docks during loading or unloading process under “entire market value rule,” as levelers and restraints could have been used independently, and levelers were sold with restraints only for marketing reasons, not because they essentially functioned together. Rite-Hite Corp. v. Kelley Co., Inc., C.A.Fed. (Wis.) 1995, 56 F.3d 1538, 35 U.S.P.Q.2d 1065, certiorari denied 116 S.Ct. 184, 516 U.S. 867, 133 L.Ed.2d 122. Patents 318(4.1)

Where defendants sold unpatented tables which were found to be useless and unmarketable without the patented die assembly which they were designed to support, where, at least in certain cases, defendants sold tables separately to buyers who had previously purchased defendants' infringing die assemblies, where die assemblies were easily removable from the tables, and where defendants were patentee's sole competitor, entire market rule was properly applied in awarding patentee damages for lost profits for the sales of all tables by defendants, with or without die assemblies. American Safety Table Co. v. Schreiber, C.A.2 (N.Y.) 1969, 415 F.2d 373, 163 U.S.P.Q. 129, certiorari denied 90 S.Ct. 683, 396 U.S. 1038, 24 L.Ed.2d 682, 164 U.S.P.Q. 225. Patents 319(1)

Evidence sustained master's finding that the plaintiff's patented invention in its general shape and form was not new, and all that was novel about it was a particular feature, so that entire market value of infringing device was not due to the invention, and profits from sale of infringing device were required to be apportioned and the plaintiff was entitled only to profits arising out of the use of the elements of the device directly infringing the patent. Cover v. Chicago Eye Shield Co., C.C.A.7 (Ill.) 1942, 130 F.2d 25. Patents 312(10)

87. ---- Improvements, measure of damages

In an action for damages, the rule of damages is not the same where the patent is only for an improvement on a

machine as it is where the patent covers the whole machine. Seymour v. McCormick, U.S.N.Y.1853, 57 U.S. 480, 16 How. 480, 14 L.Ed. 1024. Patents 275

If the entire commercial value of a defendant's device is due to the plaintiff's improvement or if such improvement is of paramount importance in giving value to the structure, the entire profit made by the defendant may be recovered. Crosby Steam-Gauge & Valve Co. v. Consolidated Safety-Valve Co., U.S.Mass.1891, 12 S.Ct. 49, 141 U.S. 441, 35 L.Ed. 809. See, also, Hurlbut v. Schillinger, Ill.1889, 9 S.Ct. 584, 130 U.S. 456, 32 L.Ed. 1011; Callaghan v. Myers, Ill.1888, 9 S.Ct. 177, 128 U.S. 617, 32 L.Ed. 547; Root v. Lake Shore, etc., R. Co., Ill.1882, 105 U.S. 189, 26 L.Ed. 975; Elizabeth v. American Nicholson Pavement Co., N.J.1878, 97 U.S. 126, 24 L.Ed. 1000; Wales v. Waterbury Mfg. Co., Conn.1900, 101 F. 126, 41 C.C.A. 250; Mosher v. Joyce, Ohio 1892, 51 F. 441, 2 C.C.A. 322.

Where an invention through an improvement adapts the machine or article to a particular use, and no way is open to the public to supply that use, entire profits may be recovered. Goulds' Mfg. Co. v. Cowing, U.S.N.Y.1881, 105 U.S. 253, 15 Otto 253, 26 L.Ed. 987. See, also, Livingston v. Jones, C.C.Pa.1861, 3 Wall.Jr.C.C. 330, Fed.Cas. No. 8,414, reversed on other grounds 1 Wall. 155, 17 L.Ed. 662.

In action for breach of confidential relations in using disclosures of improvements later covered by patent, where trial court disbelieved testimony that developments incorporated into infringing machines were arrived at independently, but record failed to disclose trickery or cajolery, and plaintiff derived much information and tangible benefits from alleged confidential relationship, defendant would be charged with same royalties or profits for machines manufactured before the patent issued as after. Kelley-Koett Mfg. Co. v. McEuen, C.C.A.6 (Ky.) 1942, 130 F.2d 488, certiorari denied 63 S.Ct. 662, 318 U.S. 762, 87 L.Ed. 1134. Patents 182

The owner of patent for improved concrete agitator could not recover profits realized by defendant on sale and use of agitators embodying improvement on ground that owner confidentially disclosed improvement to defendant, where improvement used by defendant was designed by defendant's engineers independently of disclosure, and disclosure involved neither invention nor discovery and was made by owner on his own initiative, without an express or implied promise that defendant would treat disclosure in confidence. Canfield v. Blaw-Knox Co., C.C.A.3 (N.J.) 1938, 98 F.2d 805. Patents 182

Where the real invention consists only in improvement of part of device, profits are prima facie apportionable, although the patent describes the entire combination. Herman v. Youngstown Car Mfg. Co., C.C.A.6 (Ohio) 1914, 216 F. 604, 132 C.C.A. 608. Patents 318(4.3)

Where a patented improvement combining old elements increases the efficiency or value of the mechanism, but does not change its function or affect the principle of its operation, the patentee in seeking to recover profits from an infringer is limited to the excess of profits realized by him from the use, manufacture, or sale of the mechanism as improved, over what he might or would have made from the manufacture, use, or sale of the old mechanical combination. Seeger Refrigerator Co v. American Car & Foundry Co, D.C.N.J.1914, 212 F. 742, reversed on other grounds 219 F. 565, 135 C.C.A. 333. Patents 318(4.1)

Plaintiff, owner of a patented improvement in trunks, could not recover the net profits made by defendant in the manufacture and sale of the entire trunk, but was limited to such as were properly attributable to his improvement. Maier v. Brown, C.C.E.D.Mich.1883, 17 F. 736.

Patentee of an improvement to an existing device must generally apportion his damages for infringement so as

to include only the improvement. Electric Pipe Line, Inc. v. Fluid Systems, Inc., D.C.Conn.1956, 146 F.Supp. 262, 111 U.S.P.Q. 368, affirmed 250 F.2d 697, 116 U.S.P.Q. 25. Patents 319(1)

In action for infringement of an improvement patent, to which the infringer has added no improvement of his own, the patentee must in the first instance apportion the contribution to the profit of the invention and of the prior art, unless the invention covers the whole article or the patentee can show that the invention has given the article its whole value. General Elec Co v. Grand Gaslight, S.D.N.Y.1942, 46 F.Supp. 822. Patents 318(4.3)

The rule of apportionment between patentee and infringer, obtaining when patentee is entitled to profits, is that profits from infringing sale, which are attributable to patented improvements, belong to patentee, and profits due to other features belong to infringer. Freeman v. Premier Mach. Co., D.C.Mass.1938, 25 F.Supp. 927. See, also, Flat Slab Patents Co. v. Turner, C.C.A.Minn.1923, 285 F. 257, certiorari denied 43 S.Ct. 700, 262 U.S. 752, 67 L.Ed. 1215. Patents 318(4.1)

A complainant can recover where his patent is merely an improvement on an old machine, only such profits as arose from the use of his improvement and in the absence of proof thereof can recover only nominal damages. Webster v. New Brunswick Carpet Co., C.C.N.J.1875, 29 F.Cas. 557, No. 17338. See, also, Keystone Mfg. Co. v. Adams, Ill.1894, 14 S.Ct. 295, 151 U.S. 139, 38 L.Ed. 103; McCreary v. Pennsylvania Canal Co., Pa.1891, 12 S.Ct. 40, 141 U.S. 459, 35 L.Ed. 817; Mason v. Graham, Mass.1875, 23 Wall. 261, 23 L.Ed. 86; Littlefield v. Perry, N.Y.1875, 21 Wall. 205, 22 L.Ed. 577; Calkins v. Bertrand, C.C.Ill.1881, 10 Biss., N.S. 445, 8 F. 755.

Where the patented machine is an improvement over an existing machine, increasing its productive capacity, the profits are to be ascertained upon a consideration of the increased production only. Webster v. New Brunswick Carpet Co., C.C.N.J.1875, 29 F.Cas. 557, No. 17338. Patents 318(4.1)

Where the patent only covers an improvement, the patentee is entitled to a sum equal to all the advantages of the use of his improvement, excluding the profits of the manufacture and the value of the old machine. McCormick v. Seymour, C.C.N.Y.1854, 15 F.Cas. 1329, No. 8727, affirmed in part 60 U.S. 96, 19 How. 96, 15 L.Ed. 557. See, also, Carter v. Baker, C.C.Cal.1871, Fed.Cas. No. 2,472; Burdell v. Denig, C.C.Ohio 1865, Fed.Cas. No. 2,142. Patents 275

On an accounting for infringement of a patent for an improvement, the ultimate question is whether the real invention and its influence in bringing about the infringing sales can be so far identified as to admit of reasonable apportionment of profits or damages; if it can, the apportionment must be made. Clark v. Schieble Toy & Nov- elty Co., C.C.A.6 (Ohio) 1917, 248 F. 276, 160 C.C.A. 354.

Infringer's sales and profits were result of infringement of Mock patent, for an improvement in carburetors, which alone made the carburetors salable. Stromberg Motor Devices Co. v. Zenith-Detroit Corporation, C.C.A.2 (N.Y.) 1934, 73 F.2d 62, certiorari dismissed 55 S.Ct. 509, 294 U.S. 735, 79 L.Ed. 1263. Patents 318(1)

88. ---- Knowledge, measure of damages

Where infringer knowingly copied patentee's device which had long been in commercial use, court need not exercise meticulous care to avoid hardship on infringer in fixing reasonable damages. Reynolds Spring Co. v. L.A. Young Industries, C.C.A.6 (Mich.) 1939, 101 F.2d 257. Patents 319(1)

89. ---- License fees, measure of damages

If the patented improvement has been used only to a limited extent and for a short time the license fee is not a proper measure of damages. Seymour v. McCormick, U.S.N.Y.1853, 57 U.S. 480, 16 How. 480, 14 L.Ed. 1024. See, also, Birdsall v. Coolidge, Nev.1876, 93 U.S. 64, 23 L.Ed. 802; Keller v. Stolzenbaugh, C.C.Pa.1890, 43 F. 378; Judson v. Bradford, C.C.Mass.1878, 3 B. & A. Pat.Cas. 539, Fed.Cas. No. 7,564.

Court's calculation of damages for contributory infringement of patent was erroneous; court improperly construed 6% rate paid to patentholder by single licensee as established royalty and failed to calculate reasonable royalty based upon amount willing buyer and seller would have negotiated to license device covered by patent. Trell v. Marlee Electronics Corp., C.A.Fed. (Cal.) 1990, 912 F.2d 1443, 16 U.S.P.Q.2d 1059, rehearing denied. Patents 319(1)

Where possibility of patent holder proving lost profits arising from infringement was highly speculative, damages arising from infringement would be determined upon basis of hypothetical licensing negotiations. Stickle v. Heublein, Inc., C.A.Fed.1983, 716 F.2d 1550, 219 U.S.P.Q. 377, on remand 590 F.Supp. 630, 224 U.S.P.Q. 910. See, also, Studiengesellschaft Kohle, m.b.H. v. Dart Industries, Inc., C.A.Fed. (Del.) 1988, 862 F.2d 1564, 9 U.S.P.Q. 1273. Patents 319(1)

License fee represents proper measure of damages for patent infringement only where infringer's acts of infringement are commensurate with those acts contemplated under for which fee has been established. Bandag, Inc. v. Gerrard Tire Co., Inc., C.A.Fed.1983, 704 F.2d 1578, 217 U.S.P.Q. 977. Patents 219(5)

In determining damages for patent infringement, on a lost royalty basis, trial court properly used as a base the license fee actually charged by the patentholder and properly ascertained that license rate established by patentholder may have been artificially depressed by infringer's ongoing infringement, but erred in ruling that the amount of reasonable royalties increased after decision by the court of appeals ascertaining the patent's validity. Trio Process Corp. v. L. Goldstein's Sons, Inc., C.A.3 (Pa.) 1976, 533 F.2d 126, 189 U.S.P.Q. 561, on remand 204 U.S.P.Q. 863. Patents 319(1); Patents 319(3)

In patent infringement suit, licenses granted at other times, between other parties, and on private negotiations, are not conclusive of market value. General Motors Corp. v. Blackmore, C.C.A.6 (Mich.) 1931, 53 F.2d 725. Patents 312(10)

The fee charged under license agreements, which covered four machines or devices, but which required the licensee to pay the full royalty rate for the use of the patented machine in controversy alone, establishes proper measure of damages. Empire Rubber & Tire Co. v. De Laski & Thropp Circular Woven Tire Co., C.C.A.3 (N.J.) 1922, 281 F. 1. Patents 319(1)

A master's finding of an established license fee for the use of a patented process, making it the measure of damages for infringement was not erroneous, because the licenses granted also included the right to use other patented processes, and were exclusive within a limited territory, where the processes licensed were not capable of conjoint use, but the licensees had the option to use either, and the same royalty was paid after the other patents expired, including during the time of infringement. Expanded Metal Co. v. General Fireproofing Co., N.D.Ohio 1917, 247 F. 899, appeal dismissed 272 F. 1021.

All license fees need not have been for exactly the same amount at all times. Consolidated Rubber Tire Co. v.

Diamond Rubber Co. of New York, C.C.A.2 (N.Y.) 1916, 232 F. 475, 146 C.C.A. 469.

If the license fee is apportioned to the different parts of an invention it will constitute a proper measure of damages for the infringement of such parts. Williames v. McNeely, C.C.E.D.Pa.1896, 77 F. 894. See, also, Moffitt v. Cavanagh, C.C.N.Y.1886, 27 F. 511; Porter Needle Co. v. National Needle Co., C.C.Mass.1885, 22 F. 829; Wooster v. Simonson, C.C.N.Y.1883, 16 F. 680.

Royalty must be fixed and established and without other inducements for the license fee to constitute measure of damages. Hunt Bros. Fruit-Packing Co. v. Cassiday, C.C.A.9 (Cal.) 1894, 64 F. 585, 12 C.C.A. 316. See, also, Vulcanite Paving Co. v. American Artificial Stone Pavement Co., C.C.Pa.1888, 36 F. 378; Adams v. Bellaire Stamping Co., C.C.Ohio 1886, 28 F. 360, affirmed 12 S.Ct. 66, 141 U.S. 539, 35 L.Ed. 849; Proctor v. Brill, C.C.Pa.1880, 4 F. 415.

If the portions of the invention not infringed are merely structural and are included within those infringed the license fee will constitute a proper measure of damages. Asmus v. Freeman, C.C.E.D.Pa.1888, 34 F. 902. See, also, Willimantic Thread Co. v. Clark Thread Co., C.C.N.J.1886, 27 F. 865, reversed on other grounds 11 S.Ct. 846, 140 U.S. 481, 35 L.Ed. 521.

Substantial evidence supported award of additional royalties above rates considered by parties during prior negotiations in awarding damages for infringement of patent for system of fastening mated pairs of shoes; patentee testified that rates offered were not accurate measure of her damages because widespread disregard of her patent forced her to offer licenses based on diminished royalty. Maxwell v. J. Baker, Inc., D.Minn.1995, 875 F.Supp. 1371, reversed 86 F.3d 1098, 39 U.S.P.Q.2d 1001, rehearing denied, in banc suggestion declined , certiorari denied 117 S.Ct. 1244, 520 U.S. 1115, 137 L.Ed.2d 327. Patents 312(10)

License agreement between patentee and licensee of patent for balloon dilatation catheter used to treat coronary artery disease, providing for five percent royalty payment to patentee, was not evidence of established royalty rate for patent for purposes of awarding damages against infringer, as patentee and licensee were not competitors and, thus, patentee would not lose market share by licensing, patentee was seeking someone to promote his unproven invention at the time, there was no patent at time of license, and no market for monorail-type cathet- ers. Schneider (Europe) AG v. SciMed Life Systems, Inc., D.Minn.1994, 852 F.Supp. 813, appeal dismissed 26 F.3d 140, affirmed 60 F.3d 839, 39 U.S.P.Q.2d 1596, rehearing denied, in banc suggestion declined , certiorari denied 116 S.Ct. 520, 516 U.S. 990, 133 L.Ed.2d 427. Patents 319(1)

Existing licenses did not establish royalty rate for patent to be used as measure of damages in infringement action where the patent in question had not issued when the agreements were signed, where it was impossible to determine from certain pool licenses what the patent holder would have accepted for a license outside the pool, and where actions taken by the patent holder after infringement in issue were affected by ongoing infringement litigation. Studiengesellschaft Kohle mbH v. Dart Industries, Inc., D.Del.1987, 666 F.Supp. 674, 4 U.S.P.Q.2d 1817, affirmed 862 F.2d 1564, 9 U.S.P.Q.2d 1273. Patents 319(1)

In patent infringement suit brought by owner of patents related to agricultural equipment in which patent infringement was found, damages would be assessed against defendant for the profits which plaintiff would reasonably have enjoyed absent the infringement at the rate of $104 per unit upon 19 percent of all infringing units manufactured by defendant along with damages upon additional infringing units measured by payments initially exacted in a nonexclusive license granted by plaintiff to a competitor, raised to the 1980 equivalent value of such payments. Orthman Mfg., Inc. v. Chromalloy American Corp., C.D.Ill.1981, 512 F.Supp. 1284, 210

U.S.P.Q. 364. Patents 318(4.1); Patents 319(3)

Licensing agreements made several years after defendant commenced its infringement did not establish measure of damages for infringement since not only were they too few in number and too late in time to establish market price for the license as of date of infringements but were entered into in compromise of infringement claims against the licensed parties and plaintiff licensee proved its amount of lost profits; also, rule 408, Federal Rules of Evidence, Title 28, precluded introduction of such agreements. Saf-Gard Products, Inc. v. Service Parts, Inc., D.C.Ariz.1980, 491 F.Supp. 996, 206 U.S.P.Q. 976. Patents 312(2)

The price for which plaintiff has sold his rights to certain territory is no criterion by which to determine value of patent or damages sustained from infringement in territory retained. Campbell v. Barclay, C.C.N.D.Ill.1870, 4 F.Cas. 1157, 5 Biss. 179, No. 2353. Patents 275

Damages were to be limited to cable television converters that were found to have actually infringed patented method for eliminating direct interference on community antenna television systems, even though royalties and negotiated licenses were based on number of converters capable of infringing, rather than number that would infringe. Oak Industries, Inc. v. Zenith Electronics Corp., N.D.Ill.1989, 726 F.Supp. 1525, 14 U.S.P.Q.2d 1417. Patents 319(1)

License fee was taken as measure of damages and profits, the testimony being more or less conflicting. Emigh v. Baltimore & O.R. Co., C.C.Md.1881, 6 F. 283.

90. ---- Licensees, measure of damages

Three licenses relating to products entirely different from patented product were insufficient to establish an industry standard, and therefore district court correctly refused to apply rates of those licenses in determining damages for infringement. Railroad Dynamics, Inc. v. A. Stucki Co., C.A.Fed.1984, 727 F.2d 1506, 220 U.S.P.Q. 929, certiorari denied 105 S.Ct. 220, 469 U.S. 871, 83 L.Ed.2d 150, 224 U.S.P.Q. 520. Patents 319(1)

Accounting to determine amount of damages sustained by patentee as result of infringement by defendant would be limited to damages sustained by patentee as individual and could not extend to or encompass damages which might have been sustained by his corporate sole licensee, since licensee was not party to suit and patentee could not recover such damages for his licensee. Abbott v. Barrentine Mfg. Co., N.D.Miss.1965, 255 F.Supp. 890, 149 U.S.P.Q. 287. Patents 319(1)

Where throughout the period in question, plaintiff exclusive licensee manufactured the patented devices and dis- tributed them to nationally prominent firms and plaintiff was the only authorized source of the devices and in all reasonable probability would have made the sales which the defendant made, the amount which plaintiff would have netted from the sales denied to it was its measure of loss from the infringement. Saf-Gard Products, Inc. v. Service Parts, Inc., D.C.Ariz.1980, 491 F.Supp. 996, 206 U.S.P.Q. 976. Patents 319(3)

91. ---- Lost profits, measure of damages

Assessment of adequate damages, under patent infringement damages statute, does not limit patent holder to amount of deferred sales of commercial embodiment of patented product; rather, patent holder may recover for injury caused by infringement if it was or should have been reasonably foreseeable by infringing competitor in

relevant market, broadly defined. Minco, Inc. v. Combustion Engineering, Inc., C.A.Fed. (Tenn.) 1996, 95 F.3d 1109, 40 U.S.P.Q.2d 1001, rehearing denied , in banc suggestion declined. Patents 319(1)

Type of harm for which patent infringement damages are recoverable is limited to compensatory damages which are natural result of harmful act in question, namely, damages for economic harm such as profits lost on sales of competing products. King Instruments Corp. v. Perego, C.A.Fed. (Mass.) 1995, 65 F.3d 941, 36 U.S.P.Q.2d 1129, rehearing denied, in banc suggestion declined 72 F.3d 855, certiorari denied 116 S.Ct. 1675, 517 U.S. 1188, 134 L.Ed.2d 778. Patents 319(1)

Lost profits were proper measure of patent holder's damages due to patent infringement, where there was a demand for the patented product, the patent holder had the capability to meet the demand, and there were no acceptable noninfringing substitutes. Beatrice Foods Co. v. New England Printing and Lithographing Co., C.A.Fed. (Conn.) 1990, 899 F.2d 1171, 14 U.S.P.Q.2d 1020. Patents 318(1)

Infringer's $100 profit from each sale of infringing product, an ornamental cabinet that infringed on patentee's design patent, was most reasonable measure of damages under Patent Act, since any determination of royalties based on hypothetical negotiation between patentee and infringer would be inherently difficult given their respective positions in the marketplace, animosity between them, and limited applicability of traditional factors used to determine reasonable royalty. Bernhardt L.L.C. v. Collezione Europa USA, Inc., M.D.N.C.2006, 436 F.Supp.2d 739. Patents 318(4.1)

Under “accelerated market entry” (AME) theory, patentees could seek compensation for lost sales after the patent's expiration based on defendants' entry into the market at a level accelerated by its earlier infringement. Mer- ck & Co., Inc. v. MediPlan Health Consulting, inc., S.D.N.Y.2006, 434 F.Supp.2d 257, 80 U.S.P.Q.2d 1662. Patents 318(1)

Damages expert for owner of infringed medical device patent infringement plaintiff would not be allowed to testify as to terms of hypothetical contract it would have entered into with customer in absence of infringement, where terms of such contract were so divorced from economic realities of situation as to be speculative; expert did not account for availability of acceptable noninfringing substitutes, and posited increases in parties' previous contract terms without explanation. DSU Medical Corp. v. JMS Co., Ltd., N.D.Cal.2003, 296 F.Supp.2d 1140. Evidence 555.9

Testimony by patent infringement plaintiff's damages expert was inadmissible to extent it relied on unacceptable theory that lost profits damages could be based on defendant's sales of acceptable noninfringing substitute product. DSU Medical Corp. v. JMS Co., Ltd., N.D.Cal.2003, 296 F.Supp.2d 1140. Evidence 555.9

Patent holder's reliance on proof of its own market share, without more, was insufficient as matter of law to support reasonable probability of “but for” causation of lost profits, in infringement suit over patents for disposable cameras, known as lens-fitted film packages (LFFPs), since competitor could have sold non-infringing alternative by permissibly repairing cameras out of shells first sold in United States. Fuji Photo Film Co. Ltd. v. Jazz Photo Corp., D.N.J.2003, 249 F.Supp.2d 434, affirmed 394 F.3d 1368, 73 U.S.P.Q.2d 1678. Patents 312(10)

In order to recover damages in form of lost profits, patent owner must prove, with reasonable probability: (1) demand for patented product during period in question; (2) absence of acceptable non-infringing substitutes; (3) its own manufacturing and marketing capacity to meet or exploit that demand; and (4) detailed computation of

amount of profit it would have made. Novo Industries, L.P. v. Micro Molds Corp., S.D.Fla.2002, 239 F.Supp.2d 1282, reversed 350 F.3d 1348, 69 U.S.P.Q.2d 1128. Patents 318(1)

To recover lost profit damages in patent infringement case, patentee must show reasonable probability that but for infringement, it would have made sales that were made by infringer. Pentech Intern., Inc. v. Hayduchok, S.D.N.Y.1996, 931 F.Supp. 1167. Patents 318(4.1)

Where two-supplier market existed, patent infringement award based on projected lost sales is neither remote nor speculative when there is evidence of actual preinfringement and postinfringement growth rates. Lam, Inc. v. Johns-Manville Corp., C.A.Fed.1983, 718 F.2d 1056, 219 U.S.P.Q. 670. Patents 318(3)

Trial court in patent infringement case did not err in denying alleged infringer's second motion in limine and overruling its objections to testimony regarding patentee's lost profits on basis that lost profits were never pleaded as special damages, because in a patent infringement action, patentee's lost profits are not special damages but are one of possible elements of damages adequate to compensate for infringement. Saturn Mfg., Inc. v. Williams Patent Crusher & Pulverizer Co., C.A.8 (Mo.) 1983, 713 F.2d 1347, 219 U.S.P.Q. 533. Patents 311; Patents 318(1)

Upon finding of infringement, damages may be awarded based on greater of reasonable royalties or lost profits. Creative Cookware, Inc. v. Northland Aluminum Products, Inc., C.A.8 (Minn.) 1982, 678 F.2d 746, 217 U.S.P.Q. 27. Patents 318(1); Patents 319(1)

If, in all reasonable probability, patent owner would have made sales which infringer made, what patent owner, in reasonable probability, would have netted from sales denied to him is measure of his loss, and infringer is liable for that amount. Livesay Window Co. v. Livesay Industries, Inc., C.A.5 (Fla.) 1958, 251 F.2d 469, 116 U.S.P.Q. 167. Patents 318(1)

Usually what a patent owner loses from infringement is the acquisition of a just and deserved gain from the ex- ploitation of the invention embodied in his patent. Mathey v. C.I.R., C.A.1 1949, 177 F.2d 259, 83 U.S.P.Q. 193, certiorari denied 70 S.Ct. 797, 339 U.S. 943, 94 L.Ed. 1359, 85 U.S.P.Q. 527. Patents 318(1)

Holder of patent for economizer for steam generating plant was entitled to damages for sale lost to infringer where holder would have made sale if infringer had not. Power Specialty Co. v. Connecticut Light & Power Co., C.C.A.2 (Conn.) 1936, 80 F.2d 874. Patents 319(1)

Diversion of business by infringement must be shown to warrant allowance therefor. Standard Brands v. Federal Yeast Corporation, D.C.Md.1930, 38 F.2d 314.

Lost profits are not recoverable on account of sales to those buying infringing device because of supposed su- periority. Oil Well Improvements Co. v. Acme Foundry & Machine Co., C.C.A.8 (Kan.) 1929, 31 F.2d 898. Pat- ents 319(1)

Patentee cannot recover damages from infringer for loss of sales of plaintiff's machines not embodying patented invention. Standard Mailing Machines Co. v. Postage Meter Co., D.C.Mass.1929, 31 F.2d 459. Patents 318(4.1)

A complainant may properly be allowed as damages the profit he would have made from sale of infringing articles, where it is clear that he would have made such sales but for the infringing sales. Dallas Brass & Copper

Co. v. Faries Mfg. Co., C.C.A.7 (Ill.) 1924, 1 F.2d 930. See, also, Blake v. Greenwood Cemetery, C.C.N.Y.1883, 16 F. 676; Zane v. Peck, C.C.Conn.1882, 13 F. 475.

Where neither assignee of patentee nor any concern paying it royalties manufactured or sold tires containing patented device, it cannot recover damages for lost sales. Metallic Rubber Tire Co. v. Hartford Rubber Works Co., C.C.A.2 (Conn.) 1921, 275 F. 315, certiorari denied 42 S.Ct. 57, 257 U.S. 650, 66 L.Ed. 416. Patents 319(1)

Where exact cost of product sold by complainant is shown, it must be taken as basis for computing damages. Continuous Glass Press Co v. Schmertz Wire Glass Co, C.C.A.3 (Pa.) 1915, 219 F. 199, 135 C.C.A. 85, certiorari denied 35 S.Ct. 661, 238 U.S. 623, 59 L.Ed. 1494.

The owner of a patent, whose business is established, successful, and well equipped, may recover in an action at law the profits he would probably have made on sales of the infringing device, as determined by the average profits made by plaintiff during a reasonable period. Bemis Car Box Co v. J G Brill Co, C.C.A.3 (Pa.) 1912, 200 F. 749, 119 C.C.A. 229, certiorari denied 33 S.Ct. 326, 236 U.S. 614, 57 L.Ed. 382.

When profits or reasonable royalty are chosen as basis for award of damages for patent infringement, there is no room for award of other damages. Laskowitz v. Marie Designer, Inc., S.D.Cal.1954, 119 F.Supp. 541, 100 U.S.P.Q. 367. See, also, Union Carbide Corp. v. Graver Tank & Mfg. Co., C.A.Ind.1960, 282 F.2d 653, certiorari denied 81 S.Ct. 692, 695, 365 U.S. 812, 5 L.Ed.2d 691, on remand 243 F.Supp. 358; Carter Products, Inc. v. Colgate-Palmolive Co., D.C.Md.1963, 214 F.Supp. 383. Patents 318(2)

In action for infringement of patent plaintiff's loss of profits may be proved as one element from which damages may be ascertained, in absence of satisfactory evidence of sales of licenses or of royalties which plaintiff was accustomed to receive for use of patented invention, though profits which he might have made are not primary or controlling measure of damages. Brewster v. Technicolor, Inc., S.D.N.Y.1941, 2 F.R.D. 186. Patents 275

Profits lost by the patentee by reason of an infringement properly enter into the question of damages as an element thereof. American Braided Wire Co. v. Thomson, 1890, 44 Ch.D., Eng., 274. See, also, Crosby Steam Gage, etc., Co. v. Consolidated Safety Valve Co., Mass.1891, 12 S.Ct. 49, 141 U.S. 441, 35 L.Ed. 809; Yale Lock Mfg. Co. v. Sargent, N.Y.1886, 6 S.Ct. 934, 117 U.S. 536, 29 L.Ed. 954; Philp v. Nock, Dist.Col.1873, 17 Wall. 460, 21 L.Ed. 679; Putnam v. Lomax, 1881, 9 F. 448, 10 Biss. 546; Sargent v. Yale Lock Mfg. Co., C.C.N.Y.1879, 17 Blatchf. 244, Fed.Cas. No. 12,366.

Patent infringement damages were properly calculated on lost profits theory, rather than reasonable royalty theory, where infringer's activities resulted in breakup of exclusive licensing agreement enjoyed by patent owners, and lost profits could be fairly anticipated as sum established by federal district court. Water Technologies Corp. v. Calco, Ltd., N.D.Ill.1987, 658 F.Supp. 980, 1 U.S.P.Q.2d 1872. Patents 318(1); Patents 319(1)

Where exclusive licensee bid on job awarded to infringer and whole apparatus was covered by patent, profits which would have been received, less expenses, is measure of damages. Wallace & Tiernan Co. v. City of Syra- cuse, C.C.A.2 (N.Y.) 1930, 45 F.2d 693. See, also, Electro Bleaching Gas Co. v. Village Water Co., C.C.A.Conn.1930, 45 F.2d 696. Patents 319(1)

92. ---- Royalties, measure of damages

A royalty is the measure of damages only where it is a fixed and established price at which licenses are granted under circumstances fairly similar. Colgate v. Western Electric Mfg. Co., C.C.S.D.N.Y.1886, 28 F. 146. See, also, Wooster v. Thornton, C.C.N.Y.1886, 26 F. 274, dismissed 10 S.Ct. 1074, 136 U.S. 651, 34 L.Ed. 550; Westcott v. Rude, C.C.Ind.1884, 19 F. 830; National Car-Brake Shoe Co. v. Terre Haute Car, etc., Co., C.C.Ind.1884, 19 F. 514; Cornely v. Marckwald, 47 Pat.Off.Gaz. 1353.

Established or reasonable royalties for sales of licenses may constitute measure of damages at least where patentee sells licenses, and better measure of damages is not available. Mayor, Aldermen and Commonalty of City of New York v. Ransom, U.S.N.Y.1859, 64 U.S. 487, 23 How. 487, 16 L.Ed. 515. See, also, Rude v. Westcott, Ind.1889, 9 S.Ct. 463, 130 U.S. 152, 32 L.Ed. 888; Tilghman v. Proctor, Ohio 1888, 8 S.Ct. 894, 125 U.S. 136, 31 L.Ed. 664; Root v. Lake Shore, etc., R. Co., Ill.1882, 105 U.S. 189, 26 L.Ed. 975.

Where infringer was a former licensee of patent, royalty may be a factor related to profits and hence an element of damages sustained by holder of patent. Henry Hanger & Display Fixture Corp. of America v. Sel-O-Rak Corp., C.A.5 (Fla.) 1959, 270 F.2d 635, 123 U.S.P.Q. 3. Patents 319(1)

Reasonable royalty damages for competitor's infringement of patent for animal feed mixing machines, which both it and patentee gave away to feedlots in order to obtain feed ingredient sales, was one percent of competit- or's relevant ingredient sales; there were several competitors in market and infringing competitor had viable noninfringing alternatives. Micro Chemical, Inc. v. Lextron, Inc., D.Colo.2001, 161 F.Supp.2d 1187, reversed in part , vacated in part 318 F.3d 1119, 65 U.S.P.Q.2d 1695, rehearing denied. Patents 319(1)

Where patent infringer's profits are taken as the measure of the plaintiff's loss, a royalty should not be included to increase the award of damages. Medtronic, Inc. v. Catalyst Research Corp., D.C.Minn.1982, 547 F.Supp. 401, 216 U.S.P.Q. 687.

Under former § 70 of this title recovery for compensatory damages for infringement of a patent is not matter of judicial grace, but of legal right, and damages awarded may not be less than reasonable royalty. Middleton v. Wiley, C.A.8 (Mo.) 1952, 195 F.2d 844, 93 U.S.P.Q. 77. See, also, Saf-Gard Products, Inc. v. Service Parts, Inc., D.C.Ariz.1980, 491 F.Supp. 996, 206 U.S.P.Q. 976; Paper Converting Mach. Co., Inc. v. FMC Corp., D.C.Wis.1977, 432 F.Supp. 907, affirmed 588 F.2d 832; Hartford Nat. Bank & Trust Co. v. E. F. Drew & Co., D.C.Del.1960, 188 F.Supp. 353, affirmed 290 F.2d 589, certiorari denied 82 S.Ct. 45, 368 U.S. 825, 7 L.Ed.2d 29; Bristol Laboratories v. Schenley Laboratories, D.C.Ind.1953, 117 F.Supp. 67; Aetna Ball & Roller Bearing Co. v. Standard Unit Parts Corp., D.C.Ill.1952, 103 F.Supp. 26, affirmed in part, reversed in part on other grounds 198 F.2d 222.

93. ---- Settlement amounts, measure of damages

The sum for which an owner of a patent has settled actions against each of 10 infringers is not a standard by which to measure the damages in an action against another infringer. Cornely v. Marckwald, U.S.N.Y.1889, 9 S.Ct. 744, 131 U.S. 159, 33 L.Ed. 117. See, also, Keyes v. Pueblo Smelting & Refining Co., C.C.Colo.1890, 43 F. 478, appeal dismissed 14 S.Ct. 1148, 154 U.S. 507, 38 L.Ed. 1083; United Nickel Co. v. Central Pac. R. Co., C.C.Cal.1888, 36 F. 186; Matthews v. Spangenberg, C.C.N.Y.1882, 14 F. 350. Patents 319(1)

Under settlement agreement requiring patentee's competitor to pay royalties on sales of infringing breathing reg- ulators, royalties were properly calculated on sales made by competitor's affiliated distributor to unaffiliated customers, rather than on competitor's sales to affiliated distributor; agreement provided that royalties were to be

calculated based on sales made by competitor to unaffiliated customers, and parties stipulated that terms of agreement would apply to competitor as a “corporate family.” Interspiro USA, Inc. v. Figgie Intern. Inc., C.A.Fed. (Del.) 1994, 18 F.3d 927, 30 U.S.P.Q.2d 1070. Compromise And Settlement 11

“Damages”, in agreement giving retiring partner share of damages collected in partnership's pending patent infringement suit, did not embrace royalties paid partnership under settlement of suit whereby partnership received damages and gave license with royalty provision. Miller v. Weller, C.A.3 (Pa.) 1961, 288 F.2d 438, 128 U.S.P.Q. 514, certiorari denied 82 S.Ct. 51, 368 U.S. 829, 7 L.Ed.2d 32, 131 U.S.P.Q. 499. Partnership 225

Where settlement was made in place of sum found due on accounting, which accounting was made in compliance with fraudulently secured judgment in patent infringement suit, the settlement and accounting collapsed with the judgment and money secured thereby would be required to be returned with interest. Hartford-Empire Co. v. Shawkee Mfg. Co., C.C.A.3 (Pa.) 1947, 163 F.2d 474, 74 U.S.P.Q. 252. Compromise And Settlement 8(3); Federal Civil Procedure 2641

Settlement-induced royalty agreements are determined largely by factors that are not considered in hypothetical royalty negotiation analysis and are, therefore, not accurate measure of reasonable royalty in patent infringement case. Total Containment, Inc. v. Environ Products, Inc., E.D.Pa.1995, 921 F.Supp. 1355, affirmed in part , vacated in part 106 F.3d 427. Patents 312(2)

Patentee's prior settlement agreements with other alleged infringers were relevant to issue of reasonable royalty rate in patent infringement action, to extent alleged infringers could show patentee's damages expert relied in any way on settlement agreements in reaching his conclusions about reasonable royalty rates, although prior settlements were specifically entered into under threat of litigation or against backdrop of continuing litigation, with intention of avoiding risks and expenses of that litigation. Century Wrecker Corp. v. E.R. Buske Mfg. Co., Inc., N.D.Iowa 1995, 898 F.Supp. 1334, on reconsideration in part. Patents 312(2)

Although settlement reached between patentee and another infringer was highly probative of reasonable royalty, it did not by itself establish a reasonable royalty to be used to establish damages for infringement where the patent holder received the monetary benefit of settling the case rather than enduring the time and expense of a damages trial and both the infringer and the patentee were aware of the potential for prejudgment interest as part of the recovery. Studiengesellschaft Kohle mbH v. Dart Industries, Inc., D.Del.1987, 666 F.Supp. 674, 4 U.S.P.Q.2d 1817, affirmed 862 F.2d 1564, 9 U.S.P.Q.2d 1273. Patents 312(10)

Evidence as to amount paid or agreed upon to settle other litigation is not proper basis for calculating damages for patent infringement consisting of lost reasonable royalties. Universal Athletic Sales Co. v. American Gym, W.D.Pa.1979, 480 F.Supp. 408, 205 U.S.P.Q. 840. Patents 312(3.1)

Court would award damages in patent suit based on reasonable royalty of 10 percent and reject other suggested methods which would call into play questions of settlement of associated suits in another district. Marks v. Po- laroid Corp., D.C.Mass.1964, 237 F.Supp. 425, 144 U.S.P.Q. 630. Patents 319(1)

An offer by patent owners to accept a designated sum before trial of patent infringement suit in attempt to compromise then existing controversies, were so possessed of attributes of an offer to compromise as to be priv- ileged or as to avoid any binding effect upon owners thereafter in determining amount they were entitled to recover from patent infringer. Activated Sludge v. Sanitary Dist. of Chicago, N.D.Ill.1946, 64 F.Supp. 25, 68 U.S.P.Q. 137, affirmed 157 F.2d 517, 71 U.S.P.Q. 316, certiorari denied 67 S.Ct. 970, 330 U.S. 834, 91 L.Ed.

1281, 72 U.S.P.Q. 529, rehearing denied 67 S.Ct. 1092, 330 U.S. 856, 91 L.Ed. 1297, 72 U.S.P.Q. 529, rehearing denied 67 S.Ct. 1347, 331 U.S. 866, 91 L.Ed. 1870. Evidence 213(2); Evidence 265(2)

Corporation that sold its wholly owned subsidiary did not admit to reasonableness of settlement amount reached in patent infringement action brought against subsidiary when it consented to settlement, so as to estop it from questioning reasonableness of settlement in buyer's subsequent indemnity action; corporation specifically questioned reasonableness of amount of settlement when it gave its consent, and expressly reserved right to contest any allocation of portions it, buyer or subsidiary would pay toward settlement. International Minerals & Chem- ical Corp. v. Avon Products, Inc., Mo.App. E.D.1994, 889 S.W.2d 111, rehearing and/or transfer denied. Estop- pel 91(3)

94. ---- Time of measuring, measure of damages

The value of an invention for which an infringer is liable is the value at the time of the infringement, and fact that there is something else just as good or better does not entirely destroy value. National Car-Brake Shoe Co. v. Terre Haute Car & Mfg. Co., C.C.Ind.1884, 19 F. 514. Patents 275

Most plausible switch date, when competitors switched from using process involving cups for the resin impreg- nation process, which infringed patent for underground pipe repair method, to using non-infringing process involving needles, was August 5, 1991, for purposes of determining appropriate amount of damages to be awarded to patent owner; at least three witnesses during the trial pointed to, either roughly or specifically, August 1991 as the switch date, including two employees who were hired by competitor during that same month, who both testified that they did not ever remember seeing cups used by competitors upon the commencement of their employment, and evidence did not support either earlier or later dates proposed as alternatives for switch date. In- situform Technologies, Inc. v. Cat Contracting, Inc., S.D.Tex.2007, 518 F.Supp.2d 876. Patents 312(10)

Measure of damages for patent infringement should be determined in light of circumstances existing at time patent issued, with advantage of hindsight. Carter Products, Inc. v. Colgate-Palmolive Co., D.C.Md.1963, 214 F.Supp. 383, 136 U.S.P.Q. 348, 136 U.S.P.Q. 577. Patents 319(1)

In infringement suit for three patents involving catalysts used to produce paraxylene (PX), each of which expired at a different time, patent holder was entitled to damages for infringement of earlier patents only until dates that they expired, rather than until date last patent expired; patent holder itself divided its rights under patents by separately licensing and leasing them, and others began producing patented catalyst after first patent expired. Mobil Oil Corp. v. Amoco Chemicals Corp., D.Del.1994, 915 F.Supp. 1333. Patents 319(1)

95. ---- Trade secrets, measure of damages

Damages are allowed in trade secret cases, not upon the theory of the taking of property, but rather upon the theory of a breach of a confidential relationship. International Industries, Inc. v. Warren Petroleum Corp., C.A.3 (Del.) 1957, 248 F.2d 696, 115 U.S.P.Q. 104, 115 U.S.P.Q. 159, certiorari dismissed 78 S.Ct. 529, 355 U.S. 943, 2 L.Ed.2d 523. Antitrust And Trade Regulation 418

Party may not recover damages for appropriation of secret processes for which patent has been issued, since right to secrecy and to patent monopoly are inconsistent, but mere filing of application for patent is not dedica- tion of secret to public. A.O. Smith Corp. v. Petroleum Iron Works Co. of Ohio, C.C.A.6 (Ohio) 1934, 73 F.2d 531, modified on denial of rehearing 74 F.2d 934. Patents 82

Damages for misappropriation of trade secrets as well as for patent infringement could properly be allowed on basis of a reasonable royalty where plaintiffs did not undertake to prove damages based upon their own loss of sales as a result of defendant's wrongful acts. Carter Products, Inc. v. Colgate-Palmolive Co., D.C.Md.1963, 214 F.Supp. 383, 136 U.S.P.Q. 348, 136 U.S.P.Q. 577. Damages 114; Patents 319(1)

96. ---- Unfair competition, measure of damages

In respect to damages allowable for infringement of patent, the district court reasonably concluded that damages based on excessive advertising expenditures, allegedly caused by defendant's unlawful competition, would be speculative, where the evidence showed that during the years when plaintiff licensee had no competition from defendant, its advertising expenditures were greater in relation to sales than they were during the years defendant was a competitor. Wahl v. Carrier Mfg. Co., Inc., C.A.7 (Ind.) 1975, 511 F.2d 209, 184 U.S.P.Q. 516.

Patentee was properly denied damages for unfair competition during patent infringement period where the acts of unfair competition were the same as the acts of patent infringement, and where patentee proved no damages resulting from unfair competition which were not compensated by award of damages for infringement. Americ- an Safety Table Co. v. Schreiber, C.A.2 (N.Y.) 1969, 415 F.2d 373, 163 U.S.P.Q. 129, certiorari denied 90 S.Ct. 683, 396 U.S. 1038, 24 L.Ed.2d 682, 164 U.S.P.Q. 225. Antitrust And Trade Regulation 110(2)

If defendant has aggravated the damages by unfair competition, or by infringing trademark, any damages thus caused may be awarded. W.F. Burns Co. v. Automatic Recording Safe Co., C.C.A.7 (Ill.) 1916, 241 F. 472, 154 C.C.A. 304. Patents 319(1)

Evidence was insufficient to establish that defendant was damaged by misuse of patent by plaintiff in extending scope of patent monopoly and violating Clayton Antitrust Act, §§ 12 to 27 of Title 15. Preformed Line Products Co. v. Fanner Mfg. Co., N.D.Ohio 1960, 225 F.Supp. 762, 124 U.S.P.Q. 288, affirmed 328 F.2d 265, 140 U.S.P.Q. 500, certiorari denied 85 S.Ct. 56, 379 U.S. 846, 13 L.Ed.2d 51, 143 U.S.P.Q. 464. Antitrust And Trade Regulation 977(2); Antitrust And Trade Regulation 977(3)

The sale and advertising for sale by defendants of grooved plywood, which infringed patent of plaintiff, under the trademark “Venetex”, and the use by defendants of such trademark in advertising and offering for sale and selling grooved plywood, constituted an infringement of plaintiff's trademark “Weldtex” earlier and continu- ously used by plaintiff, and amounted to unfair competition and aggravation of damages to plaintiff because of infringement of patent. U.S. Plywood Corp. v. Zeesman Plywood Corp., S.D.Cal.1950, 92 F.Supp. 336, 86 U.S.P.Q. 184. Trademarks 1426; Trademarks 1425

97. ---- Unjust enrichment, measure of damages

In view of fact that shape of defendant's soap bar was conceived, originated and developed by an independent source without direction or supervision by defendant, and in view of fact that defendant purchased rights to the shape of the bar from such source, the plaintiff could not recover damages under charge of unjust enrichment. Haskell v. Lever Bros. Co., S.D.N.Y.1965, 243 F.Supp. 601, 146 U.S.P.Q. 356. Patents 182

Generally, patentee's right to damages for infringement, commences only when patent is granted, but if, in advance of granting of patent, an invention is disclosed to one who, in breach of the confidence thus reposed, man- ufactures and sells articles embodying the invention, such person will be held liable for profits and damages resulting therefrom on principle that equity will not permit one to unjustly enrich himself at expense of another.

Carter Products, Inc. v. Colgate-Palmolive Co., D.C.Md.1955, 130 F.Supp. 557, 104 U.S.P.Q. 314, affirmed 230 F.2d 855, 108 U.S.P.Q. 383, certiorari denied 77 S.Ct. 43, 352 U.S. 843, 1 L.Ed.2d 59, 111 U.S.P.Q. 467, rehearing denied 77 S.Ct. 152, 352 U.S. 913, 1 L.Ed.2d 120, 111 U.S.P.Q. 467. Patents 182

Where an inventor between date of his application for a patent and its grant discloses some novel feature of his invention to another in strict confidence, and other person subsequently uses the information so disclosed to his advantage, he may be held liable to inventor for damages on theory of unjust enrichment. De Filippis v. Chrysler Corp, S.D.N.Y.1944, 53 F.Supp. 977, affirmed 159 F.2d 478, 72 U.S.P.Q. 288, certiorari denied 67 S.Ct. 1733, 331 U.S. 848, 91 L.Ed. 1857, 73 U.S.P.Q. 550, rehearing denied 68 S.Ct. 34, 332 U.S. 786, 92 L.Ed. 369. Pat- ents 182

98. ---- Willfulness, measure of damages

Finding that infringement of patent for ethylene oxide catalyst was not willful, for purpose of calculating damages, was supported by evidence that infringer was reasonable in its response to patent; infringer's belief that its catalysts were not infringing was, though erroneous, not implausible. Union Carbide Chemicals & Plastics Tech- nology Corp. v. Shell Oil Co., C.A.Fed.2005, 425 F.3d 1366, 76 U.S.P.Q.2d 1705, rehearing and rehearing en banc denied 434 F.3d 1357, 77 U.S.P.Q.2d 1634, on remand 2006 WL 680653. Patents 312(10)

Adverse inference that legal opinion was or would have been unfavorable should not be drawn from patent infringement defendant's invocation of attorney-client or work product privileges, or from such defendant's failure to consult with counsel, for purpose of determining whether infringement was “willful.” Knorr-Bremse Systeme Fuer Nutzfahrzeuge GmbH v. Dana Corp., C.A.Fed. (Va.) 2004, 383 F.3d 1337, 72 U.S.P.Q.2d 1560, on remand 372 F.Supp.2d 833, 76 U.S.P.Q.2d 1239. Patents 227

When it is found that an infringer acted without a reasonable belief that its actions would avoid infringement, the patentee has established “willful infringement,” which may be accompanied by enhanced damages; such entitlement is not absolute, however, and reasonable discretion reposes in the district court, on consideration of all of the circumstances. Vulcan Engineering Co., Inc. v. Fata Aluminium, Inc., C.A.Fed. (Mich.) 2002, 278 F.3d 1366, 61 U.S.P.Q.2d 1545, on remand 2002 WL 31008328, certiorari denied 123 S.Ct. 81, 537 U.S. 814, 154 L.Ed.2d 18. Patents 319(3)

Where the infringement was deliberate, all doubts as to profits should be resolved against the infringer. Coffield Motor Washer Co. v. Wayne Mfg. Co., C.C.A.8 (Mo.) 1918, 255 F. 558, 166 C.C.A. 626. Patents 318(1)

Compensatory damages constitute adequate remuneration for invasion of patentee's property rights unless infringer's refusal to bow to presumptive validity of an issued patent is consciously wrongful. Enterprise Mfg. Co. v. Shakespeare Co., C.C.A.Mich.1944, 141 F.2d 916. Enterprise Mfg. Co. v. Shakespeare Co., C.C.A.6 (Mich.) 1944, 141 F.2d 916. Patents 319(3)

Patentee established by clear and convincing evidence that infringer willfully infringed patent; after receiving notice of patentee's claims, infringer not only continued to manufacture and sell infringing product until end of liability phase of trial, but applied for its own patent claiming the same technology; moreover, infringer's contention that it had a good faith belief that patentee's claim were invalid for obviousness was belied by its representation to the Patent Office that its own claims were patentable. Novozymes A/S v. Genencor Intern., Inc., D.Del.2007, 474 F.Supp.2d 592. Patents 312(8)

Evidence supported jury's finding that defendant's infringement of patent for method of making purified lutein crystals was not willful; there was testimony that defendant independently developed method, and that it had litigated infringement issue based on advice of counsel that patent was invalid. Kemin Foods, L.C. v. Pigmentos Vegetables del Centro S.A. de C.V., S.D.Iowa 2005, 357 F.Supp.2d 1105, appeal dismissed 132 Fed.Appx. 368, 2005 WL 1231816, subsequent determination 369 F.Supp.2d 1075, affirmed 464 F.3d 1339, 80 U.S.P.Q.2d 1385. Patents 312(8)

Finding of willful patent infringement by jury authorizes but does not mandate award of enhanced damages. Novo Industries, L.P. v. Micro Molds Corp., S.D.Fla.2002, 239 F.Supp.2d 1282, reversed 350 F.3d 1348, 69 U.S.P.Q.2d 1128. Patents 319(3)

99. Lost profits, damages--Generally

A patentee, in whose favor a decree of infringement has been entered, is not entitled to an allowance for the loss sustained by him by reason of the diversion of sales of the patented article, which he would have made but for the sales made by the defendant, when he fails upon the accounting to put in any evidence showing the cost of the articles. Cornely v. Marckwald, C.C.S.D.N.Y.1885, 32 F. 292, affirmed 9 S.Ct. 744, 131 U.S. 159, 33 L.Ed. 117. Patents 319(1)

Even if asserted lost profit damages caused by patent infringer's sale of acceptable noninfringing substitute can be said to fall within reach of “but for” causation, they are not patent injuries legally compensable under patent law. DSU Medical Corp. v. JMS Co., Ltd., N.D.Cal.2003, 296 F.Supp.2d 1140. Patents 318(1)

Whether lost profits claimed by patent infringement plaintiff are legally compensable is question of law. DSU Medical Corp. v. JMS Co., Ltd., N.D.Cal.2003, 296 F.Supp.2d 1140. Patents 318(1)

To recover lost profits for patent infringement, patentee had to show: demand for patented product; absence of acceptable noninfringing substitute; manufacturing and marketing capability to exploit demand; and amount of profit it would have made. Pall Corp. v. Micron Separations, Inc., D.Mass.1992, 792 F.Supp. 1298, affirmed in part, modified in part and reversed in part 66 F.3d 1211, 36 U.S.P.Q.2d 1225, rehearing denied, certiorari denied 117 S.Ct. 1243, 520 U.S. 1115, 137 L.Ed.2d 326. Patents 318(1)

In order to recover damages for defendant's infringement of patent, patent holder must show that, but for infringement, he would have made sales. Serpentix Conveyor Corp. v. Roth, D.Colo.1989, 726 F.Supp. 282, 15 U.S.P.Q.2d 1074. Patents 319(1)

Whenever determining quantum of damage award adequate to compensate a patentholder for infringement, district court may consider profits the patentholder lost as a result of the infringement. Paper Converting Machine Co. v. Magna-Graphics Corp., C.A.Fed.1984, 745 F.2d 11, 223 U.S.P.Q. 591, on remand 631 F.Supp. 660, 228 U.S.P.Q. 524. Patents 319(1)

To recover lost profits in infringement action under four-part Panduit test, patent owner must prove demand for patented product, absence of acceptable noninfringing substitutes, manufacturing and marketing capability to exploit demand, and amount of profit patent owner would have made. Standard Havens Products, Inc. v. Gencor Industries, Inc., C.A.Fed. (Mo.) 1991, 953 F.2d 1360, 21 U.S.P.Q.2d 1321, rehearing denied, rehearing in banc declined, certiorari denied 113 S.Ct. 60, 506 U.S. 817, 121 L.Ed.2d 28, on remand 810 F.Supp. 1072, 25 U.S.P.Q.2d 1949. Patents 318(1)

In action for infringement of patents on friction weld process and process apparatus, award of damages to patentee would not necessarily be limited to reasonable royalty where patentee was apparently only seller of its apparatus in United States and therefore could be able to establish with reasonable certainty actual amount of profits it lost due to alleged infringer's activities. Signode Corp. v. Weld-Loc Systems, Inc., C.A.7 (Ill.) 1983, 700 F.2d 1108, 218 U.S.P.Q. 293. Patents 319(1)

To obtain as damages profits on sale he would have made absent infringement, i.e., the sales made by infringer, patent owner must prove demand for the patented product, absence of acceptable noninfringing substitutes, his manufacturing and marketing capability to exploit the demand, the the amount of profit he would have made. Panduit Corp. v. Stahlin Bros. Fibre Works, Inc., C.A.6 (Mich.) 1978, 575 F.2d 1152, 197 U.S.P.Q. 726. See, also, McDermott v. Omid Intern., S.D.Ohio 1988, 723 F.Supp. 1228, 13 U.S.P.Q.2d 1147, affirmed 883 F.2d 1026. Patents 319(1)

Award for infringement calculated on basis of loss of profits by patentee for each sale by infringer was fair and proper. Bros. Inc. v. W. E. Grace Mfg. Co., C.A.5 (Tex.) 1963, 320 F.2d 594, 138 U.S.P.Q. 357. Patents 319(1)

Where patentee has himself engaged in the manufacture, use, or sale of patented article, he may be awarded damages for his loss of profits resulting from infringement of the patent. Faulkner v. Gibbs, C.A.9 (Cal.) 1952, 199 F.2d 635, 95 U.S.P.Q. 400. Patents 319(1)

Proof of infringing sales does not automatically entitle patent owner to lost profits. Ristvedt-Johnson, Inc. v. Brandt, Inc., N.D.Ill.1992, 805 F.Supp. 557. Patents 318(1)

To satisfy Panduit test for recovering lost profits for patent infringement, patentee must prove demand for patented product, absence of acceptable noninfringing substitutes, marketing and manufacturing capability to exploit demand, and amount of profit patentee would have made but for infringement. Scripto-Tokai Corp. v. Gillette Co., C.D.Cal.1992, 788 F.Supp. 439, 22 U.S.P.Q.2d 1678. Patents 318(1)

In order to establish lost profits, patent owner must show by preponderance of the evidence: a demand for the product made according to patents in suit during period in question; absence during the period of acceptable noninfringing substitute; sufficient manufacturing and marketing capabilities to exploit the demand; and detailed computation of amount of profit that patent owner would have made on lost sales. Trilogy Communications, Inc. v. Comm Scope Co., W.D.N.C.1990, 754 F.Supp. 468, 18 U.S.P.Q.2d 1177, vacated , appeal dismissed. Patents 318(1)

Successful claimant in patent infringement suit may recover its lost profits where it can be demonstrated that patent holder would have made sale, but for infringing activity. Datascope Corp. v. SMEC, Inc., D.N.J.1988, 678 F.Supp. 457, 5 U.S.P.Q.2d 1963, affirmed in part , reversed in part 879 F.2d 820, 11 U.S.P.Q.2d 1321, rehearing denied, rehearing in banc declined, certiorari denied 110 S.Ct. 729, 493 U.S. 1024, 107 L.Ed.2d 747, on remand 14 U.S.P.Q.2d 1071. Patents 318(1)

Lost profit award for patent infringement requires showing that patent owner would have made sale if infringement had not taken place and proper evidence of computation on lost profits. Mil-Tec USA, Inc. v. ABC Tool, Inc., M.D.Fla.1996, 939 F.Supp. 853, reconsideration denied 1997 WL 201716. Patents 318(1)

Patentee is not required to negate every possibility that purchaser might not have purchased a product other than

patentee's, absent infringement, to recover lost profit damages; patentee must, instead, only show that there was reasonable probability that sales would have been made, but for infringement. Stryker Corp. v. Intermedics Or- thopedics, Inc., E.D.N.Y.1995, 891 F.Supp. 751, affirmed 96 F.3d 1409, 40 U.S.P.Q.2d 1065, rehearing denied , in banc suggestion declined. Patents 312(10)

Patentholder may prove lost profits by showing demand for patented product, absence of acceptable noninfringing substitutes, manufacturing and marketing capability to exploit demand, and amount of profit it would have made. T.A. Pelsue Co. v. Grand Enterprises, Inc., D.Colo.1991, 782 F.Supp. 1476, 25 U.S.P.Q.2d 1001. Patents 312(10)

100. ---- Acceptable substitute, lost profits, damages

Patent infringer of patent for synthetic orthopedic casting tapes failed to establish that master's finding that there were no acceptable noninfringing alternatives with respect to patented inventions was clearly erroneous, for purpose of award of lost profits to patent holder, notwithstanding infringer's contention that it could have purchased noninfringing alternatives; master found that while third party may have been entitled to manufacture casting tapes under the patents it was unable to manufacture commercially acceptable casting tapes, and infringer had opportunity to proffer convincing rebuttal evidence on noninfringing substitutes and failed to do so. Minnesota Min. and Mfg. Co. v. Johnson & Johnson Orthopaedics, Inc., C.A.Fed. (Minn.) 1992, 976 F.2d 1559, 24 U.S.P.Q.2d 1321, rehearing denied , in banc suggestion declined. Patents 324.55(2)

Holder of patent for specimen test slide and method for detecting hidden blood in fecal matter failed to show absence of acceptable, noninfringing substitutes, failed to prove manufacturing capacity and profit margin, and, therefore, failed to prove right to lost profits from infringement; claimed profit margin of 50% was found to be incredible. SmithKline Diagnostics, Inc. v. Helena Laboratories Corp., C.A.Fed. (Tex.) 1991, 926 F.2d 1161, 17 U.S.P.Q.2d 1922. Patents 312(10)

Conventional stretch wrap machines sold by patentee was not acceptable noninfringing substitute for patentee's film-driven stretch wrap machine, so that patentee was not precluded from obtaining lost profits damages for infringement, where film-driven machines were easier to operate and used less plastic film per load than conventional machines, did not have tendency to damage load being wrapped, and produced consistent stretch levels which was an improvement that was demanded by customers who purchased stretch wrap machines. Kaufman Co., Inc. v. Lantech, Inc., C.A.Fed. (Ohio) 1991, 926 F.2d 1136, 17 U.S.P.Q.2d 1828. Patents 318(1)

Genuine issue of material fact existed as to whether clamshell, shoebox, tourniquet, and hard stuffed methods of manufacturing catalytic converters, and the converters manufactured by these methods, were acceptable alternatives to patented catalytic converters, precluding summary judgment for alleged infringer in patent infringement action on patentee's claim for lost profits. Tenneco Auto. Operating Co. Inc. v. Visteon Corp., D.Del.2005, 375 F.Supp.2d 360. Patents 323.2(3)

Issues of material fact as to whether there was demand for patented feature of cataract surgery tool, and whether there were acceptable non-infringing substitutes in market, precluded summary judgment on infringement plaintiff's entitlement to lost profits damages. Advanced Medical Optics, Inc. v. Alcon, Inc., D.Del.2005, 361 F.Supp.2d 404. Patents 323.2(3)

Patent infringement plaintiff's foreseeably lost sales from defendant's sales of acceptable noninfringing substitute product, in addition to its sales of infringing product, were not compensable. DSU Medical Corp. v. JMS

Co., Ltd., N.D.Cal.2003, 296 F.Supp.2d 1140. Patents 318(4.1)

Damages expert for patent infringement plaintiff could properly testify as to absence of acceptable noninfringing substitutes, when explaining his calculation of lost profits damages; question of whether substitutes were in fact available went to weight of expert's testimony. DSU Medical Corp. v. JMS Co., Ltd., N.D.Cal.2003, 296 F.Supp.2d 1140. Evidence 555.9

“Availability” of acceptable noninfringing product can trigger preclusion of lost profits damages for patent infringement, even though product was not on market during period of infringement. DSU Medical Corp. v. JMS Co., Ltd., N.D.Cal.2003, 296 F.Supp.2d 1140. Patents 318(1)

Owner of infringed patent for type of animal feed mixing machine was entitled only to reasonable royalty, and not lost profit damages; noninfringing substitutes were available to market throughout period of infringement and there was no showing that market demand for machines was based on patented features. Micro Chemical, Inc. v. Lextron, Inc., D.Colo.2001, 161 F.Supp.2d 1187, reversed in part , vacated in part 318 F.3d 1119, 65 U.S.P.Q.2d 1695, rehearing denied. Patents 318(1); Patents 319(1)

Patentee failed to demonstrate there were no noninfringing substitutes of its underground containment sumps used in underground piping systems, as required to recover lost profits damages in its infringement action against competitor; patentee presented no evidence that purchasers bought its sumps because of their patented features, and major oil companies continued to specify that both patentee's and competitor's sumps were acceptable for their major installations, even though patented features had been removed from competitor's sumps. Total Containment, Inc. v. Environ Products, Inc., E.D.Pa.1995, 921 F.Supp. 1355, affirmed in part , vacated in part 106 F.3d 427. Patents 312(10)

To qualify as substitute, for purposes of determining whether patent owner is entitled to lost profit damages for infringement, competing product should possess beneficial characteristics of patented product; in addition, dis- parately higher or lower prices, absent evidence of predatory pricing or other tampering with market, would tend to show that competing product is not substitute for patented product. Ristvedt-Johnson, Inc. v. Brandt, Inc., N.D.Ill.1992, 805 F.Supp. 557. Patents 318(1)

To obtain as damages profits on sales he would have made absent infringement, i.e., the sales made by the infringer, patent owner must prove: demand for the patented product; absence of acceptable noninfringing substitutes; his manufacturing and marketing ability to exploit the demand; and the amount of profit he would have made. American Medical Systems, Inc. v. Medical Engineering Corp., E.D.Wis.1992, 794 F.Supp. 1370, 26 U.S.P.Q.2d 1081, affirmed in part , reversed in part 6 F.3d 1523, 28 U.S.P.Q.2d 1321, rehearing denied, in banc suggestion declined , certiorari denied 114 S.Ct. 1647, 511 U.S. 1070, 128 L.Ed.2d 366. Patents 318(4.1)

In concluding that holder of patent on percutaneous intraaortic balloon catheter was entitled only to reasonable royalty damages for infringement and not to lost profits, district court was clearly erroneous in finding that a third party's device was an acceptable noninfringing alternative. Datascope Corp. v. SMEC, Inc., C.A.Fed. (N.J.) 1989, 879 F.2d 820, 11 U.S.P.Q.2d 1321, rehearing denied, rehearing in banc declined, certiorari denied 110 S.Ct. 729, 493 U.S. 1024, 107 L.Ed.2d 747, on remand 14 U.S.P.Q.2d 1071. Patents 318(2)

Holder of patent on foam pad used for buffing paint finish on automobiles was not entitled to recover its alleged lost profits caused by infringement; there were many noninfringing products that competed and that could ac- complish broad purpose for which infringing products were purchased. Minnesota Min. and Mfg. Co. v. Lake

Country Mfg., Inc., D.Minn.1996, 918 F.Supp. 1307, as amended , dismissed 106 F.3d 426. Patents 318(4.2)

Holder of patent for prefilled and sterile penile prosthesis was entitled to recovery of lost profits from infringer, considering that there was demand for the product, and that demand resulted in substantial part from characteristics of patented product; moreover, evidence supported conclusion that there were no acceptable noninfringing substitutes. American Medical Systems, Inc. v. Medical Engineering Corp., E.D.Wis.1992, 794 F.Supp. 1370, 26 U.S.P.Q.2d 1081, affirmed in part , reversed in part 6 F.3d 1523, 28 U.S.P.Q.2d 1321, rehearing denied, in banc suggestion declined , certiorari denied 114 S.Ct. 1647, 511 U.S. 1070, 128 L.Ed.2d 366. Patents 318(4.1)

Evidence was sufficient to establish that competitor's infringed rotary furnace for fusing minerals diverted sales from patentee and supported award of $3,455,329 in lost profits in infringement case, despite evidence that market featured noninfringing alternatives to patent and that infringer could have designed around patent; evidence indicated that patentee's fused silica product was in significant demand, and there was no evidence of marketplace use of purported substitute by infringer or any other fused silica manufacturer. Minco, Inc. v. Combustion Engineering, Inc., C.A.Fed. (Tenn.) 1996, 95 F.3d 1109, 40 U.S.P.Q.2d 1001, rehearing denied , in banc suggestion declined. Patents 312(10)

For purposes of determining whether patentholder was entitled to recover damages for lost profits for infringement, infringer's noninfringing product, not available on the market until the last year of the infringing period, could not be considered an acceptable noninfringing substitute prior to the time it was placed on the market, on the theory that the infringer could have developed it earlier had it known that it was necessary. Andrew Corp. v. Gabriel Electronics, Inc., D.Me.1992, 785 F.Supp. 1041, 23 U.S.P.Q.2d 1019. Patents 312(10)

101. ---- Competitors, lost profits, damages

Jury's lost profit damages award, which found that prior art and other non-electronic bid submission systems were not alternatives to patented electronic system, with its added features and benefits, was within reason; although competitor alleged that there were acceptable non-infringing alternatives in the marketplace, there was evidence demonstrating that non-electronic bid systems did not provide benefits of electronic bid systems and were not acceptable substitutes. Muniauction, Inc. v. Thomson Corp., W.D.Pa.2007, 502 F.Supp.2d 477, stay denied 2007 WL 2406950, stay granted 2007 WL 2827915, reversed in part , vacated in part 532 F.3d 1318, 87 U.S.P.Q.2d 1350, rehearing and rehearing en banc denied , petition for certiorari filed 2008 WL 5459193. Pat- ents 318(1)

Patent holder for point-of-purchase display was not entitled to lost profits due to would-be customer's purchase of infringing designs, after rejecting patent holder's as being too expensive on theory that it had no incentive to accept a lower price because it never licensed its designs where patent holder and would-be customer were not competitors and no customer for the patented product existed other than the would-be customer. Trans-World Mfg. Corp. v. Al Nyman & Sons, Inc., D.Del.1986, 633 F.Supp. 1047, 229 U.S.P.Q. 873. Patents 318(1)

In two-supplier market, it is reasonable, when calculating damages due to patent infringement, to assume, provided that patent owner has sufficient manufacturing and marketing capabilities, that patent owner would have made infringer's sales but for infringement. State Industries, Inc. v. Mor-Flo Industries, Inc., C.A.Fed. (Tenn.) 1989, 883 F.2d 1573, 12 U.S.P.Q.2d 1026, rehearing denied, rehearing in banc declined, certiorari denied 110 S.Ct. 725, 493 U.S. 1022, 107 L.Ed.2d 744, on remand 17 U.S.P.Q.2d 1706. Patents 319(3)

Patent holder was entitled to award of damages for lost sales, in infringement lawsuit over patent directed toward device that detected level of contamination of air filter on internal combustion engine, where patent holder and competitor were only two available suppliers of progressive air filter restriction indicators, and competitor secured long-term contract with customer by submitting infringing bid, which in turn allowed competitor to switch from infringing product to similar but non-infringing product without having to secure new contract. En- gineered Products Co. v. Donaldson Co., Inc., C.A.Fed.2005, 147 Fed.Appx. 979, 2005 WL 2090662, Unrepor- ted. Patents 318(1)

102. ---- Computation of profits, lost profits, damages

Fireplace burner kits returned to manufacturer from distributors should not have been included in calculation of lost profits damages suffered by owner of patent for burner assembly, to extent that they were never assembled by end-users into infringing configurations. Golden Blount, Inc. v. Robert H. Peterson Co., C.A.Fed.2006, 438 F.3d 1354, 78 U.S.P.Q.2d 1004. Patents 318(4.1)

Patent owner was not entitled to lost profits for infringement of patent for gas analyzers for the period when it lacked manufacturing and marketing capacity and was not making or selling gas analyzers. On-Line Technolo- gies, Inc. v. Perkin-Elmer Corp., D.Conn.2006, 428 F.Supp.2d 76. Patents 318(1)

To have allowed patent owner to recover both lost profits and reasonable royalty for competitor's sales that actually involved same accused device would have been “manifest error” and substantially unjust, and, consequently, competitor was entitled to relief from judgment which awarded both to patent owner. Engineered Products Co. v. Donaldson Co., Inc., N.D.Iowa 2004, 335 F.Supp.2d 973, affirmed in part, vacated in part and remanded 147 Fed.Appx. 979, 2005 WL 2090662. Patents 318(1); Patents 323.3

Patentee may obtain lost profit damages for that portion of infringer's sales for which patentee can demonstrate “but for” causation and reasonable royalties for any remaining infringing sales. DSU Medical Corp. v. JMS Co., Ltd., N.D.Cal.2003, 296 F.Supp.2d 1140. Patents 318(4.1)

Patent owner may recover lost profits damages or reasonable royalty on each infringing sale, but not both. DSU Medical Corp. v. JMS Co., Ltd., N.D.Cal.2003, 296 F.Supp.2d 1140. Patents 318(1); Patents 319(1)

Licensee of patent for erasable market kit was not entitled to recover profits it would have made on sales that infringer made as element of lost profit damages, absent evidence concerning cost associated with patented product. Pentech Intern., Inc. v. Hayduchok, S.D.N.Y.1996, 931 F.Supp. 1167. Patents 318(6)

In patent infringement suit, in view of fact that patentee's profit sharing plan and officers' compensation plan did not obligate patentee to make payments on any damage award arising from infringement litigation since damage award would not represent income from sales but would be extraordinary items not arising from usual business operations, master erred in adjusting patentee's incremental income or profit figures as determined by accountants so as to include amounts for year-end officers' compensation and profit sharing. Paper Converting Mach. Co., Inc. v. FMC Corp., E.D.Wis.1977, 432 F.Supp. 907, 195 U.S.P.Q. 123, affirmed 588 F.2d 832. Patents 322

“Incremental profits,” in calculating profit loss in infringement case, are difference between gross revenue resulting from regaining sales lost due to infringement and incremental cost of making those sales; this measure of profit loss is appropriate only when patentee's fixed costs do not rise, or only slightly increase, relative to in-

creases in production. Stryker Corp. v. Intermedics Orthopedics, Inc., E.D.N.Y.1995, 891 F.Supp. 751, affirmed 96 F.3d 1409, 40 U.S.P.Q.2d 1065, rehearing denied , in banc suggestion declined. Patents 318(3)

Under incremental income method for determining patent owner's lost profits attributable to infringing sales, court calculates owner's total sale revenue had it sold infringing product, it calculates owner's incremental cost percentage by determining its fixed and variable costs, it multiplies total sale revenues by incremental cost percentage, and it subtracts resulting incremental costs from lost sales revenue. Ristvedt-Johnson, Inc. v. Brandt, Inc., N.D.Ill.1992, 805 F.Supp. 557. Patents 318(4.1)

Lost profits as result of price erosion due to infringement is a recoverable category of damages; in determining the amount of profits to which patent owner is entitled based on sales that patent owner actually made, difference between the money the patent owner would have made if the infringement did not occur and the amount of money that patent owner actually made from those sales must be calculated; patent owners can generally recover lost profits from price erosion in a two-supplier market. Ziggity Systems, Inc. v. Val Watering Systems, E.D.Pa.1990, 769 F.Supp. 752, reconsideration denied. Patents 318(1); Patents 318(3)

Lost profits in patent cases are properly calculated as the sum of profits from the patentee's potential sales which were lost actual sales by the infringer, profits lost as a consequence of price cuts which were required to over- come the infringer's competition, and profits from projected lost sales, excluding sales which were lost because of the infringer's actual sales. Sun Products Group, Inc. v. B & E Sales Co., Inc., E.D.Mich.1988, 700 F.Supp. 366, 9 U.S.P.Q.2d 2009. Patents 318(3)

Award of damages for infringement on lost-profits theory to holder of patents for retail displays after purchase by prospective customer of infringing displays following its rejection of patent holder's products as being too expensive was too speculative absent evidence about what profits prospective customer made or evidence which broke down costs of infringing display cases apart from cost of merchandise. Trans-World Mfg. Corp. v. Al Ny- man & Sons, Inc., D.Del.1986, 633 F.Supp. 1047, 229 U.S.P.Q. 873. Patents 318(1)

103. ---- Economic slump, lost profits, damages

Fact that patent holder suffered decrease in sales of agricultural bag loading apparatus due to slump in agricultural economy was irrelevant to determining lost profit due to another company's infringing sales, where patent holder showed reasonable probability that, but for the infringement, it would have made those sales. Ryco, Inc. v. Ag-Bag Corp., C.A.Fed. (Neb.) 1988, 857 F.2d 1418, 8 U.S.P.Q.2d 1323. Patents 318(1)

104. ---- Failure to bid, lost profits, damages

Patent holder is not required to prove that it would have made infringer's sales to recover lost profit damages, but must show only capacity to market patented product to purchasers who bought infringing product; it need not prove that it actually competed for each infringing sale. Ristvedt-Johnson, Inc. v. Brandt, Inc., N.D.Ill.1992, 805 F.Supp. 557. Patents 318(1)

Damages for lost sales resulting from infringement of welding machine patents were not recoverable with respect to all machines manufactured by infringer, where licensee had not bid to produce all machines manufactured by infringer. General Elec. Co. v. Sciaky Bros., Inc., C.A.6 (Mich.) 1969, 415 F.2d 1068, 163 U.S.P.Q. 257. Patents 319(1)

Where infringers' devices were the only viable competitors in the market for plaintiff's patented “modems” and only those modems manufactured and sold by plaintiff and by the infringing company had the capacity to operate on unconditioned telephone lines and this capacity represented a savings of from $40 to $80 per month per line for users, plaintiff's failure to offer evidence that it had bid on all of the infringing sales was not fatal to plaintiff's claim for damages for lost profits. Milgo Electronic Corp. v. United Business Communications, Inc., C.A.10 (Kan.) 1980, 623 F.2d 645, 206 U.S.P.Q. 481, certiorari denied 101 S.Ct. 794, 449 U.S. 1066, 66 L.Ed.2d 611, 208 U.S.P.Q. 376. Patents 318(1)

Patent owner is not barred from recovering lost profits damages by fact it did not market patented products during period of alleged infringement. Scripto-Tokai Corp. v. Gillette Co., C.D.Cal.1992, 788 F.Supp. 439, 22 U.S.P.Q.2d 1678. Patents 318(1)

105. ---- Items of recoverable profits, lost profits, damages

Holder of patent on mechanism for restraining trucks to loading docks during loading or unloading process was entitled to recover lost profits from infringer for invention which was not covered by patent in suit; even though statute did not expressly provide for such damages, infringing product competed with invention not covered by patent, as well as patented invention, such that lost sales of invention not covered by patent were foreseeable. Rite-Hite Corp. v. Kelley Co., Inc., C.A.Fed. (Wis.) 1995, 56 F.3d 1538, 35 U.S.P.Q.2d 1065, certiorari denied 116 S.Ct. 184, 516 U.S. 867, 133 L.Ed.2d 122. Patents 318(4.1)

Record in patent infringement case, which did not include proof that owner of patent on machine for automatically loading video or audio tape into closed cassettes normally anticipated selling spare parts as part of “package,” and which did not include proof that availability of spare parts was critical to uniqueness of invention, was insufficient to support district court's award to owner for lost profits on sales of spare parts allegedly caused by infringement. King Instrument Corp. v. Otari Corp., C.A.Fed.1985, 767 F.2d 853, 226 U.S.P.Q. 402, certiorari denied 106 S.Ct. 1197, 475 U.S. 1016, 89 L.Ed.2d 312. Patents 312(10)

The portion of monthly charge attributable to unpatented attachment which was part of patented machine was not an element of patentee's permissible recovery for infringement. Marvel Specialty Co., Inc. v. Bell Hosiery Mills, Inc., C.A.4 (N.C.) 1967, 386 F.2d 287, 155 U.S.P.Q. 545, certiorari denied 88 S.Ct. 1409, 390 U.S. 1030, 20 L.Ed.2d 286, 157 U.S.P.Q. 720. Patents 319(1)

In action for accounting for infringement of patent on device for machining automobile camshafts, findings of master on sufficient evidence that by use of patented machine production of camshafts was materially increased without any increase in departmental overhead costs disclosed advantage to infringer from infringement for which patent owner was entitled to recover. Gordon Form Lathe Co. v. Ford Motor Co., C.C.A.6 (Mich.) 1943, 133 F.2d 487, certiorari granted 63 S.Ct. 1325, 319 U.S. 738, 87 L.Ed. 1697, rehearing granted 63 S.Ct. 1444, 320 U.S. 213, 87 L.Ed. 1850, certiorari denied 63 S.Ct. 1328, 319 U.S. 765, 87 L.Ed. 1715, rehearing denied 64 S.Ct. 29, 320 U.S. 810, 88 L.Ed. 490, affirmed 64 S.Ct. 257, 320 U.S. 714, 88 L.Ed. 419, rehearing denied 64 S.Ct. 434, 320 U.S. 816, 88 L.Ed. 493. Patents 312(10)

Patentee could recover difference between cost of canning beans with infringing mold and another device as profits lost by licensee's infringement. Oneal v. San Jose Canning Co., C.C.A.9 (Cal.) 1929, 33 F.2d 892, certiorari denied 50 S.Ct. 69, 280 U.S. 598, 74 L.Ed. 644. Patents 318(3)

106. ---- Licensee profits, lost profits, damages

Licensor cannot recover profits which, but for the infringement, would have inured to the licensee. Bredin v. Solmson, C.C.Md.1905, 145 F. 944.

In patent infringement action, district court properly awarded damages based on exclusive sublicensee's lost profits for infringing sales and rentals of patent infringer's machines, in that district court found that, from a buyer's prospective, only acceptable substitute for sublicensee's patented machines were the infringing machines and, thus, that sublicensee would have sold or rented the machines built by infringer were it not for the infringement. Kori Corp. v. Wilco Marsh Buggies and Draglines, Inc., C.A.Fed.1985, 761 F.2d 649, 225 U.S.P.Q. 985, certiorari denied 106 S.Ct. 230, 474 U.S. 902, 88 L.Ed.2d 229. Patents 318(1)

Patentee that did not sell any product on which it could claim lost profits as damages for infringement could not recover lost profits of subsidiary that was nonexclusive licensee of patent. Novozymes A/S v. Genencor Intern., Inc., D.Del.2007, 474 F.Supp.2d 592. Patents 318(1)

Exclusive licensee of software patent did not surrender its exclusivity, and thus remained eligible to recover lost profits damages, when it and licensor jointly granted sublicenses; non-sublicense provision in license was properly understood as only barring unilateral granting of sublicenses by licensee. Honeywell International, Inc. v. Universal Avionics Systems Corp., D.Del.2004, 347 F.Supp.2d 124. Patents 212(2); Patents 213

Profits which exclusive licensee lost because of infringement were properly based on its average selling price before defendant's unlawful competition. Saf-Gard Products, Inc. v. Service Parts, Inc., D.C.Ariz.1980, 491 F.Supp. 996, 206 U.S.P.Q. 976. Patents 319(4)

Fact that exclusive patent licensee's profits during accounting period were either low or nonexistent did not mean that licensee has suffered no loss of profits attributable to defendant's infringing activity since defendant's sale of infringing devices at lowered prices significantly contributed to licensee's reduced profit margin; equity, logic and evidence required that licensee's average selling price at the time that the defendant commenced the sale of its accused devices be adopted as the basis for computing lost profits. Saf-Gard Products, Inc. v. Service Parts, Inc., D.C.Ariz.1980, 491 F.Supp. 996, 206 U.S.P.Q. 976. Patents 318(3)

107. ---- Measure of profits, lost profits, damages

Evidence of impact of infringing sales on corporate parent of process patent's sole assignee was admissible for purpose of calculating reasonable royalty damages; although assignee was technology holding company that did not make or sell product for which process was used, it would have taken parent's interest into account in any hypothetical license negotiations with infringer. Union Carbide Chemicals & Plastics Technology Corp. v. Shell Oil Co., C.A.Fed.2005, 425 F.3d 1366, 76 U.S.P.Q.2d 1705, rehearing and rehearing en banc denied 434 F.3d 1357, 77 U.S.P.Q.2d 1634, on remand 2006 WL 680653. Patents 312(2)

Where the thing appropriated or infringed, in a trade secret case, is a process rather than a manufactured article, the “profits” are simply measured by the savings determined by the standard of comparison computation. Inter- national Industries, Inc. v. Warren Petroleum Corp., C.A.3 (Del.) 1957, 248 F.2d 696, 115 U.S.P.Q. 104, 115 U.S.P.Q. 159, certiorari dismissed 78 S.Ct. 529, 355 U.S. 943, 2 L.Ed.2d 523. Damages 114

Where there is no other evidence license fees may constitute the measure of profits, but the patentee is not deprived of his right to recover profits by an established license. Emigh v. Baltimore & O.R. Co., C.C.Md.1881, 6 F. 283. See, also, Tilghman v. Proctor, Ohio 1888, 8 S.Ct. 894, 125 U.S. 136, 31 L.Ed. 664; Burdell v. Denig,

Ohio 1876, 92 U.S. 716, 23 L.Ed. 764; Wales v. Waterbury Mfg. Co., C.C.Conn.1898, 87 F. 920; Wooster v. Taylor, C.C.N.Y.1878, 14 Blatchf. 403, Fed.Cas. No. 18,041; Knox v. Great Western Quicksilver Min. Co., C.C.Cal.1878, 6 Sawy. 430, Fed.Cas. No. 7,907; American Nicholson Pavement Co. v. Elizabeth, C.C.N.J.1874, 1 B. & A.Pat.Cas. 439, Fed.Cas. No. 309.

If in all reasonable probability the patent owner would have made sales which infringer has made, what the patent owner in reasonable probability would have netted from the sales denied to him is the measure of his loss, and the infringer is liable for that. Paper Converting Machine Co. v. Magna-Graphics Corp., C.A.Fed.1984, 745 F.2d 11, 223 U.S.P.Q. 591, on remand 631 F.Supp. 660, 228 U.S.P.Q. 524. Patents 318(3)

Genuine issue of material fact existed as to whether consumers in the marketplace purchased patented products for the patented features, precluding summary judgment for alleged infringer in patent infringement action on patentee's claim for lost profits. Tenneco Auto. Operating Co. Inc. v. Visteon Corp., D.Del.2005, 375 F.Supp.2d 360. Patents 323.2(3)

Patent infringement plaintiff could not recover lost profits based on its lost sales from defendant's sales of noninfringing product, despite claim that defendant's infringement accelerated entry of its non-infringing product into market. DSU Medical Corp. v. JMS Co., Ltd., N.D.Cal.2003, 296 F.Supp.2d 1140. Patents 318(4.1)

Design patent owner could not merely claim infringer's profits as his own lost profits, under statute allowing for recovery of treble damages, absent additional evidence showing he would have made all sales which infringer made. Rocket Jewelry Box, Inc. v. Quality Intern. Packaging, Ltd., S.D.N.Y.2003, 250 F.Supp.2d 333, motion denied 2003 WL 21910888, affirmed in part, vacated in part and remanded 90 Fed.Appx. 543, 2004 WL 260998, on remand 403 F.Supp.2d 288. Patents 318(4.4)

108. ---- Price averaging, lost profits, damages

In calculating patent owner's lost sales revenue, for purposes of awarding lost profit damages, district court would account for product options by using average price of all products sold during relevant period. Ristvedt- Johnson, Inc. v. Brandt, Inc., N.D.Ill.1992, 805 F.Supp. 557. Patents 318(4.1)

109. ---- Price reductions, lost profits, damages

The actual damages recoverable under former §§ 67 and 70 of this title included reduction of prices and consequent loss of stock. Yale Lock Mfg. Co. v. Sargent, U.S.N.Y.1886, 6 S.Ct. 934, 117 U.S. 536, 29 L.Ed. 954.

Reduction of prices, and consequent loss of profits caused to a patentee by the competition of an infringer, is a proper ground for awarding damages against the infringer. Yale Lock Mfg. Co. v. Sargent, U.S.N.Y.1886, 6 S.Ct. 934, 117 U.S. 536, 29 L.Ed. 954. See, also, Kinner v. Shepard, C.C.Conn.1901, 107 F. 952; Am Ende v. Seabury, C.C.N.Y.1890, 43 F. 672, affirmed 14 S.Ct. 683, 152 U.S. 561, 38 L.Ed. 553.

Holder of patent for economizer for steam generating plant could recover from infringer reduction in price of economizers sold by holder only on showing that price was reduced solely because of infringer's competition. Power Specialty Co. v. Connecticut Light & Power Co., C.C.A.2 (Conn.) 1936, 80 F.2d 874. Patents 319(1)

Where patentee, completely supplying demand before infringement commenced, was compelled to reduce prices, amount of reduction is recoverable. Oil Well Improvements Co. v. Acme Foundry & Machine Co.,

C.C.A.8 (Kan.) 1929, 31 F.2d 898. Patents 319(1)

Patent owner may recover lost profits for price erosion by showing that infringement caused patent owner to charge lower prices than market otherwise would have dictated. Ristvedt-Johnson, Inc. v. Brandt, Inc., N.D.Ill.1992, 805 F.Supp. 557. Patents 318(3)

Evidence in patent infringement action involving Coriolis mass flowmeters justified damage award of $14,649,084 for price erosion; evidence established that patent holder suffered price erosion losses when infringement forced patent holder to forego price increases on products that competed directly with or were linked for pricing purposes to meters competing directly with infringer's meters. Micro Motion, Inc. v. Exac Corp., N.D.Cal.1991, 761 F.Supp. 1420, 19 U.S.P.Q.2d 1001. Patents 312(10)

Damages arising from infringement of patent for laminated glass was properly awarded on basis of royalty of 10 cents a square foot, together with award of damages due to price reductions forced upon patent holder by infringement. Triplex Safety Glass Co of North America v. Duplate Corporation, W.D.Pa.1934, 10 F.Supp. 420, modified on other grounds 81 F.2d 352, certiorari granted 56 S.Ct. 668, 297 U.S. 702, 80 L.Ed. 990, affirmed as modified on other grounds 56 S.Ct. 792, 298 U.S. 448, 80 L.Ed. 1274. Patents 318(3)

In suit for willful infringement of patent rights by manufacturing and selling patented coal cleaning tables, evidence did not establish that complainants suffered damages by reason of reduction in price because of competition from defendant. Sutton, Steele & Steele v. Gulf Smokeless Coal Co., S.D.W.Va.1933, 6 F.Supp. 419. Pat- ents 312(10)

The owner of a patent is entitled to damages from reduction of prices caused by competition of infringer, although he is accountable to a copartner for a part of them. Sargent v. Yale Lock Mfg. Co., C.C.N.Y.1879, 21 F.Cas. 507, No. 12366. Patents 319(1)

110. ---- Services related to sales, lost profits, damages

Patent owner seeking lost profits for sales of infringing product could additionally recover lost profits for services related to sales of patented product, to compensate for profits it would have received from sale of maintenance agreements and repair services. Ristvedt-Johnson, Inc. v. Brandt, Inc., N.D.Ill.1992, 805 F.Supp. 557. Pat- ents 318(3)

111. ---- Particular cases, lost profits, damages

Award of lost profits damages to owner of patent for fireplace burner assembly was supported by evidence that, but for defendant's sale of burner kit, which enabled end-users to make product covered by patent, end-users would have turned to owner to satisfy their demand for patented product. Golden Blount, Inc. v. Robert H. Peterson Co., C.A.Fed.2006, 438 F.3d 1354, 78 U.S.P.Q.2d 1004. Patents 312(10)

Evidence that patent for rotary furnace for fusing minerals produced marketable fused minerals and that both patentee and infringer used invention to compete in market established that infringer should have reasonably foreseen that infringement of patent would harm patentee's sales, and supported award of lost profit damages. Minco, Inc. v. Combustion Engineering, Inc., C.A.Fed. (Tenn.) 1996, 95 F.3d 1109, 40 U.S.P.Q.2d 1001, rehearing denied , in banc suggestion declined. Patents 312(10)

Owner of patent for splicing assembly for connecting tapes in cassettes was entitled to lost profits from in-

fringer, because “but for” infringement owner would have sold more of product which competed with infringer's product, even though competing product did not embody patented invention and owner did not make or sell patented device. King Instruments Corp. v. Perego, C.A.Fed. (Mass.) 1995, 65 F.3d 941, 36 U.S.P.Q.2d 1129, rehearing denied, in banc suggestion declined 72 F.3d 855, certiorari denied 116 S.Ct. 1675, 517 U.S. 1188, 134 L.Ed.2d 778. Patents 318(2)

Award of over $2.2 million for infringement damages sustained by owner of patent on machine for automatically loading audio or video tape into closed cassettes, based on profit margins from 1970's, was not too speculative and did not constitute abuse of discretion, even though bulk of lost sales occurred in 1980's. King Instrument Corp. v. Otari Corp., C.A.Fed.1985, 767 F.2d 853, 226 U.S.P.Q. 402, certiorari denied 106 S.Ct. 1197, 475 U.S. 1016, 89 L.Ed.2d 312. Patents 318(3)

District court did not abuse its discretion in awarding lost profits to patentholder for infringement of its patent for automatic rewinder used in manufacture of rolls of densely wound industrial toilet tissue and paper toweling, despite infringer's contention that because of patentholder's high prices, purchasers would have foregone their purchase of new rewinders altogether if infringer had not submitted its low bid. Paper Converting Machine Co. v. Magna-Graphics Corp., C.A.Fed.1984, 745 F.2d 11, 223 U.S.P.Q. 591, on remand 631 F.Supp. 660, 228 U.S.P.Q. 524. Patents 318(1)

Where defendant would have made all or some of its sales of rock bits without infringing bearing seals, damages were properly determined with reference to loss of premium received for presence of infringing seals rather than loss of total price of bits. Hughes Tool Co. v. G. W. Murphy Industries, Inc., C.A.5 (Tex.) 1973, 491 F.2d 923, 180 U.S.P.Q. 353. Patents 319(1)

Absent proof that decline in patentee's sales of combination weather strip and sash balance units was attributable to defendant's infringement, and in light of findings that evidence relative to defendant's sale of combination units was of no probative value in showing what a willing buyer would pay or a willing seller would accept for license to make, use, and sell infringing clips used in the mounting of the combination units, patentee was not entitled to damages based on defendant's sales of combination units. Zegers v. Zegers, Inc., C.A.7 (Ill.) 1972, 458 F.2d 726, 173 U.S.P.Q. 385, certiorari denied 93 S.Ct. 131, 409 U.S. 878, 34 L.Ed.2d 132, 175 U.S.P.Q. 385. Patents 319(1)

Owner of patents for integrated power supply controllers was not entitled to $33,981,781 in damages based on worldwide sales figure in its patent infringement action against competitor, but instead damages amount was to be reduced by 82%, even if it was foreseeable that owner would have lost sales worldwide based on competitor's infringement in the United States; worldwide sales measure of damages encompassed competitor's activities outside of United States which could not have been considered infringing, and sufficient evidence indicated that 18% of competitor's infringing products were imported into United States and, consequently, that 82% were not imported. Power Integrations, Inc. v. Fairchild Semiconductor Intern., Inc., D.Del.2008, 2008 WL 5205672. Pat- ents 319(1)

Patentee completely litigated issue of lost profits in prior patent infringement action against competitors, and thus patentee was precluded from relitigating issue of lost profits under issue preclusion, although patents at issue were not the same and jury did not find infringement against one competitor; patentee's products and accused products in each case were same, expert's damages analyses in both cases used Panduit test to show patentee was entitled to lost profits, analysis was not patent specific, patents were lumped together and viewed as

whole in relation to patentee's terrain awareness warning system products and accused products, and same infringing sales were at issue in both cases. Honeywell Intern. Inc. v. Universal Avionics Systems Corp., D.Del.2008, 585 F.Supp.2d 623. Patents 327(13)

Substantial evidence at trial supported jury determination that patentee was entitled to lost profits in action alleging infringement of patent for coronary stent that could be mounted on angioplasty balloon and delivered to target location intraluminally by catheter, and thus competitor was not entitled to judgment as a matter of law on lost profits damages; patentee offered evidence at trial that parent had created stent market in United States by developing training programs to teach physicians how to implant stents, parent acquired patentee to expand range of angioplasty products, patentee sold over $1.3 billion in coronary stents in 1995-97 and increased its market share when it introduced new stent, and patentee had access to substantial capital resources through parent. Cordis Corp. v. Medtronic Vascular, Inc., D.Del.2008, 576 F.Supp.2d 645. Patents 312(10)

Patentee failed to prove that it was entitled to actual damages in the form of lost profits because there was insufficient evidence that patentee would have made the sales that defendant made during the infringement period. Cohesive Technologies, Inc. v. Waters Corp., D.Mass.2007, 526 F.Supp.2d 84, affirmed in part, vacated in part and reversed in part 543 F.3d 1351, 88 U.S.P.Q.2d 1903, rehearing and rehearing en banc denied. Patents 312(10)

Holder of patent related to two-piece plunger lift system for removing accumulated liquids from gas wells was entitled to recover lost profits for competitor's infringement; there was great demand for patented plunger lift system, which had many benefits over prior technology, there were no acceptable, non-infringing alternatives, patent holder had the manufacturing and marketing capability to handle the increased sales it would have enjoyed had competitor not been selling infringing systems, and patent holder quantified its lost profits, using an incremental profit margin of 46%, at $851,625. MGM Well Services, Inc. v. Mega Lift Systems, LLC, S.D.Tex.2007, 505 F.Supp.2d 359, affirmed 264 Fed.Appx. 900, 2008 WL 450454. Patents 318(1)

Patent owner presented sufficient economic evidence to support all aspects of its lost profits damages theory, where owner's expert recognized in his market analysis that some portion of competitor's customers would not move their business to owner, witness offered explanation to jury as to why there was such drastic price dispar- ity between owner's system and accused system, and owner presented evidence of two supplier market; although competitor presented counter-evidence to jury in support of its version of facts, basis existed for jury to be con- vinced by owner's evidence. Muniauction, Inc. v. Thomson Corp., W.D.Pa.2007, 502 F.Supp.2d 477, stay denied 2007 WL 2406950, stay granted 2007 WL 2827915, reversed in part , vacated in part 532 F.3d 1318, 87 U.S.P.Q.2d 1350, rehearing and rehearing en banc denied , petition for certiorari filed 2008 WL 5459193. Pat- ents 312(10)

Only type of lost profits damages available in action for infringement of patent for silt fence machine, based on buyer's alleged reconstruction of machine for its own use, was what patentee would have made by selling buyer additional machine or by selling buyer license to use allegedly infringing machine. Devon Distributing Corp. v. Miner, S.D.Iowa 2004, 331 F.Supp.2d 791. Patents 318(4.1)

Owners of corporation who brought suit for infringement of two patents on which one of the owners was the named inventor were not entitled to recover as damages the profits lost by corporation as the non-exclusive licensee of the patents. Carver v. Velodyne Acoustics, Inc., W.D.Wash.2002, 202 F.Supp.2d 1147, 63 U.S.P.Q.2d 1312. Patents 318(1)

Holder of patent for stacking chair with protective edge was entitled to lost profits due to infringing sales as a measure of damages in patent infringement action; patentee and infringer were the only two suppliers in the relevant market. Gasser Chair Co., Inc. v. Infanti Chair Mfg. Corp., E.D.N.Y.1996, 943 F.Supp. 201, 40 U.S.P.Q.2d 1554, vacated 95 F.3d 1165, 40 U.S.P.Q.2d 1700, on remand 40 U.S.P.Q.2d 1701, 1996 WL 683240. Patents 318(2)

Patentees were not entitled to lost profits damages for defendant's infringement of patent in amount of $25,000, which was based on claim that patentees spent 200 hours on litigation that could have been spent making additional sales that would have resulted in $25,000 profit, as reason for alleged time spent by patentees was unclear in view of fact that patentees retained competent patent and general counsel; patentees would instead be awarded $200, which was profit from single infringing sale admitted by defendant. Mil-Tec USA, Inc. v. ABC Tool, Inc., M.D.Fla.1996, 939 F.Supp. 853, reconsideration denied 1997 WL 201716. Patents 318(1)

In infringement suit, award of lost profits was appropriate to compensate holder of patent for composition of ZSM-5 catalyst; infringer had been producing patented item for its own use, holder was the only manufacturer of patented catalyst before infringement began, infringer leased its supply of catalyst from holder before it began manufacturing its own infringing catalyst, infringer did not have an acceptable non-infringing substitute, and there was a reasonable probability that infringer would have continued to lease catalyst from holder had it not infringed. Mobil Oil Corp. v. Amoco Chemicals Corp., D.Del.1994, 915 F.Supp. 1333. Patents 318(4.1)

Evidence that patentee had reasonable possibility of selling 75 magnetic resonance imaging (MRI) scanners but for competitor's infringement was sufficient to support award to patentee of $27,825,000 in lost profit damages. Fonar Corp. v. General Elec. Co., E.D.N.Y.1995, 902 F.Supp. 330, 41 U.S.P.Q.2d 1088, affirmed in part , reversed in part 107 F.3d 1543, 41 U.S.P.Q.2d 1801, rehearing denied, in banc suggestion declined , certiorari denied 118 S.Ct. 266, 522 U.S. 908, 139 L.Ed.2d 192. Patents 312(10)

Additional damages could not be awarded in patent infringement action for that period of time prior to trial for which patentholder offered no evidence of lost profits; patentholder was entitled to establish damages for entire period or to urge jury to accept projection from past sales, but choose not to present such evidence. Oscar Mayer Foods Corp. v. Conagra, Inc., W.D.Wis.1994, 869 F.Supp. 656, 31 U.S.P.Q.2d 1173, affirmed 45 F.3d 443, 35 U.S.P.Q.2d 1278, rehearing denied, in banc suggestion declined , certiorari denied 116 S.Ct. 62, 516 U.S. 812, 133 L.Ed.2d 25. Patents 318(2)

Holder of infringed patent on collapsible tent to protect utility workers and their equipment was entitled to recover its reduced profit on its sales and lost profits on competitor's sales; evidence indicated that competitor's sales would otherwise have been holder's sales. T.A. Pelsue Co. v. Grand Enterprises, Inc., D.Colo.1991, 782 F.Supp. 1476, 25 U.S.P.Q.2d 1001. Patents 318(4.1)

Where manufacturer developed an entirely new market by inventing and marketing two different patented technologies, both of which achieved commercial success, and where infringer inspected one of the patented devices and borrowed its patented technology to make its infringing device, patent holder's right to exclude use of the patent entitled it to recover lost wholesale profits on both the copied device and its other device with which the infringing device competed. Rite-Hite Corp. v. Kelley Co., Inc., E.D.Wis.1991, 774 F.Supp. 1514, 21 U.S.P.Q.2d 1801, affirmed in part , vacated in part 56 F.3d 1538, 35 U.S.P.Q.2d 1065, certiorari denied 116 S.Ct. 184, 516 U.S. 867, 133 L.Ed.2d 122. Patents 318(4.1)

Evidence in patent infringement action involving Coriolis mass flowmeters justified damage award for profits

lost on sales taken from it by infringer in amount of $4,877,819; patent holder established demand for patented product, absence of acceptable noninfringing substitutes, manufacturing and marketing capability to exploit demand, and amount of profit it would have made. Micro Motion, Inc. v. Exac Corp., N.D.Cal.1991, 761 F.Supp. 1420, 19 U.S.P.Q.2d 1001. Patents 312(10)

Because the effect of the infringer's actions on sales of the patented product far exceeded the extent of the infringer's profits from the sale of its cheaper foldable headrest, royalty-based recovery would be inadequate to compensate patent holder for its loss and the only proper measure was the patent holder's lost profits. Sun Products Group, Inc. v. B & E Sales Co., Inc., E.D.Mich.1988, 700 F.Supp. 366, 9 U.S.P.Q.2d 2009. Patents 318(1)

Holder of patent for a chest press body exercising device which was a component of a multistation exercising apparatus was entitled to damages for infringement on basis of lost profits; royalties could not be awarded inasmuch as court had a definite figure for lost profits. Universal Athletic Sales Co. v. American Gym, W.D.Pa.1979, 480 F.Supp. 408, 205 U.S.P.Q. 840. Patents 318(1); Patents 319(1)

Where plaintiff and defendant, in civil contempt proceeding arising out of violation of consent decree by defendant in sale of infringing anaerobic sealants, were the only two manufacturers of unique type of anaerobic sealant, prices charged by defendant were almost identical, for each grade, to plaintiff's prices, and where in all reasonable probability plaintiff would have made the sales had defendant not made them, plaintiff was entitled to recover as damages profits lost by defendant's infringing sales. Broadview Chemical Corp. v. Loctite Corp., D.C.Conn.1970, 311 F.Supp. 447, 164 U.S.P.Q. 419. Patents 326(4)

112. Infringer's profits, damages--Generally

In case of infringement the courts may properly allow as damages the profits made by the infringer. Providence Rubber Co. v. Goodyear, U.S.R.I.1869, 76 U.S. 788, 19 L.Ed. 566, 9 Wall. 788. See, also, Willimantic Thread Co. v. Clark Thread Co., C.C.N.J.1886, 27 F. 865, 866, reversed on other grounds 11 S.Ct. 846, 140 U.S. 481, 35 L.Ed. 521; Sickels v. Borden, C.C.N.Y.1856, Fed.Cas. No. 12,832.

Only under peculiar circumstances and where no other rule is applicable can the defendant's profits be taken as a measure of damages in an action at law. Seymour v. McCormick, U.S.N.Y.1853, 57 U.S. 480, 16 How. 480, 14 L.Ed. 1024. See, also, Sessions v. Romadka, Wis.1892, 12 S.Ct. 799, 145 U.S. 29, 36 L.Ed. 609; Burdell v. Denig, Ohio 1876, 92 U.S. 716, 23 L.Ed. 764; Philp v. Nock, Dist.Col.1873, 17 Wall. 460, 21 L.Ed. 679; Suf- folk Mfg. Co. v. Hayden, Mass.1865, 3 Wall. 315, 18 L.Ed. 76; Cassidy v. Hunt, C.C.Cal.1896, 75 F. 1012.

Where no profits had resulted from an infringement, the patentee, though entitled to no profits as damages, may under former §§ 67 and 70 of this title have recovered all damages suffered. Marsh v. Seymour, U.S.Pa.1877, 97 U.S. 348, 7 Otto 348, 24 L.Ed. 963. See, also, Burdett v. Estey, C.C.Vt.1880, 3 F. 566, 570, certiorari denied 3 S.Ct. 531, 109 U.S. 633, 27 L.Ed. 1058.

In patent infringement action, district court properly used infringer's profits to estimate exclusive sublicensee's lost profits, in that evidence indicated sublicensee's percentage gain on sale and rental of infringing units would have been substantially similar to infringer's percentage gain and that sublicensee would have had lower overhead expenses. Kori Corp. v. Wilco Marsh Buggies and Draglines, Inc., C.A.Fed.1985, 761 F.2d 649, 225 U.S.P.Q. 985, certiorari denied 106 S.Ct. 230, 474 U.S. 902, 88 L.Ed.2d 229. Patents 318(3)

Though infringer's profits may constitute evidence tending to prove amount of patentee's damages or be a relevant factor in the calculation of a reasonable royalty, infringer's profits are not themselves recoverable without regard to the extent of the patentee's actual damages. Zegers v. Zegers, Inc., C.A.7 (Ill.) 1972, 458 F.2d 726, 173 U.S.P.Q. 385, certiorari denied 93 S.Ct. 131, 409 U.S. 878, 34 L.Ed.2d 132, 175 U.S.P.Q. 385. Patents 318(1)

Patent holder could seek whatever damages it incurred because of infringement and, though net profits made by infringer were not recoverable as such, they could provide evidence of element of patent holder's damage, i.e., loss of profits of patent holder. Atlas-Pacific Engineering Co. v. Geo. W. Ashlock Co., C.A.9 (Cal.) 1964, 339 F.2d 288, 144 U.S.P.Q. 55, certiorari denied 86 S.Ct. 55, 382 U.S. 842, 15 L.Ed.2d 83, 147 U.S.P.Q. 540. Pat- ents 319(1)

Profits of infringer are evidence of damages sustained by holder of patent and may be the measure of damages. Henry Hanger & Display Fixture Corp. of America v. Sel-O-Rak Corp., C.A.5 (Fla.) 1959, 270 F.2d 635, 123 U.S.P.Q. 3. Patents 319(1)

The appropriate measure of damages in trade secret cases, is not what plaintiff lost, but rather the benefits, profits, or advantage gained by defendant in the use of the trade secret, the advantage enjoyed by defendant being measured by the standard of comparison method. International Industries, Inc. v. Warren Petroleum Corp., C.A.3 (Del.) 1957, 248 F.2d 696, 115 U.S.P.Q. 104, 115 U.S.P.Q. 159, certiorari dismissed 78 S.Ct. 529, 355 U.S. 943, 2 L.Ed.2d 523. Damages 114

Judgment in patent infringement action having required defendant to account for and pay to plaintiff all profits realized by defendant through making, using and selling of infringing articles and to account for damages equalling profits plaintiff would have made had it made each of infringing sales made by defendant did not conform with former § 70 of this title which provided that complainant in patent infringement action should have been entitled to recover for general damages which should have been due compensation for making, using or selling the invention, not less than a reasonable royalty therefor. Ric-Wil Co. v. E. B. Kaiser Co., C.A.7 (Ill.) 1950, 179 F.2d 401, 84 U.S.P.Q. 121, certiorari denied 70 S.Ct. 981, 339 U.S. 958, 94 L.Ed. 1369, 85 U.S.P.Q. 526. Patents 323.1

The sole basis for recovery in an infringement case is the patent holder's damages and not the infringer's profits. Ellipse Corp. v. Ford Motor Co., N.D.Ill.1978, 461 F.Supp. 1354, 201 U.S.P.Q. 455, affirmed 614 F.2d 775, certiorari denied 100 S.Ct. 2160, 446 U.S. 939, 64 L.Ed.2d 792, 206 U.S.P.Q. 288. Patents 319(1)

Although a plaintiff in a patent infringement action is no longer entitled to recover the profits derived by the sale of the infringing items, the infringer's profits may constitute evidence tending to show the plaintiff's damages or be a relevant factor in the calculation of a reasonable royalty. Jenn-Air Corp. v. Penn Ventilator Co., Inc., E.D.Pa.1975, 394 F.Supp. 665, 185 U.S.P.Q. 410. Patents 319(1)

Infringement entitled patent owner in actual damages measured by profit from sale of infringing machines as determined by accounting or by reasonable royalty, whichever was greater. Koehring Co. v. National Automatic Tool Co., S.D.Ind.1966, 257 F.Supp. 282, 150 U.S.P.Q. 777, affirmed 385 F.2d 414, 155 U.S.P.Q. 231. Patents 319(1)

If patent owner can establish that he was in competition with infringer in sale of patented article and that, absent infringement, he would have made infringer's sales of patented item, but he finds it extremely difficult or im-

possible to prove what his profits would have been had he made these waylaid sales, infringer's profits on these sales may probatively be used as rough equation for patent owner's lost profits. Georgia-Pacific Corp. v. U. S. Plywood Corp., S.D.N.Y.1965, 243 F.Supp. 500, 146 U.S.P.Q. 228. Patents 312(2)

Patentee was not entitled to recover profits as such accounted for by infringer. Locklin v. Switzer Bros., Inc., N.D.Cal.1964, 235 F.Supp. 904, 143 U.S.P.Q. 233. Patents 318(1)

Award in patent infringement action was to be based on damage to patent holder rather than profits gained by infringers. Marvel Specialty Co. v. Bell Hosiery Mills, Inc., W.D.N.C.1964, 235 F.Supp. 218, 143 U.S.P.Q. 283. Patents 319(1)

Profits of an infringer are a proper factor in considering damages where other measures are not totally adequate, and where commercial value of product is increased by use of patented process and infringement is present, profits are considered a relative element. Hartford Nat. Bank & Trust Co. v. E.F. Drew & Co., D.C.Del.1960, 188 F.Supp. 353, 126 U.S.P.Q. 487, affirmed 290 F.2d 589, 129 U.S.P.Q. 204, certiorari denied 82 S.Ct. 45, 368 U.S. 825, 7 L.Ed.2d 29, 131 U.S.P.Q. 498. Patents 319(1)

Infringer is entitled to profits from making noninfringing commodity ready for market, but is accountable when making infringing products from noninfringing commodity. Barber Asphalt Paving Co. v. Standard Asphalt & Rubber Co., C.C.A.7 (Ill.) 1928, 30 F.2d 281, certiorari denied 49 S.Ct. 250, 278 U.S. 659, 73 L.Ed. 567. Pat- ents 318(1)

Plaintiffs were entitled to recover additional profits realized by defendants on sale of infringing devices to government. Fairbanks, Morse & Co. v. American Valve & Meter Co., C.C.A.7 (Ill.) 1929, 34 F.2d 869, certiorari denied 50 S.Ct. 86, 280 U.S. 604, 74 L.Ed. 649. Patents 318(3)

The profits are confined to the worth of the actual advantage gained by using the infringed invention over other modes available for the same purpose. Campbell v. Barclay, C.C.N.D.Ill.1870, 4 F.Cas. 1157, 5 Biss. 179, No. 2353. See, also, Littlefield v. Perry, N.Y.1875, 21 Wall. 205, 22 L.Ed. 577; Mowry v. Whitney, Ohio 1871, 14 Wall. 620, 20 L.Ed. 860; Williams v. Rome, etc., R.C., C.C.N.Y.1880, 18 Blatchf.U.S., 181, 2 F. 702; Knox v. Great Western Quicksilver Min. Co., C.C.Cal.1878, 6 Sawy. 430, Fed.Cas. No. 7,907; Serrell v. Collins, C.C.N.Y.1857, 1 Fish.Pat.Cas. 289, Fed.Cas. No. 12,672.

Where the infringement was neither willful nor malicious, only the net profits realized from the manufacture and sale of the patented articles will be allowed. Ford v. Kurtz, C.C.N.D.Ill.1882, 12 F. 789, 11 Biss. 324. Patents 318(3)

Award giving holder of patent all of infringer's profits from sale of infringer's device could not be made under this section. Railroad Dynamics, Inc. v. A. Stucki Co., E.D.Pa.1983, 579 F.Supp. 353, 218 U.S.P.Q. 618, affirmed 727 F.2d 1506, 220 U.S.P.Q. 929, certiorari denied 105 S.Ct. 220, 469 U.S. 871, 83 L.Ed.2d 150, 224 U.S.P.Q. 520. Patents 318(4.1)

A patentee may recover the profits derived from an infringer's use or sale of his invention or damages for the use, though the share of the profits to which he may be entitled may be a small part of all the profits derived from the use or sale of the infringing device. Myles Standish Mfg. Co. v. Champion Spark Plug Co., C.C.A.8 (Neb.) 1922, 282 F. 961. Patents 318(1); Patents 319(1)

In patent infringement suit profits are recoverable from infringer to insure full compensation to injured party. Leman v. Krentler-Arnold Hinge Last Co., U.S.Mass.1932, 52 S.Ct. 238, 284 U.S. 448, 76 L.Ed. 389. Patents 318(1)

The plaintiff is entitled to recover the profits realized by the wrongdoer from the infringement. Littlefield v. Perry, U.S.N.Y.1874, 88 U.S. 205, 22 L.Ed. 577, 21 Wall. 205. See, also, Continuous Glass Press Co. v. Schmertz Wire Glass Co., Pa.1915, 219 F. 199, 135 C.C.A. 85, certiorari denied 35 S.Ct. 661, 238 U.S. 623, 59 L.Ed. 1494; Carter v. Baker, C.C.Cal.1871, Fed.Cas. No. 2,472; Tilghman v. Werk, C.C.Ohio 1862, Fed.Cas. No. 14,046; Coleman v. Liesor, C.C.Ohio 1859, Fed.Cas. No. 2,984. Patents 318(1)

Profits from infringing use of patented device are recovered by patentee on equitable theory that infringer should not unjustly enrich himself by his wrong and will be held as trustee of profits, derived from wrongful use, not on theory of reparation or punishment, and one invoking such principle must prove unjust enrichment. Amusement Corp. of America v. Mattson, C.C.A.5 (Fla.) 1943, 138 F.2d 693, certiorari denied 64 S.Ct. 639, 321 U.S. 782, 88 L.Ed. 1074. Patents 318(1)

Absent findings to support theory that patentee would have enjoyed infringer's earnings if there had been no infringement, patentee was not entitled to recovery of infringer's profits. Zegers v. Zegers, Inc., C.A.7 (Ill.) 1972, 458 F.2d 726, 173 U.S.P.Q. 385, certiorari denied 93 S.Ct. 131, 409 U.S. 878, 34 L.Ed.2d 132, 175 U.S.P.Q. 385. Patents 318(1)

That profits were in part the result of an alleged unlawful agreement between competing manufacturers to maintain prices, does not lessen liability for profits. Brookfield v. Novelty Glass Mfg. Co., C.C.N.J.1908, 170 F. 830, affirmed 170 F. 946, 95 C.C.A. 516, affirmed 170 F. 960, 96 C.C.A. 127.

The fruits of the advantage to infringer, shown by direct evidence or by fair inference of using patentee's machine, over that it had in using other processes then open to the public and adequate to enable it to obtain an equally beneficial result, were its “profits” and could be allowed to patentee as damages. Horvath v. McCord Radiator & Mfg. Co., C.C.A.6 (Mich.) 1938, 100 F.2d 326, certiorari denied 60 S.Ct. 101, 308 U.S. 581, 84 L.Ed. 486, rehearing denied 60 S.Ct. 171, 308 U.S. 636, 84 L.Ed. 529. Patents 318(1)

113. ---- Accounting, infringer's profits, damages

Profits on all products infringing patent are properly included in accounting. James L. Taylor Mfg. Co. v. Steuernagel, C.C.A.2 (Conn.) 1927, 19 F.2d 298. Patents 318(4.1)

An infringer is a trustee ex maleficio and as such is bound to account for profits. In re Beckwith, C.C.A.7 (Wis.) 1913, 203 F. 45, 121 C.C.A. 381. See, also, Tilghman v. Proctor, Ohio 1888, 8 S.Ct. 894, 125 U.S. 136, 31 L.Ed. 664; Root v. Lake Shore, etc., R. Co., Ill.1882, 105 U.S. 189, 26 L.Ed. 975; Birdsall v. Coolidge, Nev.1876, 93 U.S. 64, 23 L.Ed. 802; Burdell v. Denig, Ohio 1876, 92 U.S. 716, 23 L.Ed. 764; Littlefield v. Perry, N.Y.1875, 21 Wall. 205, 22 L.Ed. 577; Washington, etc., Packet Co. v. Sickles, Dist.Col.1874, 19 Wall. 611, 22 L.Ed. 203; Van Kannel Revolving Door Co. v. Uhrich, C.C.A.N.Y.1924, 297 F. 363; Vaughan v. East

Tennessee, V. & G.R. Co., C.C.Tenn.1877, Fed.Cas. No. 16,898; Wetherill v. New Jersey Zinc Co., C.C.N.J.1874, Fed.Cas. No. 17,464; Jenkins v. Greenwald, C.C.Ohio 1857, 1 Bond, 126, Fed.Cas. No. 7,270.

In light of patent infringer's failure to provide actual amounts of infringing sales, failure to offer estimates of infringing sales, and failure to assist in reconstruction of infringing sales, district court's selection of amount of infringing sales as measure of damages was not clearly erroneous. Beatrice Foods Co. v. New England Printing and Lithographing Co., C.A.Fed. (Conn.) 1990, 899 F.2d 1171, 14 U.S.P.Q.2d 1020. Patents 319(1)

Where defendants offered for sale and in fact accepted order for sale of apparatus manufactured by plaintiff and in lieu of plaintiff's apparatus delivered to buyer and apparatus manufactured by defendants, plaintiff was entitled to accounting by defendants for profits made on that sale. Spray-Bilt, Inc. v. Ingersoll-Rand World Trade, Limited, C.A.5 (Fla.) 1965, 350 F.2d 99, 146 U.S.P.Q. 686. Antitrust And Trade Regulation 115

Where infringer made no attempt to segregate upon its books the respective number of sales of infringing device and noninfringing devices or profits arising from those which infringed or those which did not infringe, infringer was properly hed to account to patentee as trustee for all profits resulting. W. H. Miner, Inc., v. Peerless Equip- ment Co., C.C.A.7 (Ill.) 1940, 115 F.2d 650, certiorari denied 61 S.Ct. 615, 312 U.S. 687, 85 L.Ed. 1125. Pat- ents 318(4.1)

Court was empowered to determine whether certain payment by infringer to another company was legitimate manufacturing expense or mere division of spoils between joint adventurers, notwithstanding fact that company was not party to suit for infringement and accounting, and hence would not be bound by decision therein. Ste- arns-Roger Mfg. Co. v. Ruth, C.C.A.10 (Colo.) 1936, 87 F.2d 35. Patents 318(6)

Infringer's profits, if proved, may be relevant evidence on damages for infringement, and infringer may be required to account for its profits. England v. Deere & Co., S.D.Ill.1964, 236 F.Supp. 356, 143 U.S.P.Q. 236. Pat- ents 318(1); Patents 319(1)

Plaintiffs were not entitled to an accounting for profits, in addition to damages, for patent infringement, although they were entitled to an accounting for profits as well as damages for misappropriation of trade secrets. Carter Products, Inc. v. Colgate-Palmolive Co., D.C.Md.1963, 214 F.Supp. 383, 136 U.S.P.Q. 348, 136 U.S.P.Q. 577. Patents 318(1)

Plaintiff, which had acquired infringed patents, was entitled to injunction restraining defendants from further infringing patents, accounting for profits and damages occasioned by defendants' infringement, interest, and costs of suit. Eversharp, Inc. v. Fisher Pen Co., N.D.Ill.1961, 204 F.Supp. 649, 132 U.S.P.Q. 423. Patents 286; Patents 317; Patents 318(1); Patents 318(5); Patents 319(1); Patents 325.9

114. ---- Actual profits, infringer's profits, damages

A patentee may recover profits actually realized, although from other causes the infringer's general business shows no profit, but when the infringer's entire profit results from the use of the invention, the patentee may recover the entire profits. City of Elizabeth v. American Nicholson Pavement Co., U.S.N.J.1877, 97 U.S. 126, 7 Otto 126, 24 L.Ed. 1000, motion denied 24 L.Ed. 1059. Patents 318(4.1)

Co-infringers of patent are severally accountable to patentee only for profits which each infringer receives, unless they are partners. Amusement Corp. of America v. Mattson, C.C.A.5 (Fla.) 1943, 138 F.2d 693, certiorari

denied 64 S.Ct. 639, 321 U.S. 782, 88 L.Ed. 1074. Patents 287(1)

Award for profits, admittedly not based on actual gains from business, was not sustainable. Merrell Soule Co. v. Powdered Milk Co. of America, C.C.A.2 (N.Y.) 1925, 7 F.2d 297.

An infringer is liable for the entire profit realized from the infringing device and not merely for the difference between those profits and the profits which might have been made by the sale of the device previously used by him. Expanded Metal Co. v. General Fireproofing Co., N.D.Ohio 1917, 247 F. 899, appeal dismissed 272 F. 1021. See, also, Lee v. Malleable Iron Range Co., D.C.Wis.1918, 247 F. 795, modified on other grounds 263 F. 896, certiorari denied 40 S.Ct. 342, 251 U.S. 562, 64 L.Ed. 415.

An infringer cannot escape liability for actual profits made, on the ground that this superior skill and scientific methods in conducting the business enabled him to reap greater profits than others would have done by the infringement. Lawther v. Hamilton, C.C.E.D.Wis.1892, 64 F. 221. Patents 318(1)

A profit which might have been made is not recoverable, but only that which was actually made or ought to have been made. Burdett v. Estey, C.C.Vt.1880, 3 F. 566, reversed 3 S.Ct. 531, 109 U.S. 633, 27 L.Ed. 1058. See, also, Sessions v. Romadka, Wis.1892, 12 S.Ct. 799, 145 U.S. 29, 36 L.Ed. 609; Tilghman v. Proctor, Ohio 1888, 8 S.Ct. 894, 125 U.S. 136, 31 L.Ed. 664; Burdell v. Denig, Ohio 1876, 92 U.S. 716, 23 L.Ed. 764; Dean v. Ma- son, R.I.1858, 61 U.S. 198, 20 How. 198, 15 L.Ed. 876; Livingston v. Woodworth, Mass.1853, 15 How. 546, 14 L.Ed. 809; Robbins v. Illinois Watch Co., C.C.Ill.1897, 78 F. 124; Lawther v. Hamilton, C.C.Wis.1892, 64 F. 221; Kirk v. Du Bois, C.C.Pa.1891, 46 F. 486, affirmed 15 S.Ct. 729, 158 U.S. 58, 39 L.Ed. 895; Munson v. City of New York, C.C.N.Y.1883, 16 F. 560, reversed on other grounds 8 S.Ct. 622, 124 U.S. 601, 31 L.Ed. 586.

The amount which may be recovered is the amount of profits which were realized by the infringer from his unlawful use of the patent. Williams v. Rome, W. & O.R. Co., C.C.N.D.N.Y.1880, 2 F. 702. See, also, Crosby Steam Gage, etc., Co. v. Consolidated Safety Valve Co., Mass.1891, 12 S.Ct. 49, 141 U.S. 441, 35 L.Ed. 809; Root v. Lake Shore, etc., R. Co., Ill.1882, 105 U.S. 189, 26 L.Ed. 975; Washington, etc., Packet Co. v. Sickles, Dist.Col.1873, 19 Wall. 611, 22 L.Ed. 203; Providence Rubber Co. v. Goodyear, R.I.1870, 9 Wall. 788, 19 L.Ed. 566; Livingston v. Woodworth, Mass.1853, 15 How. 546, 14 L.Ed. 809; Jenkins v. Greenwald, C.C.Ohio 1857, 1 Bond. 126, Fed.Cas. No. 7,270.

A patentee is entitled to a decree for the profits that have been actually realized from the use of his invention, although from other causes the general business of the defendant in which the invention is employed may not have resulted in profits. Graham v. Mason, C.C.Mass.1872, 10 F.Cas. 930, No. 5672. See, also, Tilghman v. Proctor, Ohio 1888, 8 S.Ct. 894, 125 U.S. 136, 31 L.Ed. 664; Thomson v. Wooster, N.Y.1885, 5 S.Ct. 788, 114 U.S. 104, 29 L.Ed. 105; Elizabeth v. American Nicholson Pavement Co., N.J.1878, 97 U.S. 126, 24 L.Ed. 1000; Cawood Patent, Ill.1877, 94 U.S. 695, 24 L.Ed. 238; Mevs v. Conover, N.Y.1877, 131 U.S., Appendix, cxlii, 23 L.Ed. 1008; Celluloid Mfg. Co. v. Cellonite Mfg. Co., C.C.N.Y.1889, 40 F. 476; Andrews v. Creegan, C.C.N.Y.1881, 7 F. 477; Steam Stone Cutter Co. v. Windsor Mfg. Co., C.C.Vt.1879, 17 Blatchf. 24, Fed.Cas. No. 13,335; Knox v. Great Western Quicksilver Min. Co., C.C.Cal.1878, 6 Sawy. 430, Fed.Cas.7,907.

Profits are the gains upon any business when both receipts and payments are taken into account, and in suits for infringement are confined to the actual advantage gained by the infringer. Piper v. Brown, C.C.Mass.1873, 19 F.Cas. 722, No. 11181. See, also, Mowry v. Whitney, Pa.1872, 14 Wall. 434, 20 L.Ed. 858; Providence Rubber Co. v. Goodyear, R.I.1870, 9 Wall. 788, 19 L.Ed. 566; Dean v. Mason, R.I.1858, 20 How. 198, 15 L.Ed. 876; Livingston v. Woodworth, Mass.1853, 15 How. 546, 14 L.Ed. 809.

Profits actually realized are usually the measure of damages. Littlefield v. Perry, U.S.N.Y.1874, 88 U.S. 205, 22 L.Ed. 577, 21 Wall. 205. See, also, Philadelphia Rubber Works Co. v. U.S. Rubber Reclaiming Works, D.C.N.Y.1920, 276 F. 600, affirmed 277 F. 171, certiorari denied 42 S.Ct. 187, 257 U.S. 660, 66 L.Ed. 422.

115. ---- Computation of profits, infringer's profits, damages

Profits from patented device as part of machines made and sold cannot be estimated from proof of profits of other manufacturers from the sale of similar devices in similar machines. Keystone Mfg. Co. v. Adams, U.S.Ill.1894, 14 S.Ct. 295, 151 U.S. 139, 38 L.Ed. 103. See, also, Robbins v. Illinois Watch Co., C.C.Ill.1897, 78 F. 124, affirmed 81 F. 957, 27 C.C.A. 21. Patents 318(3)

When only the profits made by one infringing a patent are awarded as damages, it is immaterial in the calculation thereof whether or not the owner of the patent was using the invention in articles sold by him. Crosby Steam-Gauge & Valve Co. v. Consolidated Safety-Valve Co., U.S.Mass.1891, 12 S.Ct. 49, 141 U.S. 441, 35 L.Ed. 809. See, also, Carborundum Co. v. Electric Smelting & Aluminum Co., Pa.1913, 203 F. 976, 122 C.C.A. 276, certiorari denied 34 S.Ct. 323, 231 U.S. 754, 58 L.Ed. 467. Patents 318(4.1)

In estimating profits, it is not the profits of the business, as a business, that are to be considered, but the value of the advantages derived by the infringer from the use of the invention over what he would have derived from the use of other machines then known and open to the public. Mowry v. Whitney, U.S.Ohio 1871, 81 U.S. 620, 20 L.Ed. 860, 14 Wall. 620. See, also, Webster Loom Co. v. Higgins, C.C.N.Y.1890, 43 F. 673; Coupe v. Weather- head, C.C.R.I.1888, 37 F. 16; McMurray v. Emerson, C.C.Mass.1888, 36 F. 901; Tomkinson v. Willets Mfg. Co., C.C.N.Y.1888, 34 F. 536; Shannon v. Bruner, C.C.Mo.1888, 33 F. 871; Locomotive Safety Truck Co. v. Pennsylvania R. Co., C.C.Pa.1880, 2 F. 677; Knox v. Great Western Quicksilver Min. Co., C.C.Cal.1878, Fed.Cas. No. 7,907; Mulford v. Pearce, C.C.N.Y.1877, Fed.Cas. No. 9,908, reversed on other grounds 102 U.S. 112, 26 L.Ed. 93; Wetherill v. New Jersey Zinc Co., C.C.N.J.1874, Fed.Cas. No. 17,464. Patents 318(4.1)

In patent infringement suit, district court did not abuse its discretion in accepting computation of profits according to standard cost accounting system based on infringer's records which accountants testified were well kept, though separate records of all infringing acts were not kept. Perrine v. Burdick, C.C.A.8 (Minn.) 1943, 138 F.2d 861. Patents 318(3)

The predicate of the standard of comparison in determining gain of infringer by use of patented device is that infringer would have used comparative device but for his infringement. Gordon Form Lathe Co. v. Ford Motor Co., C.C.A.6 (Mich.) 1943, 133 F.2d 487, certiorari granted 63 S.Ct. 1325, 319 U.S. 738, 87 L.Ed. 1697, rehearing granted 63 S.Ct. 1444, 320 U.S. 213, 87 L.Ed. 1850, certiorari denied 63 S.Ct. 1328, 319 U.S. 765, 87 L.Ed. 1715, rehearing denied 64 S.Ct. 29, 320 U.S. 810, 88 L.Ed. 490, affirmed 64 S.Ct. 257, 320 U.S. 714, 88 L.Ed. 419, rehearing denied 64 S.Ct. 434, 320 U.S. 816, 88 L.Ed. 493. Patents 318(3)

“Profit” recoverable by patentee for infringement of patent means all financial gains, representing difference between cost of production and sale of infringing article and receipts therefrom. Levin Bros. v. Davis Mfg. Co., C.C.A.8 (Minn.) 1934, 72 F.2d 163. Patents 318(3)

Evidence established that, notwithstanding German wireless corporation's contracts guaranteeing revenue to American subsidiary and providing for division of gross receipts, in equity, profits belonged to German corporation as matter of law and hence agreements should be disregarded as affecting rights against subsidiary for infringement of patents. Kintner v. Atlantic Communication Co., S.D.N.Y.1921, 51 F.2d 109. Patents 322

Where “marketable” noninfringing commodities are produced by infringer and subsequently used in making infringing products, “market value” is basis for determining profits. Barber Asphalt Paving Co. v. Standard As- phalt & Rubber Co., C.C.A.7 (Ill.) 1928, 30 F.2d 281, certiorari denied 49 S.Ct. 250, 278 U.S. 659, 73 L.Ed. 567. Patents 318(3)

“Profits” are determined by principles applicable to noninfringing situations. Christensen v. National Brake & Elec. Co., D.C.Wis.1924, 10 F.2d 856. Patents 318(3)

Under suitable conditions, profits may be computed by subtracting total investments in infringing business from total receipts of its conduct and liquidation, with allowance for profits or losses of relatively small noninfringing departments. Union Electric Welding Co. v. Curry, C.C.A.6 (Ohio) 1922, 279 F. 465, certiorari denied 43 S.Ct. 89, 260 U.S. 727, 67 L.Ed. 484. Patents 318(3)

In determining the profits of an infringer, other methods of accomplishing results of the patented process cannot be used as standards of comparison, if such methods were covered by other patents, so as not to be available to defendant. Philadelphia Rubber Works Co. v. U.S. Rubber Reclaiming Works, C.C.A.2 (N.Y.) 1921, 277 F. 171, certiorari denied 42 S.Ct. 187, 257 U.S. 660, 66 L.Ed. 422. Patents 318(3)

Incidental, but nonessential, features not used, which do not enter into the profits made, although contributing possibly to the general efficiency of the patented machine, do not need to be considered. Novelty Glass Mfg. Co. v. Brookfield, C.C.A.3 (N.J.) 1909, 170 F. 946, 95 C.C.A. 516. Patents 318(3)

Finding as to profits realized in certain months cannot be based solely on comparison of sales during corresponding months, for the previous and following years. Keep v. Fuller, C.C.N.D.N.Y.1890, 42 F. 896. Patents 318(3)

Design patent owner, claiming that its lost profits damages are equivalent to infringer's profits, must show: (1) demand for patented product, (2) absence of acceptable non-infringing substitutes, (3) his manufacturing and marketing capability to exploit demand, and (4) amount of profit he would have made. Rocket Jewelry Box, Inc. v. Quality Intern. Packaging, Ltd., S.D.N.Y.2003, 250 F.Supp.2d 333, motion denied 2003 WL 21910888, affirmed in part, vacated in part and remanded 90 Fed.Appx. 543, 2004 WL 260998, on remand 403 F.Supp.2d 288. Patents 318(4.4)

In computing profits as an element of damages for wrongful appropriation of trade secrets, no part of general expense is to be allocated to infringing goods if manufacture and marketing thereof causes no increase in general expense, where defendant's misappropriation of trade secrets resulted in unjust enrichment of defendant. Carter Products, Inc. v. Colgate-Palmolive Co., D.C.Md.1963, 214 F.Supp. 383, 136 U.S.P.Q. 348, 136 U.S.P.Q. 577. Antitrust And Trade Regulation 437

“Profits” derived from infringement of patent for which infringer must account to the owner of the patent are the difference between the cost of producing the infringing article and the sale price of the article. Triplex Safety Glass Co. of North America v. Pittsburgh Plate Glass Co., D.C.Del.1941, 38 F.Supp. 639. Patents 318(3)

In determining accountability of patent infringer for profits from manufacture of infringing toy torpedoes, fairness of sale price of toy torpedoes to infringer's parent corporation would be critically scrutinized. Victory Fire- works & Specialty Co. v. Commercial Novelty Co., D.C.Md.1939, 26 F.Supp. 126. Patents 318(3)

In determining profits derived from carbon recovery system which used patented carbon as basis of award to owner of patent, defendants were entitled to have such profits measured by comparison with any other proper recovery system available at beginning of infringing period, and similar system, which was superseded by infringing system, as it performed in its prime, was proper standard of comparison. National Carbon Co. v. Richards & Co., D.C.Conn.1935, 16 F.Supp. 239, affirmed 85 F.2d 490. Patents 318(3)

Comparison should be made with other machines in existence, or known, and which were open to public use at the time of the infringement. Knox v. Great Western Quicksilver Min. Co., C.C.Cal.1878, 14 F.Cas. 809, 6 Sawy. 430, No. 7907. See, also, Turrill v. Illinois Cent. R. Co., C.C.Ill.1880, 20 F. 912.

Profits are to be computed by finding the difference between cost and yield and the calculation is to be made as a manufacturer calculates the profits of his business. Goodyear v. Providence Rubber Co., C.C.R.I.1864, 10 F.Cas. 712, No. 5583.

In determining profits arising from sale of infringing devices as a measure of damages for the infringement, infringing company was entitled to an allowance of bonuses paid by company to its officers, pursuant to contracts entered into, as additional compensation for services actually rendered. W. H. Miner, Inc., v. Peerless Equip- ment Co., C.C.A.7 (Ill.) 1940, 115 F.2d 650, certiorari denied 61 S.Ct. 615, 312 U.S. 687, 85 L.Ed. 1125. Pat- ents 319(1)

Where patent infringer did not produce relevant records and there was no evidence upon which lost profits or a reasonable royalty could be based, patentee was properly allowed as damages the gross profits on the infringing machines subject to any deduction which would be allowed if clearly established by the infringer, but patentee was not entitled to the interest on the damages from date of last infringing sale but only from the date of master's report. Wm. Bros Boiler & Mfg. Co. v. Gibson-Stewart Co., C.A.6 (Ohio) 1963, 312 F.2d 385, 136 U.S.P.Q. 239. Patents 319(1); Patents 319(4)

Measuring profits on defendant's sale of infringing structures by profits on noninfringing part was not improper. Fairbanks, Morse & Co. v. American Valve & Meter Co., C.C.A.7 (Ill.) 1929, 34 F.2d 869, certiorari denied 50 S.Ct. 86, 280 U.S. 604, 74 L.Ed. 649. Patents 318(3)

116. ---- Improvements, infringer's profits, damages

If the party infringing has improved the machine, and a part of the profits are due to his improvement, the portion of the profits due to such improvement do not belong to the owner of the prior patent. Westinghouse Elec- tric & Mfg. Co. v. Wagner Electric & Mfg. Co., U.S.Mo.1912, 32 S.Ct. 691, 225 U.S. 604, 56 L.Ed. 1222. See, also, Force v. Sawyer-Boss Mfg. Co., N.Y.1906, 143 F. 894, 75 C.C.A. 102, certiorari denied 26 S.Ct. 766, 202 U.S. 621, 50 L.Ed. 1175; Carter v. Baker, C.C.Cal.1871, Fed.Cas. No. 2,472.

Owner of infringed patent is only entitled to recover for value of his invention, not for noninfringing improvements therein. Saulnier v. U. S., Ct.Cl.1963, 314 F.2d 950, 161 Ct.Cl. 223, 137 U.S.P.Q. 222. Patents 319(1)

Owner of patent can recover from infringer total profits derived from manufacture, use, or sale of product where entire commercial value thereof arises from patent improvement. Duplate Corporation v. Triplex Safety Glass Co of North America, C.C.A.3 (Pa.) 1935, 81 F.2d 352, certiorari granted 56 S.Ct. 668, 297 U.S. 702, 80 L.Ed. 990, affirmed as modified on other grounds 56 S.Ct. 792, 298 U.S. 448, 80 L.Ed. 1274. Patents 318(4.1)

When patented improvement does not give entire value to device, profits recoverable for infringement are measurable by difference between what infringer received from sales of improved device and what he might reasonably have expected to receive from sales of that part of it which he had right to sell. Alliance Securities Co. v. De Vilbliss Mfg. Co., C.C.A.6 (Ohio) 1935, 76 F.2d 503. Patents 318(3)

Patentee cannot by language of claim transform improvement into complete structure, entitling him to profits on whole structure. Egry Register Co. v. Standard Register Co., C.C.A.6 (Ohio) 1928, 23 F.2d 438. Patents 318(4.1)

Inventor of device constituting improvement must properly apportion profits. James L. Taylor Mfg. Co. v. Steuernagel, C.C.A.2 (Conn.) 1927, 19 F.2d 298. Patents 318(4.3)

Though an infringer claims to have “improved” the patented structure, so long as he is within the inhibited field he is still infringing; and if by his improvements he has enhanced his sales and profits, he is still exercising the patentee's rights and is accountable for the profits. Christensen v. National Brake & Elec. Co., D.C.Wis.1924, 10 F.2d 856.

In determining sanitary district's liability for infringement of patents relating to activated sludge process, district would not be relieved from failure to sell sludge as a fertilizer because a suggested practice of district of using chloride instead of acid constituted an improvement over the patents, since an infringer cannot claim that his superior skill or intelligence enabled him to realize profits by his infringement which a person of less skill might not have realized. Activated Sludge v. Sanitary Dist. of Chicago, N.D.Ill.1946, 64 F.Supp. 25, 68 U.S.P.Q. 137, affirmed 157 F.2d 517, 71 U.S.P.Q. 316, certiorari denied 67 S.Ct. 970, 330 U.S. 834, 91 L.Ed. 1281, 72 U.S.P.Q. 529, rehearing denied 67 S.Ct. 1092, 330 U.S. 856, 91 L.Ed. 1297, 72 U.S.P.Q. 529, rehearing denied 67 S.Ct. 1347, 331 U.S. 866, 91 L.Ed. 1870. Patents 319(1)

Infringer is accountable for profits though enhanced by “improvements” of the patented structure. Christensen v. National Brake & Elec. Co., D.C.Wis.1924, 10 F.2d 856. Patents 318(1)

When an infringer uses the essential part of a patented machine, it is no answer to a demand for an accounting of profits that his substituted equivalents improved by work of the machine. Tuttle v. Claflin, C.C.A.2 (N.Y.) 1896, 76 F. 227, 22 C.C.A. 138, motion denied 82 F. 744, 27 C.C.A. 255, certiorari denied 17 S.Ct. 992, 166 U.S. 721, 41 L.Ed. 1187. Patents 318(1)

Damages for breach by patent infringer of provision in agreement settling infringement case to refrain from further use of motor casing similar to that of patentee were properly based on sales made by infringer to common customers of patentee and infringer before and after agreement, including sales to customers first obtained by infringer, even if infringer's improved motors contributed to sales. Howard Industries, Inc. v. Rae Motor Corp., C.A.7 (Wis.) 1961, 293 F.2d 116. Compromise And Settlement 20(2)

117. ---- Items of recoverable profits, infringer's profits, damages

Where infringement of one claim only of a patent is adjudged, the infringer cannot be held to account for profits from device which was element of other claims. Canda Bros. v. Michigan Malleable Iron Co., C.C.A.6 (Mich.) 1907, 152 F. 178, 81 C.C.A. 420. Patents 318(3)

If proof disclosed that parts sold by infringer for use on infringing machines were not actually used in infringe-

ment, profits on such parts should be eliminated, even though such proof was formally offered on another and untenable theory. Stearns-Roger Mfg. Co. v. Ruth, C.C.A.10 (Colo.) 1936, 87 F.2d 35. Patents 318(4.1)

Infringer of wagon loader patent was liable for all profits received from sale of loaders containing infringing device, from sales of parts relating to blades or feeding paddles, but not from sales of parts not covered by patent. George Haiss Mfg. Co. v. Linkbelt Co., C.C.A.3 (Pa.) 1932, 63 F.2d 479. Patents 318(4.1)

When demonstrably present, value of good will may be considered in determining profits of patent infringement. Stromberg Motor Devices Co. v. Detroit Trust Co., C.C.A.7 (Ill.) 1930, 44 F.2d 958. Patents 318(3)

Where defendant leased separately under five-year leases infringing boards portraying baseball games, master properly allowed profits for terms which leases actually ran, eliminating rentals on renewals. Baseball Display Co. v. Star Ballplayer Co., C.C.A.3 (N.J.) 1929, 35 F.2d 1. Patents 318(3)

Plaintiffs in patent infringement suit were entitled to profits realized by defendants on sale of infringing structures to Canadian corporation. Fairbanks, Morse & Co. v. American Valve & Meter Co., C.C.A.7 (Ill.) 1929, 34 F.2d 869, certiorari denied 50 S.Ct. 86, 280 U.S. 604, 74 L.Ed. 649. Patents 318(3)

An infringer of a patent for a process is liable for all the profits made on the product of such process, in the absence of proof that other processes, adequate to produce the same product, were open to its use and of the cost of production by their use. Expanded Metal Co. v. General Fireproofing Co., N.D.Ohio 1917, 247 F. 899, appeal dismissed 272 F. 1021. Patents 318(4.5)

Complainant is entitled to have taken into account all products of value resulting from use of infringing process whether claimed in the patent or not. Byerly v. Sun Co, E.D.Pa.1915, 226 F. 759.

On an accounting for infringement of patent for manufactured article, defendants cannot be required to account for profits on machines manufactured and sold by them, to be used by others in making the infringing article. Diamond Drill & Machine Co v. Kelley, C.C.E.D.Pa.1904, 131 F. 89.

Where defendants bought the infringing articles from the manufacturers, and resold the same, they are chargeable only with the profits made by themselves above the price paid, and not for the profits made by the manufacturers. Kissinger-Ison Co. v. Bradford Belting Co., C.C.A.6 (Ohio) 1903, 123 F. 91, 59 C.C.A. 221. Pat- ents 318(3)

Where patent involved was a process patent relating to the method of applying rubber cement, benefit to the infringer resulted from savings to the customers using the process in retreading tires, and he should be made to surrender such benefit in order to compensate the patentee for the infringement since in became a user of the process through his customers. Elrick Rim Co. v. Cheek, S.D.Cal.1961, 195 F.Supp. 496, 131 U.S.P.Q. 8. Pat- ents 319(1)

In determining amount of compensation sanitary district of Chicago should pay for infringement of patents relating to activated sludge process, advantages including freedom from noxious odors, putrid streams, pestilential flies, freedom from suits for maintaining nuisances and enjoyment of privilege of maintaining plant on compar- atively small tract of land adjacent to rapidly expanding residential districts free of annoyance to inhabitants were factors to be considered. Activated Sludge v. Sanitary Dist. of Chicago, N.D.Ill.1946, 64 F.Supp. 25, 68 U.S.P.Q. 137, affirmed 157 F.2d 517, 71 U.S.P.Q. 316, certiorari denied 67 S.Ct. 970, 330 U.S. 834, 91 L.Ed.

1281, 72 U.S.P.Q. 529, rehearing denied 67 S.Ct. 1092, 330 U.S. 856, 91 L.Ed. 1297, 72 U.S.P.Q. 529, rehearing denied 67 S.Ct. 1347, 331 U.S. 866, 91 L.Ed. 1870. Patents 319(1)

Where question presented in patent infringement action was not whether defendant during infringement period made a profit or sustained a loss in operating its coal dumper as an entirety, or how much profit, if any, plaintiffs would probably have made if contract to construct dumper had been awarded to them by defendant, but whether defendant received material benefit and advantage from having plaintiffs' devices incorporated in dumper and used as a part thereof during infringement period, and master found on ample evidence that devices were beneficial in defendant's dumper operations, plaintiffs were entitled to recover damages for infringement. Kaltenbach v. Chesapeake & Ohio Ry. Co., E.D.Va.1941, 43 F.Supp. 819, modified on other grounds 124 F.2d 375. Patents 319(1)

Benefits derived by manufacture of automobile bodies through use of patent infringing devices for kiln drying of lumber, and for amount of which benefits manufacturer was liable to owner of infringed patent, were determin- able by computing excess of board footage that was dried by infringing devices priced at cost of custom drying less increased cost of production due to use of infringing devices, and not by calculations based on so-called “efficiency factors,” “doctrines of comparison by inclusive totals,” and “theories of expectancy.” Humidity Con- trol Co. v. Mengel Body Co., D.C.N.J.1935, 13 F.Supp. 185. Patents 319(1)

The profits recoverable include all the profits upon product of infringing machine, where the infringer could have made no profits by the use of any other machine then known and open to his use. Brookfield v. Novelty Glass Mfg. Co., C.C.N.J.1908, 170 F. 830, affirmed 170 F. 946, 95 C.C.A. 516, affirmed 170 F. 960, 96 C.C.A. 127. See, also, Peerless Brick Mach. Co. v. Miracle Pressed Stone Co., C.C.Minn.1910, 181 F. 526. Patents 318(1)

118. ---- Lack of infringer's profits, damages

Infringer should not be charged with agreed price of old machines taken in exchange, from which it realized nothing. Racine Engine & Machinery Co. v. Confectioners' Machinery & Mfg. Co., C.C.A.7 (Wis.) 1916, 234 F. 876, 148 C.C.A. 474. Patents 318(3)

In measuring damages adequate to compensate for patent infringement, infringer's failure to have made profit from its infringement is irrelevant. Weinar v. Rollform Inc., C.A.Fed. (Mich.) 1984, 744 F.2d 797, 223 U.S.P.Q. 369, certiorari denied 105 S.Ct. 1844, 470 U.S. 1084, 85 L.Ed.2d 143. Patents 319(1)

In suit for infringement of patent for a car dumping mechanism, evidence justified finding that coal pier of defendant on which infringing machine was used, was operated at a loss so that profits could not be used as a measure of damages. Chesapeake & O. Ry. Co. v. Kaltenbach, C.C.A.4 (Va.) 1941, 124 F.2d 375. Patents 312(10)

Finding in accounting for infringement that infringer makes no profit does not preclude award of damages to owner of patent. Duplate Corporation v. Triplex Safety Glass Co of North America, C.C.A.3 (Pa.) 1935, 81 F.2d 352, certiorari granted 56 S.Ct. 668, 297 U.S. 702, 80 L.Ed. 990, affirmed as modified on other grounds 56 S.Ct. 792, 298 U.S. 448, 80 L.Ed. 1274. Patents 319(1)

No decree for profits can be made if the use of the invention has not contributed to the profits of the defendant's business, no matter how profitable his business may be. City of Elizabeth v. American Nicholson Pavement Co.,

U.S.N.J.1877, 97 U.S. 126, 7 Otto 126, 24 L.Ed. 1000, motion denied 24 L.Ed. 1059. See, also, Mowry v. Whit- ney, Pa.1872, 14 Wall. 434, 20 L.Ed. 858; Seeger Refrigerator Co. v. American Car, etc., Co., N.J.1915, 219 F. 565, 135 C.C.A. 333; Conroy v. Penn. Electrical, etc., Co., Pa.1912, 199 F. 427, 118 C.C.A. 101, certiorari denied 33 S.Ct. 219, 226 U.S. 612, 57 L.Ed. 381; Williams v. Leonard, C.C.N.Y.1872, 9 Blatchf. 476, Fed.Cas. No. 17,726. Patents 75

Profits made by buyers through use of patented coal cleaning tables, but not participated in by seller who willfully infringed patent rights of complainants who did not let their tables upon royalty basis, were not recoverable from seller. Sutton, Steele & Steele v. Gulf Smokeless Coal Co., S.D.W.Va.1933, 6 F.Supp. 419. Patents 318(1)

An infringer who has realized no profit is only liable in damages, and a court of equity cannot decree profits by way of damages. City of Elizabeth v. American Nicholson Pavement Co., U.S.N.J.1877, 97 U.S. 126, 7 Otto 126, 24 L.Ed. 1000, motion denied 24 L.Ed. 1059.

Plaintiff could not recover judgment for damages or profits, even if infringement of its patent were established, where it did not appear that the infringement could add to defendant's profit or interfere with plaintiff's sales. Condenser Corp of America v. Micamold Radio Corp, C.C.A.2 (N.Y.) 1944, 145 F.2d 878, certiorari denied 65 S.Ct. 869, 324 U.S. 861, 89 L.Ed. 1418. Patents 318(1); Patents 319(1)

Where no profits have been realized there can be no allowance therefor. Standard Brands v. Federal Yeast Cor- poration, D.C.Md.1930, 38 F.2d 314.

Infringer is under no obligation to so use the patented device or to so manage his infringing business as to make a profit. Robbins v. Illinois Watch Co., C.C.N.D.Ill.1897, 78 F. 124, affirmed 81 F. 957, 27 C.C.A. 21. Patents 318(1)

Where no profits have accrued, no profits will be decreed on account of the infringement. Burdett v. Estey, C.C.Vt.1880, 3 F. 566, reversed on other grounds 3 S.Ct. 531, 109 U.S. 633, 27 L.Ed. 1058. Patents 318(1)

It would be improper to base damages to patentee for infringement on spraying devices sold by the infringer in view of the hidden nature of the real profits, especially where the infringer deliberately sold the machines it was handling below cost in order to stifle competition. Elrick Rim Co. v. Cheek, S.D.Cal.1961, 195 F.Supp. 496, 131 U.S.P.Q. 8. Patents 319(1)

A patentee was not entitled to recover profits, or damages for sales, made by defendant before issuance of patent for improvement in easels, where steps taken, by defendant to introduce the easels to the trade were with patentee's knowledge and acquiescence, defendant sold only a few easels, which had been manufactured for purpose of experimentation, and there was no breach of confidence or any unjust enrichment. Tepper v. Ross, D.C.Mass.1938, 25 F.Supp. 92. Patents 316

119. ---- License agreements, infringer's profits, damages

That third person has interest in license fees and recovers under the patent does not amount to such legal owner- ship in the patent as well defeat the owner's recovery of gains and profits of wrongdoers. Tilghman v. Proctor, U.S.Ohio 1888, 8 S.Ct. 894, 125 U.S. 136, 31 L.Ed. 664. Patents 286

120. ---- Nominal damages, infringer's profits

In a suit in equity for infringement of patent for carpet design, where no profits were found to have been made by the defendant, only nominal damages should have been allowed. Dobson v. Hartford Carpet Co; Dobson v. Bigelow Carpet Co., U.S.Pa.1885, 5 S.Ct. 945, 114 U.S. 439, 29 L.Ed. 177. Costs 241; Patents 325.8

Only nominal damages of one dollar were appropriate for pharmaceutical company's unauthorized import of drug made by patented process into United States; company gave drug away to Jehovah's Witness patients, and did not profit from its conduct. Trustees of Columbia University in City of New York v. Roche Diagnostics GmbH, D.Mass.2002, 272 F.Supp.2d 90. Patents 319(2)

121. ---- Savings, infringer's profits, damages

Savings in cost by infringement are recoverable as profits. Brown Bag Filling Mach. Co. v. Drohen, C.C.A.2 (N.Y.) 1910, 175 F. 576, 99 C.C.A. 192. See, also, Macbeth-Evans Glass Co. v. L. E. Smith Glass Co., C.C.A.Pa.1927, 23 F.2d 459; Eastern Paper Bag Co. v. Continental Paper Bag Co., C.C.Me.1905, 142 F. 517; Rose v. Hirsh, C.C.Pa.1898, 91 F. 149, reversed on other grounds 94 F. 177; Campbell v. City of New York, C.C.N.Y.1897, 81 F. 182; Campbell v. James C.C.N.Y.1880, 2 F. 338, reversed on other grounds 104 U.S. 356, 26 L.Ed. 786; New York Bank-Note Co. v. Hamilton Bank-Note Engraving & Printing Co., 1898, 50 N.Y.S. 1093, 28 App.Div. 411.

Where unlawful use of patented article or process constitutes infringement, advantage or savings which infringer derives from using patented article or process over what he could derive with any other process or thing which was known prior to invention constitutes “profit” which patent owner is entitled to recover. Gordon Form Lathe Co. v. Ford Motor Co., C.C.A.6 (Mich.) 1943, 133 F.2d 487, certiorari granted 63 S.Ct. 1325, 319 U.S. 738, 87 L.Ed. 1697, rehearing granted 63 S.Ct. 1444, 320 U.S. 213, 87 L.Ed. 1850, certiorari denied 63 S.Ct. 1328, 319 U.S. 765, 87 L.Ed. 1715, rehearing denied 64 S.Ct. 29, 320 U.S. 810, 88 L.Ed. 490, affirmed 64 S.Ct. 257, 320 U.S. 714, 88 L.Ed. 419, rehearing denied 64 S.Ct. 434, 320 U.S. 816, 88 L.Ed. 493. Patents 318(3)

Proper inquiry is not what saving the defendant has made by using the patented device over the saving which he might have made if he had used any or all of various other devices, but what saving he has made directly by using the patented device. Herring v. Gage, C.C.N.Y.1878, 12 F.Cas. 44, No. 6422, reversed on other grounds 2 S.Ct. 819, 107 U.S. 640, 17 Otto 640, 27 L.Ed. 601. Patents 318(4.1)

122. ---- Speculative profits, infringer's profits, damages

Infringer is not liable for profits, unless there is some satisfactory evidence from which the value of the advantage derived from the use of the invention can be measured. Locomotive Safety Truck Co. v. the Pennsylvania Railroad Co., C.C.E.D.Pa.1880, 2 F. 677, reversed on other grounds 4 S.Ct. 220, 110 U.S. 490, 28 L.Ed. 222.

The rule of damages is the amount which the infringer actually realized in profits, not what he might have made by reasonable diligence. Dean v. Mason, U.S.R.I.1857, 61 U.S. 198, 20 How. 198, 15 L.Ed. 876. Patents 318(3)

Owner of patent for folding headrest failed to establish entitlement to lost profits based on retailer's infringement of patent, as evidence relating to retailer's sales of patented headrest, including pictures from only three of retailer's 1600 stores and report discussing “vague concept” of average amount of sales per square foot of floor space, was speculative. Oiness v. Walgreen Co., C.A.Fed. (Colo.) 1996, 88 F.3d 1025, 39 U.S.P.Q.2d 1304, rehearing denied, in banc suggestion declined , certiorari denied 117 S.Ct. 951, 519 U.S. 1112, 136 L.Ed.2d 838. Patents

312(10)

No recovery may be had for remote, contingent, or speculative profit. Piper v. Brown, C.C.Mass.1870, 19 F.Cas. 718, No. 11180, reversed 91 U.S. 37, 1 Otto 37, 23 L.Ed. 200. See, also, Tilghman v. Proctor, Ohio 1888, 8 S.Ct. 894, 125 U.S. 136, 31 L.Ed. 664; Dobson v. Hartford Carpet Co., Pa.1885, 5 S.Ct. 945, 114 U.S. 439, 29 L.Ed. 177; MacDonald v. Whitney, C.C.Mass.1889, 39 F. 466; Piper v. Brown, C.C.Mass.1873, Holmes, 196, Fed.Cas. No. 11,181.

123. ---- Particular cases, infringer's profits, damages

Complete discretion of sole owner, president, and chief executive officer (CEO) of company to dispose of profits of company as he saw fit, and his intent that profits flow from company to him, was insufficient to show inexorable flow of profits to owner, as required for owner to recover lost profits of company from competitor in patent infringement action, absent contractual, structural, or historical flow of profits from company to owner, even if it might have been standard or “usual” for owner of sole proprietorship to take all profits of the business. Kowalski v. Mommy Gina Tuna Resources, D.Hawai'i 2008, 574 F.Supp.2d 1160. Patents 318(4.1)

After patent owner had demonstrated that its patent for gas separation processes had been infringed by gas company and designer and builder of gas plant, even though evidence estimating patent owner's profits had it been awarded contract for construction and design of gas plant could not be exactly calculated, profits earned by competitor would be used to calculate patent owner's lost profits as result of infringement. Ortloff Corp. v. Gulsby Engineering, Inc., S.D.Tex.1988, 706 F.Supp. 1295, 8 U.S.P.Q.2d 1873, affirmed 884 F.2d 1399, 13 U.S.P.Q.2d 1335. Patents 318(3)

Damages for patent infringement were to be measured by exclusive licensee's lost profits and recovery was not to be had in amount of infringing manufacturer's profits. Saf-Gard Products, Inc. v. Service Parts, Inc., D.C.Ariz.1980, 491 F.Supp. 996, 206 U.S.P.Q. 976. Patents 318(3)

Where patentee did not attempt to prove his damages for infringement as such, infringer made no allocation of its cost, even after suit was filed, and 90% of the sales of certain machines by infringer were attributable to infringing pump incorporated therein, patentee would be awarded as damages that percentage of infringer's total net profit as the total of all of infringer's sales of the infringing pump plus 90% of infringer's sales of machines incorporating the infringing pump bore to the total of all of infringer's sale. Rosen v. Kahlenberg, M.D.Fla.1970, 337 F.Supp. 1075, 171 U.S.P.Q. 386, reversed on other grounds 474 F.2d 858, 177 U.S.P.Q. 118. Patents 319(1)

Damages for infringement of patent by installation of elevators at a cost of approximately $140,000 might reasonably be fixed at 10 or 15 percent. Otis Elevator Co. v. John W. Kiesling & Son, Inc., E.D.N.Y.1949, 87 F.Supp. 408, 83 U.S.P.Q. 289. Patents 319(1)

Inventor who submitted duplicating machine to company under contract could not recover profits alleged to

have been made by company of sale of similar machine made by company on ground that company took advantage of inventor's confidential disclosure, where company did not make and sell machines until after inventor made full disclosure in obtaining patent. Flanigan v. Ditto, Inc., C.C.A.7 (Ill.) 1936, 84 F.2d 490, certiorari denied 57 S.Ct. 190, 299 U.S. 598, 81 L.Ed. 440, rehearing denied 57 S.Ct. 234, 299 U.S. 623, 81 L.Ed. 459, certiorari denied 57 S.Ct. 233, 299 U.S. 607, 81 L.Ed. 448. Patents 182

Where two infringing machines were sold by defendant machinery company after issuance of apparatus patent, patent holders were entitled to recover profit figure on such machines plus interest. Thomson Machinery Co. v. LaRose, E.D.La.1969, 306 F.Supp. 681, 163 U.S.P.Q. 80. Patents 319(1); Patents 319(4)

Where plaintiff in prior patent infringement suit against defendant's subsidiary had recovered a reasonable royalty, based upon defendant's wrongful manufacture of tires, sale thereof to subsidiary, and subsidiary's sale to public, amounting to more than total profits earned by defendant and subsidiary on sale of tires, rule that a patentee may recover ordinary damages from an infringing manufacturer and subsequently sue his vendee was in- applicable, and plaintiff could not recover from defendant its profits earned on sale of tires. Goodyear Tire & Rubber Co. v. Overman Cushion Tire Co., C.C.A.6 (Ohio) 1937, 95 F.2d 978, certiorari dismissed 59 S.Ct. 459, 306 U.S. 665, 83 L.Ed. 1061, certiorari dismissed 59 S.Ct. 460, 306 U.S. 665, 83 L.Ed. 1061. Patents 318(1)

124. Limitation of infringer's profits to infringement, damages--Generally

An infringer of a patent which covers only part of a device or is merely a patent for an improvement is liable only for so much of the value as is due to such improvement. Seymour v. McCormick, U.S.N.Y.1853, 57 U.S. 480, 16 How. 480, 14 L.Ed. 1024. See, also, McCreary v. Pennsylvania Canal Co., Pa.1891, 12 S.Ct. 40, 141 U.S. 459, 35 L.Ed. 817; Garretson v. Clark, N.Y.1884, 4 S.Ct. 291, 111 U.S. 120, 28 L.Ed. 371; Blake v. Robertson, N.Y.1877, 94 U.S. 728, 24 L.Ed. 245; Southern Textile Machinery Co. v. Fay Stocking Co., Ohio 1919, 259 F. 243, 170 C.C.A. 311; T. L. Smith Co. v. Cement Tile Machinery Co., D.C.Iowa 1919, 258 F. 636; Roemer v. Simon, C.C.N.Y.1887, 31 F. 41; Star Salt Caster Co. v. Crossman, C.C.Mass.1879, 4 B. & A. 566, Fed.Cas. No. 13,320; Gould's Mfg. Co. v. Cowing, C.C.N.Y.1874, 1 B. & A. 375, Fed.Cas. No. 5,642; Hayden v. Suffolk Mfg. Co., C.C.Mass.1862, 4 Fish.Pat.Cas. 86, Fed.Cas. No. 6,261.

District court's award of lost profits to patentee based on patent infringement which caused patentee to lose sales of product which competed with infringing product but did not embody patented device was properly limited based on patentee's market share and differences between infringing product and product sold by patentee, but properly included lost profits on spare parts for machines which patentee would have sold but for infringement as well as reasonable royalty on acceptable noninfringing alternatives and prejudgment interest. King Instru- ments Corp. v. Perego, C.A.Fed. (Mass.) 1995, 65 F.3d 941, 36 U.S.P.Q.2d 1129, rehearing denied, in banc suggestion declined 72 F.3d 855, certiorari denied 116 S.Ct. 1675, 517 U.S. 1188, 134 L.Ed.2d 778. Patents 318(4.1)

Since infringer merely shipped silicon chips to bailee outside of United States for encapsulation and return to infringer, it was appropriate to include housed devices rather than chips themselves in final measure of damages for infringement. Western Elec. Co., Inc. v. Stewart-Warner Corp., C.A.4 (Va.) 1980, 631 F.2d 333, 208 U.S.P.Q. 183, certiorari denied 101 S.Ct. 1492, 450 U.S. 971, 67 L.Ed.2d 622. Patents 319(1)

In suit brought for infringement of patents relating to components of airport baggage carts, trial court's allowance of damages to patentee of $163 on each cart, the profit on carts sold to infringing party by patentee's com-

petitor, multiplied by number of carts which otherwise would have been sold to infringing party by patentee absent the infringement was reasonable, and no apportionment was required for value of parts of the carts not specifically covered by the patents. Saginaw Products Corp. v. Eastern Airlines, Inc., C.A.6 (Mich.) 1980, 615 F.2d 1136, 205 U.S.P.Q. 105. Patents 319(1)

In action for profits resulting from infringement of patent covering adjustable welt of ladies' silk stockings, after the defendant's entire net profits from sale of infringing stockings was determined, it was necessary to ascertain the profits which accrued to the defendant by reason of such infringing feature. Gotham Silk Hosiery Co. v. Art- craft Silk Hosiery Mills, C.C.A.3 (Del.) 1944, 147 F.2d 209. Patents 318(4.1)

Ordinarily, distinction between article patented as entirety and one in which article is separable device to be used in connection with another machine operable without device determines question whether infringer's profits should be computed on entire sale price of machines or only on patented constituent thereof. Stearns-Roger Mfg. Co. v. Ruth, C.C.A.10 (Colo.) 1936, 87 F.2d 35. Patents 318(4.1)

Where the valuable feature of bottle capping machine was the presence of a reciprocating capping tool, and this could be accomplished as well by a noninfringing can and spring as by the infringing cam-ring, such cam-ring did not give the entire value to the infringing bottle capper, and patent owner was therefore not entitled to recover defendant's entire profits from sale of infringing machines. Columbia Machine & Stopper Corporation v. Ad- riance Machine Works, C.C.A.2 (N.Y.) 1935, 79 F.2d 16. Patents 318(4.1)

When exclusive licensee bid on job awarded to infringer, and only part of apparatus was patented, reasonable manufacturing profit on unpatented part should be deducted and remainder of profits allowed as damages. Wal- lace & Tiernan Co. v. City of Syracuse, C.C.A.2 (N.Y.) 1930, 45 F.2d 693. See, also, Electro Bleaching Gas Co. v. Village Water Co., C.C.A.Conn.1930, 45 F.2d 696. Patents 319(1)

Profits from thing produced by infringing means are immaterial, where thing is not patented, or can be produced by methods open to public. Carson v. American Smelting & Refining Co., D.C.Wash.1928, 25 F.2d 116. Patents 318(4.1)

Court could not assume that all defendant's sales of infringing article were due to presence of patented features. Egry Register Co. v. Standard Register Co., C.C.A.6 (Ohio) 1928, 23 F.2d 438. Patents 318(4.1)

Where the patented feature gives the whole value to an infringing structure, without which it would not be salable, the fact that the infringing article has also a collapsible feature, which effects a saving of freight in its ship- ment, does not impose on complainant the burden of apportioning the profits on an accounting for the infringement. Vandenburgh v. Concrete Steel Co, C.C.A.2 (N.Y.) 1921, 278 F. 607, certiorari granted 42 S.Ct. 186, 257 U.S. 632, 66 L.Ed. 407, reversed on other grounds 43 S.Ct. 335, 261 U.S. 16, 67 L.Ed. 512. Patents 312(1.7)

Where the net profits made by the manufacture of an infringing article are shown, but such articles also infringed another patent, for which defendant was compelled to pay, a reasonable royalty for the use of the latter patent, the burden of showing which is on defendant, should be deducted, and the remaining profits are recoverable by complainant. Farmers' Handy Wagon Co. v. Beaver Silo & Box Mfg. Co., C.C.A.7 (Wis.) 1919, 259 F. 270, 170 C.C.A. 338. Patents 318(6)

On an accounting for patent infringement for a part of a structure, the ultimate question is whether the real in-

vention and its influence in bringing about the infringing sales can be so far identified as to admit of reasonable apportionment of profits or damages; if it can, the apportionment must be made. Clark v. Schieble Toy & Nov- elty Co., C.C.A.6 (Ohio) 1917, 248 F. 276, 160 C.C.A. 354.

Where the real invention of a patent consists only in the improvement of one element of a combination, although the claims describe the entire combination, it must be construed with regard to the real invention in determining its validity and scope and also the extent of liability for infringement, and profits derived from the sale of the complete device by an infringer are prima facie to be apportioned. Herman v. Youngstown Car Mfg. Co., C.C.A.6 (Ohio) 1914, 216 F. 604, 132 C.C.A. 608. Patents 318(4.3)

Where a patented invention was confined to an alteration or improvement of one or more old elements increasing the utility of a combination, and a case against an infringer was not susceptible of an apportionment of profits, either from its nature of from a failure to keep proper accounts, or other cause making it impossible to establish the amount of profits on the combination attributable to the improvement or alteration, complainant may recover the entire profits. Seeger Refrigerator Co v. American Car & Foundry Co, D.C.N.J.1914, 212 F. 742, reversed on other grounds 219 F. 565, 135 C.C.A. 333. Patents 318(4.1)

Although difference between infringing and a noninfringing machine may consist of a single feature, the profits recoverable for the use of such machine are not confined to the saving secured by this one feature. Novelty Glass Mfg. Co. v. Brookfield, C.C.A.3 (N.J.) 1909, 170 F. 946, 95 C.C.A. 516.

The rule requiring separation of profits between patented and unpatented features does not apply to patent for a combination as a unit in which the parts cooperate. Yesbera v. Hardesty Mfg. Co., C.C.A.6 (Ohio) 1908, 166 F. 120, 92 C.C.A. 46, certiorari denied 29 S.Ct. 696, 214 U.S. 513, 53 L.Ed. 1063. Patents 318(4.3)

If an infringing machine has a special value for certain classes of work because of a single part, which alone constitutes the infringement, and no machine without such element could meet the demand for those to be used for that class of work, the patentee is entitled to recover the entire profit realized by the infringer from the sale of machines to meet that special market, but he is not entitled to recover the entire profit made from the sale of the machines for other classes of work for which other and noninfringing machines are also adapted and salable. Penfield v. C. & A. Potts & Co., C.C.A.6 (Ohio) 1903, 126 F. 475, 61 C.C.A. 371. Patents 318(4.2)

Profits and damages cannot be enhanced by the fact that the use of the infringing element of a combination enabled defendant to sell the entire combination. Westinghouse v. New York Air Brake Co., C.C.S.D.N.Y.1902, 115 F. 645, reversed 140 F. 545, 72 C.C.A. 61, certiorari denied 26 S.Ct. 762, 201 U.S. 648, 50 L.Ed. 904.

Defendant is accountable only for the profits resulting from the employment of the patented devices, and if the article made by him embodies the use of other valuable features, which have contributed to its marketable value, the defendant is not liable for the use of such features. Robbins v. Illinois Watch Co., C.C.A.7 (Ill.) 1897, 81 F. 957, 27 C.C.A. 21.

In patent infringement suit, master in determining damages, correctly relied on “entire market value” rule which allows recovery based on value of an entire mechanism containing several features, even though only one feature is patented, where substantially entire marketable value of total mechanism is attributable to patented feature, in view of evidence that entire marketable value of rewinder system was attributable to patented perforator. Paper Converting Mach. Co., Inc. v. FMC Corp., E.D.Wis.1977, 432 F.Supp. 907, 195 U.S.P.Q. 123, affirmed 588 F.2d 832. Patents 322

In determining the question of compensation from an infringing sale, the important consideration is the place or status that the actual invention assumes in the art rather than the actual terms in which the claims may be formu- lated. Imperial Machine & Foundry Corporation v. U.S., Ct.Cl.1930, 69 Ct.Cl. 667. Patents 319(1)

Profits limited to those attributable to the element which gives patented device its novelty. Waite v. U.S., Ct.Cl.1930, 69 Ct.Cl. 153, certiorari granted 51 S.Ct. 21, 282 U.S. 817, 75 L.Ed. 731, reversed 51 S.Ct. 227, 282 U.S. 508, 75 L.Ed. 494.

Patentee's recovery from infringer for sales made by it were not properly subject to reduction computed on basis of sales which would probably have been made by infringer's competitors had there been no sales by infringer. Bros. Inc. v. W. E. Grace Mfg. Co., C.A.5 (Tex.) 1963, 320 F.2d 594, 138 U.S.P.Q. 357. Patents 319(1)

Where claims infringed are for a combination of old elements, the infringer is liable for all of the profits made by the use of such combination. Brookfield v. Novelty Glass Mfg. Co., C.C.N.J.1908, 170 F. 830, affirmed 170 F. 946, 95 C.C.A. 516, affirmed 170 F. 960, 96 C.C.A. 127. Patents 318(1)

125. ---- Duty to apportion profits, limitation of infringer's profits to infringement, damages

A patentee suing to recover profits from an infringer who has added noninfringing and valuable improvements discharges the burden resting upon him of showing what part of the commingled profits are attributable to the use of his invention by proving the existence of such profits and the impossibility of accurately or approximately separating them from those arising out of defendant's additions, and the defendant must then carry the burden of such separation if he is to escape liability for the entire profits. Westinghouse Electric & Mfg. Co. v. Wagner Electric & Mfg. Co., U.S.Mo.1912, 32 S.Ct. 691, 225 U.S. 604, 56 L.Ed. 1222. Patents 312(1.7)

When profits are made by an infringer by the use of an article patented as an entirety or product, he is responsible to the patentee for them, unless he can show that a portion of them is the result of some other thing used by him. City of Elizabeth v. American Nicholson Pavement Co., U.S.N.J.1877, 97 U.S. 126, 7 Otto 126, 24 L.Ed. 1000, motion denied 24 L.Ed. 1059. See, also, Seeger Refrigerator Co. v. American Car & Foundry Co., N.J.1915, 219 F. 565, 135 C.C.A. 333; Orr & Lockett Hardware Co. v. Murray, Ill.1908, 163 F. 54, 89 C.C.A. 492; Tuttle v. Claflin, N.Y.1896, 76 F. 227, 22 C.C.A. 138, certiorari denied 17 S.Ct. 992, 166 U.S. 721, 41 L.Ed. 1187. Patents 318(4.1)

In apportioning profits between an infringing feature and a device as a whole, the burden of proving that profits resulted to defendant from the sale of the infringing feature ordinarily rests on plaintiff, who must exhaust all available means for ascertaining profits resulting from the infringing feature. Gotham Silk Hosiery Co. v. Art- craft Silk Hosiery Mills, C.C.A.3 (Del.) 1944, 147 F.2d 209. Patents 312(1.7)

The burden of separating profits resulting from use of infringed patented device does not rest upon infringer when he uses the patented structure without change as part only of a larger machine and there is no practicable way in which apportionment records may be kept. Swan Carburetor Co. v. Nash Motors Co., C.C.A.4 (Md.) 1943, 133 F.2d 562, certiorari denied 64 S.Ct. 36, 320 U.S. 762, 88 L.Ed. 454, rehearing denied 64 S.Ct. 155, 320 U.S. 812, 88 L.Ed. 491. Patents 312(1.7)

An infringer in computing profits from infringing product could not deduct any sum as interest on capital investment employed in manufacturing that product in absence of producing evidence enabling court to satisfactorily apportion interest among the several kinds of businesses. Horvath v. McCord Radiator & Mfg. Co., C.C.A.6

(Mich.) 1938, 100 F.2d 326, certiorari denied 60 S.Ct. 101, 308 U.S. 581, 84 L.Ed. 486, rehearing denied 60 S.Ct. 171, 308 U.S. 636, 84 L.Ed. 529. Patents 318(6)

If it is practicable for patentee to apportion profits between what is new and what is old, patentee should do so or fail to recover more than nominal damages, but, if it is not practicable, infringer should either make apportionment or yield up all profits, though, if such a decree would be shockingly unjust, patentee should be relegated to a royalty. Stearns-Roger Mfg. Co. v. Ruth, C.C.A.10 (Colo.) 1936, 87 F.2d 35. Patents 318(4.1)

Where both patented invention and other factors have contributed to infringer's profits, patentee seeking to recover profits from infringer must apportion profits or prove that he is entitled to entire fund by showing that entire value of resulting product is legally attributable to patented invention, or that defendant has so confused contributing factors as to make apportionment impossible. National Carbon Co. v. Richards & Co., C.C.A.2 (Conn.) 1936, 85 F.2d 490. Patents 318(4.1)

In patent infringement suit, the invention being for limited improvement, it was in general plaintiff's duty to allocate the contribution of the invention to defendant's profits, and if plaintiff failed to do so, it failed altogether in so far as recovery of profits was concerned. Columbia Machine & Stopper Corporation v. Adriance Machine Works, C.C.A.2 (N.Y.) 1935, 79 F.2d 16. Patents 318(4.1)

Where invention is only a detail of infringing device, burden of apportionment is upon party seeking profits for infringement but where patent gives the entire value to a combination, owner of patent is entitled to recover all the profits an infringer has made from its sale or use. Stromberg Motor Devices Co. v. Zenith-Detroit Corpora- tion, C.C.A.2 (N.Y.) 1934, 73 F.2d 62, certiorari dismissed 55 S.Ct. 509, 294 U.S. 735, 79 L.Ed. 1263.

Where infringer of patent for davenport bed proved that part of profits from sale was due to special features added by infringer, and patentee thereafter introduced positive evidence showing confusion rendering apportionment of profits impossible, failure of infringer to sustain burden of establishing proper method of apportioning profits entitled patentee to all profits. Levin Bros. v. Davis Mfg. Co., C.C.A.8 (Minn.) 1934, 72 F.2d 163. Pat- ents 318(4.1)

Where entire value of infringement article was not due to plaintiff's patent, plaintiff must apportion defendant's profits by evidence reliable and tangible. American Can Co. v. Goldee Mfg. Co., E.D.N.Y.1927, 31 F.2d 492, affirmed 31 F.2d 494. Patents 318(4.1)

Where an infringer on an accounting for profits claims to have commingled other elements with those of the patented combination, he has the burden of proving such facts as entitle him to a segregation of profits. Christensen v. National Brake & Elec. Co., D.C.Wis.1924, 10 F.2d 856. Patents 322

Burden is on the complainant to show what portion of defendant's profits arose from the use of complainant's patent. Robbins v. Illinois Watch Co., C.C.A.7 (Ill.) 1897, 81 F. 957, 27 C.C.A. 21.

In order for a patent owner to rely on “entire market value rule” in a patent infringement suit, owner must show, by reliable and tangible evidence, that profits and damages are to be calculated on whole machine for reason that entire value of machine, as a marketable article, is properly and legally attributable to patented feature. Paper Converting Mach. Co., Inc. v. FMC Corp., E.D.Wis.1977, 432 F.Supp. 907, 195 U.S.P.Q. 123, affirmed 588 F.2d 832. Patents 319(1)

Where infringer's profits from infringing activities have been comingled with profits from noninfringing activity, the infringer has the burden of proof of apportioning the profits. Rosen v. Kahlenberg, M.D.Fla.1970, 337 F.Supp. 1075, 171 U.S.P.Q. 386, reversed on other grounds 474 F.2d 858, 177 U.S.P.Q. 118. Patents 318(4.1)

In awarding profits for misappropriation of trade secrets burden is on plaintiff to prove profits, and having done so, he is entitled to all profits made from sale of articles manufactured as a result of a misappropriation unless the defendant assumes burden of showing that part of profit is attributable to features other than those covered by the secrets, and when such added features attributing to profit are shown it devolves upon plaintiff to prove either what part of the profit should be apportioned or to prove defendant by commingling the elements has made it impossible for plaintiff to meet requirement of apportionment. Carter Products, Inc. v. Colgate-Pal- molive Co., D.C.Md.1963, 214 F.Supp. 383, 136 U.S.P.Q. 348, 136 U.S.P.Q. 577. Antitrust And Trade Regula- tion 431; Antitrust And Trade Regulation 437

126. ---- Apportionment of profits, limitation of infringer's profits to infringement, damages

In proceeding to determine damages for patent infringement with respect to a machine which was partly patented and partly unpatented, evidence supported trial court's allocation of profit as between the patented and unpatented portions. Allen v. W. H. O. Alfalfa Mill. Co., C.A.10 (Colo.) 1959, 272 F.2d 98, 123 U.S.P.Q. 473. Pat- ents 319(1)

In determining loss of profits resulting from infringement of patent, where it was business of patentee to furnish unpatented component parts for its fuel transportation system, patentee was not required to apportion profits resulting from sale of system to exclude revenues derived from sale of unpatented component parts, in view of fact that patentee's revenues would have reflected sales of component parts had it not been for the infringement. Electric Pipe Line, Inc. v. Fluid Systems Inc., C.A.2 (Conn.) 1957, 250 F.2d 697, 116 U.S.P.Q. 25. Patents 319(1)

Where greater amount of profits was derived from sale of automobiles in which infringing manifolds constituted only a minor part patentee could recover only that part of profits upon evidence tending to apportion infringer's profits and patentee's damages between patented feature and unpatented features. Swan Carburetor Co. v. Nash Motors Co., C.C.A.4 (Md.) 1943, 133 F.2d 562, certiorari denied 64 S.Ct. 36, 320 U.S. 762, 88 L.Ed. 454, rehearing denied 64 S.Ct. 155, 320 U.S. 812, 88 L.Ed. 491. Patents 318(4.1)

In patent infringement suit, failure to apportion profits resulting from infringing and from noninfringing elements was not error where infringers who kept records, purchased material, and sold infringing devices, were not able to show what part of profits was attributed to the infringed patent and what to other patents allegedly embodied in the device. Autographic Register Co. v. Sturgis Register Co., C.C.A.6 (Mich.) 1940, 110 F.2d 883. Patents 318(4.1)

Conception disclosed by patent for process and machine for separating metalliferous minerals from rock by flot- ation was not a separable device but involved rearrangement of parts resulting in new machine, and it was impossible to apportion profits of infringer, who contended that profits should be computed, not on entire sale price of machines, but only on use of patented partition or weir. Stearns-Roger Mfg. Co. v. Ruth, C.C.A.10 (Colo.) 1936, 87 F.2d 35. Patents 318(4.1)

In calculating profits to which owner of patent was entitled to reason of defendants' use of patented carbon in

their carbon recovery system, reduction of profits derived from such system by amount which would have been realized by continuation of former system renovated to restore its prior efficiency was proper as means of determining advantage gained by operation of new carbon recovery system. National Carbon Co. v. Richards & Co., C.C.A.2 (Conn.) 1936, 85 F.2d 490. Patents 318(3)

In determining proportion of defendant's profits attributable to infringement of patented bottle capping machine, fact that the invention resided in a cam-ring did not require conclusion that the invention contributed that proportion to the profits which cost of parts embodying the cam-ring bore to cost of whole machine. Columbia Ma- chine & Stopper Corporation v. Adriance Machine Works, C.C.A.2 (N.Y.) 1935, 79 F.2d 16. Patents 318(4.1)

Each device, patented or unpatented, licensed or unlicensed, contributing to success of wireless station, was entitled to receive its just percentage in apportionment of station's profits on accounting for use of infringing devices. Kintner v. Atlantic Communication Co., S.D.N.Y.1921, 51 F.2d 109. Patents 318(1)

Where other elements beside patented feature contributed to profits, these will be apportioned in accordance with contribution of each, if possible, in determining recovery of profits of patent infringement. Stromberg Mo- tor Devices Co. v. Detroit Trust Co., C.C.A.7 (Ill.) 1930, 44 F.2d 958. Patents 318(4.1)

Master's apportionment of 50 percent of profits derived by defendant from leases of baseball boards to infringing device showing movement of base runner was sustained by evidence. Baseball Display Co. v. Star Ball- player Co., C.C.A.3 (N.J.) 1929, 35 F.2d 1. Patents 312(3)

Profits should be apportioned between parts of device which embody patent and those which do not, where portion of profits is reasonably attributable to nonfringing part. Fairbanks, Morse & Co. v. American Valve & Meter Co., C.C.A.7 (Ill.) 1929, 34 F.2d 869, certiorari denied 50 S.Ct. 86, 280 U.S. 604, 74 L.Ed. 649. Patents 318(4.1)

Evidence of patentee's prices for its products, including prices at which it proposed to sell its products to alleged infringer, was relevant to issue of apportionment of lost profits. Curtis Mfg. Co., Inc. v. Plasti-Clip Corp., D.N.H.1995, 933 F.Supp. 94. Patents 312(2)

Owner of twine holder patent which was infringed by manufacturer of balers was not, in fixing damages, entitled to have manufacturer account for profits of all of its dealers upon balers using infringing device, but plaintiff was entitled to have manufacturer account for sales and profits upon wire-tie balers. England v. Deere & Co., S.D.Ill.1963, 221 F.Supp. 319, 138 U.S.P.Q. 608. Patents 319(1)

Where plaintiffs' patent, infringed by defendant, was not for an improvement but for a new device and plaintiffs established infringement and profits made by defendant, defendant was not entitled to apportionment of profits by showing that portion of profits were attributable to improvements covered by patents owned by defendant, but burden of segregating profits was on defendant. Clair v. Kastar, Inc., S.D.N.Y.1946, 70 F.Supp. 484, 73 U.S.P.Q. 347. Patents 318(4.1)

127. ---- Commingling of profits, limitation of infringer's profits to infringement, damages

In action for accounting for patent infringement where evidence disclosed that infringer profited by use of patented machine but a portion of profits was due to use of a feature not covered by patent, failure of infringer, which

had commingled profits, to disclose what proportion of profits arose from infringement, created an unavoidable liability for profit. Gordon Form Lathe Co. v. Ford Motor Co., C.C.A.6 (Mich.) 1943, 133 F.2d 487, certiorari granted 63 S.Ct. 1325, 319 U.S. 738, 87 L.Ed. 1697, rehearing granted 63 S.Ct. 1444, 320 U.S. 213, 87 L.Ed. 1850, certiorari denied 63 S.Ct. 1328, 319 U.S. 765, 87 L.Ed. 1715, rehearing denied 64 S.Ct. 29, 320 U.S. 810, 88 L.Ed. 490, affirmed 64 S.Ct. 257, 320 U.S. 714, 88 L.Ed. 419, rehearing denied 64 S.Ct. 434, 320 U.S. 816, 88 L.Ed. 493. Patents 312(10)

Rule permitting recovery of profits so confused as to the nonproportionable, will not be enforced beyond point where it is demonstrable that to go further would embrace profits to which infringing elements made no contribution. Standard Scale & Supply Co. v. Cropp Concrete Machinery Co., C.C.A.7 (Ill.) 1925, 6 F.2d 447.

The apportionment doctrine does not entitle patentee to commingled profits where patentee's evidence as to profits was based on an erroneous standard of comparison. Empire Rubber & Tire Co. v. De Laski & Thropp Circular Woven Tire Co., C.C.A.3 (N.J.) 1922, 281 F. 1.

An infringer of a patent is a trustee for the owner, and, where he has so confused the profits received with other matters that either he or the owner must bear a loss, the loss must fall on the infringer. Dowagiac Mfg. Co. v. Superior Drill Co., C.C.A.6 (Mich.) 1908, 162 F. 479, 89 C.C.A. 399. See, also, Metallic Rubber Tire Co. v. Hartford Rubber Works Co., Conn.1917, 245 F. 860; Decker v. Smith, D.C.N.Y.1915, 225 F. 776, modified on other grounds 234 F. 646; Force v. Sawyer-Boss Mfg. Co., C.C.N.Y.1904, 131 F. 884, reversed on other grounds 143 F. 894, 75 C.C.A. 102, certiorari denied 26 S.Ct. 766, 202 U.S. 621, 50 L.Ed. 1175.

Where patented combination is for a new structure, and infringer who has deliberately copied such structure cannot avoid liability for the entire profits by adding improvements which do not materially add to its sale value, and by so conducting its business as to make it impossible to separate the profits due to each. Brennan & Co. v. Dowagiac Mfg. Co., C.C.A.6 (Ky.) 1908, 162 F. 472, 89 C.C.A. 392. Patents 318(4.1)

Generally, where infringer's profits from infringing activities have been commingled with profits from noninfringing activity, patentee is entitled to infringer's entire profits. Rosen v. Kahlenberg, M.D.Fla.1970, 337 F.Supp. 1075, 171 U.S.P.Q. 386, reversed 474 F.2d 858, 177 U.S.P.Q. 118. Patents 318(4.1)

Where profits from infringing reels were inextricably commingled with the entire business of defendant and during the period infringing reels were being produced thousands of nonfringing reels were put in production in the same factory with the same employees, so that correct distribution of executive, office and factory expenses between infringing and noninfringing reels could not be effected, an accounting of profits and damages for infringement could not be based upon apportionment of profits. Enterprise Mfg. Co. v. Shakespeare Co., W.D.Mich.1942, 47 F.Supp. 859, affirmed 141 F.2d 916. Patents 318(4.1)

Owner of patent infringed by defendants' use of patented carbon in their solvent recovery plant was entitled to award of defendants' entire profits from recovery process, notwithstanding that they used infringing carbon only as one step in such process, where determination of portion of such profits arising from use of patented carbon was impossible. National Carbon Co. v. Richards & Co., D.C.Conn.1935, 16 F.Supp. 239, affirmed 85 F.2d 490. Patents 318(4.5)

128. ---- Entire profits attributable, limitation of infringer's profits to infringement, damages

The machine being a unit, having peculiar value because of the patentee's discovery or invention, the profits will

not be divided among its parts. Warren v. Keep, U.S.N.Y.1894, 15 S.Ct. 83, 155 U.S. 265, 39 L.Ed. 144. See, also, Ruggles v. Eddy, C.C.N.Y.1877, Fed.Cas. No. 12,116; Carter v. Baker, C.C.Cal.1871, Fed.Cas. No. 2,472; Livingston v. Jones, C.C.Pa.1861, Fed.Cas. No. 8,414, reversed on other grounds 68 U.S. 155, 1 Wall. 155, 17 L.Ed. 662.

Profits upon the entire article are only allowable where such article is wholly the invention of the patentee or where its entire value is properly and legally attributable to the patented feature. Sessions v. Romadka, U.S.Wis.1892, 12 S.Ct. 799, 145 U.S. 29, 36 L.Ed. 609. See, also, Garretson v. Clark, N.Y.1884, 4 S.Ct. 291, 111 U.S. 120, 28 L.Ed. 371; Littlefield v. Perry, N.Y.1875, 21 Wall. 205, 22 L.Ed. 577; Mowry v. Whitney, Ohio 1872, 14 Wall. 620, 20 L.Ed. 860; Seymour v. McCormick, N.Y.1853, 16 How. 480, 14 L.Ed. 1024.

Where, but for the patented feature, an article made and sold by an infringer would not be a salable commodity, or where it derives its entire commercial value from the patented elements, the patentee is entitled to the whole profit. City of Elizabeth v. American Nicholson Pavement Co., U.S.N.J.1877, 97 U.S. 126, 7 Otto 126, 24 L.Ed. 1000, motion denied 24 L.Ed. 1059. See, also, Crosby Steam Gauge & Valve Co. v. Consolidated Safety Valve Co., Mass.1891, 12 S.Ct. 49, 141 U.S. 441, 35 L.Ed. 809; Hurlbut v. Schillinger, Ill.1889, 9 S.Ct. 584, 130 U.S. 456, 32 L.Ed. 1011; Carborundum Co. v. Electric Smelting & Aluminum Co., Pa.1913, 203 F. 976, 122 C.C.A. 276; Wales v. Waterbury Mfg. Co., Conn.1900, 101 F. 126, 41 C.C.A. 250; Coddington v. Propfe, C.C.Pa.1902, 112 F. 1016; Heaton Button-Fastener Co. v. Macdonald, C.C.N.Y.1893, 57 F. 648; Tatum v. Gregory, C.C.Cal.1892, 51 F. 446.

An infringer is liable for the entire profits made by the manufacturer and sale of article containing patented device where it appeared that but for patented feature article would not have been salable. National Rejectors v. A. B. T. Mfg. Corp., C.A.7 (Ill.) 1951, 188 F.2d 706, 89 U.S.P.Q. 508, certiorari denied 72 S.Ct. 51, 342 U.S. 828, 96 L.Ed. 626, 91 U.S.P.Q. 382. Patents 318(4.1)

An infringer is liable for all profits arising from infringement of an article patented as an entirety, unless he can show that a portion of profits is the result of some other element employed by him. Perrine v. Burdick, C.C.A.8 (Minn.) 1943, 138 F.2d 861. Patents 318(3)

Where patent though using old elements gives the entire value to combination, patentee may recover all the profits from infringer, but when patent has created only a part of profits, patentee's recovery is limited thereto, and such rule applies whether patent covers the whole or only part of infringing machine. Swan Carburetor Co. v. Nash Motors Co., C.C.A.4 (Md.) 1943, 133 F.2d 562, certiorari denied 64 S.Ct. 36, 320 U.S. 762, 88 L.Ed. 454, rehearing denied 64 S.Ct. 155, 320 U.S. 812, 88 L.Ed. 491. Patents 318(4.1)

Where a patent though using old elements gives the entire value to the combination, patentee is entitled to recover all the profits of an infringement of the patent, but if the patent is used in combination with valuable improvements made or other patents appropriated by the infringer, and each contributed to the profits, the patentee's patent only created a part of the profits and he is only entitled to recover that part of the net gains. Cover v. Chicago Eye Shield Co., C.C.A.7 (Ill.) 1942, 130 F.2d 25. Patents 318(4.1)

Owner of patent was entitled to all profits accruing to infringing corporation from sale of infringing device, where profits were derived from single order which infringing corporation obtained by agreeing to furnish infringing device, in absence of which agreement owner of patent would have made sale, and device of infringing corporation derived its value from inclusion of invention. Enterprise Ry. Equipment Co. v. Wine Ry. Appliance Co., C.C.A.6 (Ohio) 1935, 77 F.2d 159, certiorari granted 56 S.Ct. 137, 296 U.S. 560, 80 L.Ed. 395, reversed 56

S.Ct. 528, 297 U.S. 387, 80 L.Ed. 736. Patents 318(3)

If patent is unitary structure, holder thereof is entitled to all profits received by infringer on infringing devices during accounting period, but if patent is mere improvement patent, holder thereof is entitled only to infringer's profits by virtue of improvement. Safe Cabinet Co. v. Globe-Wernicke Co., C.C.A.7 (Ill.) 1933, 63 F.2d 492, certiorari denied 53 S.Ct. 794, 289 U.S. 761, 77 L.Ed. 1504. Patents 318(4.1)

Patentee was entitled to entire profits realized by infringer from sale of disconnecting switches with patented blade assembly, where switches, though containing subsidiary base and insulator, were usually sold as unit. Electrical Engineers Equipment Co. v. Champion Switch Co., D.C.N.Y.1931, 49 F.2d 359. Patents 318(4.1)

Where profits to the infringer are impossible save through his infringement of a process patent he must be treated as a trustee ex maleficio and can withhold none of his gains. Carborundum Co. v. Electric Smelting & Aluminum Co., C.C.A.3 (Pa.) 1913, 203 F. 976, 122 C.C.A. 276, certiorari denied 34 S.Ct. 323, 231 U.S. 754, 58 L.Ed. 467.

Where patented invention is a new and complete type of art or manufacture, the infringer is accountable for the whole profits. Conroy v. Penn Electrical & Manufacturing Co, C.C.A.3 (Pa.) 1912, 199 F. 427, 118 C.C.A. 101, certiorari denied 33 S.Ct. 219, 226 U.S. 612, 57 L.Ed. 381.

If the profit is derived from the construction of the patented device an account must be made by the infringer for the entire profit arising from such construction. Burdett v. Estey, C.C.Vt.1880, 3 F. 566, reversed on other grounds 3 S.Ct. 531, 109 U.S. 633, 27 L.Ed. 1058. See, also, Hurlbut v. Schillinger, Ill.1889, 9 S.Ct. 584, 130 U.S. 456, 32 L.Ed. 1011; Elizabeth v. American Nicholson Pavement Co., N.J.1878, 97 U.S. 126, 24 L.Ed. 1000; American Nicholson Pavement Co. v. Elizabeth, C.C.N.J.1874, 1 B. & A.Pat.Cas. 439, Fed.Cas. No. 309; Whitney v. Mowry, C.C.Ohio 1870, 4 Fish.Pat.Cas. 207, Fed.Cas. No. 17,594.

All profits made by appropriator of plaintiffs' trade secrets during the period for which an accounting was due were properly awarded to plaintiffs where it was impossible to make an apportionment of profit attributable to appropriation of the trade secrets and profit attributable to defendant's ingredients, and where defendant, through a deliberate and continuing campaign of deceit, unfair competition and infringement, involving repeated misappropriation of plaintiffs' trade secrets, was able to seize leadership in a new and profitable market. Carter Products, Inc. v. Colgate-Palmolive Co., D.C.Md.1963, 214 F.Supp. 383, 136 U.S.P.Q. 348, 136 U.S.P.Q. 577. Antitrust And Trade Regulation 437

Owners of patent were entitled to all profits on all sales of all infringing devices, and profits on sales of one infringing device could neither be decreased nor increased, by reference to profits on sales of another infringing device. Clair v. Kastar, Inc., S.D.N.Y.1946, 70 F.Supp. 484, 73 U.S.P.Q. 347. Patents 318(4.1)

A patent infringer cannot diminish his liability by ascribing his profit to capacity indwelling in a patent, or by showing that inventor did not realize all the utility, or all the advantages of what he invented. Activated Sludge v. Sanitary Dist. of Chicago, N.D.Ill.1946, 64 F.Supp. 25, 68 U.S.P.Q. 137, affirmed 157 F.2d 517, 71 U.S.P.Q. 316, certiorari denied 67 S.Ct. 970, 330 U.S. 834, 91 L.Ed. 1281, 72 U.S.P.Q. 529, rehearing denied 67 S.Ct. 1092, 330 U.S. 856, 91 L.Ed. 1297, 72 U.S.P.Q. 529, rehearing denied 67 S.Ct. 1347, 331 U.S. 866, 91 L.Ed. 1870. Patents 319(1)

129. Deductions from infringer's profits--Generally

Patent infringer was not entitled on accounting to offset against profits realized on sale of infringing product factory wastes incurred as a necessary or normal incident in the manufacture. Duplate Corp. v. Triplex Safety Glass Co. of North America, U.S.Pa.1936, 56 S.Ct. 792, 298 U.S. 448, 80 L.Ed. 1274. Patents 318(6)

Defendant will not be allowed to put in unconscionable claims for personal services or other inequitable deductions. City of Elizabeth v. American Nicholson Pavement Co., U.S.N.J.1877, 97 U.S. 126, 7 Otto 126, 24 L.Ed. 1000, motion denied 24 L.Ed. 1059.

In patent infringement suit, failure to allow a deduction for inventory of devices not sold within the infringing period within that period for the purpose of calculating profit was not error. Autographic Register Co. v. Sturgis Register Co., C.C.A.6 (Mich.) 1940, 110 F.2d 883. Patents 318(4.1)

Infringer was properly credited only for its actual expenditures in connection with manufacture of infringing machines by third person, as against contention that credit should be for amount that infringer would have paid if it had not discounted its bills, thereby reducing cash outlay, and similarly, if buyers of machines took cash dis- counts, infringer would be charged only with cash received. Stearns-Roger Mfg. Co. v. Ruth, C.C.A.10 (Colo.) 1936, 87 F.2d 35. Patents 318(6)

Reasonable and necessary expenses of patent infringer's business are deductible in estimating profits accepted by patent owner, though infringement was willful and deliberate. Sutton v. Gulf Smokeless Coal Co., C.C.A.4 (W.Va.) 1935, 77 F.2d 439. Patents 318(6)

In accounting for profits derived from infringement, infringer was properly allowed deduction for royalties paid to parent corporation pursuant to bona fide agreement entered into before infringement. Stromberg Motor Devices Co. v. Zenith-Detroit Corporation, C.C.A.2 (N.Y.) 1934, 73 F.2d 62, certiorari dismissed 55 S.Ct. 509, 294 U.S. 735, 79 L.Ed. 1263. Patents 318(6)

In determining profits of patent infringement, royalties paid by infringer were expense of business to be deducted from profits, commission infringer paid manager should be deducted from profits, including balance infringer retained for time on theory federal tax should be taken out before manager's proportion was figured, interest on invested capital may be deducted, and recoverable profits are not to be increased by interest on di- vidends paid by infringer. Stromberg Motor Devices Co. v. Detroit Trust Co., C.C.A.7 (Ill.) 1930, 44 F.2d 958. Patents 318(6)

Infringers were liable for reasonable royalty for use of infringed value as essential to sprinkler system, less saving in manufacturing cost by unpatented improvement, overhead, and interest on investment. Rockwood v. Gen- eral Fire Extinguisher Co., C.C.A.2 (N.Y.) 1930, 37 F.2d 62. Patents 319(1)

Master's allowance for transportation, installation, maintenance, and overhead expenses, in calculating profits attributable to infringing device, was sustained by evidence. Standard Mailing Machines Co. v. Postage Meter Co., D.C.Mass.1929, 31 F.2d 459. Patents 312(3)

Infringer is entitled to credit for the expense of advertising the infringing article. Coffield Motor Washer Co. v. Wayne Mfg. Co., C.C.A.8 (Mo.) 1918, 255 F. 558, 166 C.C.A. 626. See, also, Metallic Rubber Tire Co. v. Hart- ford Rubber Works Co., C.C.A.Conn.1921, 275 F. 315, certiorari denied 42 S.Ct. 57, 257 U.S. 650, 66 L.Ed.

416; La Baw v. Hawkins, C.C.N.J.1877, Fed.Cas. No. 7,961. Patents 318(6)

To entitle an infringer of a process patent to reduce its liability for profits because of other processes which were open to its use, such processes must have been in existence and open to public use when the infringement commenced; it cannot avail itself of a process developed afterward by itself, or others, and used only experimentally or occasionally during the time of infringement, for the purpose of avoiding or minimizing its liability. Expan- ded Metal Co. v. General Fireproofing Co., N.D.Ohio 1917, 247 F. 899, appeal dismissed 272 F. 1021. Patents 318(4.5)

Infringer is not entitled to credit for alleged saving because of superior skill and intelligence over cost to complainant of producing the patented article. Conroy v. Penn Electrical & Manufacturing Co, C.C.A.3 (Pa.) 1912, 199 F. 427, 118 C.C.A. 101, certiorari denied 33 S.Ct. 219, 226 U.S. 612, 57 L.Ed. 381.

Where defendant corporation was continuing business which had prior to accounting period operated exclusively in manufacture, sale and distribution of products covered by complainant's patent, and transactions begun before accounting period extended into accounting period and sales during accounting period were a part of continuous transaction of business, and prior to and during accounting period defendant unquestioningly accepted returned merchandise to retain goodwill of jobbers who sold to ultimate consumers, credits for merchandise returned during accounting period were properly allowed by special master appointed to take and state account of profits to which complainants were entitled under decree permanently enjoining defendant corporation from infringing on complainant's patents. Hayslip v. Textag Co., N.D.Ga.1951, 98 F.Supp. 879, 89 U.S.P.Q. 515. Patents 318(6)

In calculating profits due to use of patented carbon in solvent recovery plant as basis for award to owner of patent, expenditure in renovation of coating machines was not properly a part of capital investment in recovery system, where such expenditure was no part of process of solvent recovery. National Carbon Co. v. Richards & Co., D.C.Conn.1935, 16 F.Supp. 239, affirmed 85 F.2d 490. Patents 318(3)

In determining plaintiff's damages for defendant's infringement of vitamin extracting process, defendant could deduct advertising expense although it represented 100 percent of gross profits, where it was impossible to determine value received by defendant from such expense subsequent to termination of infringing period by profits through sale of articles made by noninfringing process. International Vitamin Corporation v. E.R. Squibb & Sons, E.D.N.Y.1935, 13 F.Supp. 129. Patents 319(1)

Where the infringer had incurred liabilities on guaranties and warranty of title as to the infringing machines, nothing is to be deducted on that account. Steam Stone Cutter Co. v. Windsor Mfg. Co., C.C.Vt.1879, 22 F.Cas. 1169, No. 13335. Patents 318(6)

Where the defendant is engaged in other businesses besides that involving that patented invention the general expenses must be fairly apportioned. Hitchcock v. Tremaine, C.C.N.Y.1872, 12 F.Cas. 244, No. 6539, affirmed 90 U.S. 518, 23 L.Ed. 97, 23 Wall. 518. See, also, Seabury v. Am Ende, N.Y.1894, 14 S.Ct. 683, 152 U.S. 561, 38 L.Ed. 553; Tremolo Patent, N.Y.1875, 23 Wall. 518, 23 L.Ed. 97; Goodyear v. Providence Rubber Co., C.C.R.I.1864, 2 Fish.Pat.Cas. 499, Fed.Cas. No. 5,583, affirmed 9 Wall. 788, 19 L.Ed. 566.

Royalties paid or due in good faith by defendant under an infringing patent, which contains improvements over complainant's patent, should be deducted. Graham v. Mason, C.C.Mass.1872, 10 F.Cas. 930, No. 5672.

130. ---- Books of account, deductions from infringer's profits, damages

An infringer failing to keep books enabling him to separate the expense of making and selling the infringing article from that of others was not entitled to any deduction from gross profits. Seabury & Johnson v. Am Ende, U.S.N.Y.1894, 14 S.Ct. 683, 152 U.S. 561, 38 L.Ed. 553. See, also, Decker v. Smith, D.C.N.Y.1915, 224 F. 776, modified on other grounds 234 F. 646; Kissinger-Ison Co. v. Bradford Belting Co., Ohio 1903, 123 F. 91, 59 C.C.A. 221; National Folding Box & Paper Co. v. Dayton Paper Novelty Co., C.C.Ohio 1899, 95 F. 991.

In calculating damages for lost profits arising from patent infringement, when the patentholder's inability to prove lost profits is due to the infringer's failure to keep accurate or complete records, the consequences of such failure must rest on the infringer. Milgo Electronic Corp. v. United Business Communications, Inc., C.A.10 (Kan.) 1980, 623 F.2d 645, 206 U.S.P.Q. 481, certiorari denied 101 S.Ct. 794, 449 U.S. 1066, 66 L.Ed.2d 611, 208 U.S.P.Q. 376. Patents 319(1)

An infringer's commercial expenses made up of salaries, traveling expenses, and other items including depreciation, taxes and insurance, maintenance of branch offices, and group insurance premiums, were not proper deductions from manufacturing gain in determining profits from manufacturing infringing product, where it was impossible to segregate the particular items to the infringing business. Horvath v. McCord Radiator & Mfg. Co., C.C.A.6 (Mich.) 1938, 100 F.2d 326, certiorari denied 60 S.Ct. 101, 308 U.S. 581, 84 L.Ed. 486, rehearing denied 60 S.Ct. 171, 308 U.S. 636, 84 L.Ed. 529. Patents 318(6)

131. ---- Costs, deductions from infringer's profits, damages

Patent infringer was not entitled on accounting to credit for savings effected by use of its own plate glass manufacturing patents in determining cost of laminated glass sold, nor to offset against profits realized on sale of infringing product cost of articles sold to its customers and returned for defects afterwards discovered. Duplate Corp. v. Triplex Safety Glass Co. of North America, U.S.Pa.1936, 56 S.Ct. 792, 298 U.S. 448, 80 L.Ed. 1274. Patents 318(6)

Salaries paid stockholders in good faith for services actually rendered are to be allowed as part of the cost. Seabury & Johnson v. Am Ende, U.S.N.Y.1894, 14 S.Ct. 683, 152 U.S. 561, 38 L.Ed. 553. See, also, National Folding Box & Paper Co. v. Dayton Paper Novelty Co., C.C.Ohio 1899, 95 F. 991; Steam Stone Cutter Co. v. Windsor Mfg. Co., C.C.Vt.1879, Fed.Cas. No. 13,335.

Profits are rightly estimated by finding difference between costs and sales; and, in estimating cost, the cost of materials, interest, expense of manufacture and sale, and bad debts, are to be taken into account, but not interest on capital stock or “manufacturer's profits.” Providence Rubber Co. v. Goodyear, U.S.R.I.1869, 76 U.S. 788, 19 L.Ed. 566, 9 Wall. 788. See, also, Oehring v. Fox Typewriter Co., C.C.A.N.Y.1918, 251 F. 584; Expanded Met- al Co. v. General Fireproofing Co., D.C.Ohio 1917, 247 F. 899, appeal dismissed , 272 F. 1021; National Fold- ing Box & Paper Co. v. Elsas, N.Y.1898, 86 F. 917, 30 C.C.A. 487; Am Ende v. Seabury, C.C.N.Y.1890, 43 F. 672, affirmed 14 S.Ct. 683, 152 U.S. 561, 38 L.Ed. 553; Troy Iron & Nail Factory v. Corning, C.C.N.Y.1869, Fed.Cas. No. 14,196. Patents 318(6)

An allowance for the cost of conducting the business may be made in the estimation of the profits. Providence Rubber Co. v. Goodyear, U.S.R.I.1869, 76 U.S. 788, 19 L.Ed. 566, 9 Wall. 788. See, also, Crosby Steam Gage, etc., Co. v. Consolidated Safety Valve Co., Mass.1891, 12 S.Ct. 49, 141 U.S. 441, 35 L.Ed. 809; Tilghman v. Proctor, Ohio 1888, 8 S.Ct. 894, 125 U.S. 136, 31 L.Ed. 664; Zane v. Peck, C.C.Conn.1882, 13 F. 475.

In determining measure of patentee's damages for infringement based on infringer's profits, infringer is not entitled to deduction representing proportionate allocation to infringing products of compensation paid to infringer's corporate officers who are owners of corporation. Zysset v. Popeil Bros., Inc., C.A.7 (Ill.) 1963, 318 F.2d 701, 137 U.S.P.Q. 694, certiorari denied 84 S.Ct. 658, 376 U.S. 913, 11 L.Ed.2d 610, 140 U.S.P.Q. 694, rehearing denied 84 S.Ct. 965, 376 U.S. 959, 11 L.Ed.2d 978, 140 U.S.P.Q. 694, rehearing denied 85 S.Ct. 16, 379 U.S. 872, 13 L.Ed.2d 79. Patents 319(1)

In patent infringement action, where plaintiff's damages were based in part on net profits of corporate infringer, it was not entitled to retain as part of its profits not accounted for to patentee any part of legal expenses incurred in defendant infringement suit. Graham v. Jeoffroy Mfg., Inc., C.A.5 (Tex.) 1958, 253 F.2d 72, 116 U.S.P.Q. 542, certiorari denied 79 S.Ct. 28, 358 U.S. 817, 3 L.Ed.2d 59, 119 U.S.P.Q. 501, rehearing denied 79 S.Ct. 117, 358 U.S. 890, 3 L.Ed.2d 118, 119 U.S.P.Q. 501. See, also, Zysset v. Popeil Bros., Inc., C.A.Ill.1963, 318 F.2d 701, certiorari denied 84 S.Ct. 658, 376 U.S. 913, 11 L.Ed.2d 610, rehearing denied 84 S.Ct. 965, 376 U.S. 959, 11 L.Ed.2d 978, rehearing denied 85 S.Ct. 16, 379 U.S. 872, 13 L.Ed.2d 79. Patents 319(1)

In action for profits resulting from infringement of patent covering adjustable welt of ladies' silk stockings, plaintiff was not entitled to all the profits under the evidence, and defendant's additional cost of manufacture by reason of infringing feature must be taken into account. Gotham Silk Hosiery Co. v. Artcraft Silk Hosiery Mills, C.C.A.3 (Del.) 1944, 147 F.2d 209. Patents 310.11

In action for accounting for infringement of patent on device for machining automobile camshafts, evidence sustained finding of master disallowing claimed increased labor cost of straightening camshafts thrown out of align- ment in course of shaping as an increased expense of using new process over old. Gordon Form Lathe Co. v. Ford Motor Co., C.C.A.6 (Mich.) 1943, 133 F.2d 487, certiorari granted 63 S.Ct. 1325, 319 U.S. 738, 87 L.Ed. 1697, rehearing granted 63 S.Ct. 1444, 320 U.S. 213, 87 L.Ed. 1850, certiorari denied 63 S.Ct. 1328, 319 U.S. 765, 87 L.Ed. 1715, rehearing denied 64 S.Ct. 29, 320 U.S. 810, 88 L.Ed. 490, affirmed 64 S.Ct. 257, 320 U.S. 714, 88 L.Ed. 419, rehearing denied 64 S.Ct. 434, 320 U.S. 816, 88 L.Ed. 493. Patents 312(10)

Upon statement of account between patentee and infringer, patentee is not looked upon as a quasi partner of the infringers under a duty to contribute to the cost of the infringing business, but is free at his own election to adopt what will help and discard what will harm. Autographic Register Co. v. Sturgis Register Co., C.C.A.6 (Mich.) 1940, 110 F.2d 883. Patents 318(4.1)

Patent infringer was not entitled on accounting to offset against profits realized on sale of infringing product, cost of articles sold to its customers and returned for defects afterwards discovered, where contracts showed that defective articles were not replaced pursuant to contract, but only if and when a second formal purchase order was given. Triplex Safety Glass Co. of North America v. Duplate Corp., C.C.A.3 (Pa.) 1940, 110 F.2d 326. Pat- ents 319(1)

On patent infringement accounting, manufacturing cost of infringing devices on hand when decree adjudging infringement was affirmed, less their junk value, could not be deducted from profits on devices sold by infringer. Oil Well Improvements Co. v. Acme Foundry & Machine Co., C.C.A.8 (Kan.) 1929, 31 F.2d 898. Patents 318(6)

Infringer cannot claim credit for cost of manufacturing infringing articles remaining on hand, when not charged with profits thereon. MacBeth Evans Glass Co v. L.E. Smith Glass Co, C.C.A.3 (Pa.) 1927, 23 F.2d 459. Patents 318(6)

Defendant is not entitled to a deduction of costs of changes required to satisfy purchaser. Morgan Const Co v. Forter-Miller Engineering Co, C.C.A.3 (Pa.) 1916, 234 F. 324, 148 C.C.A. 226.

In finding the value of raw material used by an infringer the cost to him is to be taken. Byerly v. Sun Co, E.D.Pa.1915, 226 F. 759.

The value of the use of real and personal estate belonging to the infringer, such as shops, fixtures, and machinery, including repairs, employed in making the machines made and sold for profit, is to be allowed as part of their cost. Western Glass Co v. Schmertz Wire Glass Co, C.C.A.7 (Ill.) 1915, 226 F. 730, 141 C.C.A. 486, certiorari denied 36 S.Ct. 222, 239 U.S. 648, 60 L.Ed. 485, modified on other grounds 236 F. 744, 150 C.C.A. 76. See, also, Steam Stone Cutter Co. v. Windsor Mfg. Co., C.C.Vt.1879, Fed.Cas. No. 13,335; Troy Iron & Nail Factory v. Corning, C.C.N.Y.1869, Fed.Cas. No. 14,196.

In estimating the profits realized by a defendant from the manufacture and sale of an infringing article, for which it is accountable, it is entitled to be allowed for office and factory rental and for labor in producing and selling the article, but not for insurance, or for legal services or expenses in defending a prior suit, although successful in such defense. Piaget Novelty Co. v. Headley, C.C.S.D.N.Y.1903, 123 F. 897. Patents 318(6)

Willful design patent infringer's expenses for bad debts, commissions, consulting and legal fees, salaries, dis- counts, travel, and entertainment were not deductible from gross revenues, for purpose of determining amount of profits which it had to pay to patentee, absent showing that they were sufficiently related to production of infringing products. Rocket Jewelry Box, Inc. v. Quality Intern. Packaging, Ltd., S.D.N.Y.2003, 250 F.Supp.2d 333, motion denied 2003 WL 21910888, affirmed in part, vacated in part and remanded 90 Fed.Appx. 543, 2004 WL 260998, on remand 403 F.Supp.2d 288. Patents 318(4.4)

In action for patent infringement wherein special master was appointed to take and state account of profits to which complainants were entitled under decree permanently enjoining defendant corporation from infringing on complainant's patent as defendant corporation had been doing, special master, under evidence, in computing cost of sales reported in audit, properly added to cost of material 25 percent thereof as an allowance for spoilage in manufacturing process. Hayslip v. Textag Co., N.D.Ga.1951, 98 F.Supp. 879, 89 U.S.P.Q. 515. Patents 318(6)

In patent infringement action, cost of patent owned by infringer could not be included in determining infringing machine costs, and exclusion, in arriving at infringer's profits on foreign sales of infringing machine, of cost of inferior machine manufactured under infringer's patent was not error. Mathey v. United Shoe Machinery Corp., D.C.Mass.1944, 54 F.Supp. 694. Patents 318(6)

An award for infringement of a patent for hosiery adjustable to varying leg lengths could not be based on a dif- ferential of $1 between patented and unpatented stocking, on assumption that $1 was the “profit”, without determination having been made of the cost of manufacture or the price received, since “profit” is the difference between cost and sales. Gotham Silk Hosiery Co v. Artcraft Silk Hosiery Mills, D.C.Del.1940, 33 F.Supp. 344. Patents 318(1)

In calculating profits from use of patented carbon as basis for award to owner of patent, owner was not entitled to increase of finding as to operating cost of comparative system during infringing period on ground that comparative system would not have operated with its former efficiency if used with coating machines used with infringing system, where such machines were not part of infringing process and extent of impairment of such effi-

ciency was not shown. National Carbon Co. v. Richards & Co., D.C.Conn.1935, 16 F.Supp. 239, affirmed 85 F.2d 490. Patents 318(3)

Where portion of the price received for an infringing machine is due to a patented improvement of the infringer, no part of the cost of making the improvement should be allowed. Steam Stone Cutter Co. v. Windsor Mfg. Co., C.C.Vt.1879, 22 F.Cas. 1169, No. 13335. Patents 318(6)

132. ---- Interest, deductions from infringer's profits, damages

A wrongful appropriator of a trade secret for converting a dry cargo vessel to vessel for transportation of liquefied petroleum gas was entitled to an allowance of interest on necessary capital invested by it in water transportation, and in comparative railroad transportation, in computing plaintiff's damages by the standard of comparison method. International Industries, Inc. v. Warren Petroleum Corp., C.A.3 (Del.) 1957, 248 F.2d 696, 115 U.S.P.Q. 104, 115 U.S.P.Q. 159, certiorari dismissed 78 S.Ct. 529, 355 U.S. 943, 2 L.Ed.2d 523. Damages 114

In computing an infringer's profits from infringing device, interest is only allowable on capital investment actually used wholly or partly in producing and marketing infringing device, and infringer has burden of producing evidence which will enable the court to satisfactorily apportion interest among the several kinds of businesses. Horvath v. McCord Radiator & Mfg. Co., C.C.A.6 (Mich.) 1938, 100 F.2d 326, certiorari denied 60 S.Ct. 101, 308 U.S. 581, 84 L.Ed. 486, rehearing denied 60 S.Ct. 171, 308 U.S. 636, 84 L.Ed. 529. Patents 312(1.7); Patents 318(5)

Infringer was not entitled to credit for interest on invested capital where it appeared that infringing machines were not kept in stock but were manufactured by third person on order, to whom infringer furnished drawings and sometimes items not stocked by such manufacturer, and where infringer showed only its capital and surplus and proportion of infringing sales to gross sales. Stearns-Roger Mfg. Co. v. Ruth, C.C.A.10 (Colo.) 1936, 87 F.2d 35. Patents 318(6)

Where infringement of patent, was not deliberate, interest on infringers' invested capital was properly deducted in ascertaining infringers' profits. Duplate Corporation v. Triplex Safety Glass Co of North America, C.C.A.3 (Pa.) 1935, 81 F.2d 352, certiorari granted 56 S.Ct. 668, 297 U.S. 702, 80 L.Ed. 990, affirmed as modified on other grounds 56 S.Ct. 792, 298 U.S. 448, 80 L.Ed. 1274. See, also, Stromberg Motor Devices Co. v. Zenith- Detroit Corporation, C.C.A.N.Y.1934, 73 F.2d 62, certiorari dismissed 55 S.Ct. 509, 294 U.S. 735, 79 L.Ed. 1263; Barber Asphalt Paving Co. v. Standard Asphalt & Rubber Co., C.C.A.Ill.1928, 30 F.2d. 281. Patents 318(6)

Patent infringer was entitled to deduction of proportionate part of interest and depreciation at its plant in estimating profits awarded patent owners by court decree. Sutton v. Gulf Smokeless Coal Co., C.C.A.4 (W.Va.) 1935, 77 F.2d 439. Patents 318(6)

That there was some noninfringing business was not fatal to allowance of interest on capital invested in infringing business. Permutit Co. v. Refinite Co., C.C.A.2 (N.Y.) 1928, 27 F.2d 695. Patents 318(6)

Defendant is not entitled to allowance of interest on capital invested where that was only a part of its business, and it is impossible to satisfactorily apportion the interest. W.W. Sly Mfg. Co. v. Pangborn Corporation, D.C.Md.1921, 276 F. 971, affirmed 284 F. 217, certiorari denied 43 S.Ct. 249, 260 U.S. 749, 67 L.Ed. 495. Pat-

ents 318(6)

An infringer, on an accounting for profits, is not entitled to a deduction of interest on the capital invested. Ex- panded Metal Co. v. General Fireproofing Co., N.D.Ohio 1917, 247 F. 899, appeal dismissed 272 F. 1021. Pat- ents 318(6)

Interest on the cost of a device and the cost of power are to be allowed as deductions from profits only when it is shown they have been paid or incurred as debts. Herring v. Gage, C.C.N.Y.1878, 12 F.Cas. 44, No. 6422, reversed 2 S.Ct. 819, 107 U.S. 640, 17 Otto 640, 27 L.Ed. 601. Patents 318(6)

Interest on the capital invested in machines carried over in consequence of inability to sell, due to sales by the infringer, is a proper element of damages to be considered. Carter v. Baker, C.C.Cal.1871, 5 F.Cas. 195, 1 Sawy. 512, No. 2472.

133. ---- Losses, deductions from infringer's profits, damages

Infringer accounting for profits from sale of infringing laminated glass could not offset against its profits resulting from some of sales losses occurring on other sales, even though costs could not be ascertained with precision and were required to be apportioned on an average basis. Duplate Corp. v. Triplex Safety Glass Co. of North America, U.S.Pa.1936, 56 S.Ct. 792, 298 U.S. 448, 80 L.Ed. 1274. Patents 318(6)

Patentee is entitled to any profit the infringer has made by the unlicensed use of the patented contrivance without recoupment for losses on other infringing mechanisms or other parts of same structure of machine. Crosby Steam-Gauge & Valve Co. v. Consolidated Safety-Valve Co., U.S.Mass.1891, 12 S.Ct. 49, 141 U.S. 441, 35 L.Ed. 809. See, also, Starr Piano Co. v. Auto Pneumatic Action Co., C.C.A.Ind.1926, 12 F.2d 586; Van Kan- nell Revolving Door Co. v. Revolving Door, etc., Co., D.C.N.Y.1920, 293 F. 261; Fox Typewriter Co. v. Under- wood Typewriter Co., C.C.A.Mich.1923, 287 F. 447; McKee Glass Co. v. H. C. Fry Glass Co., Pa.1918, 248 F. 125, 160 C.C.A. 265; Decker v. Smith, D.C.N.Y.1915, 225 F. 776, modified on other grounds 234 F. 646; Un- derwood Typewriter Co. v. Fox Typewriter Co., Mich.1915, 220 F. 880, 136 C.C.A. 446; Canda Bros. v. Michigan Malleable Iron Co., Mich.1907, 152 F. 178, 81 C.C.A. 420; Steam Stone Cutter Co. v. Windsor Mfg. Co., C.C.Vt.1879, Fed.Cas. No. 13,335; Conover v. Mers, C.C.N.Y.1873, Fed.Cas. No. 3,122affirmed 131 U.S. cxlii appendix, 23 L.Ed. 1008.

To justify a damage award equal to lost profits, patentholder can present affirmative evidence of demand for his patented product in marketplace, the absence of acceptable noninfringing substitutes, his production and marketing capacity to meet demand, and computations on loss of profits. Paper Converting Machine Co. v. Magna- Graphics Corp., C.A.Fed.1984, 745 F.2d 11, 223 U.S.P.Q. 591, on remand 631 F.Supp. 660, 228 U.S.P.Q. 524. Patents 312(10)

In determining measure of patentee's damages for infringement based on infringer's profits, infringer was not entitled to deduction representing loss sustained when infringer drastically reduced price of infringing devices toward termination of infringement period. Zysset v. Popeil Bros., Inc., C.A.7 (Ill.) 1963, 318 F.2d 701, 137 U.S.P.Q. 694, certiorari denied 84 S.Ct. 658, 376 U.S. 913, 11 L.Ed.2d 610, 140 U.S.P.Q. 694, rehearing denied 84 S.Ct. 965, 376 U.S. 959, 11 L.Ed.2d 978, 140 U.S.P.Q. 694, rehearing denied 85 S.Ct. 16, 379 U.S. 872, 13 L.Ed.2d 79. Patents 319(1)

In patent infringement suit, court was not required to treat the infringing years as one continuous transaction and

to deduct losses of subsequent years from profits of earlier years in order that infringers might receive the advantage. Autographic Register Co. v. Sturgis Register Co., C.C.A.6 (Mich.) 1940, 110 F.2d 883. See, also, Clair v. Kastar, Inc., D.C.N.Y.1946, 70 F.Supp. 484. Patents 318(4.1)

Losses to infringer from sale of article, including patented feature, below cost were not deductible from profits due patentee. Electrical Engineers Equipment Co. v. Champion Switch Co., D.C.N.Y.1931, 49 F.2d 359. Patents 318(6)

Bad debts, if representing loss actually incurred in connection with manufacture or sale of infringing device, make proper deduction from profits recoverable in infringement suit. Oil Well Improvements Co. v. Acme Foundry & Machine Co., C.C.A.8 (Kan.) 1929, 31 F.2d 898. Patents 318(6)

Losses occurring concurrently with gaining of profits will be considered. MacBeth Evans Glass Co v. L E Smith Glass Co, D.C.Pa.1927, 21 F.2d 553, modified 23 F.2d 459. Patents 318(6)

Patentholder and infringer comprised a two-supplier market of horn reflector antennas, and thus patentholder was entitled to presumption that its lost profits were caused by the infringement; although third party had market shares of 16.4% and 9.8% at the beginning of the infringement period, its antennas were not considered acceptable alternatives by purchasers, who consistently chose antennas with the patented feature, and third party's market share dropped below 6%. Andrew Corp. v. Gabriel Electronics, Inc., D.Me.1992, 785 F.Supp. 1041, 23 U.S.P.Q.2d 1019. Patents 312(1.7)

In computing profits on general sales of a product manufactured by defendant as a result of misappropriation of trade secrets, as an element of plaintiffs' damages, defendant was not entitled to offset losses on one product which made use of the trade secrets against profits made on the sale of another product which incorporated the trade secrets. Carter Products, Inc. v. Colgate-Palmolive Co., D.C.Md.1963, 214 F.Supp. 383, 136 U.S.P.Q. 348, 136 U.S.P.Q. 577. Antitrust And Trade Regulation 437

Owner of patent was entitled to entire profits from defendants' carbon recovery process which used patented carbon without deduction of losses sustained during one year of infringing period. National Carbon Co. v. Richards & Co., D.C.Conn.1935, 16 F.Supp. 239, affirmed 85 F.2d 490. Patents 318(4.5)

134. ---- Overhead expenses, deductions from infringer's profits, damages

Damages for patent infringement, which were measured by profits patent licensee would have earned had it produced infringing machines which it could have produced, were not required to be diminished by amount of licensee's fixed overhead expenses, absent evidence showing that licensee's overhead expenses would have been greater had it produced the infringing machines. General Elec. Co. v. Sciaky Bros., Inc., C.A.6 (Mich.) 1969, 415 F.2d 1068, 163 U.S.P.Q. 257. Patents 319(1)

If general overhead is to be allowed as an element of cost in computing profits of defendants from their sale of garment display racks which infringed plaintiff's design patent, the factors which should be incorporated in the reckoning are whether depreciation deducted in determining federal income taxes had any reasonable relation to the cost of the infringing racks, and whether the “general” overhead included any of the expense of defending the suit, which might be questionable as an allowable cost item, and whether the overhead included interest on money borrowed for purposes unrelated to the production of the infringing racks; the burden of establishing such matters rested upon the defendants. Henry Hanger & Display Fixture Corp. of America v. Sel-O-Rak Corp.,

C.A.5 (Fla.) 1959, 270 F.2d 635, 123 U.S.P.Q. 3. Patents 319(1)

In patent infringement action, where two individual defendants were found to be guilty of infringement along with their corporation, in determining infringing profits of corporation, entire salary of such individual infringers had to be added to corporate net profits which had been computed with a deduction therefor. Graham v. Jeoffroy Mfg., Inc., C.A.5 (Tex.) 1958, 253 F.2d 72, 116 U.S.P.Q. 542, certiorari denied 79 S.Ct. 28, 358 U.S. 817, 3 L.Ed.2d 59, 119 U.S.P.Q. 501, rehearing denied 79 S.Ct. 117, 358 U.S. 890, 3 L.Ed.2d 118, 119 U.S.P.Q. 501. Patents 318(6)

In action involving infringement of patent, master's finding that patentee would have incurred no increase in general overhead expenses had it undertaken the 37 installations for which it was allowed recovery of lost profits was justified. Electric Pipe Line, Inc. v. Fluid Systems Inc., C.A.2 (Conn.) 1957, 250 F.2d 697, 116 U.S.P.Q. 25. Patents 312(10)

In action for profits resulting from infringement of patent covering adjustable welt of ladies' silk stockings, evidence showed that plaintiff's expert in computing defendant's costs properly allowed a salary of $25,000 a year for defendant's president. Gotham Silk Hosiery Co. v. Artcraft Silk Hosiery Mills, C.C.A.3 (Del.) 1944, 147 F.2d 209. Patents 312(10)

In action for accounting for infringement of patent on device for machining automobile camshafts, where special master followed infringer's own method of accounting to determine apportionment of manufacturing overhead to production of camshafts which correlated direct labor costs, time and overhead expense to prove allocation of manufacturing costs to a unit of production, which method was best approximation that could be made under evidence, and from such method determined gain of infringer over former method of producing camshafts, overruling of master's finding was error. Gordon Form Lathe Co. v. Ford Motor Co., C.C.A.6 (Mich.) 1943, 133 F.2d 487, certiorari granted 63 S.Ct. 1325, 319 U.S. 738, 87 L.Ed. 1697, rehearing granted 63 S.Ct. 1444, 320 U.S. 213, 87 L.Ed. 1850, certiorari denied 63 S.Ct. 1328, 319 U.S. 765, 87 L.Ed. 1715, rehearing denied 64 S.Ct. 29, 320 U.S. 810, 88 L.Ed. 490, affirmed 64 S.Ct. 257, 320 U.S. 714, 88 L.Ed. 419, rehearing denied 64 S.Ct. 434, 320 U.S. 816, 88 L.Ed. 493. Patents 322

Evidence supported finding of master in chancery and district court, in determining profits from sale of infringing devices as a measure of damages for the infringement, that at least 30 percent of infringer's general overhead expense was in fact selling expense of non-infringing business and that such amount should be deducted therefrom before allocating general overhead between infringing and non-infringing business. W. H. Miner, Inc., v. Peerless Equipment Co., C.C.A.7 (Ill.) 1940, 115 F.2d 650, certiorari denied 61 S.Ct. 615, 312 U.S. 687, 85 L.Ed. 1125. Patents 312(10)

In ascertaining net profits on sales of infringing machines, infringer was entitled to some allowance for overhead expense, notwithstanding absence of proof that stenographers, telephones, and other items embodied in overhead were actually used in connection with such sales, since courts will resort to allocation. Stearns-Roger Mfg. Co. v. Ruth, C.C.A.10 (Colo.) 1936, 87 F.2d 35. Patents 318(6)

In accounting for profits from patent infringement, deduction of 33 1/3 percent for overhead was properly refused, where selling of infringing device was merely an incident to regular business of infringing corporation, and device was not manufactured by infringing corporation but by another company for it. Enterprise Ry. Equip- ment Co. v. Wine Ry. Appliance Co., C.C.A.6 (Ohio) 1935, 77 F.2d 159, certiorari granted 56 S.Ct. 137, 296 U.S. 560, 80 L.Ed. 395, reversed on other grounds 56 S.Ct. 528, 297 U.S. 387, 80 L.Ed. 736. Patents

318(6)

In accounting for profits derived from infringement, infringer was properly allowed deduction for an amount paid its president under contract that entitled him to salary and percentage of profits. Stromberg Motor Devices Co. v. Zenith-Detroit Corporation, C.C.A.2 (N.Y.) 1934, 73 F.2d 62, certiorari dismissed 55 S.Ct. 509, 294 U.S. 735, 79 L.Ed. 1263. Patents 318(6)

Where infringer of patent takes on line of infringing articles without increasing overhead expense, only such part of overhead should be charged as expense of added line in determining profits from infringing articles as participated in manufacture or sale of infringing articles. Levin Bros. v. Davis Mfg. Co., C.C.A.8 (Minn.) 1934, 72 F.2d 163. Patents 318(6)

Where no segregation of overhead due to manufacture of infringing devices can be made, infringer will be required to account for profits on gross sales of infringing devices figured at average profits in all lines. George Haiss Mfg. Co. v. Linkbelt Co., C.C.A.3 (Pa.) 1932, 63 F.2d 479. Patents 318(6)

Infringer is entitled to deduction for overhead expenses only when made necessary for production of infringing article. Krentler-Arnold Hinge Last Co. v. Leman, D.C.Mass.1928, 24 F.2d 423. Patents 318(6)

Variable overhead cannot be allocated per unit of infringing product, to make sales appear unprofitable, where manufacture or selling is continuous. Christensen v. National Brake & Elec. Co., D.C.Wis.1924, 10 F.2d 856. Patents 318(6)

Relationship between particular fixed expenses and production or sale of the infringing product is a central factor in determining propriety of a deduction of overhead or fixed costs and amount thereof in computing the profits recoverable for infringement of a design patent. Bergstrom v. Sears, Roebuck and Co., D.C.Minn.1980, 496 F.Supp. 476, 207 U.S.P.Q. 481. Patents 318(6)

Fixed overhead was not to be deducted from exclusive licensee's damages for patent infringement where such expenses would not have been greater if it, rather than defendant manufacturer, had produced the infringing items. Saf-Gard Products, Inc. v. Service Parts, Inc., D.C.Ariz.1980, 491 F.Supp. 996, 206 U.S.P.Q. 976. Patents 318(3)

Where defendant corporation which had been infringing complainant's patent and which was permanently enjoined from infringing complainant's patent was alter ego of specified person, and such person was jointly liable with defendant corporation for all profits realized by such person from infringement, amounts paid by defendant corporation to such person as salary were improperly allowed as a deduction in his audit by special master appointed to take and state account of profits to which complainant was entitled. Hayslip v. Textag Co., N.D.Ga.1951, 98 F.Supp. 879, 89 U.S.P.Q. 515. Patents 318(6)

In case of corporate infringers, regardless of whether corporation is a close corporation, salaries to officers in payment of services rendered will be allowed as a credit, in determining profits of infringer to which patentee is entitled, but only if such salaries are reasonable in amount and are not distribution of profits in disguise. Clair v. Kastar, Inc., S.D.N.Y.1946, 70 F.Supp. 484, 73 U.S.P.Q. 347. Patents 318(6)

In determining accountability of patent infringer for profits from manufacture of infringing toy torpedoes, use of prime cost method of accounting, which involved allocation of general overhead expense of business to manu-

facture of toy torpedoes, as distinguished from direct labor costs method, was proper under the evidence. Vic- tory Fireworks & Specialty Co. v. Commercial Novelty Co., D.C.Md.1939, 26 F.Supp. 126. Patents 312(10)

Compensation is not allowed infringer for his time and labor. Williams v. Leonard, C.C.N.Y.1872, 29 F.Cas. 1372, No. 17726. See, also, Kansas City Hay Press Co. v. Devol, C.C.Mo.1904, 127 F. 363, error dismissed 137 F. 1019; Piper v. Brown, C.C.Mass.1873, Fed.Cas. No. 11,181.

135. ---- Taxes, deductions from infringer's profits, damages

In action for profits resulting from infringement of patent covering adjustable welt of ladies' silk stockings, where infringing corporation was under domination of its president and rented plant from him at a high rental and paid taxes thereon, such rent and taxes were not bona fide elements of expense in determining costs. Gotham Silk Hosiery Co. v. Artcraft Silk Hosiery Mills, C.C.A.3 (Del.) 1944, 147 F.2d 209. Patents 318(6)

An infringer's franchise taxes, corporate expenses, bonuses, capital stock tax, amortization of machine costs, bad accounts, interest, and other expenses were not allowable as deductions in computing profits from infringing product, where there was nothing in record to show that expenses were incurred in acquiring infringing machines or in producing their product. Horvath v. McCord Radiator & Mfg. Co., C.C.A.6 (Mich.) 1938, 100 F.2d 326, certiorari denied 60 S.Ct. 101, 308 U.S. 581, 84 L.Ed. 486, rehearing denied 60 S.Ct. 171, 308 U.S. 636, 84 L.Ed. 529. Patents 318(6)

Federal income tax actually paid by patent infringers was deductible from infringers' profits as item of expense, in accounting, where infringers acted in good faith. Duplate Corporation v. Triplex Safety Glass Co of North America, C.C.A.3 (Pa.) 1935, 81 F.2d 352, certiorari granted 56 S.Ct. 668, 297 U.S. 702, 80 L.Ed. 990, affirmed as modified on other grounds 56 S.Ct. 792, 298 U.S. 448, 80 L.Ed. 1274. Patents 318(6)

Deliberate test of patent under honest belief of right to manufacture devices subsequently adjudged infringements did not preclude deduction from profits of federal income taxes paid on account of profits attributable to infringement. Stromberg Motor Devices Co. v. Zenith-Detroit Corporation, C.C.A.2 (N.Y.) 1934, 73 F.2d 62, certiorari dismissed 55 S.Ct. 509, 294 U.S. 735, 79 L.Ed. 1263. Patents 318(6)

Whether, in accounting, infringer should be allowed to deduct from profits federal income taxes paid because of profits attributable to infringement, depends upon whether infringement was willful. Stromberg Motor Devices Co. v. Zenith-Detroit Corporation, C.C.A.2 (N.Y.) 1934, 73 F.2d 62, certiorari dismissed 55 S.Ct. 509, 294 U.S. 735, 79 L.Ed. 1263. See, also, Enterprise Ry. Equipment Co. v. Wine Ry. Appliance Co., C.C.A.Ohio 1935, 77 F.2d 159, reversed on other grounds 56 S.Ct. 528, 297 U.S. 387, 80 L.Ed. 736; Macbeth-Evans Glass Co. v. L. E. Smith Glass Co., C.C.A.Pa.1927, 23 F.2d 459. Patents 318(6)

In determining profits of patent infringement, entire amount of infringer's federal income taxes during infringing period should be deducted from net profits. Stromberg Motor Devices Co. v. Detroit Trust Co., C.C.A.7 (Ill.) 1930, 44 F.2d 958. Patents 318(6)

On an accounting by an infringer for profits, taxes and insurance premiums paid stand on the same footing as interest on capital invested and are allowable as charges against gross profits. Christensen v. National Brake & Elec. Co., D.C.Wis.1924, 10 F.2d 856.

Taxes and insurance premiums paid by an infringer are not usually allowable to him on an accounting for profits, but are so allowable where they were paid on a plant devoted solely to the infringing business, the entire profits of which have been awarded to the patent owner. Carborundum Co. v. Electric Smelting & Aluminum Co., C.C.A.3 (Pa.) 1913, 203 F. 976, 122 C.C.A. 276, certiorari denied 34 S.Ct. 323, 231 U.S. 754, 58 L.Ed. 467.

Prevailing patent holder was entitled to award of prejudgment interest calculated from date of first patent infringement to date of judgment, not date that patent holder's surviving successful theory of infringement was allegedly articulated. Informatica Corp. v. Business Objects Data Integration, Inc., N.D.Cal.2007, 489 F.Supp.2d 1075. Interest 39(2.20)

A corporation which was guilty of conscious and deliberate patent infringement and misappropriation of plaintiffs' trade secrets was not entitled to a deduction for income taxes paid in computing profits on sale of the product in question, as an element of damages. Carter Products, Inc. v. Colgate-Palmolive Co., D.C.Md.1963, 214 F.Supp. 383, 136 U.S.P.Q. 348, 136 U.S.P.Q. 577. Patents 319(1); Antitrust And Trade Regulation 437

In patentee's action against former employee, charged with contributory infringement of patents by designing and helping to build machines for competitor, special master, in determining employee's profits, consisting of sums paid to employee by competitors, properly disallowed credit for employee's income tax payments thereon. Conmar Products Corp. v. Tibony, E.D.N.Y.1945, 63 F.Supp. 372. Patents 318(6)

136. Damages beyond profits

Gains and profits are the proper measure of damages in equity suits, except where the injury sustained is plainly greater than the aggregate of what was made by the respondent, in which event the complainant is entitled to recover, in addition to profits, the damages he has sustained. Birdsall v. Coolidge, U.S.Nev.1876, 93 U.S. 64, 3 Otto 64, 23 L.Ed. 802. See, also, Expanded Metal Co. v. General Fireproofing Co., D.C.Ohio 1917, 247 F. 899; Metallic Rubber Tire Co. v. Hartford Rubber Works Co., D.C.Conn.1917, 245 F. 860; Williamantic Thread Co. v. Clark Thread Co., C.C.N.J.1886, 27 F. 865, reversed on other grounds 11 S.Ct. 847, 140 U.S. 481, 35 L.Ed. 521; Goldmark v. Kreling, C.C.Cal.1885, 25 F. 349, 355; Brady v. Atlantic Works, C.C.Mass.1878, Fed.Cas. No. 1,795, reversed on other grounds 2 S.Ct. 225, 107 U.S. 192, 27 L.Ed. 438; Carew v. Boston Elastic Fabric Co., C.C.Mass.1871, Fed.Cas. No. 2,397. Patents 318(2)

Damages may not be added to profits on same infringement, if given infringement constitutes single tort. Base- ball Display Co. v. Star Ballplayer Co., C.C.A.3 (N.J.) 1929, 35 F.2d 1. Patents 318(2)

Plaintiff's damages may exceed defendant's profits. Toledo Plate & Window Glass Co. v. Kawneer Mfg. Co., C.C.A.6 (Mich.) 1920, 262 F. 510.

Damages in addition to profits cannot be allowed, except on proof. Burdett v. Estey, C.C.Vt.1880, 3 F. 566, reversed on other grounds 3 S.Ct. 531, 109 U.S. 633, 27 L.Ed. 1058. See, also, Morss v. Union Form Co., C.C.Conn.1889, 39 F. 468.

Where plaintiff had patent on twine holder designed for use as component of knotter assembly on twine-tie balers, and defendant, which manufactured balers, used infringing twine holder as one of its component parts, plaintiff was entitled to accounting by defendant for its profits on sales of such balers, and plaintiff's damages

were not limited to a reasonable royalty upon his invention or profits which plaintiff would derive from lost sales which the infringement occasioned. England v. Deere & Co., S.D.Ill.1963, 221 F.Supp. 319, 138 U.S.P.Q. 608. Patents 319(1)

Where patent has been infringed, patentee is not limited to infringer's profits merely because infringer can prove its profits with reasonable certainty, but where profits are inadequate measure of patentee's damages court in equity suit may allow compensatory damages in addition to profits. Mathey v. United Shoe Machinery Corp., D.C.Mass.1944, 54 F.Supp. 694. Patents 318(2)

Under former §§ 67 and 70 of this title where a decree was entered for complainant, he may have recovered in addition to the profits, the damages he had sustained, and the court may in its discretion have assessed the same. Carew v. Boston Elastic Fabric Co, C.C.Mass.1871, 5 F.Cas. 49, No. 2397. See, also, Fox v. Knickerbocker En- graving Co., C.C.N.Y.1905, 140 F. 714; Social Register Ass'n v. Murphy, C.C.R.I1904, 129 F. 148; Wooster v. Trowbridge, C.C.N.Y.1902, 115 F. 722, affirmed 120 F. 667, 57 C.C.A. 129; Willimantic Thread Co. v. Clark Thread Co., C.C.N.J.1886, 27 F. 865, 866, reversed on other grounds 11 S.Ct. 846, 140 U.S. 481, 35 L.Ed. 521; Coburn v. Schroeder, C.C.N.Y.1881, 8 F. 521; Williams v. Rome, W. & O.R. Co., C.C.N.Y.1880, 2 F. 702. Pat- ents 318(2)

Where, on an accounting for damages and profits in an infringement suit, the profits made by defendant are in excess of complainant's damages, complainant is not entitled to recover damages in addition to profits. Expan- ded Metal Co. v. General Fireproofing Co., N.D.Ohio 1917, 247 F. 899, appeal dismissed 272 F. 1021. Patents 318(2)

137. Profits beyond damages

Before former §§ 67 and 70 of this title, courts of equity could not have allowed damage in addition to profits. City of Elizabeth v. American Nicholson Pavement Co., U.S.N.J.1877, 97 U.S. 126, 7 Otto 126, 24 L.Ed. 1000, motion denied 24 L.Ed. 1059. See, also, Williams v. Leonard, C.C.N.Y.1872, Fed.Cas. No. 17,726. Patents 318(2)

The patentee in infringement suit is not permitted to recover profits plus damages, but profits plus any damages in excess thereof. Goodyear Tire & Rubber Co. v. Overman Cushion Tire Co., C.C.A.6 (Ohio) 1937, 95 F.2d 978, certiorari dismissed 59 S.Ct. 459, 306 U.S. 665, 83 L.Ed. 1061, certiorari dismissed 59 S.Ct. 460, 306 U.S. 665, 83 L.Ed. 1061. See, also, Mathey v. United Shoe Machinery Corporation, D.C.Mass.1944, 54 F.Supp. 694. Patents 318(2)

Acceptance of general damages for willful infringement of patent rights by manufacturing and selling patented coal cleaning tables, precludes recovery of profits made by buyers through use of tables. Sutton, Steele & Steele v. Gulf Smokeless Coal Co., S.D.W.Va.1933, 6 F.Supp. 419. Patents 318(2)

Assignee or exclusive licensee may recover not only the damage to himself, but the profit to the infringer. Man- ning v. Galland-Henning Pneumatic Malting Drum Mfg. Co., Wis.1910, 124 N.W. 291, 141 Wis. 199, 18 Am.Ann.Cas. 976.

138. Nominal damages

Only nominal damages will be allowed where it appears that other methods in common use produce the same

results with equal facility and cost. Black v. Thorne, U.S.N.Y.1884, 4 S.Ct. 326, 111 U.S. 122, 28 L.Ed. 372. Patents 319(2)

Mere proof of the infringement of a patent right entitles the plaintiff to no more than nominal damages and the plaintiff must prove proper data if he would recover more. Mayor, Aldermen and Commonalty of City of New York v. Ransom, U.S.N.Y.1859, 64 U.S. 487, 23 How. 487, 16 L.Ed. 515. See, also, Coupe v. Royer, Mass.1895, 15 S.Ct. 199, 155 U.S. 565, 39 L.Ed. 263; Dobson v. Dornan, Pa.1886, 6 S.Ct. 946, 949, 118 U.S. 10, 30 L.Ed. 63; City of Boston v. Allen, Mass.1898, 91 F. 248, 33 C.C.A. 485; City of Seattle v. McNamara, Wash.1897, 81 F. 863, 26 C.C.A. 652; National Car Brake Shoe Co. v. Terre Haute Car & Mfg. Co., C.C.Ind.1884, 19 F. 514; Poppenhusen v. New York Gutta-Percha Comb Co., C.C.N.Y.1858, Fed.Cas. No. 11,283; Rollhaus v. McPherson, C.C.N.Y.1855, Fed.Cas. No. 12,026. Patents 275

Although patent owner in appropriate circumstances may be able to recover lost profits attributable to each of series of infringers, reasonable royalty as measure of damages arising from infringement is not to be separately calculated against each successive infringer; once full recovery is obtained from one infringer with respect to particular infringing device, at most nominal additional damages may be awarded against another with respect to same device. Stickle v. Heublein, Inc., C.A.Fed.1983, 716 F.2d 1550, 219 U.S.P.Q. 377, on remand 590 F.Supp. 630, 224 U.S.P.Q. 910. Patents 319(1); Patents 319(2)

Evidence on damages with respect to counterclaim by alleged infringer against patentholder on the common law claim of unfair competition was too speculative to support any greater award than merely nominal damages. Colortronic Reinhard & Co., K.G. v. Plastic Controls, Inc., C.A.1 (Mass.) 1981, 668 F.2d 1, 213 U.S.P.Q. 801. Antitrust And Trade Regulation 110(2)

Under former § 70 of this title when United States district court found that defendants' infringing use of plaintiff's patented beer cooler had been worth seventy-five cents per day, entry of judgment for only nominal damages had been improper, but judgment should have been at rate of seventy-five cents per day for period of infringement. Middleton v. Wiley, C.A.8 (Mo.) 1952, 195 F.2d 844, 93 U.S.P.Q. 77.

An infringer could not dispute right to more than nominal damages for patent infringement on ground that patented improvement was of only nominal value in view of infringer's use of improvement and advertisements pro- claiming its advantages. Enterprise Mfg. Co. v. Shakespeare Co., C.C.A.6 (Mich.) 1944, 141 F.2d 916. Patents 319(2)

Only nominal damages could be awarded for patent infringement, in view of evidence as to damages or profits. American Can Co. v. Goldee Mfg. Co., E.D.N.Y.1927, 31 F.2d 492, affirmed 31 F.2d 494. Patents 319(2)

Accounting will not be limited to nominal damages because of delay acquiesced in by defendant. Hitchcock v. Valley Camp Coal Co, W.D.Pa.1928, 29 F.2d 426. Patents 319(2)

Where, in a suit for patent infringement, the case was one calling for an apportionment of profits, but complainant made no effort to prove the amount of profits reasonably attributable to the infringement, relying on the position that it was entitled to recover the entire profits made by defendant from the sale of certain refrigerator cars containing the infringement, complainant could only recover nominal damages. Seeger Refrigerator Co v. Amer- ican Car & Foundry Co, D.C.N.J.1914, 212 F. 742, reversed on other grounds 219 F. 565, 135 C.C.A. 333.

In an action at law where validity, title, and infringement are proved, plaintiff is entitled to recover at least nom-

inal damages. Reis v. Rosenfeld, C.C.A.2 (N.Y.) 1913, 204 F. 282, 122 C.C.A. 480.

In the settlement of the account between a patentee and infringer, the former is entitled only to nominal damages wherever he fails to show the value of his patented improvement. Force v. Sawyer-Boss Mfg. Co., C.C.A.2 (N.Y.) 1906, 143 F. 894, 75 C.C.A. 102, certiorari denied 26 S.Ct. 766, 202 U.S. 621, 50 L.Ed. 1175. See, also, Schillinger v. Gunther, C.C.N.Y.1878, Fed.Cas. No. 12,457.

In an action at law for infringement of a patent containing two claims, if the evidence shows that the patent is valid as respects one claim only, and the plaintiff has established no license fee for the separate use of the device covered by such claim, he can recover only nominal damages. Hunt Bros. Fruit Packing Co. v. Cassidy, C.C.A.9 (Cal.) 1892, 53 F. 257, 3 C.C.A. 525. See, also, Moffitt v. Cavanagh, C.C.N.Y.1886, 27 F. 511, 512; Proctor v. Brill, C.C.Pa.1880, 4 F. 415.

Only nominal damages of one dollar were appropriate for pharmaceutical company's unauthorized import of ge- netically engineered cells made by patented process into United States; cells had been frozen and unused, pursuant to injunction in related infringement litigation. Trustees of Columbia University in City of New York v. Roche Diagnostics GmbH, D.Mass.2002, 272 F.Supp.2d 90. Patents 319(2)

Patent holder was entitled to mere nominal royalty as damages for defendants' infringement, where patent holder was never forced to share sales of its patented conveyor given complete lack of evidence that defendants had ever sold their infringing product. Serpentix Conveyor Corp. v. Roth, D.Colo.1989, 726 F.Supp. 282, 15 U.S.P.Q.2d 1074. Patents 218(1)

Where substitute fluxes were available during second period of infringement and such substitute fluxes were completely interchangeable with patented and patent-infringing fluxes, only nominal damages could be awarded for such period of infringement. Union Carbide Corp. v. Graver Tank & Mfg. Co., N.D.Ind.1963, 243 F.Supp. 358, 145 U.S.P.Q. 446, affirmed in part , reversed in part 345 F.2d 409, 145 U.S.P.Q. 240. Patents 319(2)

If a plaintiff neglected to prove that his patented article had been stamped, or that he had given to the infringer the notice required by former § 49 of this title [now § 287 of this title], a jury could not have awarded him more than nominal damages. McComb v. Brodie, C.C.La.1872, 15 F.Cas. 1290, No. 8708. Patents 275

Burden rests on complainant to separate or apportion damages and profits between patented and unpatented features, and, in absence of reliable and tangible evidence to sustain such burden, he is entitled to recover only nominal damages and profits. Garretson v. Clark, C.C.N.Y.1878, 10 F.Cas. 40, No. 5248, affirmed 4 S.Ct. 291, 111 U.S. 120, 28 L.Ed. 371. See, also, Robertson v. Blake, N.Y.1877, 94 U.S. 728, 24 L.Ed. 245; Kansas City Hay Press Co. v. Devol, C.C.Mo.1904, 127 F. 363, appeal dismissed 137 F. 1019; Williams v. McNeely, C.C.Pa.1896, 77 F. 894; Tuttle v. Haylord, C.C.N.Y.1886, 28 F. 97; Kirby v. Armstrong, C.C.Ind.1881, 5 F. 801.

Where information is not furnished by the evidence upon which an estimate of the profits or damages can be based by the master, the recovery of nominal profits or damages only should be reported by him. Fisk v. West Bradley & Cary Mfg. Co., C.C.N.Y.1880, 9 F.Cas. 168, No. 4830A. See, also, Fischer v. Hayes, C.C.N.Y.1889, 39 F. 613; Kirby v. Armstrong, C.C.Ind.1881, 5 F. 801.

Only nominal damages should be granted for the making of a patented article merely, without either selling or using it. Carter v. Baker, C.C.Cal.1871, 5 F.Cas. 195, 1 Sawy. 512, No. 2472. See, also, Hogg v. Emerson,

N.Y.1850, 11 How. 587, 13 L.Ed. 824; Whittemore v. Cutter, C.C.Mass.1813, 1 Gall. 429, 478, Fed.Cas. Nos. 17,600, 17,601.

Where the thing patented was made by one in the employ of another, without knowledge of its having been patented, nominal damages only should be given in an action at law. Bryce v. Dorr, C.C.Mich.1845, 4 F.Cas. 521, 3 McLean 582, No. 2070. Patents 275

Only nominal damages may be recovered in the absence of sufficient proof. Calkins v. Bertrand, C.C.N.D.Ill.1881, 8 F. 755, 10 Biss. 445. See, also, New York v. Ransom, N.Y.1860, 23 How. 487, 16 L.Ed. 515; Spaulding v. Tucker, C.C.Cal.1869, Deady, 649, Fed.Cas. No. 13,220; Conover v. Rapp, C.C.N.Y.1859, 4 Fish.Pat.Cas. 57, Fed.Cas. No. 3,124; Burdell v. Denig, C.C.Ohio 1865, 2 Fish.Pat.Cas. 588, Fed.Cas. No. 2,142; Whittemore v. Cutter, C.C.Mass.1813, 1 Gall. 429, Fed.Cas. No. 17,601.

139. Excessive damages

Award to plaintiff of $75,000,000 in compensatory damages and one dollar in punitive damages in case involving claims relating to patent for method of melting metal by magnetic forces and confidentiality agreement was clearly excessive and could not be sustained. Proler v. Modern Equipment Co., E.D.Wis.1985, 602 F.Supp. 1388, 225 U.S.P.Q. 1244. Damages 140; Patents 319(1)

140. Royalty fees, damages--Generally

Upon infringement, royalty, whether upon established or reasonable basis, is appropriate compensation for breach of plaintiff's monopoly, no matter upon how many bases that monopoly rests. Firestone Tire & Rubber Co. v. U.S. Rubber Co., C.C.A.6 (Ohio) 1935, 79 F.2d 948, certiorari denied 56 S.Ct. 945, 298 U.S. 679, 80 L.Ed. 1399, certiorari denied 56 S.Ct. 946, 298 U.S. 679, 80 L.Ed. 1399. See, also, Reo Motor Car Co. v. Gear Grinding Mach. Co., C.C.A.Mich.1930, 42 F.2d 965, rehearing denied 50 F.2d 412. Patents 319(1)

In ascertaining damages allowable for infringement of patent, proof of established royalty is evidence of value of what has been taken and in absence of such proof court must determine a reasonable royalty compensating patentees for value of what has been taken wrongfully and such proof, though it may be difficult to produce, is admissible. Activated Sludge v. Sanitary Dist. of Chicago, N.D.Ill.1946, 64 F.Supp. 25, 68 U.S.P.Q. 137, affirmed 157 F.2d 517, 71 U.S.P.Q. 316, certiorari denied 67 S.Ct. 970, 330 U.S. 834, 91 L.Ed. 1281, 72 U.S.P.Q. 529, rehearing denied 67 S.Ct. 1092, 330 U.S. 856, 91 L.Ed. 1297, 72 U.S.P.Q. 529, rehearing denied 67 S.Ct. 1347, 331 U.S. 866, 91 L.Ed. 1870. Patents 319(1)

Where a patent has been infringed, holder gets his own lost profits; however when those cannot be established patent holder is entitled to a reasonable royalty. Universal Athletic Sales Co. v. American Gym, W.D.Pa.1979, 480 F.Supp. 408, 205 U.S.P.Q. 840. Patents 318(1); Patents 319(1)

Damages for infringement of patent may be ascertained on basis of reasonable royalty, in absence of exact method of computation showing losses suffered. Standard Brands v. Federal Yeast Corporation, D.C.Md.1930, 38 F.2d 314. See, also, Mathey v. United Shoe Machinery Corporation, D.C.Mass.1944, 54 F.Supp. 694. Patents 319(1)

Damages for patent infringement should be based on apportionment of profits if possible, but, if this is impossible, may be based on reasonable royalty, after consideration of nature of invention, its utility and advant-

ages, and extent of use involved. Enterprise Mfg. Co. v. Shakespeare Co., C.C.A.6 (Mich.) 1944, 141 F.2d 916. Patents 319(1)

Where it appears that either actual damages of patentee or profits of infringer are not susceptible of calculation with reasonable certainty, court on evidence may award reasonable sum as general damages which may be determined by opinion evidence or fixed by way of reasonable royalty when there is no established royalty. Math- ey v. United Shoe Machinery Corp., D.C.Mass.1944, 54 F.Supp. 694. See, also, Hughes Tool Co. v. G. W. Murphy Industries, Inc., C.A.Tex.1973, 491 F.2d 923. Patents 319(1)

In awarding damages in patent infringement case, any reasonable royalty rate determined by trier of fact must be supported by relevant evidence on the record; court may also award increased damages, attorney fees, and prejudgment interest when appropriate. Unisplay, S.A. v. American Electronic Sign Co., Inc., C.A.Fed. (Wash.) 1995, 69 F.3d 512, 36 U.S.P.Q.2d 1540, rehearing denied , in banc suggestion declined. Interest 39(2.20); Patents 319(1); Patents 319(3); Patents 325.11(2.1)

In patent infringement, when the royalty method is adopted in ascertaining damages, all that is expected is a reasonable approximation and the determination involves a consideration of varying factors, and if the trier determines damages according to some accepted basis not inherently unfair, it will be sustained. Elrick Rim Co. v. Cheek, S.D.Cal.1961, 195 F.Supp. 496, 131 U.S.P.Q. 8. Patents 319(1)

A successful patentee in a patent infringement suit is entitled either to an established royalty rate, if there is one, or, if not, a reasonable royalty rate. Beatty Safway Scaffold Co. v. Up-Right, Inc., C.A.9 (Or.) 1962, 306 F.2d 626, 134 U.S.P.Q. 379, certiorari denied 83 S.Ct. 881, 372 U.S. 934, 9 L.Ed.2d 766, 136 U.S.P.Q. 679. Patents 275

In awarding reasonable royalty for use made of invention by patent infringer, amount of royalty should be that amount which adequately compensates for infringement. Stickle v. Heublein, Inc., C.A.Fed.1983, 716 F.2d 1550, 219 U.S.P.Q. 377, on remand 590 F.Supp. 630, 224 U.S.P.Q. 910. Patents 319(1)

In absence of showing that patent holder lost sales as direct result of defendant's infringement, damages must be measured by reasonable royalty, together with interest and costs. Wayne-Gossard Corp. v. Moretz Hosiery Mills, Inc., W.D.N.C.1976, 447 F.Supp. 12, 199 U.S.P.Q. 87, affirmed 573 F.2d 191, 200 U.S.P.Q. 12. Patents 319(1); Patents 319(4)

141. ---- Factors, royalty fees, damages

To guide the royalty determination, a court considers: (1) royalties received by patentee for licensing of patent in suit, proving or tending to prove an established royalty; (2) rates paid by licensee for use of other patents comparable to patent in suit; (3) nature and scope of license, as exclusive or non-exclusive, or as restricted or non- restricted in terms of territory or with respect to whom manufactured product may be sold; (4) licensor's established policy and marketing program to maintain his patent monopoly by not licensing others to use invention or by granting licenses under special conditions designed to preserve that monopoly; (5) commercial relationship between licensor and licensee; (6) effect of selling patented specialty in promoting sales of other products of licensee, existing value of invention to licensor as a generator of sales of his non-patented items, and extent of such derivative or convoyed sales; (7) duration of patent and term of license; (8) established profitability of product made under patent, its commercial success, and its current popularity; (9) utility and advantages of patent property over old modes or devices, if any, that had been used for working out similar results; (10) nature of

patented invention, character of commercial embodiment of it as owned and produced by licensor, and benefits to those who have used invention; (11) extent to which infringer has made use of invention, and any evidence probative of value of that use; (12) portion of profit or of selling price that may be customary in particular business or in comparable businesses to allow for use of invention or analogous inventions; (13) portion of realizable profit that should be credited to invention as distinguished from non-patented elements, manufacturing process, business risks, or significant features or improvements added by infringer; (14) opinion testimony of qualified experts; and (15) amount that licensor and licensee would have agreed upon at time infringement began if both had been reasonably and voluntarily trying to reach an agreement. ResQNet.com, Inc. v. Lansa, Inc., S.D.N.Y.2008, 533 F.Supp.2d 397, adhered to on reconsideration 2008 WL 4376367. Patents 319(1)

Sales projections that were unavailable at the time infringement of patent began could be used as a royalty base to calculate damages in infringement action. Honeywell Intern., Inc. v. Hamilton Sundstrand Corp., D.Del.2005, 378 F.Supp.2d 459. Patents 319(1)

Damage award for infringement of e-commerce patents, which was 3.5 times amount patentee's expert had opined as reasonable royalty, was supported by substantial evidence; jury was entitled to consider additional factors in determining what amount of damages would compensate patentee. Mercexchange, L.L.C. v. eBay, Inc., E.D.Va.2003, 275 F.Supp.2d 695, affirmed in part , reversed in part 401 F.3d 1323, 74 U.S.P.Q.2d 1225, rehearing and rehearing en banc denied , certiorari granted 126 S.Ct. 733, 546 U.S. 1029, 163 L.Ed.2d 567, vacated and remanded 126 S.Ct. 1837, 547 U.S. 388, 164 L.Ed.2d 641, 78 U.S.P.Q.2d 1577, on remand 188 Fed.Appx. 993, 2006 WL 2036554. Patents 312(10)

“Reasonable royalty,” for purpose of calculating damages from patent infringement, is that amount which person wishing to manufacture patented product would be willing to pay as royalty while still making reasonable profit on product. Novo Industries, L.P. v. Micro Molds Corp., S.D.Fla.2002, 239 F.Supp.2d 1282, reversed 350 F.3d 1348, 69 U.S.P.Q.2d 1128. Patents 318(4.1)

Amount of reasonable royalty after infringement turns on facts of each case, including what plaintiff's property is, to what extent defendant has taken it, its usefulness and commercial value as shown by its advantages and extent of its use and commercial situation. McDermott v. Omid Intern., S.D.Ohio 1988, 723 F.Supp. 1228, 13 U.S.P.Q.2d 1147, motion to vacate denied 13 U.S.P.Q.2d 1153, affirmed 883 F.2d 1026. Patents 319(1)

In determining reasonable royalty rate to be awarded to patentee as compensation for infringement, court should consider factors including rates paid for comparable licenses, patent holder's licensing policy, commercial relationship between patent holder and infringer, effect of selling patented product on sales of other products, profitability of patented product, and opinion testimony from qualified experts. GNB Battery Technologies, Inc. v. Exide Corp., D.Del.1995, 886 F.Supp. 420, affirmed 78 F.3d 605, 38 U.S.P.Q.2d 1506. Patents 319(1)

Among factors reviewed in determining reasonable royalty which patent owner may recover for infringement are number of competitors in market, size of market, patent owner's research investment, remaining life of patent, and significance of advance made by patented invention in field. Ristvedt-Johnson, Inc. v. Brandt, Inc., N.D.Ill.1992, 805 F.Supp. 557. Patents 319(1)

Reasonable royalty must be determined from proofs of acceptance, utility, value, and demand, and on hypothesis that patent as valid and would be respected. General Motors Corp. v. Dailey, C.C.A.6 (Mich.) 1937, 93 F.2d 938. See, also, General Motors Corporation v. Blackmore, C.C.A.Mich.1931, 53 F.2d 725. Patents 319(1)

Elements necessary to determination of reasonable royalty as compensation for patent infringement were patentee's actual profit margin at time infringement commenced and the customary profit allowed licensees in industry; additional factors to be considered in the instant case were lack of acceptable noninfringing substitutes, patentee's unvarying policy of not licensing its patent future business and attendant profit patentee would expect to lose by licensing a competitor, and fact that infringed patent gave the entire marketable value to the infringed product. Panduit Corp. v. Stahlin Bros. Fibre Works, Inc., C.A.6 (Mich.) 1978, 575 F.2d 1152, 197 U.S.P.Q. 726. Patents 319(1)

Factors relevant to determination of reasonable royalty are: royalties received from licensing patent; rates paid to licensee for use of comparable patents; exclusivity of license; licensor's patent licensing policy; competitive relationship of parties; beneficial effect of sales of patented products on other sales; duration of patent protection and terms of license; profitability of product manufactured under patent; advantage of patent over prior art processes or devices; nature of patented invention and benefits to infringer; extent infringer has made use of invention; customary profits in industry; portion of profits that are related to patented elements of product; expert testimony; and amount prudent licensee would have been willing to pay for license and yet make reasonable profit and amount prudent licensor would have willing to accept. Total Containment, Inc. v. Environ Products, Inc., E.D.Pa.1995, 921 F.Supp. 1355, affirmed in part , vacated in part 106 F.3d 427. Patents 318(3)

Court, in fixing royalty, may base its finding on evidence showing nature of invention, its utility and advantages. Dunkley Co. v. Central California Canneries, C.C.A.9 (Cal.) 1925, 7 F.2d 972, certiorari denied 46 S.Ct. 347, 270 U.S. 646, 70 L.Ed. 778. See, also, Hartford Nat. Bank & Trust Co. v. E. F. Drew & Co., D.C.Del.1960, 188 F.Supp. 353, affirmed 290 F.2d 589, certiorari denied 82 S.Ct. 45, 368 U.S. 825, 7 L.Ed.2d 29; Mathey v. United Shoe Machinery Corporation, D.C.Mass.1944, 54 F.Supp. 694. Patents 319(1)

142. ---- Reasonable royalty fees, damages

Evidence was sufficient at trial on patentee's claims that game manufacturer infringed patent on polyhedral dice to support reasonable royalty award; patentee presented his own testimony, testimony of game manufacturer's senior director of research and development, and testimony of manufacturer's vice president of product engineering to determine reasonable royalty. Bowling v. Hasbro, Inc., D.R.I.2008, 582 F.Supp.2d 192. Patents 312(10)

Competitor did not waive its Seventh Amendment right to jury trial regarding reasonable royalty rate merely by remaining silent when court made single statement about possibility of post-trial damages award, after patent owner waived its jury trial right regarding reasonable royalty rate when it had been given clear choice between putting on infringement damages evidence and foregoing its Seventh Amendment right and it chose to rely entirely on evidence of reasonable royalty rate in context of other patents. Boston Scientific Corp. v. Johnson & Johnson, N.D.Cal.2008, 550 F.Supp.2d 1102. Jury 28(5)

Royalty rate of 12.5% was reasonable, for competitor's infringement of patent on screen recognition software used to facilitate terminal emulation, where percentage was obtained by taking into account differences between patent owner's actual licenses and hypothetical license between competitor and owner. ResQNet.com, Inc. v. Lansa, Inc., S.D.N.Y.2008, 533 F.Supp.2d 397, adhered to on reconsideration 2008 WL 4376367. Patents 319(1)

Holder of a patent for a thermal/jersey fabric established a reasonable royalty rate of 8 percent of the retail price of infringing garments, for purposes of a damages award; the holder tendered substantial evidence through its

expert, in response to which the infringer tendered no expert analysis showing what it believed constituted a reasonable royalty. Domestic Fabrics Corp. v. Sears, Roebuck & Co., E.D.N.C.2003, 325 F.Supp.2d 612, appeal dismissed in part 88 Fed.Appx. 407, 2004 WL 346126, order recalled and vacated 90 Fed.Appx. 409, 2004 WL 557611, subsequent determination 326 F.Supp.2d 694, dismissed 122 Fed.Appx. 518, 2005 WL 545714. Patents 312(10)

In event that lost profits cannot be calculated, reasonable royalty damages represent floor of possible damages for patent infringement. DSU Medical Corp. v. JMS Co., Ltd., N.D.Cal.2003, 296 F.Supp.2d 1140. Patents 319(1)

Generally approved approach to determining reasonable royalty damages for patent infringement is by way of hypothetical negotiation between patentee and infringer. DSU Medical Corp. v. JMS Co., Ltd., N.D.Cal.2003, 296 F.Supp.2d 1140. Patents 319(1)

Reasonable royalty damages, payable for infringement of patent for carrier structure for vertical window blind assembly, were $41,622.50. Novo Industries, L.P. v. Micro Molds Corp., S.D.Fla.2002, 239 F.Supp.2d 1282, reversed 350 F.3d 1348, 69 U.S.P.Q.2d 1128. Patents 319(1)

Documents relating to losses caused by recalls of allegedly ancillary products were discoverable and relevant to patent holder's claim for reasonable royalty on patents which related to hemiodialysis machines and their various features, since patent holder also claimed correlation between sales of hemodialysis machines and sale of disposable commodities, and patent holder sought to have sales of disposable commodities considered in determination of reasonable royalty. Fresenius Medical Care Holding Inc. v. Baxter Intern., Inc., N.D.Cal.2004, 224 F.R.D. 644. Patents 292.3(2)

Reasonable royalty damages for discount retailer's infringement of patent for remote controlled portable searchlight were $31.80 per infringing unit, which was half of patentee's per unit profit. Golight, Inc. v. Wal-Mart Stores, Inc., D.Colo.2002, 216 F.Supp.2d 1175, affirmed 355 F.3d 1327, 69 U.S.P.Q.2d 1481, rehearing en banc denied. Patents 319(1)

Under hypothetical license approach, “reasonable royalty” damages for patent infringement are defined as amount that willing licensor and willing licensee would have agreed upon if both had been reasonably and voluntarily trying to reach agreement at time when infringement began. Micro Chemical, Inc. v. Lextron, Inc., D.Colo.2001, 161 F.Supp.2d 1187, reversed in part , vacated in part 318 F.3d 1119, 65 U.S.P.Q.2d 1695, rehearing denied. Patents 319(1)

Reasonable patent royalty is determined by applying “willing buyer-willing seller” test; reasonable royalty is amount that two free uncoerced bargainers would have agreed upon as of the date when infringement began. Medtronic, Inc. v. Catalyst Research Corp., D.C.Minn.1982, 547 F.Supp. 401, 216 U.S.P.Q. 687. Patents 319(1)

Application of the “willing buyer-willing seller” rule in apportioning damages in an infringement action involves a determination of the reasonable market value of a license under subject patent and a resolution of such issues as what would defendant, as a prospective willing buyer, have been willing to pay for license, and what would plaintiff, as a prospective willing seller, have been willing to accept. Ellipse Corp. v. Ford Motor Co., N.D.Ill.1978, 461 F.Supp. 1354, 201 U.S.P.Q. 455, affirmed 614 F.2d 775, certiorari denied 100 S.Ct. 2160, 446 U.S. 939, 64 L.Ed.2d 792, 206 U.S.P.Q. 288. Patents 319(1)

A “reasonable royalty” as measure of recovery for infringement of design patent is a legal fiction resorted to upon a failure of proof as to an established royalty or other general damages, and is made the minimum limit of recovery, and such legal fiction envisions that royalty agreement is operative ab initio, and if defendant is required to pay a royalty for right to make, use and sell, he is not then to be deprived of his profits earned from such making, using and selling, and if infringer is to be deprived of its profits for unlawfully making, using, and selling, it is not to be charged a royalty for such making, using and selling which has availed it nothing. Sel- O-Rak Corp. v. Henry Hanger & Display Fixture Corp. of America, S.D.Fla.1958, 159 F.Supp. 769, 117 U.S.P.Q. 245, affirmed 270 F.2d 635, 123 U.S.P.Q. 3. Patents 319(1)

“Reasonable royalty,” recoverable for patent infringement, is amount a person, desiring to manufacture, use, or sell the patented invention as a business proposition, would be willing to pay as a royalty and yet be able to make, use or sell the patented article, in the market, at a reasonable profit; it is a hypothetical royalty resulting from arm's length negotiations between willing licensor and willing licensee. Trilogy Communications, Inc. v. Comm Scope Co., W.D.N.C.1990, 754 F.Supp. 468, 18 U.S.P.Q.2d 1177, vacated , appeal dismissed. Patents 319(1)

Reasonable royalty payable by firm which purchased infringing display units after rejecting purchase of patent holder's units as being too expensive, in the situation in which buyer was the only firm interested in purchasing such display units, was determined by the maximum amount purchaser would have paid for such units and then employing the usual mark up of patent holder as a reasonable means to gauge its profits. Trans-World Mfg. Corp. v. Al Nyman & Sons, Inc., D.Del.1986, 633 F.Supp. 1047, 229 U.S.P.Q. 873. Patents 319(1)

A “reasonable royalty” is that amount which the trier of facts estimates a person desiring to use a patent right would be willing to pay for its use and a patent owner desiring to license the patent would be willing to accept. University Computing Co. v. Lykes-Youngstown Corp., C.A.5 (Ga.) 1974, 504 F.2d 518, 183 U.S.P.Q. 705, rehearing denied 505 F.2d 1304. Patents 218(5)

A “reasonable royalty”, for purposes of determining measure of damages, is that which a manufacturer who desires to use patented device would be willing to pay as royalty for its use. Randolph Laboratories v. Specialties Development Corp., C.A.3 (N.J.) 1954, 213 F.2d 873, 102 U.S.P.Q. 140, certiorari denied 75 S.Ct. 91, 348 U.S. 861, 99 L.Ed. 678, 103 U.S.P.Q. 424, certiorari denied 75 S.Ct. 91, 348 U.S. 861, 99 L.Ed. 678, 103 U.S.P.Q. 425. Patents 319(1)

In fixing damages on a reasonable royalty basis against an infringer, the sum allowed should be reasonable and that which would be accepted by prudent person who wished to obtain a license but was not compelled to do so and a prudent patentee who wished to grant a license but was not compelled to do so. Reynolds Spring Co. v. L.A. Young Industries, C.C.A.6 (Mich.) 1939, 101 F.2d 257. See, also, Union Carbide Corp. v. Graver Tank & Mfg. Co., C.A.Ind.1960, 282 F.2d 653, certiorari denied 81 S.Ct. 692, 695, 365 U.S. 812, 5 L.Ed.2d 691, on remand 243 F.Supp. 358. Patents 319(1)

In every case having involved the determination of reasonable royalties for patent infringement under former § 70 of this title the court should have sifted the evidence and placed its determination on something tangible if it could have been found in the record in order to avoid an arbitrary conclusion. Horvath v. McCord Radiator & Mfg. Co., C.C.A.6 (Mich.) 1938, 100 F.2d 326, certiorari denied 60 S.Ct. 101, 308 U.S. 581, 84 L.Ed. 486, rehearing denied 60 S.Ct. 171, 308 U.S. 636, 84 L.Ed. 529. Patents 312(10)

A “reasonable royalty” in patent infringement suit is an amount which a person desiring to manufacture and sell

a patented article as a business proposition would be willing to pay as a royalty and yet be able to make and sell the patented article in the market at a reasonable profit. Goodyear Tire & Rubber Co. v. Overman Cushion Tire Co., C.C.A.6 (Ohio) 1937, 95 F.2d 978, certiorari dismissed 59 S.Ct. 459, 306 U.S. 665, 83 L.Ed. 1061, certiorari dismissed 59 S.Ct. 460, 306 U.S. 665, 83 L.Ed. 1061. See, also, Faulkner v. Gibbs, C.A.Cal.1952, 199 F.2d 635; Horvath v. McCord Radiator & Mfg. Co., C.C.A.Mich.1938, 100 F.2d 326, certiorari denied 60 S.Ct. 101, 308 U.S. 581, 84 L.Ed. 486, rehearing denied 60 S.Ct. 171, 308 U.S. 636, 84 L.Ed. 527; Rockwood v. General Fire Extinguisher Co., C.C.A.N.Y.1930, 37 F.2d 62; Ebrick Rim Co. v. Cheek, D.C.Cal.1961, 195 F.Supp. 496; Mathey v. United Shoe Machinery Corporation, D.C.Mass.1944, 54 F.Supp. 694. Patents 319(1)

“Reasonable royalty” awarded as patent damages should be based upon amount that willing licensor and willing licensee would have agreed upon during hypothetical negotiation at time infringement began, if both parties had been reasonably and voluntarily trying to reach agreement; in hypothetical negotiation, patent is assumed to be valid and infringed. Schneider (Europe) AG v. SciMed Life Systems, Inc., D.Minn.1994, 852 F.Supp. 813, appeal dismissed 26 F.3d 140, affirmed 60 F.3d 839, 39 U.S.P.Q.2d 1596, rehearing denied, in banc suggestion declined , certiorari denied 116 S.Ct. 520, 516 U.S. 990, 133 L.Ed.2d 427. Patents 319(1)

Patent holder was entitled to damages in the amount of reasonable royalty for use made of invention by infringer, together with interest and costs; reasonable royalty is the amount of money which the owner of the patent would accept to license his patent and the amount a person would be willing to pay for the license, but the setting of reasonable royalty after infringement cannot be treated as the equivalent of ordinary royalty negotiations among truly willing patent owners and licensees. Conopco, Inc. v. May Dept. Stores Co., E.D.Mo.1992, 784 F.Supp. 648, 24 U.S.P.Q.2d 1721, amended 797 F.Supp. 740, reversed 46 F.3d 1556, 32 U.S.P.Q.2d 1225, rehearing denied, in banc suggestion declined , certiorari denied 115 S.Ct. 1724, 514 U.S. 1078, 131 L.Ed.2d 582. Patents 319(1); Patents 319(4); Patents 325.1

143. ---- Actual royalties, royalty fees, damages

Appropriate damages for foreign pharmaceutical company's inducement of third party to produce bulk drug, in infringement of genetic engineering patent, was three percent royalty patentee was receiving from others for right to produce bulk drug. Trustees of Columbia University in City of New York v. Roche Diagnostics GmbH, D.Mass.2002, 272 F.Supp.2d 90. Patents 319(1)

Plaintiffs whose patent for fruit picker's crane was infringed were entitled to damages equivalent to a reasonable royalty measured by royalties which the various manufacturing firms paid to plaintiffs for use of their invention. FMC Corp. v. McCabe-Powers Body Co., S.D.Cal.1965, 237 F.Supp. 1018, 144 U.S.P.Q. 294. Patents 319(1)

Diminished royalty rate to which patentee was driven in individual cases by disrepute of patent and open defi- ance of right is not true measure of “reasonable royalty,” where no established royalty is shown. General Motors Corp. v. Blackmore, C.C.A.6 (Mich.) 1931, 53 F.2d 725. See, also, General Motors Corporation v. Dailey, C.C.A.Mich.1938, 93 F.2d 938; Georgia-Pacific Corp. v. U.S. Plywood Corp., D.C.N.Y.1970, 318 F.Supp. 1116, modified on other grounds 446 F.2d 295, certiorari denied 92 S.Ct. 105, 404 U.S. 870, 30 L.Ed.2d 114. Patents 319(1)

In determining a reasonable royalty for a license to use patented invention, it is improper to give substantial evidentiary weight to existing license agreements having a royalty rate which was arrived at under conditions of open, industrywide infringement and lack of respect for the patent; and this is true even if application of the

reasonable royalty thus determined would not allow defendant a reasonable profit from the infringing activity. Tights, Inc. v. Kayser-Roth Corp., M.D.N.C.1977, 442 F.Supp. 159, 196 U.S.P.Q. 750. Patents 319(1)

District court did not err in awarding successful patentee in patent infringement suit royalty payments at rate published in Patent and Trademark Office, which was rate included in most contracts for use of the design. Armco, Inc. v. Republic Steel Corp., C.A.6 (Ohio) 1983, 707 F.2d 886, 219 U.S.P.Q. 397. Patents 319(1)

When actual license rate is artificially low, a reasonable royalty may be set above that rate in calculating damages for patent infringement; nevertheless, the actual license rate is an important factor in determining reasonable royalty, at least when those royalties prove or tend to prove an established royalty. Trio Process Corp. v. L. Goldstein's Sons, Inc., C.A.3 (Pa.) 1980, 612 F.2d 1353, 204 U.S.P.Q. 881, certiorari denied 101 S.Ct. 91, 449 U.S. 827, 66 L.Ed.2d 30, 207 U.S.P.Q. 1064, mandate clarified 638 F.2d 661. Patents 319(1)

144. ---- Absence of proof, royalty fees, damages

Where holder of infringed patent could prove no damages because he was not in business either directly or through licensees, holder was entitled only to reasonable royalties for use of his invention. Foster v. American Mach. & Foundry Co., C.A.2 (N.Y.) 1974, 492 F.2d 1317, 182 U.S.P.Q. 1, certiorari denied 95 S.Ct. 58, 419 U.S. 833, 42 L.Ed.2d 59, 183 U.S.P.Q. 321, rehearing denied 95 S.Ct. 648, 419 U.S. 1061, 42 L.Ed.2d 659. Pat- ents 319(1)

Owner of patent can recover damages for infringement on reasonable royalty basis if he is unable to prove his loss specifically. Duplate Corporation v. Triplex Safety Glass Co of North America, C.C.A.3 (Pa.) 1935, 81 F.2d 352, certiorari granted 56 S.Ct. 668, 297 U.S. 702, 80 L.Ed. 990, affirmed as modified on other grounds 56 S.Ct. 792, 298 U.S. 448, 80 L.Ed. 1274. See, also, Alliance Securities Co. v. De Vilbiss Mfg. Co., C.C.A.Ohio 1935, 76 F.2d 503; Standard Mailing Machines Co. v. Postage Meter Co., D.C.Mass.1929, 31 F.2d 459; Mathey v. United Shoe Machinery Corporation, D.C.Mass.1944, 54 F.Supp. 694; Wedge v. Waynesboro Nurseries, D.C.Va.1940, 31 F.Supp. 638. Patents 319(1)

Damages for sales lost to infringer should be measured on basis of reasonable royalty, where there is insufficient proof that holder of patent would have made sales if infringer had not. Power Specialty Co. v. Connecticut Light & Power Co., C.C.A.2 (Conn.) 1936, 80 F.2d 874. Patents 319(1)

145. ---- Collateral profits, royalty fees, damages

In determining amount of reasonable royalty that infringer would have had to pay patent holder, fact that, at time of hypothetical royalty negotiations, infringer would reasonably have expected to derive substantial additional profits from collateral sales of other products sold along with the patented product was significant, in that it had logical tendency to increase amount of reasonable royalty. Georgia-Pacific Corp. v. U. S. Plywood Corp. (State Report Title: Georgia-Pacific Corp. v. U.S. Plywood-Champion Papers Inc.), S.D.N.Y.1970, 318 F.Supp. 1116, 166 U.S.P.Q. 235, modified on other grounds 446 F.2d 295, 170 U.S.P.Q. 369, certiorari denied 92 S.Ct. 105, 404 U.S. 870, 30 L.Ed.2d 114, 171 U.S.P.Q. 322. Patents 319(1)

146. ---- Commingled profits, royalty fees, damages

Where patent infringement was not conscious, wilful or deliberate, and profits from infringing device were inextricably commingled with defendant's entire business, damages were properly based on reasonable royalty. En-

terprise Mfg. Co. v. Shakespeare Co., C.C.A.6 (Mich.) 1944, 141 F.2d 916. Patents 319(1)

147. ---- Competitors, royalty fees, damages

Measuring royalty rate accorded to most favored licensee's competitor by including value received by patent holder would be inappropriate application of settlement agreement entitling most favored licensee to royalty rate equal to or less than effective royalty rate accorded to competitor; competitor made profit from exchange of services, and measuring royalty rate in that manner would lead to nonsensical result of allowing competitor to operate at great advantage. Carpenter Technology Corp. v. Armco, Inc., E.D.Pa.1992, 800 F.Supp. 215. Patents 218(5)

148. ---- Cost, royalty fees, damages

Reasonable royalty may be based on manufacturing cost. Motor Player Corp. v. Piano Motors Corp., D.C.N.J.1927, 19 F.2d 993. Patents 319(1)

149. ---- Entire profits attributable, royalty fees, damages

In a patent infringement suit, profits from combination sales of patented component and system whose marketable value is attributable to patented component are properly considered in computing royalty or damages. Paper Converting Mach. Co., Inc. v. FMC Corp., E.D.Wis.1977, 432 F.Supp. 907, 195 U.S.P.Q. 123, affirmed 588 F.2d 832. Patents 319(1)

Price of trucks which were not purchased and resold by defendant but to which defendant added device which infringed plaintiffs' patent would not be included in determining damages by way of royalties. Miller v. Day- brook-Ottawa Corp., N.D.Ohio 1968, 291 F.Supp. 896, 158 U.S.P.Q. 635. Patents 319(1)

150. ---- Established royalty fees, damages

Technology fee of $6.50 per 50-pound bag of patented, herbicide-resistant soybean seed did not take into account the added obligation imposed on all authorized licensees under technology agreement to purchase seed from an authorized seed store and, thus, was not the established royalty for a license comparable to the infringing conduct of seed-buying farmer. Monsanto Co. v. McFarling, C.A.Fed. (Mo.) 2007, 488 F.3d 973, 82 U.S.P.Q.2d 1942, certiorari denied 128 S.Ct. 871, 169 L.Ed.2d 724. Patents 319(1)

In patent infringement action, plaintiff was entitled to damages based on long-standing royalty rate set by plaintiff instead of based on much higher rate which was set when patent's expiration approached. Laitram Corp. v. Depoe Bay Fish Co., D.C.Or.1982, 549 F.Supp. 29. Patents 218(5)

Evidence of royalty rates charged other manufacturers by plaintiffs for use of their patented invention, although not amounting to proof of established royalty, was proper evidence for consideration in determining reasonable royalty rates in computing damages for patent infringement. Carter Products, Inc. v. Colgate-Palmolive Co., D.C.Md.1963, 214 F.Supp. 383, 136 U.S.P.Q. 348, 136 U.S.P.Q. 577. Patents 319(1)

Eight payments of royalty in three years does not establish fixed royalty recoverable for patent infringement. Wallace & Tiernan Co. v. City of Syracuse, C.C.A.2 (N.Y.) 1930, 45 F.2d 693. See, also, Electro Bleaching Gas Co. v. Village Water Co., C.C.A.Conn.1930, 45 F.2d 696. Patents 312(10)

An “established royalty” is one which has been uniform at places where licenses have been issued and which has been paid prior to patent infringement complained of by such a number of persons as to indicate a general acquiescence in its reasonableness by those who had had occasion to use the invention. Faulkner v. Gibbs, C.A.9 (Cal.) 1952, 199 F.2d 635, 95 U.S.P.Q. 400. Patents 319(1)

“Established royalty,” if clearly shown in patent infringement suit, controls in fixing damages. General Motors Corp. v. Blackmore, C.C.A.6 (Mich.) 1931, 53 F.2d 725. Patents 319(1)

In determining damages for patent infringement using the royalty basis in determining whether there was an established royalty, it must have been paid prior to the infringement, and must have been paid by such a number of persons as to indicate a general acquiescence in its reasonableness by those who have had occasion to use the invention, and it must have been uniform at the places where licenses were issued. Elrick Rim Co. v. Cheek, S.D.Cal.1961, 195 F.Supp. 496, 131 U.S.P.Q. 8. Patents 319(1)

One measure of damages in infringement cases is on as established royalty basis which is royalty paid by others in an industry and which indicates a general acquiescence in the value of the invention. Hartford Nat. Bank & Trust Co. v. E.F. Drew & Co., D.C.Del.1960, 188 F.Supp. 353, 126 U.S.P.Q. 487, affirmed 290 F.2d 589, 129 U.S.P.Q. 204, certiorari denied 82 S.Ct. 45, 368 U.S. 825, 7 L.Ed.2d 29, 131 U.S.P.Q. 498. Patents 319(1)

The terms “established royalty” and “reasonable royalty,” as used in assessing damages for patent infringement on royalty basis, ordinarily denote merely fair common sense method of compensating patentee for infringement, where other methods of computing damages are unavailing or unsatisfactory. Wedge v. Waynesboro Nurs- eries, W.D.Va.1940, 31 F.Supp. 638. Patents 319(1)

In action for infringement of patent, amount of royalties or licenses which plaintiff has been accustomed to receive for use of patented invention, with interest thereon from time when they should have been paid, is generally taken as measure of damages. Brewster v. Technicolor, Inc., S.D.N.Y.1941, 2 F.R.D. 186. Patents 275

When determining reasonable patent royalty, for purposes of statute providing that patent owner whose patented invention is used or manufactured by or for United States without license may bring suit to recover from United States “reasonable and entire compensation,” court first assesses whether there is established royalty rate for patent; if there is established rate, that rate typically constitutes reasonable royalty and is used as “best measure of reasonable and entire compensation.” de Graffenried v. U.S., Cl.Ct.1992, 25 Cl.Ct. 209, 24 U.S.P.Q.2d 1594. United States 108

Award of damages for infringement according to previously-established royalty rate was not improper. Western Elec. Co., Inc. v. Stewart-Warner Corp., C.A.4 (Va.) 1980, 631 F.2d 333, 208 U.S.P.Q. 183, certiorari denied 101 S.Ct. 1492, 450 U.S. 971, 67 L.Ed.2d 622. Patents 319(1)

The fact that that patented was a minor improvement in a highly developed art was not sufficient reason to de- part from general rule that primary method of assessing damages for infringement of patent is using the patentee's established royalties as a measure of those damages. U.S. Nat. Bank of Portland, Or. v. Fabri-Valve Co. of America, C.A.9 (Or.) 1956, 235 F.2d 565, 110 U.S.P.Q. 77. Patents 319(1)

In absence of an established royalty, the value of what was taken by infringing sales may be shown by proving what would have been a reasonable royalty. Dowagiac Mfg. Co. v. Minnesota Moline Plow Co., U.S.Minn.1915, 35 S.Ct. 221, 235 U.S. 641, 59 L.Ed. 398. See, also, American Telephone & Telegraph Co. v. Radio Audion Co.,

D.C.Del.1925, 5 F.2d 535; Austin-Western Road Machinery Co. v. Disc. Grader, etc., Co., C.C.A.Minn.1923, 291 F. 301, certiorari denied 44 S.Ct. 180, 263 U.S. 717, 68 L.Ed. 522; Munger v. Perlman Rim Corp., C.C.A.N.Y.1921, 275 F. 21, certiorari denied 42 S.Ct. 54, 257 U.S. 645, 66 L.Ed. 413. Patents 312(2)

That there is no established royalty does not preclude a court from fixing a reasonable royalty as the basis of damages. Malleable Iron Range Co. v. Lee, C.C.A.7 (Wis.) 1920, 263 F. 896, certiorari denied 40 S.Ct. 342, 251 U.S. 562, 64 L.Ed. 415. See, also, K.W. Ignition Co. v. Temco Electric Motor Co., C.C.A.Ohio 1922, 283 F. 873, certiorari denied 43 S.Ct. 247, 260 U.S. 746, 67 L.Ed. 493.

151. ---- Exceptional contracts, royalty fees, damages

Royalty paid for whole monopoly is not sufficient evidence of value of right to make occasional sales in a particular territory. La Baw v. Hawkins, C.C.N.J.1877, 14 F.Cas. 899, No. 7961. See, also, Colgate v. Western Electric Mfg. Co., C.C.N.Y.1886, 28 F. 146.

Where there is no fixed and established royalty exceptional contracts may be taken as the measure of damages. Greenleaf v. Yale Lock Mfg. Co., C.C.N.Y.1879, 10 F.Cas. 1175, No. 5783.

152. ---- Expert testimony, royalty fees, damages

Expert report submitted by owner of patents relating to high-efficiency adaptive DC/AC converter failed to establish damages in infringement action, where report stated that appropriate reasonable royalty rate for alleged infringement was percentage of average retail price of notebook computer, even though not all allegedly infringing chips were used in notebook computers, royalty calculation was based on premium paid for different product, and report did not account for law of supply and demand. Monolithic Power Systems, Inc. v. O2 Micro Intern. Ltd., N.D.Cal.2007, 476 F.Supp.2d 1143, clarified on denial of reconsideration 2007 WL 1108615. Pat- ents 312(10)

Award of $5,290,000, plus 4% running royalty, for infringement of patents for method of cleaving nucleic acids was supported by expert testimony as to what terms of reasonable licensing agreement would have been on date infringement began. Third Wave Technologies, Inc. v. Stratagene Corp., W.D.Wis.2005, 405 F.Supp.2d 991. Patents 312(10)

Evidence supported award of reasonable royalty damages, due to infringement of patent for de-icing product for treating rock salt, of $1.50 per ton of infringing product sold; amount, which was half of amount sought as reasonable royalty by patentee, fell between amounts advocated by competing expert opinions. Cargill, Inc. v. Sears Petroleum & Transport Corp., N.D.N.Y.2005, 388 F.Supp.2d 37, appeal dismissed 163 Fed.Appx. 894, 2006 WL 197472. Patents 312(10)

Damages expert's report was not inadmissible in patent infringement case on basis of argument that expert relied too heavily on two of the fifteen Georgia-Pacific factors for calculating a reasonable royalty; such argument was applicable to the weight that should be given expert's opinion, not its admissibility. Oxford Gene Technology Ltd. v. Mergen Ltd., D.Del.2004, 345 F.Supp.2d 431. Evidence 555.9

Lack of express testimony or the testimony of plaintiff's expert does not, where facts are sufficient for ascertain- ment of a royalty rate to be used as a measure of damages, bind federal district court any more than it would a jury. Broadview Chemical Corp. v. Loctite Corp., D.C.Conn.1970, 311 F.Supp. 447, 164 U.S.P.Q. 419. Patents

312(10)

153. ---- Fees advocated by parties, royalty fees, damages

In determining award of reasonable royalty in patent infringement suit, court is not limited to selecting specific royalty figures urged by counsel as reasonable; determination of reasonable royalty must be based upon entirety of the evidence and court is free to and indeed must, reject royalty figures proffered by the litigants where record as a whole leads court to a different figure. American Medical Systems, Inc. v. Medical Engineering Corp., E.D.Wis.1992, 794 F.Supp. 1370, 26 U.S.P.Q.2d 1081, affirmed in part , reversed in part 6 F.3d 1523, 28 U.S.P.Q.2d 1321, rehearing denied, in banc suggestion declined , certiorari denied 114 S.Ct. 1647, 511 U.S. 1070, 128 L.Ed.2d 366. Patents 218(5)

In assessing probative value of royalty rate offered by infringer to prove rate lower than that claimed by patentee, court may not uncritically accept that numerical evidence but must consider economic ambiance of that statistic, since special circumstances may explain why that particular rate was depressed or lower than others. Georgia-Pacific Corp. v. U. S. Plywood Corp. (State Report Title: Georgia-Pacific Corp. v. U.S. Plywood- Champion Papers Inc.), S.D.N.Y.1970, 318 F.Supp. 1116, 166 U.S.P.Q. 235, modified on other grounds 446 F.2d 295, 170 U.S.P.Q. 369, certiorari denied 92 S.Ct. 105, 404 U.S. 870, 30 L.Ed.2d 114, 171 U.S.P.Q. 322. Patents 319(1)

154. ---- Future profits, royalty fees, damages

Future profits from sale of supplies for patented machine may be considered, in retroactively determining reasonable royalty. Egry Register Co. v. Standard Register Co., C.C.A.6 (Ohio) 1928, 23 F.2d 438. Patents 318(3)

Submission to jury of question of future royalty rate in patent infringement case was not likely to cause juror confusion or to otherwise affect verdict; calculation of rate would have been less speculative than a traditional lost profits case in that rate would only be applied to competitor's future sales as, and if, they actually occurred, without any need to go through a complex reduction to present value analysis. Cummins-Allison Corp. v. SBM Co., Ltd., E.D.Tex.2008, 584 F.Supp.2d 916. Patents 314(1)

155. ---- Infringer's profits, royalty fees, damages

Reasonable royalty awarded for infringer's planting or transferring patented seed that he saved at end of season after agreeing to use the seed only in a single season could exceed infringer's anticipated profits from use of the seed; patentee would not have permitted infringer to transfer or replant saved seed at any price. Monsanto Co. v. Ralph, C.A.Fed. (Mo.) 2004, 382 F.3d 1374, 72 U.S.P.Q.2d 1515, rehearing and rehearing en banc denied , on subsequent appeal 122 Fed.Appx. 510, 2005 WL 406544, certiorari denied 126 S.Ct. 342, 546 U.S. 816, 163 L.Ed.2d 53. Patents 319(1)

Where, at time when hypothetical negotiations between willing licensor and willing licensee would have taken place, infringer's profit margin was in the range of six to seven percent of total sales, four percent of the net selling price of infringed centrifugal sidewall exhauster and of infringed roof exhauster and sound control curb was reasonable royalty upon which the parties would have agreed in negotiating a license agreement. Jenn-Air Corp. v. Penn Ventilator Co., Inc., E.D.Pa.1975, 394 F.Supp. 665, 185 U.S.P.Q. 410. Patents 319(1)

Profits derived by infringer as a result of infringing activity are a proper factor, but not the only factor, to be considered in determining a reasonable royalty to compensate the patentee. Rosen v. Kahlenberg, M.D.Fla.1970, 337 F.Supp. 1075, 171 U.S.P.Q. 386, reversed on other grounds 474 F.2d 858, 177 U.S.P.Q. 118. Patents 319(1)

Though amendment by Act Aug. 1, 1946, c. 726, § 1, 60 Stat. 778, to former § 70 of this title and this section abolished recovery of infringer's profits as such, in cases of infringement of ordinary patents, proof of infringer's profits may, evidentially in particular circumstances, be probative of patentee's damages or reasonable royalty. Georgia-Pacific Corp. v. U. S. Plywood Corp., S.D.N.Y.1965, 243 F.Supp. 500, 146 U.S.P.Q. 228. Patents 312(2)

Determination of reasonably royalty for use of infringed patent is not based on infringer's profit margin, but on what willing licensor and licensee would bargain for at hypothetical negotiations on date infringement started. State Industries, Inc. v. Mor-Flo Industries, Inc., C.A.Fed. (Tenn.) 1989, 883 F.2d 1573, 12 U.S.P.Q.2d 1026, rehearing denied, rehearing in banc declined, certiorari denied 110 S.Ct. 725, 493 U.S. 1022, 107 L.Ed.2d 744, on remand 17 U.S.P.Q.2d 1706. Patents 319(1)

Where invention embodied in patent for bottling machine was of most trifling character and never had any real value, and it was not shown that the invention contributed to defendant's profits, plaintiff, though not entitled to recover profits, was nevertheless entitled to prove a reasonable royalty. Columbia Machine & Stopper Corpora- tion v. Adriance Machine Works, C.C.A.2 (N.Y.) 1935, 79 F.2d 16. Patents 318(4.1)

In patent infringement proceeding, the court should be conservative in fixing the amount of the reasonable royalty because of the inevitable uncertainty of the computation, and gross receipts and profits of the infringer are to be considered along with royalties paid in more or less similar circumstances, although weight of such evidence in any particular case might be slight. Faulkner v. Gibbs, C.A.9 (Cal.) 1952, 199 F.2d 635, 95 U.S.P.Q. 400. Patents 319(1)

Where profits made by an infringer are proved and allowed, but no damages are proved, general damages by way of a reasonable royalty are not recoverable. Krentler-Arnold Hinge Last Co. v. Leman, D.C.Mass.1928, 24 F.2d 423.

Infringer's profits may have evidentiary bearing on determination of reasonableness of royalty in situation in which such minimal compensation is awarded to patentee. Locklin v. Switzer Bros., Inc., N.D.Cal.1964, 235 F.Supp. 904, 143 U.S.P.Q. 233. Patents 319(1)

Prices that alleged infringer charged to automobile dealers when separately selling patented, electronic intermit- tent windshield wiper systems, infringer's mark-up over manufacturing costs, its sales forecast, its marketing and advertising of systems, and its decision to introduce systems as option or standard equipment were irrelevant to determining reasonable royalty in infringement action; infringer manufactured circuits and sold them from one of its divisions to another; reasonable royalty on system would be merely one of many costs covered by total price of automobile; and no expert testimony indicated that mark-up over manufacturing costs, suggested retail price, and decision to make systems standard or optional would have been part of negotiations for license. Kearns v. Ford Motor Co., E.D.Mich.1989, 726 F.Supp. 159. Patents 218(5)

156. ---- License agreements, royalty fees, damages

Award of lost royalty damages of $31.80 per infringing unit, for discount retailer's infringement of patent for remote controlled portable searchlight, was reasonable; although rate was higher than retailer's projected, $8.00 per unit profit, there was expert testimony that amount awarded, which was half of patentee's per unit profit, would have been result of hypothetical licensing negotiation. Golight, Inc. v. Wal-Mart Stores, Inc., C.A.Fed. (Colo.) 2004, 355 F.3d 1327, 69 U.S.P.Q.2d 1481, rehearing en banc denied. Patents 319(1)

Royalty of $5.00 was reasonable for patent license on ramps, where patent owner entered into exclusive license agreement with manufacturer regarding patent, manufacturer sold ramps to customers for $20.00 per set and instructed owner that it would require $5.00 royalty to waive its exclusive rights, competitor sold infringing ramps during relevant time period at more than $5.00 below manufacturer's $20.00 price, and thus competitor could have passed $5.00 royalty on to its customers and still would have been able to undersell manufacturer. Rhino Associates, L.P. v. Berg Mfg. and Sales Corp., M.D.Pa.2007, 531 F.Supp.2d 652. Patents 319(1)

Royalty rate of 2.5% was reasonable royalty to be used in determining damages to be awarded to holder of patent for polymerization of ethylene and other lower olefins, including propylene, even though it was higher than the rate paid by any licensee. Studiengesellschaft Kohle mbH v. Dart Industries, Inc., D.Del.1987, 666 F.Supp. 674, 4 U.S.P.Q.2d 1817, affirmed 862 F.2d 1564, 9 U.S.P.Q.2d 1273. Patents 319(1)

Royalty rates based on license agreement entered into by patentee at time patentee was threatening to bring infringement litigation could not be considered in determining patentee's “established royalty rate” for purposes of establishing damages in infringement case. Wang Laboratories, Inc. v. Mitsubishi Electronics America, Inc., C.D.Cal.1993, 860 F.Supp. 1448, 30 U.S.P.Q.2d 1241. Patents 319(1)

Where patent owner has granted licenses at different rates, lowest rate, in absence of contrary evidence, constitutes reasonable royalty. Minnesota Mining & Mfg. Co. v. Berwick Industries, Inc., M.D.Pa.1975, 393 F.Supp. 1230, 185 U.S.P.Q. 536, affirmed 532 F.2d 330, 190 U.S.P.Q. 209. Patents 218(5)

In determining damages for patent infringement on a lost royalty basis, the extent of deviation from existing license fees must be determined solely on the basis of evidence submitted to the trial court and upon an evaluation of the factors that could affect the royalty rate, not upon mere conjecture. Trio Process Corp. v. L. Goldstein's Sons, Inc., C.A.3 (Pa.) 1976, 533 F.2d 126, 189 U.S.P.Q. 561, on remand 204 U.S.P.Q. 863. Patents 319(1)

Where a patentee has granted licenses and has an established royalty, the gross royalty with interest from date on which it was payable from time to time is a proper measure of patentee's recovery for infringement of patents. Marvel Specialty Co., Inc. v. Bell Hosiery Mills, Inc., C.A.4 (N.C.) 1967, 386 F.2d 287, 155 U.S.P.Q. 545, certiorari denied 88 S.Ct. 1409, 390 U.S. 1030, 20 L.Ed.2d 286, 157 U.S.P.Q. 720. Patents 319(1)

Best guide for determination of just compensation for infringement of patent is royalties agreed upon between patentee and licensees in arm-length transactions. Saulnier v. U. S., Ct.Cl.1963, 314 F.2d 950, 161 Ct.Cl. 223, 137 U.S.P.Q. 222. Patents 319(1)

That a royalty fixed by license contracts may be accepted as a measure of damages against an infringer, a stranger to the licenses, it must have been paid or secured before the infringement in suit, and, where that extended both before and after the date of the license contracts, such measure is applicable only to the infringement committed afterward. Rude v. Westcott, U.S.Ind.1889, 9 S.Ct. 463, 130 U.S. 152, 32 L.Ed. 888. See, also, Dia- mond Stone-Sawing Mach. Co. of New York v. Brown, N.Y.1908, 166 F. 306, 92 C.C.A. 224; United Nickel Co. v. Central Pac. R. Co., C.C.Cal.1888, 36 F. 186; National Car Brake Shoe Co. v. Terre Haute Car & Mfg.

Co., C.C.Ind.1884, 19 F. 514. Patents 319(1)

Where owner of patent granted a license to make, use, and sell rolling mills for a stipulated royalty for each mill and mills infringing patent were manufactured and sold, any claim for damages against manufacturer and purchaser of infringing mills equitably ran in favor of the licensee rather than in favor of owner of patent and measure of damages of patent owner for infringement was limited to stipulated royalty. Cold Metal Process Co. v. E. W. Bliss Co., C.A.6 (Ohio) 1960, 285 F.2d 231, 128 U.S.P.Q. 49, certiorari denied 81 S.Ct. 1085, 366 U.S. 911, 6 L.Ed.2d 235, 129 U.S.P.Q. 502. Patents 319(1)

Patentholder's recovery of total damages including acceleration of future royalty payments due under licensing agreement would not be justified as result of licensee's breach of its obligations to make periodic royalty payments where parties' intention was manifest in agreement that agreement was not entire and indivisible contract. Wallace Clark & Co., Inc. v. Acheson Industries, Inc., S.D.N.Y.1976, 422 F.Supp. 20, 200 U.S.P.Q. 364. Patents 219(7)

157. ---- Lost profits, royalty fees, damages

When actual lost profits cannot be determined in patent infringement case, proper approach is to award damages on basis of reasonable royalty. Stryker Corp. v. Intermedics Orthopedics, Inc., E.D.N.Y.1995, 891 F.Supp. 751, affirmed 96 F.3d 1409, 40 U.S.P.Q.2d 1065, rehearing denied , in banc suggestion declined. Patents 318(4.1)

Patent licensee could not recover damages for lost profits from infringer absent evidence that it would have made the sales made by infringer but for the infringement, and thus damages had to be determined on the basis of reasonable royalty. Water Technologies Corp. v. Calco, Ltd., C.A.Fed. (Ill.) 1988, 850 F.2d 660, 7 U.S.P.Q.2d 1097, certiorari denied 109 S.Ct. 498, 488 U.S. 968, 102 L.Ed.2d 534, on remand 714 F.Supp. 899, 11 U.S.P.Q.2d 1410, on remand 709 F.Supp. 821, 11 U.S.P.Q.2d 1217. Patents 318(1); Patents 319(1)

Before reasonable royalty can be awarded for infringement of patent, it must be shown whether plaintiff's putat- ive profits were computable. Wallace & Tiernan Co. v. City of Syracuse, C.C.A.2 (N.Y.) 1930, 45 F.2d 693. See, also, Electro Bleaching Gas Co. v. Village Water Co., C.C.A.Conn.1930, 45 F.2d 696. Patents 319(1)

Where it did not appear that plaintiff lost any sales through defendant's infringement of plaintiff's patents relating to schoolroom wardrobes and hardware therefor, proper measure of damages was a reasonable royalty, which should be based upon actual selling price by defendant of infringing products less the cost of steel shelving which was not an essential part of the complete wardrobe. Austral Sales Corp v. Jamestown Metal Equipment Co, W.D.N.Y.1941, 41 F.Supp. 508. Patents 319(1)

158. ---- Nonuse by patentee, royalty fees, damages

Where there was not reasonable probability that plaintiff, which brought civil contempt proceeding to recover for defendant's violation of consent decree by its sale of infringing anaerobic sealants, would have made foreign

sales, which defendant had made, “but for” sale by defendant, plaintiff would be entitled to recover damages for such sales based on a reasonable royalty. Broadview Chemical Corp. v. Loctite Corp., D.C.Conn.1970, 311 F.Supp. 447, 164 U.S.P.Q. 419. Patents 326(4)

Where the patent holder has not and cannot exploit the patent, the only pecuniary loss suffered is the loss of royalties the patent holder would have, hypothetically, received had the infringing use of the patent been made under appropriate license agreement. Ellipse Corp. v. Ford Motor Co., N.D.Ill.1978, 461 F.Supp. 1354, 201 U.S.P.Q. 455, affirmed 614 F.2d 775, certiorari denied 100 S.Ct. 2160, 446 U.S. 939, 64 L.Ed.2d 792, 206 U.S.P.Q. 288. Patents 319(1)

Where party alleging patent infringement did not itself manufacture or use patented process, compensation could take form of reasonable royalty for licensing use of patent. Devex Corp. v. General Motors Corp., C.A.3 (Del.) 1981, 667 F.2d 347, 212 U.S.P.Q. 643, certiorari granted 102 S.Ct. 2267, 456 U.S. 988, 73 L.Ed.2d 1283, certiorari denied 102 S.Ct. 2270, 456 U.S. 990, 73 L.Ed.2d 1285, rehearing denied 106 S.Ct. 212, 474 U.S. 890, 88 L.Ed.2d 181, affirmed 103 S.Ct. 2058, 461 U.S. 648, 76 L.Ed.2d 211, 217 U.S.P.Q. 1185. Patents 319(1)

Where patentholder was not itself engaged in use of patent, the only damages it suffered from infringement were royalties it would have received if infringer's use of patented process had been made under a licensure agreement. Trio Process Corp. v. L. Goldstein's Sons, Inc., C.A.3 (Pa.) 1976, 533 F.2d 126, 189 U.S.P.Q. 561, on remand 204 U.S.P.Q. 863. Patents 319(1)

159. ---- Settlements, royalty fees, damages

Royalty, if any, resulting from settlement of infringement suit between patentee and third party should not be considered evidence of an “established” royalty and thus a measure of adequate damages in separate infringement suit. Panduit Corp. v. Stahlin Bros. Fibre Works, Inc., C.A.6 (Mich.) 1978, 575 F.2d 1152, 197 U.S.P.Q. 726. See, also, Faulkner v. Gibbs, C.A.Cal.1952, 199 F.2d 635. Patents 319(1)

Royalty rates agreed to in anticipation of litigation cannot be relied upon to prove reasonable royalty rate in patent infringement case. Wang Laboratories, Inc. v. Mitsubishi Electronics America, Inc., C.D.Cal.1993, 860 F.Supp. 1448, 30 U.S.P.Q.2d 1241. Patents 319(1)

160. ---- Time of determination, royalty fees, damages

Reasonable royalty determination for purposes of making damages evaluation in patent infringement case must relate to time infringement occurred, and not the after-the-fact assessment. Unisplay, S.A. v. American Electron- ic Sign Co., Inc., C.A.Fed. (Wash.) 1995, 69 F.3d 512, 36 U.S.P.Q.2d 1540, rehearing denied , in banc suggestion declined. Patents 319(1)

Jury's award to patentee of $207,554 addressed damages for reasonable royalties up to and including the trial on claim that its patent for lighting system for hospital beds was infringed; even though patentee's expert witness stopped his damages analysis, based on sales activity data that competitor provided, jury was advised of this fact and was instructed to return damages to address reasonable royalties that would include the entire time up to and including the trial. Genlyte Thomas Group LLC v. Architectural Lighting Systems, Div. of Arch Lighting Group, D.Mass.2007, 483 F.Supp.2d 119, affirmed 278 Fed.Appx. 1004, 2008 WL 2062248, certiorari denied 129 S.Ct. 459. Patents 319(1)

161. ---- Willfulness, royalty fees, damages

Finding that discount retailer's sales of patented remote controlled portable searchlight amounted to “willful” infringement was supported by evidence that retailer failed to take appropriate actions after receiving patent owner's cease and desist letter; letter obtained by retailer from manufacturer, denying infringement, was “crudely drafted” and “cursory,” and retailer continued to sell off its remaining inventory after receiving owner's letter. Golight, Inc. v. Wal-Mart Stores, Inc., C.A.Fed. (Colo.) 2004, 355 F.3d 1327, 69 U.S.P.Q.2d 1481, rehearing en banc denied. Patents 312(8)

It was fundamentally unfair to give willful infringer benefit of group royalty rate it had previously rejected, so that appropriate measure of damages in case involving tobacco processing patents was 12 cents per pound for first fifty million pounds of smoking material processed and nine cents thereafter. Philip Morris, Inc. v. Brown & Williamson Tobacco Corp., M.D.Ga.1986, 645 F.Supp. 174, 1 U.S.P.Q.2d 1567. Patents 319(1)

162. ---- Particular cases, royalty fees, damages

Use of royalty rate of 29.2 percent was not abuse of discretion in action for infringement of patent for device for electronically measuring movement of caliper's slide relative to its scale, given that rate was calculated based upon hypothetical negotiation between willing patentee and willing licensee at time infringement began and was determined based on the entirety of evidence in the record, and that rate was reasonable in light of contentious history between patentee and infringing competitor, which made it unlikely that patentee would have been interested in lower rate. Mitutoyo Corp. v. Central Purchasing, LLC, C.A.Fed. (Ill.) 2007, 499 F.3d 1284, 84 U.S.P.Q.2d 1001. Patents 319(1)

“Technology fee” paid by infringer for right to plant commercial crop of patented seed in single season was not established royalty that could be used to calculate damages after infringer planted or transferred saved seed; although the fee was a royalty, it was a royalty for only a narrow, contractually agreed-upon, use of the seed, and patentee had never granted licenses to anyone to plant, produce, or transfer saved seed. Monsanto Co. v. Ralph, C.A.Fed. (Mo.) 2004, 382 F.3d 1374, 72 U.S.P.Q.2d 1515, rehearing and rehearing en banc denied , on subsequent appeal 122 Fed.Appx. 510, 2005 WL 406544, certiorari denied 126 S.Ct. 342, 546 U.S. 816, 163 L.Ed.2d 53. Patents 319(1)

A jury finding on question of future royalty rate in patent infringement case would not be determinative of adequacy of legal remedies factor in analysis of whether to grant injunctive relief, and thus submission of question to jury was warranted; merely because experts would be allowed, and jury could have arrived at, future royalty rate did not mean that such compensation automatically would be deemed adequate. Cummins-Allison Corp. v. SBM Co., Ltd., E.D.Tex.2008, 584 F.Supp.2d 916. Patents 314(1)

Jury rightfully weighed countervailing positions of parties against evidence presented on all or some required factors to determine damages calculation based on reasonable royalty in patentee's action against game manufacturer alleging infringement of patent for polyhedral dice; as finder of fact, jury was entitled to reject figures proffered by litigants as incredible and substitute an intermediate figure as a matter of its judgment from all evidence, jury determined such intermediate figure, and verdict represented determination on part of jury that in a hypothetical negotiation, royalty rate calculated using standard industry rates was justified, and that royalty calculated through cost-added approach would neither meet minimal standard set forth, nor adequately compensate patentee for manufacturer's unauthorized use of his patented dice. Bowling v. Hasbro, Inc., D.R.I.2008, 582 F.Supp.2d 192.

Arguments regarding reasonable royalty rate established outside of rates negotiated during settlement, raised for first time in summary judgment reply, had to be disregarded, in patent infringement lawsuit. Kowalski v. Mommy Gina Tuna Resources, D.Hawai'i 2008, 574 F.Supp.2d 1160. Patents 323.2(5)

For purposes of determining damages for infringement of patent relating to alpha-amylase enzymes used in the production of fuel ethanol, reasonable royalty was 20% for the United States fuel ethanol market and 8% for other markets, considering hypothetical negotiation would have taken into account available or soon to be available alternatives to infringing product. Novozymes A/S v. Genencor Intern., Inc., D.Del.2007, 474 F.Supp.2d 592. Patents 319(1)

Determination of reasonable royalty by court, after patent owner waived its Seventh Amendment right to jury trial during trial when it decided to not put on evidence in support of its contention that 2% would have been reasonable royalty rate and instead chose to rely on testimony about reasonable rates for other, similar patents, despite fact that its own witness had testified that every license negotiation was distinct, would have violated competitor's Seventh Amendment rights, despite statutory presumption in favor of award of damages when patent infringement had been proven. Boston Scientific Corp. v. Johnson & Johnson, N.D.Cal.2008, 550 F.Supp.2d 1102. Jury 34(3)

Evidence was sufficient for jury to render royalty award of $48.25 per wheel for competitor's infringement of design patent for vehicle-wheel front face, where witness testified that patent owner had licensed one of its wheel designs for “like $75 a wheel” and witness testified that he would have tried to license patent design to competitor for between $50 and $100 per wheel. Mobile Hi-Tech Wheels v. CIA Wheel Group, C.D.Cal.2007, 514 F.Supp.2d 1172, appeal dismissed 259 Fed.Appx. 310, 2007 WL 4481311. Patents 312(10)

Jury verdict that based damages award on 0.5% royalty rate was against clear weight of evidence; although plethora of licensing agreements were admitted into evidence, majority of those which advocated royalty rate in 0.5% range lacked sufficient relevance to technology at issue and lacked relevant date of hypothetical negotiation and/or scope of license that would be negotiated between parties. Lucent Technologies Inc. v. Gateway, Inc., S.D.Cal.2007, 509 F.Supp.2d 912, affirmed 543 F.3d 710, 88 U.S.P.Q.2d 1481. Patents 312(10)

Substantial evidence supported jury's damages award in action alleging infringement of patent for aircraft ground warning system, despite defendant's contention that royalty rate used was too high, that patent technology was given away for free as part of software upgrade, and that technology was not integral to patentee's system, in light of expert testimony that royalty rate was within field's normative range, that contracts providing lower royalty rates were not comparable, and that there were sound business reasons for providing free software upgrades to existing customers. Honeywell Intern. Inc. v. Universal Avionics Systems Corp., D.Del.2006, 426 F.Supp.2d 211, affirmed 493 F.3d 1358, 83 U.S.P.Q.2d 1425. Patents 312(10)

Damage award, in action for infringement of patent for method of making purified lutein crystals, was supported by evidence of reasonable royalty rate, appropriate time period, and relevant sales figures. Kemin Foods, L.C. v. Pigmentos Vegetables del Centro S.A. de C.V., S.D.Iowa 2005, 357 F.Supp.2d 1105, appeal dismissed 132 Fed.Appx. 368, 2005 WL 1231816, subsequent determination 369 F.Supp.2d 1075, affirmed 464 F.3d 1339, 80 U.S.P.Q.2d 1385. Patents 312(10)

Holder of patent covering elliptical shaped port for loudspeaker could not recover lost profits from infringer's sale of comparably priced units alleged to be competitive, and was limited to reasonable royalty damages, when types of equipment used in conjunction with speakers was different. Bose Corp. v. JBL, Inc., D.Mass.2000, 112

F.Supp.2d 138.

Royalty rate applicable to damages award, following determination that loudspeaker manufacturer infringed rival's patent for elliptical port on bass speakers, would be determined by taking one-quarter of 20% profit earned by infringer on sales of infringing parties, and augmenting resulting 5% by 2%, representing result of consideration of 15 factors set forth in Georgia-Pacific decision. Bose Corp. v. JBL, Inc., D.Mass.2000, 112 F.Supp.2d 138.

Reasonable royalty rate for hypothetical agreement between holder of patent on nipple drinker for poultry and infringer would not be less than 15%, in view of infringer's profit margin and the prime lending rate, and that amount would be applied to those sales of infringing product as to which it was not shown the patent holder had lost sales. Ziggity Systems, Inc. v. Val Watering Systems, E.D.Pa.1990, 769 F.Supp. 752, reconsideration denied. Patents 318(3)

Where defendant actively induced infringement of valid claims of patent relating to resin-coated sand as used in making foundry molds for casting iron and other metals and contributorily infringed claims, damages were to be awarded against defendant computed at rate equal to royalties being charged for licenses under patents on all phenol formaldehyde resin sold by defendant for use in making resin-coated sand during specified period together with interest thereon from dates of sale. Morris Bean & Co. v. Reichhold Chemicals, Inc., N.D.Ala.1971, 329 F.Supp. 1396, 169 U.S.P.Q. 813. Patents 319(1); Patents 319(4)

Damages to be awarded patent owner by reason of infringement thereof would be based upon doubling owner's established royalty rate applied to all sales of infringing product together with costs and interest. Rayonier Inc. v. Georgia-Pacific Corp., W.D.Wash.1967, 281 F.Supp. 687, 156 U.S.P.Q. 110. Patents 319(1); Patents 319(4)

Where patentee was entitled to stipulated royalty on egg incubators manufactured by competitor, and sale of two incubators was lost because of sale of infringing incubators, patentee was entitled to damages equal to lost royalties. Smith v. Thurrell, D.C.N.H.1936, 13 F.Supp. 937. Patents 319(1)

Where award of damages to plaintiff in patent infringement suit for infringing tires sold by defendant, awarded as a reasonable royalty, was not supported by evidence, but amount of defendant's profits had been found, plaintiff was given option of accepting a reduced award equaling amount of profits, or of offering further evidence concerning a reasonable royalty. Goodyear Tire & Rubber Co. v. Overman Cushion Tire Co., C.C.A.6 (Ohio) 1937, 95 F.2d 978, certiorari dismissed 59 S.Ct. 459, 306 U.S. 665, 83 L.Ed. 1061, certiorari dismissed 59 S.Ct. 460, 306 U.S. 665, 83 L.Ed. 1061. Patents 324.60

Manufacturer of patented device was entitled to reasonable royalties with respect to infringing sales to customers who were not contacted by the manufacturer of the patented device prior to the infringing sale, and manufacturer and its independent sales organizations were entitled to reasonable distribution royalties on all infringing sales. Rite-Hite Corp. v. Kelley Co., Inc., E.D.Wis.1991, 774 F.Supp. 1514, 21 U.S.P.Q.2d 1801, affirmed in part , vacated in part 56 F.3d 1538, 35 U.S.P.Q.2d 1065, certiorari denied 116 S.Ct. 184, 516 U.S. 867, 133 L.Ed.2d 122. Patents 218(5)

Reasonable royalty rate to be applied in awarding damages for infringement of patent covering method of construction of disposable diapers was 6% of the net sales of the adhesive which was covered by the patent. H.B. Fuller Co. v. National Starch and Chemical Corp., D.Minn.1988, 689 F.Supp. 923, 7 U.S.P.Q.2d 1753. Patents

319(1)

Considering nature of plaintiff's patented process for refining copper in a converter, its apparent utility and advantages over prior processes and others known and available to defendants during infringing period, royalty rate to which parties would have agreed had they bargained in good faith at time patent issued would have been about one dollar per ton of anode copper product produced by defendants; accordingly, damages for infringement would be set at one dollar per ton. Brian Jackson Associates, Inc. v. San Manuel Copper Corp., D.C.Ariz.1969, 305 F.Supp. 66, 163 U.S.P.Q. 198. Patents 275

Manufacturer of patented device was entitled to a royalty greater than that which was the standard rate in the freight dock industry where it was the only manufacturer of the product at issue, it would have expected to forego a significant level of profits by granting a license to competitor because competitor was historically a strong competitor in the industry, it had anticipated being able to sell a large number of the devices in highly profitable packages, and it consistently followed a policy of exploiting its own patents rather than licensing its patents to competitors; manufacturer was entitled to royalty based on one half of the per unit profits which it would have been foregoing by a license. Rite-Hite Corp. v. Kelley Co., Inc., E.D.Wis.1991, 774 F.Supp. 1514, 21 U.S.P.Q.2d 1801, affirmed in part , vacated in part 56 F.3d 1538, 35 U.S.P.Q.2d 1065, certiorari denied 116 S.Ct. 184, 516 U.S. 867, 133 L.Ed.2d 122. Patents 218(5)

Holder of infringed patent was entitled to recover amount that holder was willing to pay patent assignor as reasonable royalty for patent on adjustable chair. Contour Chair Lounge Co., Inc. v. True-Fit Chair, Inc., E.D.Mo.1986, 648 F.Supp. 704, 1 U.S.P.Q.2d 1353. Patents 319(1)

Reasonable royalty for infringement of patent for process for flue gas desulfurization was 25% of savings between use of patented process and next best process. Joy Technologies, Inc. v. Flakt, Inc., D.Del.1996, 954 F.Supp. 796, 42 U.S.P.Q.2d 1042. Patents 318(4.1)

For purposes of computing damages in suit for infringement of patent for composition of ZSM-5 catalyst, rights infringed were not comparable to rights granted under patentee's standard lease agreements, and thus established royalty rate did not provide appropriate measure of damages for which infringer was liable. Mobil Oil Corp. v. Amoco Chemicals Corp., D.Del.1994, 915 F.Supp. 1333. Patents 318(4.1)

Jury's award of damages to holder of patent for system of fastening mated shoes, based on reasonable royalty of $.05 per pair of infringing shoes plus additional lump-sum amount, was supported by substantial evidence; total compensatory award based on sales resulted in effective royalty rate just below $.10 per pair of shoes, and that rate was supported by patentee's other licensing agreements and expert testimony that $.10 per pair of shoes was reasonable royalty rate. Maxwell v. J. Baker, Inc., C.A.Fed. (Minn.) 1996, 86 F.3d 1098, 39 U.S.P.Q.2d 1001, rehearing denied, in banc suggestion declined , certiorari denied 117 S.Ct. 1244, 520 U.S. 1115, 137 L.Ed.2d 327. Patents 312(10)

District court was not required to select 3% figure advanced by patent infringer as reasonable royalty or 48% figure advance by patent holder and could award 25% as royalty for infringement of patent for specimen test slide and method for detecting hidden blood in fecal matter, even though infringer proved that it had entered licenses for other fecal occult blood test products at rates of 3 and 5%; holder was unwilling licensor and had never licensed its technology. SmithKline Diagnostics, Inc. v. Helena Laboratories Corp., C.A.Fed. (Tex.) 1991, 926 F.2d 1161, 17 U.S.P.Q.2d 1922. Patents 312(10)

Reasonable royalty rate to award to patentee of mechanism for restraining trucks to loading docks during loading or unloading process, in infringement action against competitor, was one-half of patentee's expected lost profits on sale of infringing restraints; award did not have to be based on infringer's profits, and fact that award was based on and was significant portion of patentee's profits did not make award unreasonable. Rite-Hite Corp. v. Kelley Co., Inc., C.A.Fed. (Wis.) 1995, 56 F.3d 1538, 35 U.S.P.Q.2d 1065, certiorari denied 116 S.Ct. 184, 516 U.S. 867, 133 L.Ed.2d 122. Patents 318(4.1)

Award of damages for lost profits based on royalty at rate of 5% of gross selling price of infringing electro car- diac computer was inadequate to compensate patentee which would not have licensed its invention for royalty and its imposition on patent owner which would not have licensed invention for royalty was form of compulsory license, against will and interest of party wronged, in favor of wrongdoer, which could not be imposed merely based on difficulty of determination of lost profits. Del Mar Avionics, Inc. v. Quinton Instrument Co., C.A.Fed. (Wash.) 1987, 836 F.2d 1320, 5 U.S.P.Q.2d 1255. Patents 318(3)

Award of damages measured as 5% of infringer's gross sales, and court award of 5% royalty for compulsory patent license for continuing operations was not clearly erroneous or abuse of discretion, notwithstanding that one of plaintiff's witnesses testified that 4% of “net” sales would be a reasonable royalty. Shatterproof Glass Corp. v. Libbey-Owens Ford Co., C.A.Fed.1985, 758 F.2d 613, 225 U.S.P.Q. 634, certiorari dismissed 106 S.Ct. 340, 474 U.S. 976, 88 L.Ed.2d 326. Patents 319(1)

Since there was no showing of profits made by ski resort through its infringing use of snow making machine and no showing of income loss to patent holder, those methods could not be used to determine damages in infringement action and, furthermore, since there was only one royalty agreement, record did not show an established royalty which could be used to establish amount of damages, and thus damages were properly determined by looking at royalty agreement that would have been entered into between willing licensor and willing licensee, namely, one third of the energy cost savings realized by using patented device rather than another device. Han- son v. Alpine Valley Ski Area, Inc., C.A.Fed.1983, 718 F.2d 1075, 219 U.S.P.Q. 679. Patents 318(1); Pat- ents 319(1)

Where patentee failed to furnish even an approximate estimate of amount which infringed manifolds used in automobiles contributed to profits made by infringer, and royalty paid by other manufacturers for such manifolds was uniform in amount, such royalty could be used to determine amount to which patentee was entitled. Swan Carburetor Co. v. Nash Motors Co., C.C.A.4 (Md.) 1943, 133 F.2d 562, certiorari denied 64 S.Ct. 36, 320 U.S. 762, 88 L.Ed. 454, rehearing denied 64 S.Ct. 155, 320 U.S. 812, 88 L.Ed. 491. Patents 318(4.1)

Royalty award of 8% was appropriate for infringement of patent for process for preparing microfiltration membrane. Pall Corp. v. Micron Separations, Inc., D.Mass.1992, 792 F.Supp. 1298, affirmed in part, modified in part and reversed in part 66 F.3d 1211, 36 U.S.P.Q.2d 1225, rehearing denied, certiorari denied 117 S.Ct. 1243, 520 U.S. 1115, 137 L.Ed.2d 326. Patents 319(1)

Reasonable royalty for horn reflector antenna would have been 10%, as a measure of patent owner's damages for infringement, where patentholder had demonstrably effective and desirable product, infringer had reason to want to produce a similar product, and patentholder would have had very little, if any, incentive for licensing its product. Andrew Corp. v. Gabriel Electronics, Inc., D.Me.1992, 785 F.Supp. 1041, 23 U.S.P.Q.2d 1019. Patents 319(1)

Although seller of eyeglasses merely furnished infringing display cases to its customers and did not manufacture

the infringing cases, the seller had used the patented invention in promoting eyeglass sales and extent of profits from such sales could be relevant in determining amount of a reasonable royalty and, for example, if eyeglass sales were increased because of infringing use of the displays that fact could affect the amount of royalties a potential licensee would be willing to pay and the most accurate indication of damages suffered from the infringement. Trans-World Mfg. Corp. v. Al Nyman & Sons, Inc., C.A.Fed. (Del.) 1984, 750 F.2d 1552, 224 U.S.P.Q. 259, on remand 633 F.Supp. 1047, 229 U.S.P.Q. 873. Patents 318(3)

Reasonable royalty for patentee's underground piping system containment sumps was 21 percent of gross sales, for purposes of awarding damages in patentee's infringement action against competitor; patentee could have demanded, and received, very high royalty for license, since competitor needed to continue selling sumps to re- main in business while it redesigned its product and produced new, noninfringing molds. Total Containment, Inc. v. Environ Products, Inc., E.D.Pa.1995, 921 F.Supp. 1355, affirmed in part , vacated in part 106 F.3d 427. Patents 318(4.2)

Holder of patent on foam pad used for buffing paint finish on automobile was entitled to royalty of $1 per pad from infringer; average price of pads was slightly under $5, amount served to provide appropriate recompense to patent holder while avoiding allowing infringer to profit from its infringement, holder had policy not to license its patents, holder and infringer were competitors of one another in the same territory and in the same line of business, patent had been recently issued, and infringer had made substantial use of the invention. Minnesota Min. and Mfg. Co. v. Lake Country Mfg., Inc., D.Minn.1996, 918 F.Supp. 1307, as amended , dismissed 106 F.3d 426. Patents 319(1)

Evidence in action for infringement of patent covering magnetic resonance imaging (MRI) device capable of obtaining images at multiple angle in single scan was sufficient to support award of $34,125,000 as reasonable royalty, based on competitor's sale of 525 infringing units; although competitor claimed that reasonable royalty on the 525 infringing sales would be in range of $525,000 to $1,837,500, evidence indicated that demand for MRI units with multiple-angle capability was high at time of infringing sale and that competitor would have paid royalty reflecting high demand at time of infringement. Fonar Corp. v. General Elec. Co., E.D.N.Y.1995, 902 F.Supp. 330, 41 U.S.P.Q.2d 1088, affirmed in part , reversed in part 107 F.3d 1543, 41 U.S.P.Q.2d 1801, rehearing denied, in banc suggestion declined , certiorari denied 118 S.Ct. 266, 522 U.S. 908, 139 L.Ed.2d 192. Pat- ents 312(10)

Substantial evidence supported jury's assessment of royalty rate of five cents per pair of shoes that infringed patented system for fastening mated pairs of shoes, where royalty rates varying between one cent per pair to six cents per pair had been discussed during prior unsuccessful negotiation between the parties. Maxwell v. J. Baker, Inc., D.Minn.1995, 875 F.Supp. 1371, reversed 86 F.3d 1098, 39 U.S.P.Q.2d 1001, rehearing denied, in banc suggestion declined , certiorari denied 117 S.Ct. 1244, 520 U.S. 1115, 137 L.Ed.2d 327. Patents 312(10)

Reasonable royalty that patent owner was entitled to for infringement of coin sorting machine patent was 16.7%, considering that patent owner had already invested amount equal to 10% of sales to produce product and that infringer proposed royalty of 6.7%, though patent owner suggested royalty in range of 25% to 40%. Ristvedt-John- son, Inc. v. Brandt, Inc., N.D.Ill.1992, 805 F.Supp. 557. Patents 319(1)

In patent infringement suit, district court properly fixed reasonable royalty, on which court calculated damages awarded plaintiff for part of accounting period during which plaintiff issued no licenses and competed with de-

fendant at amount of plaintiff's contractual payments to inventor of patented product. Russell Box Co. v. Grant Paper Box Co., C.A.1 (Mass.) 1953, 203 F.2d 177, 97 U.S.P.Q. 19, certiorari denied 74 S.Ct. 37, 346 U.S. 821, 98 L.Ed. 347, 99 U.S.P.Q. 491, rehearing denied 74 S.Ct. 216, 346 U.S. 905, 98 L.Ed. 404. Patents 319(1)

Reasonable royalty, rather than lost profits approach was proper method for quantifying damages in action based on government's infringement of patented camouflage screen. Brunswick Corp. v. U.S., Fed.Cl.1996, 36 Fed.Cl. 204, affirmed 152 F.3d 946, 46 U.S.P.Q.2d 1446. United States 97

In action arising from infringement of patent for taco shell fryers, trial court was in error in basing royalty-based damages on infringer's production rather than on lump sum for each infringing machine. Stickle v. Heublein, Inc., C.A.Fed.1983, 716 F.2d 1550, 219 U.S.P.Q. 377, on remand 590 F.Supp. 630, 224 U.S.P.Q. 910. Patents 319(1)

In patent infringement action against company doing business in the western states, where evidence showed that plaintiff bank owned all right, title, and interest in patent, the finding that patentee was not entitled to 7 1/2 percent of gross sale of the infringer on the basis that patentee had lost that amount under his contract with his own licensee in the western states was not clearly erroneous. U.S. Nat. Bank of Portland, Or. v. Fabri-Valve Co. of America, C.A.9 (Or.) 1956, 235 F.2d 565, 110 U.S.P.Q. 77. Patents 324.55(2)

In patent infringement suit, district court was justified in assessing damages awarded plaintiff for part of accounting period during which plaintiff issued licenses to others on basis of reasonable royalty of amounts paid for such licenses, though they were so specialized as to provide no basis for finding established royalty. Russell Box Co. v. Grant Paper Box Co., C.A.1 (Mass.) 1953, 203 F.2d 177, 97 U.S.P.Q. 19, certiorari denied 74 S.Ct. 37, 346 U.S. 821, 98 L.Ed. 347, 99 U.S.P.Q. 491, rehearing denied 74 S.Ct. 216, 346 U.S. 905, 98 L.Ed. 404. Patents 319(1)

Terms of license granted by patentee to petroleum products producer was not relevant to determining reasonable royalty in action for infringement of patentee's underground containment sump used in underground piping systems; petroleum producer may have been more interested in making sure that secondary containment systems that satisfied environmental regulations were available in marketplace than in profiting from patent. Total Con- tainment, Inc. v. Environ Products, Inc., E.D.Pa.1995, 921 F.Supp. 1355, affirmed in part , vacated in part 106 F.3d 427. Patents 312(2)

Proposals made by plaintiff for a reasonable royalty could not be accepted in allocating damages by reason of defendant's infringement of patented high-pressure pump where neither a willing buyer nor a willing seller would have made a decision as to a royalty on basis of plaintiff's arbitrary allocation of profits on basis of a cost ratio, and no evidence was introduced that profits, whether allocated or otherwise, would have had any relevance to what either defendant as a willing buyer would be willing to pay or defendant as a willing seller would be willing to accept as a reasonable royalty. Ellipse Corp. v. Ford Motor Co., N.D.Ill.1978, 461 F.Supp. 1354, 201 U.S.P.Q. 455, affirmed 614 F.2d 775, certiorari denied 100 S.Ct. 2160, 446 U.S. 939, 64 L.Ed.2d 792, 206 U.S.P.Q. 288. Patents 319(1)

Evidence in action for infringement of patent for rotary furnace used to fuse minerals supported award of reasonable royalty damages at rate of 20% on gross value of infringer's sales; infringer and patentee were direct competitors, infringer had inferior product at time of infringement, market contained no noninfringing alternatives, infringer regarded invention a significant advance, and industry enjoyed high rates of profit. Minco, Inc. v. Combustion Engineering, Inc., C.A.Fed. (Tenn.) 1996, 95 F.3d 1109, 40 U.S.P.Q.2d 1001, rehearing denied , in

banc suggestion declined. Patents 312(10)

Trial court's addition of “Panduit kicker” to reasonable royalty rate, in determining damages in patent-infringement action, was abuse of discretion; although Panduit set forth method of proving lost profits damages, lost profits were not at issue in instant case, and award of “kicker” to compensate for litigation expenses was not consistent with statutory requirements for awards of enhanced damages and attorney fees. Mahurkar v. C.R. Bard, Inc., C.A.Fed. (Ill.) 1996, 79 F.3d 1572, 38 U.S.P.Q.2d 1288, rehearing denied , in banc suggestion declined. Patents 319(3)

Price at which infringer sold its archery bows to its wholly owned subsidiary was not the proper basis for calculating the amount of royalty owed to the patent owner under the agreed standard, established in industry-wide licensing agreement, of “net selling price,” based on invoice or billhead price “established in normal, bona fide, arms-length transactions,” where it was shown only that the price between the two companies was jointly established by the management of the companies; correct price for calculating the royalty was the price at which the subsidiary resold the bows to its customers. Allen Archery, Inc. v. Browning Mfg. Co., C.A.Fed. (Utah) 1990, 898 F.2d 787, 14 U.S.P.Q.2d 1156. Patents 319(1)

Unpatented wheels and axles were properly included in royalty base and in lost-profits award for infringement of patent covering device enabling trucks to carry an additional axle and wheels to carry heavy loads where a hypothetical licensee would have anticipated an increase in sales of collateral unpatented items because of the patent, infringer did not show how many, if any, of the patented devices were sold alone without wheels and axles and patentee probably would have made the sales that the infringer made. TWM Mfg. Co., Inc. v. Dura Corp., C.A.Fed. (Mich.) 1986, 789 F.2d 895, 229 U.S.P.Q. 525, certiorari denied 107 S.Ct. 183, 479 U.S. 852, 93 L.Ed.2d 117. Patents 319(1)

Worth of contested corn-harvesting device patent could not reasonably be divorced from value both patentee and infringer placed on their respective shares in combine market, therefore, district court, at accounting trial following judgment in favor of patentee in infringement suit, properly took into account, in basing its royalty award, impact of anticipated collateral sales of an admittedly noninfringing product line on respective bargaining positions of parties engaged in theorized licensing negotiations; district court in no way assumed that a willing licensor would condition grant of license under patent on purchase of any unpatented product. Deere & Co. v. In- ternational Harvester Co., C.A.Fed.1983, 710 F.2d 1551, 218 U.S.P.Q. 481. Patents 312(2)

Where infringer's sale of infringing flux enabled it to sell other, noninfringing materials and equipment for use in connection with it, these sales could be considered in determining a reasonable royalty, on willing seller and buyer rule, as basis for damages for infringement. Union Carbide Corp. v. Graver Tank & Mfg. Co., C.A.7 (Ind.) 1960, 282 F.2d 653, 127 U.S.P.Q. 3, certiorari denied 81 S.Ct. 692, 365 U.S. 812, 5 L.Ed.2d 691, 129 U.S.P.Q. 557, certiorari denied 81 S.Ct. 695, 365 U.S. 812, 5 L.Ed.2d 691, 128 U.S.P.Q. 557, on remand 243 F.Supp. 358, 145 U.S.P.Q. 446. Patents 319(1)

Evidence established that net selling price of ventilation products covered by hypothetical license agreement between patent owner and infringer, to which reasonable royalty rate is applied, would not include the cost of freight or accessories for the ventilation equipment but would include the amount of commissions paid on the sale of the products. Jenn-Air Corp. v. Penn Ventilator Co., Inc., E.D.Pa.1975, 394 F.Supp. 665, 185 U.S.P.Q. 410. Patents 312(10)

Patent holder was entitled to damages in excess of reasonable royalty amount in order to compensate him for in-

fringement in the amount of a ten percent increase and reasonable royalty for wipe-on plates and 7.5 percent increase for reasonable royalty for presensitized plates; patent holder had to engage in painful and time-consuming litigation, true extent of damages could not be precisely measured because of degree to which infringers competed in the market, holder could have made economies of scale as production increased without infringement but lost potential for expansion as well as premium that his product would have enjoyed when infringers installed their own aluminum treatment facilities and competed among themselves. Fromson v. Citiplate, Inc., E.D.N.Y.1988, 699 F.Supp. 398, 9 U.S.P.Q.2d 1506, affirmed 886 F.2d 1300, 12 U.S.P.Q.2d 1299. Patents 319(1)

Royalty rate of between three and four percent that was presently being negotiated by patentee, rather than two and three percent rates for other licenses, was reasonable royalty rate in determining damages for patent infringement, where other licenses were granted at time validity of patent was being contested by accused infringers who later became licensees. Wisconsin Alumni Research Foundation v. General Elec. Co., E.D.Wis.1995, 880 F.Supp. 1266. Patents 319(1)

Appropriate damages for infringement of patented hip prosthesis was reasonable royalty in amount of 10% of total volume of sales by infringer of infringing prosthesis. Ramos v. Biomet, Inc., S.D.Fla.1993, 828 F.Supp. 1570, affirmed in part , reversed in part 69 F.3d 553, rehearing denied, rehearing denied , in banc suggestion declined. Patents 319(1)

Holder of valid patent for a sailboard design was entitled to a reasonable royalty for the sailboards that its licensees would have sold absent the defendant's infringement. BIC Leisure Products, Inc. v. Windsurfing Intern., Inc., S.D.N.Y.1991, 761 F.Supp. 1032, 19 U.S.P.Q.2d 1922, modified on other grounds on reconsideration 774 F.Supp. 832, 21 U.S.P.Q.2d 1548, affirmed 1 F.3d 1214, 27 U.S.P.Q.2d 1671, rehearing denied, on remand 850 F.Supp. 224, 30 U.S.P.Q.2d 1949, reconsideration denied. Patents 318(4.1)

163. Apportionment of damages

In patent infringement suit, where proper measure of damages was reasonable royalty because it did not appear that plaintiff lost any sales through defendant's infringement, master, to whom case was referred, did not err in refusing to apportion royalty basis as between the patented parts in suit and other parts of the composite structure, where it appeared that patents covered the composite structure. Austral Sales Corp v. Jamestown Metal Equipment Co, W.D.N.Y.1941, 41 F.Supp. 508. Patents 319(1)

A jury can properly apportion all damages to the second claim of a patent when there is evidence that the royalty which the patentee had received was for this claim alone. Hunt Bros. Fruit-Packing Co. v. Cassiday, C.C.A.9 (Cal.) 1894, 64 F. 585, 12 C.C.A. 316. Patents 275

On suit for infringement of patents of different dates, damages need not be apportioned for infringement of each. Timken v. Olin, C.C.S.D.Ohio 1890, 41 F. 169. Patents 319(1)

Where the claims not infringed are merely structural, and comprehended within those infringed, no apportionment of the license fee is proper. Willimantic Thread Co v. Clark Thread Co, C.C.N.J.1886, 27 F. 865, reversed on other grounds 11 S.Ct. 846, 140 U.S. 481, 35 L.Ed. 521. Patents 319(1)

164. Punitive damages

Imposition of $1 million in punitive damages was warranted for wilful infringement of patent for stacking chair with protective edge, which had resulted in actual damages of approximately $14 million. Gasser Chair Co., Inc. v. Infanti Chair Mfg. Corp., E.D.N.Y.1996, 943 F.Supp. 201, 40 U.S.P.Q.2d 1554, vacated 95 F.3d 1165, 40 U.S.P.Q.2d 1700, on remand 40 U.S.P.Q.2d 1701, 1996 WL 683240. Patents 319(1)

The district court in further proceedings, if any, for determination of reasonable royalty on sale of tires by defendant, would be authorized to make additional award as punitive damages only in event defendant was found guilty of conscious and deliberate infringement. Goodyear Tire & Rubber Co. v. Overman Cushion Tire Co., C.C.A.6 (Ohio) 1937, 95 F.2d 978, certiorari dismissed 59 S.Ct. 459, 306 U.S. 665, 83 L.Ed. 1061, certiorari dismissed 59 S.Ct. 460, 306 U.S. 665, 83 L.Ed. 1061. Patents 319(3)

Exemplary or punitive damages for patent infringement are allowed only on basis of conscious and willful infringement. Union Carbide Corp. v. Graver Tank & Mfg. Co., C.A.7 (Ind.) 1960, 282 F.2d 653, 127 U.S.P.Q. 3, certiorari denied 81 S.Ct. 692, 365 U.S. 812, 5 L.Ed.2d 691, 129 U.S.P.Q. 557, certiorari denied 81 S.Ct. 695, 365 U.S. 812, 5 L.Ed.2d 691, 128 U.S.P.Q. 557, on remand 243 F.Supp. 358, 145 U.S.P.Q. 446. Patents 319(3)

Where issue of patentability is close and litigated in good faith, court should be more reluctant to impose punitive damages. Yoder Bros., Inc. v. California-Florida Plant Corp., C.A.5 (Fla.) 1976, 537 F.2d 1347, 193 U.S.P.Q. 264, certiorari denied 97 S.Ct. 1108, 429 U.S. 1094, 51 L.Ed.2d 540, 200 U.S.P.Q. 65, 200 U.S.P.Q. 128. Patents 319(3)

Court, in patent infringement suit, may award punitive damages in addition to compensatory damages if oppressive or fraudulent conduct on part of defendant is shown to exist, but exercise of such power is discretionary. Laskowitz v. Marie Designer, Inc., S.D.Cal.1954, 119 F.Supp. 541, 100 U.S.P.Q. 367. Patents 319(3)

165. Treble damages--Generally

It was not abuse of discretion to refuse to treble damages for patent infringement, notwithstanding that record was devoid of opinions of counsel and silent on defendant's reaction to existence of the patents. Shatterproof Glass Corp. v. Libbey-Owens Ford Co., C.A.Fed.1985, 758 F.2d 613, 225 U.S.P.Q. 634, certiorari dismissed 106 S.Ct. 340, 474 U.S. 976, 88 L.Ed.2d 326. Patents 319(3)

Former §§ 67 and 70 of this title which provided for trebling of recovery by patentee for infringing use of patented device was limited to recovery of treble damages, not profits. Amusement Corp. of America v. Mattson, C.C.A.5 (Fla.) 1943, 138 F.2d 693, certiorari denied 64 S.Ct. 639, 321 U.S. 782, 88 L.Ed. 1074. See, also, Bird- sall v. Coolidge, Nev.1876, 93 U.S. 64, 23 L.Ed. 802; McSherry Mfg. Co. v. Dowagiac Mfg. Co., C.C.A.Ohio 1908, 160 F. 948, rehearing denied 163 F. 34; Covert v. Sargent, C.C.N.Y.1890, 42 F. 298, appeal dismissed 12 S.Ct. 979, 145 U.S. 635, 36 L.Ed. 855, reversed on other grounds 14 S.Ct. 676, 152 U.S. 516, 38 L.Ed. 536; Campbell v. James, C.C.N.Y.1880, 5 F. 806; Campbell v. James, C.C.N.Y.1880, 2 F. 338, 18 Blatchf., U.S., 92; Holbrook v. Small, C.C.Mass.1878, Fed.Cas. No. 6,596; Sanders v. Logan, C.C.Pa.1861; 2 Fish.Pat.Cas. 167, Fed.Cas. No. 12,295; Moote v. Bennett, C.C.S.C.1849, 2 Fish.Pat.Cas. 642, Fed.Cas. No. 9,884. Patents 319(3)

Among factors court should consider in determining whether patentee is entitled to triple damages because of willful infringement are: whether the infringer, when he knew of the patent protection, investigated the scope of the patent and formed a good faith belief that it was invalid or not infringed; whether infringer deliberately

copied the ideas and design of patentee; and infringer's behavior as party to the litigation. American Medical Systems, Inc. v. Medical Engineering Corp., E.D.Wis.1992, 794 F.Supp. 1370, 26 U.S.P.Q.2d 1081, affirmed in part , reversed in part 6 F.3d 1523, 28 U.S.P.Q.2d 1321, rehearing denied, in banc suggestion declined , certiorari denied 114 S.Ct. 1647, 511 U.S. 1070, 128 L.Ed.2d 366. Patents 319(3)

Infringer's sale of redesigned device, following judgment that its original device infringed patent for surgical suction irrigator, warranted contempt finding, in view of evidence that redesigned device could also meet limitations of patent claim, and district court did not abuse its discretion in awarding treble the compensatory royalty damages, attorney fees, and costs, in view of conclusory nature of opinion of counsel used by infringer to justify selling revised device and minor changes made to the original device. Stryker Corp. v. Davol Inc., C.A.Fed. (Mich.) 2000, 234 F.3d 1252, 57 U.S.P.Q.2d 1133, rehearing and rehearing en banc denied. Patents 326(4)

In an action at law the verdict must be for the actual damages sustained subject to the right of the court to enter judgment thereon for any sum above the verdict, not exceeding three times that amount, together with costs. Birdsall v. Coolidge, U.S.Nev.1876, 93 U.S. 64, 3 Otto 64, 23 L.Ed. 802. See, also, Motte v. Bennett, C.C.S.C.1849, 2 Fish.Pat.Cas. 642, Fed.Cas. No. 9,884; Livingston v. Jones, C.C.Pa.1836, 2 Wall.Jr.C.C. 330, Fed.Cas. No. 8,414, reversed on other grounds 1 Wall. 155, 17 L.Ed. 662; Evans v. Hettick, C.C.Pa.1818, 3 Wash. 408, Fed.Cas. No. 4,562, affirmed 7 Wheat. 453, 5 L.Ed. 496; Gray v. James, C.C.Pa.1817, Fed.Cas. No. 5,718; Whittemore v. Cutter, C.C.Mass.1813, Fed.Cas. No. 17,601. Patents 275

Treble damages are awarded in a patent infringement action only in exceptional cases involving fraud or conduct tantamount to fraud. Armstrong v. Emerson Radio & Phonograph Corp., S.D.N.Y.1959, 179 F.Supp. 95, 123 U.S.P.Q. 133. Patents 319(3)

In patent infringement suit, award of treble damages should be determined after an accounting has been had pursuant to a finding of infringement and not before such accounting. Austral Sales Corp v. Jamestown Metal Equipment Co, W.D.N.Y.1941, 41 F.Supp. 508. See, also, Arthur J. Schmitt Foundation v. Stockham Valves & Fittings, Inc., D.C.Ala.1966, 292 F.Supp. 893, affirmed 404 F.2d 13, rehearing denied 420 F.2d 699, certiorari denied 90 S.Ct. 2177, 398 U.S. 965, 26 L.Ed.2d 549; Baltz v. Walgreen Co., D.C.Tenn.1961, 198 F.Supp. 22; Solex Laboratories, Inc. v. Graham, D.C.Cal.1958, 165 F.Supp. 428; Anchor Hocking Glass Corporation v. White Cap. Co., D.C.Del.1942, 47 F.Supp. 451.

In patent infringement cases where the issues are close and fairly debatable and are litigated in good faith, treble damages should not be awarded. Wedge v. Waynesboro Nurseries, W.D.Va.1940, 31 F.Supp. 638. See, also, Deere & Co. v. International Harvester Co., C.A.7 (Ill.)1981, 658 F.2d 1137, 211 U.S.P.Q. 11, certiorari denied 102 S.Ct. 514, 454 U.S. 969, 70 L.Ed.2d 386; Wahl v. Carrier Mfg. Co., Inc., C.A.Ind.1975, 511 F.2d 209; Toledo Computing Scale Co., C.C.Ill.1910, 178 F. 557, affirmed 187 F. 826; Brown Bag Filing Mach. Co. v. Drohen, C.C.A.N.Y.1910, 175 F. 576; B & J Mfg. Co. v. Hennessy Industries, Inc., D.C.Ill.1979, 493 F.Supp. 1105, affirmed 663 F.2d 1075, certiorari denied 102 S.Ct. 645, 454 U.S. 1086, 70 L.Ed.2d 622.

Provision of this section for treble damages for patent infringement is remedial, and damages contemplated may be awarded whether the wrong was intentional or unwitting. Armstrong v. Emerson Radio & Phonograph Corp., S.D.N.Y.1955, 132 F.Supp. 176, 106 U.S.P.Q. 404. Patents 319(3)

Finding on appropriateness of treble damages award in patent infringement case could be made before amount of actual damages was ascertained. Paper Converting Mach. Co. v. Magna-Graphics Corp., C.A.7 (Wis.) 1982, 680 F.2d 483. Patents 319(3)

Award of profits from patent infringement to patent owners electing to take such profits cannot serve as basis for increasing damages because of deliberate and willful infringement, but such increase must be limited to trebling amount awarded as damages. Sutton v. Gulf Smokeless Coal Co., C.C.A.4 (W.Va.) 1935, 77 F.2d 439. Patents 319(3)

The court in a proper case may award treble damages for patent infringement. Goldmark v. Kreling, C.C.Cal.1885, 25 F. 349, 11 Sawy. 215. See, also, Activated Sludge v. Sanitary Dist. of Chicago, D.C.Ill.1946, 64 F.Supp. 25, affirmed 157 F.2d 517, certiorari denied 67 S.Ct. 970, 330 U.S. 834, 91 L.Ed. 1281, rehearing denied 67 S.Ct. 1092, 330 U.S. 856, 91 L.Ed. 1297, rehearing denied 67 S.Ct. 1347, 331 U.S. 866, 91 L.Ed. 1870.

Treble damages would not be awarded in patent infringement suit, in view of circumstances of case, including but not limited to invalidity of patent for obviousness. White v. Mar-Bel, Inc., M.D.Fla.1973, 369 F.Supp. 1321, 180 U.S.P.Q. 795, affirmed in part, reversed in part on other grounds 509 F.2d 287, 185 U.S.P.Q. 129, rehearing denied 511 F.2d 1402. Patents 319(3)

166. ---- Discretion of court, treble damages

Award of treble damages in patent infringement action was matter solely within discretion of the trial judge, even though a jury trial was granted. Swofford v. B & W, Inc., S.D.Tex.1963, 34 F.R.D. 15, 139 U.S.P.Q. 92, affirmed 336 F.2d 406, 142 U.S.P.Q. 291, certiorari denied 85 S.Ct. 653, 379 U.S. 962, 13 L.Ed.2d 557, 144 U.S.P.Q. 780. Patents 319(3); Patents 325.1; Patents 325.11(3)

Trebling of damage award for patent infringement is within discretion of district court when infringement is willful and wanton. Baumstimler v. Rankin, C.A.5 (Tex.) 1982, 677 F.2d 1061, 215 U.S.P.Q. 575. Patents 319(3)

The allowance of treble damages for patent infringement is largely discretionary. Marvel Specialty Co., Inc. v. Bell Hosiery Mills, Inc., C.A.4 (N.C.) 1967, 386 F.2d 287, 155 U.S.P.Q. 545, certiorari denied 88 S.Ct. 1409, 390 U.S. 1030, 20 L.Ed.2d 286, 157 U.S.P.Q. 720. Patents 319(3)

District court enjoys discretion to treble damages in patent infringement action. Oiness v. Walgreen Co., D.Colo.1991, 774 F.Supp. 1277, 21 U.S.P.Q.2d 1654, affirmed in part , vacated in part 980 F.2d 742, 26 U.S.P.Q.2d 1548, rehearing denied, certiorari denied 113 S.Ct. 1849, 507 U.S. 1032, 123 L.Ed.2d 473, on remand 838 F.Supp. 1420, 30 U.S.P.Q.2d 1383. Patents 319(3)

167. ---- Willfulness, treble damages

Although infringer's willful infringement justified award of enhanced damages in infringement suit, damages would only be doubled rather than trebled as permitted by statute, where infringer's behavior as party to litigation was not objectionable, and there was no evidence that infringer copied patentee's idea or design. No- vozymes A/S v. Genencor Intern., Inc., D.Del.2007, 474 F.Supp.2d 592. Patents 319(3)

Award of treble damages and attorney fees was warranted, upon finding that patents for method of cleaving nucleic acids had been infringed; defendant knew of patents but did not obtain timely opinion letter, opinion letter ultimately obtained did not rest on accurate analysis of relevant facts, defendant had engaged in extensive litigation misconduct, defendant could afford enhanced damage award, and case was not close. Third Wave Techno-

logies, Inc. v. Stratagene Corp., W.D.Wis.2005, 405 F.Supp.2d 991. Patents 319(3); Patents 325.11(3)

Competitor's willful infringement of patent for air filter restriction indicator warranted full trebling of damages; competitor performed, at best, cursory and inadequate investigation of scope and validity of patent, which did not even involve advice of counsel, before copying it, and case was not close. Engineered Products Co. v. Don- aldson Co., Inc., N.D.Iowa 2004, 330 F.Supp.2d 1013, amended in part 335 F.Supp.2d 973, affirmed in part, vacated in part and remanded 147 Fed.Appx. 979, 2005 WL 2090662. Patents 319(3)

Trebling of reasonable royalty damages was warranted, upon determination that retail garment seller's infringement of fabric patent was willful; retailer had continued selling accused garments after being put on notice of potential infringement, engaged in questionable litigation behavior, and was much larger company than patentee, and case was not close. Domestic Fabrics Corp. v. Sears, Roebuck & Co., E.D.N.C.2004, 326 F.Supp.2d 694, dismissed 122 Fed.Appx. 518, 2005 WL 545714. Patents 319(3)

Evidence pertaining to willful infringement of design patents warranted award of treble damages; infringer offered no competent opinion of counsel tending to show that its typewriter cassettes did not infringe patent holder's designs or that design patents were primarily functional; moreover, issue of willful infringement was not close. Smith Corona Corp. v. Pelikan, Inc., M.D.Tenn.1992, 784 F.Supp. 452, affirmed 1 F.3d 1252, rehearing denied , in banc suggestion declined. Patents 319(3)

Award of treble damages was warranted against competitor for its infringement of manufacturer's patent in hand-held kitchen blender, despite competitor's alleged reliance upon opinion of its patent attorney, in view of jury's supported determination that competitor's infringement was nevertheless willful, and all evidence presented concerning competitor's actions and intent in producing, marketing, and selling infringing device. Braun Inc. v. Dynamics Corp. of America, D.Conn.1991, 775 F.Supp. 33, 19 U.S.P.Q.2d 1696, affirmed in part , reversed in part 975 F.2d 815, 24 U.S.P.Q.2d 1121, rehearing in banc declined. Patents 319(3)

Testimonial evidence established that infringement of patent for Coriolis mass flowmeters was not willful and did not warrant imposition of treble damages. Micro Motion, Inc. v. Exac Corp., N.D.Cal.1991, 761 F.Supp. 1420, 19 U.S.P.Q.2d 1001. Patents 312(8); Patents 319(3)

Issue of willful infringement is relevant only to question of whether increased or treble damages should be awarded pursuant to this section. Medtronic, Inc. v. Catalyst Research Corp., D.C.Minn.1982, 547 F.Supp. 401, 216 U.S.P.Q. 687. Patents 319(3)

In action in which it was determined patents were valid and were infringed, plaintiff was not entitled to treble damages, in view of failure to establish that defendant's infringement had been willful and intentional. USM Corp. v. Detroit Plastic Molding Co., E.D.Mich.1982, 536 F.Supp. 902, 214 U.S.P.Q. 603, 220 U.S.P.Q. 383, affirmed 720 F.2d 680, certiorari denied 104 S.Ct. 2658, 467 U.S. 1215, 81 L.Ed.2d 364. Patents 319(3)

Finding of willful patent infringement will support award of increased damages up to three times amount found or assessed. T.A. Pelsue Co. v. Grand Enterprises, Inc., D.Colo.1991, 782 F.Supp. 1476, 25 U.S.P.Q.2d 1001. Patents 319(3)

Where proof at trial shows infringement to be willful, damage award may be trebled. Datascope Corp. v. SMEC, Inc., D.N.J.1988, 678 F.Supp. 457, 5 U.S.P.Q.2d 1963, affirmed in part , reversed in part 879 F.2d 820, 11

U.S.P.Q.2d 1321, rehearing denied, rehearing in banc declined, certiorari denied 110 S.Ct. 729, 493 U.S. 1024, 107 L.Ed.2d 747, on remand 14 U.S.P.Q.2d 1071. Patents 319(3)

If wilful and wanton infringement of patent is found, court, in its discretion, may award treble damages and reasonable attorneys fees. Besly-Welles Corp. v. Balax, Inc., E.D.Wis.1968, 291 F.Supp. 328, 160 U.S.P.Q. 265, affirmed in part , reversed in part 421 F.2d 809, 164 U.S.P.Q. 485, certiorari denied 90 S.Ct. 2203, 399 U.S. 911, 26 L.Ed.2d 562, 166 U.S.P.Q. 65, on remand 321 F.Supp. 1095, 168 U.S.P.Q. 461. Patents 319(3); Patents 325.11(2.1)

If it should be found that defendant's infringement of plaintiff's patent was intentional, willful, and deliberate, plaintiff should be entitled to treble amount of damages. Bristol Laboratories v. Schenley Laboratories, S.D.Ind.1953, 117 F.Supp. 67, 99 U.S.P.Q. 400. See, also, Leesona Corp. v. U.S., 1979, 599 F.2d 958, 220 Ct.Cl. 234, certiorari denied 100 S.Ct. 522, 444 U.S. 991, 62 L.Ed.2d 420; Coleman Co. v. Holly Mfg. Co., C.A.Cal.1959, 269 F.2d 660; L. F. Strassheim Co. v. Gold Medal Folding Furniture Co., D.C.Wis.1968, 294 F.Supp. 708, vacated on other grounds 477 F.2d 818; Maxon Premix Burner Co. v. Mid-Continent Metal Products Co., D.C.Ill.1967, 279 F.Supp. 164. Patents 319(3)

168. Increased damages--Generally

Enhanced damages may be awarded in patent infringement action only as penalty for infringer's increased culpability, namely willful infringement or bad faith; damages cannot be enhanced to award patentee additional compensation to rectify what district court views as inadequacy in actual damages awarded. Beatrice Foods Co. v. New England Printing and Lithographing Co., C.A.Fed. (Conn.) 1991, 923 F.2d 1576, 17 U.S.P.Q.2d 1553. Pat- ents 319(3)

If jury finding of willful infringement of patent is not overturned on motion for judgment notwithstanding the verdict, court has discretion to award increased damages on basis of jury's finding; if jury finds that willful infringement did not occur and that finding is not overturned on motion for judgment notwithstanding the verdict, no basis for assessing increased damages for willful infringement exists; if jury finding is that willful infringement did not occur, and court overturns that finding on motion for judgment notwithstanding the verdict, because no reasonable jury could on all the facts find absence of willful infringement, court may increase damages within its discretion. Shiley, Inc. v. Bentley Laboratories, Inc., C.A.Fed. (Cal.) 1986, 794 F.2d 1561, 230 U.S.P.Q. 112, certiorari denied 107 S.Ct. 1291, 479 U.S. 1087, 94 L.Ed.2d 148. Patents 319(3)

Increased damages are within trial court's discretion to award, but are warranted only upon clear showing of willful and deliberate infringement. Medtronic, Inc. v. Catalyst Research Corp., D.C.Minn.1982, 547 F.Supp. 401, 216 U.S.P.Q. 687. Patents 319(3)

“Reasonable royalty” which was general damages and not profits may have been increased under former §§ 67 and 70 of this title which allowed increase of damages caused by patent infringement. Overman Cushion Tire Co. v. Goodyear Tire & Rubber Co., C.C.A.2 (N.Y.) 1933, 66 F.2d 361, certiorari denied 54 S.Ct. 119, 290 U.S. 681, 78 L.Ed. 587. Patents 319(3)

Factors which should be considered by court when deciding whether to award enhanced damages in patent infringement case are: whether infringer deliberately copied ideas or designs of another; whether infringer formed good-faith and soundly-based belief that either patent was invalid or product was not infringing; infringer's behavior as party to litigation; infringer's size and financial condition; closeness of case; duration of infringer's

misconduct; remedial action by infringer; infringer's motivation for harm; and whether infringer attempted to conceal its misconduct. Pentech Intern., Inc. v. Hayduchok, S.D.N.Y.1996, 931 F.Supp. 1167. Patents 319(3)

Among factors which may be considered in determining whether to award multiple damages in patent infringement action are whether infringer deliberately copied, whether infringer had formed good faith belief that patent was invalid or not infringed, and infringer's behavior as party to litigation. Oscar Mayer Foods Corp. v. Conagra, Inc., W.D.Wis.1994, 869 F.Supp. 656, 31 U.S.P.Q.2d 1173, affirmed 45 F.3d 443, 35 U.S.P.Q.2d 1278, rehearing denied, in banc suggestion declined , certiorari denied 116 S.Ct. 62, 516 U.S. 812, 133 L.Ed.2d 25. Patents 319(3)

169. ---- Discretion of court, increased damages

Decision whether to enhance damages in patent infringement action is committed to discretion of trial judge and will not be disturbed absent clear showing of abuse of discretion. Amsted Industries Inc. v. Buckeye Steel Cast- ings Co., C.A.Fed. (Ill.) 1994, 24 F.3d 178, 30 U.S.P.Q.2d 1462, rehearing denied , in banc suggestion declined. Patents 319(3); Patents 324.55(1)

Determination as to whether or not increased damages are warranted in patent case is committed to sound discretion of district court and will not be overturned absent clear showing of abuse of discretion. State Industries, Inc. v. Mor-Flo Industries, Inc., C.A.Fed. (Tenn.) 1991, 948 F.2d 1573, 20 U.S.P.Q.2d 1738, rehearing denied. Patents 319(3)

Court declined to exercise its discretion to award enhanced damages and attorney fees, even though jury found that competitor had willfully infringed on patent with respect to newly-made disposable cameras, known as lens- fitted film packages (LFFPs); competitor acquired newly-made cameras from third parties, newly-made cameras reflected very small percentage of total cameras sold by competitor, competitor took remedial measures once infringement was discovered, competitor did not conceal existence of its sales of newly-made cameras, and competitor's conduct in litigation did not warrant any damages enhancement. Fuji Photo Film Co. Ltd. v. Jazz Photo Corp., D.N.J.2003, 249 F.Supp.2d 434, affirmed 394 F.3d 1368, 73 U.S.P.Q.2d 1678. Patents 319(3)

Whether to enhance damages in patent infringement case, and extent of any enhancement, is committed to sound discretion of trial court. Virginia Panel Corp. v. Mac Panel Co., W.D.Va.1995, 887 F.Supp. 880, affirmed 133 F.3d 860, 45 U.S.P.Q.2d 1225, rehearing denied, in banc suggestion declined , certiorari denied 119 S.Ct. 52, 525 U.S. 815, 142 L.Ed.2d 40. Patents 319(3)

It is within the discretion of the court to increase the damages or not. Topliff v. Topliff, U.S.Ohio 1892, 12 S.Ct. 825, 145 U.S. 156, 36 L.Ed. 658. See, also, National Folding-Box, etc., Co. v. Elsas, N.Y.1898, 86 F. 917, 30 C.C.A. 487; Stimpson v. Railroads, C.C.1847, 1 Wall.Jr.C.C. 104, Fed.Cas. No. 13,456.

Enhancement of damages in patent infringement case is discretionary ruling of trial court; it is reviewed with requisite deference to discretion of trial judge, and is not disturbed absent abuse of that discretion. National Presto Industries, Inc. v. West Bend Co., C.A.Fed. (Wis.) 1996, 76 F.3d 1185, 37 U.S.P.Q.2d 1685. Patents 319(3)

Award of enhanced damages for willful patent infringement is within discretion of district court and will not be overturned absent a clear showing of abuse of discretion. American Medical Systems, Inc. v. Medical Engineer-

ing Corp., C.A.Fed. (Wis.) 1993, 6 F.3d 1523, 28 U.S.P.Q.2d 1321, rehearing denied, in banc suggestion declined , certiorari denied 114 S.Ct. 1647, 511 U.S. 1070, 128 L.Ed.2d 366. Patents 319(3); Patents 324.55(1)

Awards of increased damages and attorney fees in patent infringement action are within discretion of trial court and will not be disturbed absent abuse of discretion. Acoustical Design, Inc. v. Control Electronics Co., Inc., C.A.Fed. (N.Y.) 1991, 932 F.2d 939, 18 U.S.P.Q.2d 1707, certiorari denied 112 S.Ct. 185, 502 U.S. 863, 116 L.Ed.2d 146. Patents 319(3); Patents 325.11(2.1)

In patent infringement case, trial court may award amount of damages greater than reasonable royalty so that award is adequate to compensate for infringement; such increase, which may be stated by trial court either as reasonable royalty for infringer or as increase in reasonable royalty determined by court, is left to its sound discretion. Stickle v. Heublein, Inc., C.A.Fed.1983, 716 F.2d 1550, 219 U.S.P.Q. 377, on remand 590 F.Supp. 630, 224 U.S.P.Q. 910. Patents 319(1)

The allowance of increase of damages in infringement suit on ground that defendant was guilty of conscious, deliberate patent infringement, and protracted, vexatious, and expensive litigation, is entirely within discretion of court. General Motors Corp. v. Dailey, C.C.A.6 (Mich.) 1937, 93 F.2d 938. Patents 319(3)

Substantial discretion is reposed in the trial court in a patent infringement case when reaching a judgment following lack of cooperation of a party, and the trial court may increase damages up to treble the amount of actual damages. Beatrice Foods Co. v. New England Printing and Lithographing Co., C.A.Fed. (Conn.) 1990, 899 F.2d 1171, 14 U.S.P.Q.2d 1020. Patents 319(3)

The factor by which damages are multiplied in patent infringement case is within the sound discretion of the district court. Trio Process Corp. v. L. Goldstein's Sons, Inc., C.A.3 (Pa.) 1976, 533 F.2d 126, 189 U.S.P.Q. 561, on remand 204 U.S.P.Q. 863. Patents 319(3)

Ordinarily an award of double damages for wilful and deliberate infringement of patents is peculiarly within the sound discretion of the district court. E-I-M Co. v. Philadelphia Gear Works, C.A.5 (Tex.) 1955, 223 F.2d 36, 105 U.S.P.Q. 402, certiorari denied 76 S.Ct. 304, 350 U.S. 933, 100 L.Ed. 815, 108 U.S.P.Q. 456. Patents 319(3)

If a patent infringement suit is conscious and deliberate, an exemplary increase may be made in compensatory damages in discretion of the court. Carter Products, Inc. v. Colgate-Palmolive Co., D.C.Md.1963, 214 F.Supp. 383, 136 U.S.P.Q. 348, 136 U.S.P.Q. 577. Patents 319(3)

Grant of damages in addition to compensatory damages in patent infringement suit lies in sound legal discretion of the court, based presumably upon facts of the case and extent and character of defendant's conduct, if any, damaging to the plaintiff. Armstrong v. Allen B. Du Mont Laboratories, D.C.Del.1955, 137 F.Supp. 659, 108 U.S.P.Q. 70. Patents 319(3)

District court did not abuse its discretion by awarding patent holder $7,029,360 in enhanced damages, which was half of compensatory damages award, to compensate patent holder for competitor's deliberate indifference to its rights; competitor's conduct was reckless, but not egregious, and competitor presented good-faith defenses to infringement throughout the litigation. Atmel Corp. v. Silicon Storage Technology, Inc., C.A.Fed.2003, 76 Fed.Appx. 298, 2003 WL 22129398, Unreported, rehearing and rehearing en banc denied. Patents 319(3)

District court did not abuse its discretion in patent infringement suit by applying a multiplier of 1.21 instead of 3 and awarding holder of patent for athletic shoes $150,000 in enhanced damages; in making its award, the court considered the Read factors and goals behind the award of enhanced damages. Hockerson-Halberstadt, Inc. v. Propet USA, Inc., C.A.Fed.2003, 62 Fed.Appx. 322, 2003 WL 1795641, Unreported. Patents 319(3)

170. ---- Advice of counsel, increased damages

There is no affirmative obligation to obtain an opinion of counsel in order to oppose a claim of willful patent infringement that permits enhanced damages. In re Seagate Technology, LLC, C.A.Fed. (N.Y.) 2007, 497 F.3d 1360, 83 U.S.P.Q.2d 1865, certiorari denied 128 S.Ct. 1445, 170 L.Ed.2d 275. Patents 319(3)

Failure of patent infringement defendant to obtain exculpatory opinion of counsel did not give rise to adverse inference or presumption that such opinion would have been unfavorable, for purpose of determining whether infringement was willful. Insituform Technologies, Inc. v. CAT Contracting, Inc., C.A.Fed.2004, 385 F.3d 1360, 72 U.S.P.Q.2d 1870, on remand 518 F.Supp.2d 876. Patents 227

Alleged infringer of patents did not act despite objectively high likelihood that its actions constituted infringement of valid patents relating to prepaid telephone cards with such risk either known or so obvious that it should have been known to alleged infringer, as required for willful infringement of claimed patents, although alleged infringer ultimately did not prove its invalidity defense, since alleged infringer relied on opinion letters from law firm stating that patents-in-suit were invalid and not infringed, and patentee asked for reexamination of patent, and delayed taking action on patent for six years. TGIP, Inc. v. AT&T Corp., E.D.Tex.2007, 527 F.Supp.2d 561, appeal dismissed 274 Fed.Appx. 890, 2008 WL 1766918. Patents 227

Because defendant obtained an opinion of counsel in good faith, and because there was a bona fide dispute over whether defendant's polymeric particles infringed patents relating to high-performance liquid chromatography (HPLC) method and apparatus, defendant's infringement was not willful. Cohesive Technologies, Inc. v. Waters Corp., D.Mass.2007, 526 F.Supp.2d 84, affirmed in part, vacated in part and reversed in part 543 F.3d 1351, 88 U.S.P.Q.2d 1903, rehearing and rehearing en banc denied. Patents 227

Genuine issue of material fact existed as to propriety of competitor's reliance on counsel's incomplete opinion letter, precluding summary judgment in favor of competitor on defense to willful infringement claim; letter did not express a definitive opinion on the infringement issue. Cargill, Inc. v. Sears Petroleum & Transport Corp., N.D.N.Y.2004, 334 F.Supp.2d 197. Patents 323.2(3)

Patent infringement defendant received competent advice of counsel, for purpose of determining whether infringement of patent for snowmobile ski was willful and thus whether enhanced damages were available; counsel's conclusions were not unreasonable. Simmons, Inc. v. Bombardier, Inc., D.Utah 2004, 328 F.Supp.2d 1188, entered 339 F.Supp.2d 1270. Patents 319(3)

Evidence established that manufacturer of belt hangers designed to be displayed in stores infringed patent with disregard for patentee's rights, so that patentee was entitled to finding of willfulness and enhancement of damages notwithstanding fact that challenger relied on opinion of counsel. Berger & Gorin, Inc. v. Gary Plastic Packaging Corp., S.D.N.Y.1988, 691 F.Supp. 740, 8 U.S.P.Q.2d 1480, reconsideration denied. Patents 312(10); Patents 319(3)

Patent infringer did not act unreasonably in relying on opinion of in-house counsel that patent was unenforce-

able and was not liable for increased damages on theory that such reliance was unreasonable. Western Elec. Co., Inc. v. Stewart-Warner Corp., C.A.4 (Va.) 1980, 631 F.2d 333, 208 U.S.P.Q. 183, certiorari denied 101 S.Ct. 1492, 450 U.S. 971, 67 L.Ed.2d 622. Patents 319(3)

Receipt of letter from counsel indicating noninfringement of patent will not defeat increased damages in patent infringement action. Oiness v. Walgreen Co., D.Colo.1991, 774 F.Supp. 1277, 21 U.S.P.Q.2d 1654, affirmed in part , vacated in part 980 F.2d 742, 26 U.S.P.Q.2d 1548, rehearing denied, certiorari denied 113 S.Ct. 1849, 507 U.S. 1032, 123 L.Ed.2d 473, on remand 838 F.Supp. 1420, 30 U.S.P.Q.2d 1383. Patents 319(3)

District court did not abuse its discretion in determining that infringement of patent was willful, warranting award of treble damages and attorney fees, even though patent examiner initially rejected patent applications; following initial rejection, claims were later confirmed on reexamination and infringers failed to demonstrate that their seeking opinion of general, not patent, counsel with regard to validity and infringement of patents led to good faith belief that patents were either invalid or not infringed. Acoustical Design, Inc. v. Control Electron- ics Co., Inc., C.A.Fed. (N.Y.) 1991, 932 F.2d 939, 18 U.S.P.Q.2d 1707, certiorari denied 112 S.Ct. 185, 502 U.S. 863, 116 L.Ed.2d 146. Patents 319(3); Patents 325.11(2.1)

Treble damages would not be awarded to patent owner whose patent for gas separation processes had been infringed by gas company and competitor in design and building of gas plant, as there was inadequate proof that infringement was willful and wanton; competitor took steps to alter patent owner's process in attempt to avoid infringement, and gas company sought legal advice prior to beginning of operation of gas plant to assure itself that infringement had not occurred. Ortloff Corp. v. Gulsby Engineering, Inc., S.D.Tex.1988, 706 F.Supp. 1295, 8 U.S.P.Q.2d 1873, affirmed 884 F.2d 1399, 13 U.S.P.Q.2d 1335. Patents 319(3)

Infringer of patent for venous return catheter justifiably relied on patent attorney's opinion that patent was invalid, for purpose of determining whether infringement was willful, where infringer was informed that other competitors of patent holder had determined patent to be invalid, but had taken licenses from holder, rather than suffer costs of litigation. Minnesota Min. and Mfg. Co. v. Research Medical, Inc., D.Utah 1987, 679 F.Supp. 1037, 6 U.S.P.Q.2d 1401, motion to certify appeal denied 691 F.Supp. 1305, 9 U.S.P.Q.2d 1548. Patents 227

An infringer's consultation of patent counsel, solicitation of a validity opinion and receipt of an opinion of invalidity do not by themselves preclude a finding of wanton and willful infringement justifying increased damages. Sims v. Mack Trucks, Inc., E.D.Pa.1978, 459 F.Supp. 1198, 199 U.S.P.Q. 668, reversed on other grounds 608 F.2d 87, 203 U.S.P.Q. 961, on remand 488 F.Supp. 592, 206 U.S.P.Q. 11, certiorari denied 100 S.Ct. 1319, 445 U.S. 930, 63 L.Ed.2d 764, 205 U.S.P.Q. 488. Patents 319(3)

Damages for infringement would not be increased where defendant acted reasonably on advice of counsel. Rosen v. Kahlenberg, M.D.Fla.1970, 337 F.Supp. 1075, 171 U.S.P.Q. 386, reversed on other grounds 474 F.2d 858, 177 U.S.P.Q. 118. Patents 319(3)

Whether defendant received advice of counsel before developing its infringing device and extent of such advice is relevant to question whether infringement was deliberate and willful. Porter-Cable Mach. Co. v. Black & Decker Mfg. Co., D.C.Md.1967, 274 F.Supp. 905, 155 U.S.P.Q. 491, affirmed 402 F.2d 517, 159 U.S.P.Q. 65, certiorari denied 89 S.Ct. 716, 393 U.S. 1063, 21 L.Ed.2d 706, 160 U.S.P.Q. 832. Patents 312(2)

Defendant who had in good faith consulted counsel and relied upon his advice and had accordingly designed tool handle with physical changes from that of plaintiff's patent and had made patent application which resulted

in patent could not be said to be a wilful infringer, for treble damages purposes. Webster v. Speed Corp., D.C.Or.1957, 158 F.Supp. 472, 115 U.S.P.Q. 285, affirmed in part, remanded in part on other grounds 262 F.2d 482, 120 U.S.P.Q. 256. Patents 319(3)

In action for infringement of patents for ammoniated dentifrices, plaintiff was not entitled to treble damages, where defendants did not willfully and wantonly infringe, but obtained assignment of patent for infringing denti- frice from patentee and acted on counsel's advice. University of Illinois Foundation v. Block Drug Co., E.D.Ill.1955, 133 F.Supp. 580, 107 U.S.P.Q. 159, affirmed 241 F.2d 6, 112 U.S.P.Q. 204, certiorari denied 77 S.Ct. 1382, 354 U.S. 922, 1 L.Ed.2d 1437, 113 U.S.P.Q. 549. Patents 319(4)

171. ---- Bad faith, increased damages

Patentholder's filing of infringement suit on same day patent was issued did not preclude finding that infringement was willful, where infringer had several months advance notice that patent would issue and did not obtain written opinion of counsel until 11 months after suit was filed and continued its infringing sales. National Presto Industries, Inc. v. West Bend Co., C.A.Fed. (Wis.) 1996, 76 F.3d 1185, 37 U.S.P.Q.2d 1685. Patents 319(3)

Conclusory account of infringer's counsel's aspirations for winning patent infringement action without any supporting reasons did not constitute “authoritative opinion” upon which good-faith reliance on invalidity of patent could be founded, so that discretion was not abused by district court in patent infringement action by doubling the pecuniary damage award as exemplary damages. Kori Corp. v. Wilco Marsh Buggies and Draglines, Inc., C.A.Fed.1985, 761 F.2d 649, 225 U.S.P.Q. 985, certiorari denied 106 S.Ct. 230, 474 U.S. 902, 88 L.Ed.2d 229. Patents 319(3)

In determining whether an infringer acted in such bad faith as to warrant treble damages three factors are considered, the first being whether the infringer deliberately copied the ideas or design of another, the second being whether the infringer, when he knew or should have known of the other's patent protection, reasonably investigated the scope of the patent and formed a good-faith belief that the patent was invalid or that it was infringed, and the third being the infringer's behavior as a party to the litigation. Lam, Inc. v. Johns-Manville Corp., C.A.10 (Colo.) 1982, 668 F.2d 462, 213 U.S.P.Q. 1061, certiorari denied 102 S.Ct. 2298, 456 U.S. 1007, 73 L.Ed.2d 1302. See, also, Bott v. Four Star Corp., C.A.Fed. (Mich.) 1986, 807 F.2d 1567, 1 U.S.P.Q.2d 1210. Patents 319(3)

In patent infringement suit, master's findings, supported by evidence and adopted by district court, that defendant corporation's belief that it was not infringing patent was due to carelessness in ascertaining facts and constru- ing claim involved, and that defendant failed to preserve its records and cooperate as it should have at trial of issue of damages, were adequate to support district court's conclusion that actual damages proved should be increased by fifty percent, and counsel fees awarded plaintiff. Russell Box Co. v. Grant Paper Box Co., C.A.1 (Mass.) 1953, 203 F.2d 177, 97 U.S.P.Q. 19, certiorari denied 74 S.Ct. 37, 346 U.S. 821, 98 L.Ed. 347, 99 U.S.P.Q. 491, rehearing denied 74 S.Ct. 216, 346 U.S. 905, 98 L.Ed. 404. Patents 319(3)

There is no requirement that “bad faith” be proven before damages can be enhanced in willful patent infringement case. Oiness v. Walgreen Co., D.Colo.1991, 774 F.Supp. 1277, 21 U.S.P.Q.2d 1654, affirmed in part , vacated in part 980 F.2d 742, 26 U.S.P.Q.2d 1548, rehearing denied, certiorari denied 113 S.Ct. 1849, 507 U.S. 1032, 123 L.Ed.2d 473, on remand 838 F.Supp. 1420, 30 U.S.P.Q.2d 1383. Patents 319(3)

Patent holder was not entitled to multiple damages or attorney fees in suit to recover for infringement of lubricating process for use in connection with pressure forming metal objects, since the defense of the case was not characterized by inequitable dealings normally required for the award of multiple damages or attorney fees. De- vex Corp. v. General Motors Corp., D.C.Del.1980, 494 F.Supp. 1369, 210 U.S.P.Q. 902, affirmed 667 F.2d 347, 212 U.S.P.Q. 643, certiorari granted 102 S.Ct. 2267, 456 U.S. 988, 73 L.Ed.2d 1283, certiorari denied 102 S.Ct. 2270, 456 U.S. 990, 73 L.Ed.2d 1285, rehearing denied 106 S.Ct. 212, 474 U.S. 890, 88 L.Ed.2d 181, affirmed 103 S.Ct. 2058, 461 U.S. 648, 76 L.Ed.2d 211, 217 U.S.P.Q. 1185. Patents 319(3); Patents 325.11(3)

Patent owner and its exclusive licensee were entitled to treble damages for infringement since suit was an “exceptional” one with respect to defendant manufacturer in view of its faithful copying of invention, its willful infringement, its complete disregard for patent rights, its breach of confidential relationship with owner, with which it had entered into confidential licensing negotiations, its misappropriation and unauthorized use of trade secrets and adoption and use of a sales term confusingly similar to owner's and licensee's common law trademark. Saf-Gard Products, Inc. v. Service Parts, Inc., D.C.Ariz.1980, 491 F.Supp. 996, 206 U.S.P.Q. 976. Patents 319(3)

Where defendant in infringement suit was aware of plaintiff's patents from time it started infringing, and where claim that plaintiff's patent was invalid was quite unpersuasive, case was appropriate one for award of double damages and costs; counsel fees, however, would not be awarded. St. Regis Paper Co. v. Winchester Carton Corp., D.C.Mass.1976, 410 F.Supp. 1304, 189 U.S.P.Q. 514. Patents 319(3); Patents 325.11(3)

Where patent owner's three patents for ventilation devices were knowingly, deliberately and intentionally infringed and owner had been forced to indulge in protracted, vexatious and expensive litigation to protect its rights and infringer had made no effort to maintain separate financial records showing the profits which it derived from the sales of infringing products, patent owner was entitled to treble damages. Jenn-Air Corp. v. Penn Ventilator Co., Inc., E.D.Pa.1975, 394 F.Supp. 665, 185 U.S.P.Q. 410. Patents 319(3)

Where infringer's production manager admitted use of patent process after patent had been issued only a month, patent experts put defendant's process in operation two years later and infringer was offered license under patent the same as other companies in industry were operating under but defendant infringer refused and continued to infringe patent, award of amount double the actual damages was not improper. Hartford Nat. Bank & Trust Co. v. E.F. Drew & Co., D.C.Del.1960, 188 F.Supp. 353, 126 U.S.P.Q. 487, affirmed 290 F.2d 589, 129 U.S.P.Q. 204, certiorari denied 82 S.Ct. 45, 368 U.S. 825, 7 L.Ed.2d 29, 131 U.S.P.Q. 498. Patents 319(3)

In action for infringement of patent wherein patentee asked in addition to an accounting for profits treble damages, evidence disclosed that the several infringements were intentional, willful, and deliberate without probable cause for believing that patent in suit was invalid. Solex Laboratories, Inc. v. Graham, S.D.Cal.1958, 165 F.Supp. 428, 118 U.S.P.Q. 438. Patents 319(3)

Where defendant, with full knowledge of facts, including decision of the federal district court upholding validity of patents, persisted in infringement of patents and secured financial assistance from some of the defendants re- strained by permanent injunction granted in former case upholding validity of the patents, treble damages would be awarded to plaintiff for such infringement. Davis Co. v. Russell-Harvelle Hosiery Mills, Inc., M.D.N.C.1956, 140 F.Supp. 32, 110 U.S.P.Q. 23. Patents 319(3)

Multiplication of damages awarded for patent infringement depends on the degree of bad faith exhibited by defendant. Trio Process Corp. v. L. Goldstein's Sons, Inc., C.A.3 (Pa.) 1980, 612 F.2d 1353, 204 U.S.P.Q. 881,

certiorari denied 101 S.Ct. 91, 449 U.S. 827, 66 L.Ed.2d 30, 207 U.S.P.Q. 1064, mandate clarified 638 F.2d 661. Patents 319(3)

In absence of evidence sufficient to justify finding of wilful and wanton infringement or bad faith on part of defendant, patent infringement action was not a proper one for imposition of extraordinary damages or an exceptional case justifying an award of attorney's fees. Illinois Tool Works, Inc. v. Continental Can Co., N.D.Ill.1967, 273 F.Supp. 94, 154 U.S.P.Q. 401, affirmed 397 F.2d 517, 158 U.S.P.Q. 437. Patents 319(3); Patents 325.11(3)

172. ---- Deductions, increased damages

Infringer's advance royalty payments to individual could not be set off against corporation's claim for damages. W.S. Godwin Co. v. International Steel Tie Co., C.C.A.6 (Ohio) 1928, 29 F.2d 476. Patents 318(1); Patents 319(1); Set-off And Counterclaim 33(1)

Where patent consisted in new combination of old elements, and not in a mere improvement on prior machines, it was proper not to deduct from damages awarded the value of such prior machines. Fifield v. Whittemore, C.C.Mass.1888, 33 F. 835.

Where damages are measured by the amount of profits that the plaintiffs would have made on sales of the patented article the cost of manufacture and sale should be deducted, and on sales of a large amount, clerks' hire, storage, freight, etc., should be considered as part of such cost. Zane v Peck, C.C.Conn.1882, 13 F. 475. Patents 319(1)

Telex indicating alleged infringer would accept 45 containers of sailboards established that, as of reissue date of patent for sailboards, such sailboards were “purchased,” and thus, infringing sales were required to be reduced by sales of such sailboards, in addition to those sailboards already delivered to alleged infringer on date of reissue, under absolute intervening rights defense to damages in patent infringement action. BIC Leisure Products, Inc. v. Windsurfing Intern., Inc., S.D.N.Y.1991, 774 F.Supp. 832, 21 U.S.P.Q.2d 1548, affirmed 1 F.3d 1214, 27 U.S.P.Q.2d 1671, rehearing denied, on remand 850 F.Supp. 224, 30 U.S.P.Q.2d 1949, reconsideration denied. Patents 138(2); Patents 318(3)

Where defendant, using infringing process, produced product which was not valuable for commercial purposes, defendant could not charge cost of manufacturing such product against price of marketable product manufactured six or seven months thereafter, for purpose of determining damages for infringement. International Vitam- in Corporation v. E.R. Squibb & Sons, E.D.N.Y.1935, 13 F.Supp. 129. Patents 319(1)

173. ---- Deliberate infringement, increased damages

Damages award to plaintiff for willful patent infringement did not warrant enhancement, since defendant did not act despite objectively high likelihood that its actions constituted infringement of valid patent, which risk was either known or so obvious that defendant should have known. Informatica Corp. v. Business Objects Data In- tegration, Inc., N.D.Cal.2007, 527 F.Supp.2d 1076. Patents 319(3)

Enhanced damages were merited to punish defendants' wilful infringement of process patents and patent for thermal cycler and to deter similar behavior, and to promote appropriate regard for patent rights; defendants engaged in copying, in disregard of patentee's rights, aimed at encouraging the unlicensed performance of its in-

fringing device, defendants lacked a good faith basis for believing that their actions did not infringe the process patents or the thermal cycler patent, or that they had successful defenses to infringement, defendants' infringing activities lasted over a decade and were motivated by a desire to undersell competitors by avoiding the licensing requirements, defendants took no remedial measures during the pendency of the litigation and made attempts to conceal their infringing activities, and defendants opposed patentee's post-verdict efforts to enjoin defendants' continuing infringement. Applera Corp. v. MJ Research Inc., D.Conn.2005, 372 F.Supp.2d 233, reconsideration denied 2005 WL 2050274, appeal dismissed 172 Fed.Appx. 322, 2006 WL 752031. Patents 319(3)

Totality of circumstances in patent infringement case weighed in favor of enhanced damage award, where patentee's competitor deliberately copied patentee's tow truck patents, its size and financial condition were such that competitor could bear some enhancement of damages, and competitor continued to infringe eight years after receiving notice of the patents. Century Wrecker Corp. v. E.R. Buske Mfg. Co., Inc., N.D.Iowa 1996, 913 F.Supp. 1256. Patents 319(3)

District court would enhance damages awarded for patent infringement by 100%, rather than by 300%, where infringers deliberately based accused process on ideas embodied in patent but based their decision to use accused process on argument that accused process was outside an admittedly inexplicit limitation of the patented claims. Hoechst Celanese Corp. v. BP Chemicals Ltd., S.D.Tex.1994, 846 F.Supp. 542, 31 U.S.P.Q.2d 1825, affirmed 78 F.3d 1575, 38 U.S.P.Q.2d 1126, certiorari denied 117 S.Ct. 275, 519 U.S. 911, 136 L.Ed.2d 198. Patents 319(3)

Where town's privies deliberately and intentionally set out to test validity of patent relating to method and means of treatment of bodies of water by knowingly copying it in all material respects and in intentional disregard of patentee's patent rights, patentee, whose patent was found to have been infringed, was entitled to award of triple damages. Hinde v. Hot Sulphur Springs, Colorado, D.C.Colo.1972, 359 F.Supp. 987, 178 U.S.P.Q. 597, affirmed 482 F.2d 829, 178 U.S.P.Q. 584. Patents 319(3)

Where infringer did not act in good faith with respect to infringement of patent and infringement was deliberate, and all elements of damage done to the patentee were not included in award made by master, the award was increased 50 percent. Mathey v. United Shoe Machinery Corp., D.C.Mass.1944, 54 F.Supp. 694. Patents 319(3)

If the infringement is deliberate and intentional or wanton and persistent, damages will be increased by the court, but generally not unless such is the case. Emerson v. Simm, C.C.N.J.1873, 8 F.Cas. 640, No. 4443. See, also, T. L. Smith Co. v. Cement Tile Machinery Co., D.C.Iowa 1919, 258 F. 636; National Folding-Box, etc., Co. v. Elsas, N.Y.1898, 86 F. 917, 30 C.C.A. 497; Morss v. Union Form Co., C.C.Conn.1889, 39 F. 468; Welling v. La Bau, C.C.N.Y.1888, 35 F. 302.

Competitor's infringement of patent warranted enhanced damages, where competitor engaged in deliberate copying and did not make good-faith effort to avoid infringement, and competitor's remedial efforts in subsequent development of non-infringing product did not offset egregiousness of competitor's prior conduct with regard to infringing product. Engineered Products Co. v. Donaldson Co., Inc., C.A.Fed.2005, 147 Fed.Appx. 979, 2005 WL 2090662, Unreported. Patents 319(3)

174. ---- Due care, increased damages

Where infringer failed to discharge its affirmative duty to exercise due care to determine whether it was in-

fringing on patents in suit, double damages was appropriate increased damage award for infringement. Shiley, Inc. v. Bentley Laboratories, Inc., C.D.Cal.1985, 601 F.Supp. 964, 225 U.S.P.Q. 1013, affirmed 794 F.2d 1561, 230 U.S.P.Q. 112, certiorari denied 107 S.Ct. 1291, 479 U.S. 1087, 94 L.Ed.2d 148. Patents 319(3)

Patent infringer did not deliberately copy patented solar cell design, or deliberately ignore its duty of due care to avoid infringement, so as to support finding of willful infringement, where infringer investigated patents prelim- inarily and the production of amorphous silicon solar cells at the time were being pursued by many other scient- ists and manufacturers in the field. Solarex Corp. v. Arco Solar, Inc., D.Del.1992, 805 F.Supp. 252. Patents 227

Producer of knitted, one-piece, flame resistant cubicle curtain which infringed on plaintiff's patent was liable for triple damages, where producer did not conduct patent search of prior art until more than a year after it had been notified of its alleged infringement, and where it sought no legal advice as to validity of infringed patent until after suit had been commenced. Indecor, Inc. v. Fox-Wells & Co., Inc., S.D.N.Y.1986, 642 F.Supp. 1473, 1 U.S.P.Q.2d 1847. Patents 319(3)

175. ---- Good faith, increased damages

Refusal to award enhanced damages, attorney fees, and costs to patent holder in infringement action involving control circuit for shutting off electric power to liquid well pump was not abuse of discretion where trial record showed no copying of patent by competitor and no intentional infringement of patent, record indicated that competitor concluded in good faith that its devise did not infringe, competitor mounted substantial challenge to charge of infringement, and patent holder's evidence of willfulness included testimony based upon recollections of conversations with unidentified person, even though competitor did not obtain opinion of counsel concerning likelihood of infringement. Delta-X Corp. v. Baker Hughes Production Tools, Inc., C.A.Fed. (Tex.) 1993, 984 F.2d 410, 25 U.S.P.Q.2d 1447. Patents 325.11(3)

Competitor's infringement of patent was not objectively reckless, and thus was not subject to enhanced damages award, despite its ultimate lack of success in defending against infringement or proving invalidity, where competitor's arguments in those areas were substantial, reasonable, and far from sort of easily-dismissed claims that objectively reckless infringer would have been forced to rely upon, and owner could not point to any evidence of objective recklessness, but instead relied only on subjective evidence. ResQNet.com, Inc. v. Lansa, Inc., S.D.N.Y.2008, 533 F.Supp.2d 397, adhered to on reconsideration 2008 WL 4376367. Patents 319(3)

Competitor's infringement of patent had not been objectively reckless, and thus enhanced damages award was not warranted, where competitor saw patented ramp, which was essentially one piece, and believed that he could design it better, and competitor read patent and attempted to design around it when he created ramp with three individual components, two of which were “self-locking” with dowel and pin structure. Rhino Associates, L.P. v. Berg Mfg. and Sales Corp., M.D.Pa.2007, 531 F.Supp.2d 652. Patents 319(3)

Infringers' willful use of patented food preservation process without requiring license did not support award of multiple damages in patent infringement action, where infringers vigorously pursued invalidity defense in good faith. Oscar Mayer Foods Corp. v. Conagra, Inc., W.D.Wis.1994, 869 F.Supp. 656, 31 U.S.P.Q.2d 1173, affirmed 45 F.3d 443, 35 U.S.P.Q.2d 1278, rehearing denied, in banc suggestion declined , certiorari denied 116 S.Ct. 62, 516 U.S. 812, 133 L.Ed.2d 25. Patents 319(3)

General verdict of $1,263,482 for owner of patent describing gas permeable contact lens made principally of ter-

tiary butyl styrene would be doubled in view of evidence of willful infringement; triple damages were not warranted, in view of defendant's testimony that it had been developing its contact lenses for approximately two years before becoming aware of the patent in issue, and since defendant did not litigate in bad faith. Schering Corp. v. Precision-Cosmet Co., Inc., D.C.Del.1985, 614 F.Supp. 1368, 227 U.S.P.Q. 278. Patents 319(3)

An infringer honestly mistaken as to a reasonably debatable question of validity of patent should not be required to pay punitive damages. Enterprise Mfg. Co. v. Shakespeare Co., C.C.A.6 (Mich.) 1944, 141 F.2d 916. Patents 319(3)

Infringer's attempt to design around patent can be sufficient evidence of good faith so as to avoid enhancement of damages, even though infringer may have received inadequate legal counsel on whether infringement had been avoided. Afros S.p.A. v. Krauss-Maffei Corp., D.Del.1987, 671 F.Supp. 1402, 5 U.S.P.Q.2d 1145, reargument denied 671 F.Supp. 1458, 5 U.S.P.Q.2d 1145, affirmed 848 F.2d 1244. Patents 319(3)

Inasmuch as there was an existence of an honest doubt as to validity of patent for chest press body exercising device, infringement of such patent was not willful; thus, patent holder was not entitled to treble damages. Uni- versal Athletic Sales Co. v. American Gym, W.D.Pa.1979, 480 F.Supp. 408, 205 U.S.P.Q. 840. Patents 319(3)

Infringer was not liable for award of increased damages where although infringement was intentional, in sense that defendants virtually copied the actual embodiment produced by plaintiff under the patent, their belief that the patent was invalid had an arguable basis. Maclaren v. B-I-W Group Inc., S.D.N.Y.1975, 401 F.Supp. 283, 187 U.S.P.Q. 345, reversed 535 F.2d 1367, 190 U.S.P.Q. 513, certiorari denied 97 S.Ct. 531, 429 U.S. 1001, 50 L.Ed.2d 612, 192 U.S.P.Q. 121. Patents 319(3)

In light of fact that defendant, after learning of plaintiff's patent, received assurances from supplier of noninfringement and a contractual indemnity, plaintiff whose patent was infringed would not be entitled to extraordinary damages or award of attorney's fee on claim of willful and wanton infringement. Malsbary Mfg. Co. v. Ald, Inc., N.D.Ill.1970, 310 F.Supp. 1112, 165 U.S.P.Q. 241, affirmed 447 F.2d 809, 171 U.S.P.Q. 7. Patents 325.11(3)

Those who did not willfully and deliberately infringe patent for compressive stocking, but acted in good faith in honest belief that they had right to make their stockings and were so advised by counsel, would not be required to pay treble damages for infringement if patent was valid. Triumph Hosiery Mills, Inc. v. Alamance Industries, Inc., M.D.N.C.1961, 191 F.Supp. 652, 128 U.S.P.Q. 471, affirmed 299 F.2d 793, 132 U.S.P.Q. 414, certiorari denied 82 S.Ct. 1566, 370 U.S. 924, 8 L.Ed.2d 504, 133 U.S.P.Q. 702. Patents 319(3)

176. ---- Infringer's profit, increased damages

Where award for infringement was based solely on profits of infringer, former §§ 67 and 70 of this title did not confer power to increase award. Clair v. Kastar, Inc., S.D.N.Y.1946, 70 F.Supp. 484, 73 U.S.P.Q. 347. Patents 319(3)

177. ---- Negative effect on patentee, increased damages

Award of damages in patent infringement action would not be multiplied where sale of infringing mowers had no adverse effect on plaintiffs' business. Mott Corp. v. Sunflower Industries, Inc., D.C.Kan.1961, 217 F.Supp.

559, 137 U.S.P.Q. 398. Patents 319(3)

178. ---- Present value of infringement

In patent infringement suit, owner was not entitled to increased damages as a result of inflation and loss of interest, nor was fact that patent owner incurred attorney fees in and of itself grounds for increasing damages. Pa- per Converting Mach. Co., Inc. v. FMC Corp., E.D.Wis.1977, 432 F.Supp. 907, 195 U.S.P.Q. 123, affirmed 588 F.2d 832. Patents 319(3)

Patent holder was not entitled to increase in damages to account for the present value of amounts earned in infringement period and was not entitled to an adjustment based on fact that if infringer had paid damages to patent holder as profits and royalties during infringement period patent holder could have invested money to earn more, and interest rate applied only to damages awarded for nonwillful infringement from time special master's report in damage assessment proceeding was filed. H. K. Porter Co., Inc. v. Goodyear Tire & Rubber Co., C.A.6 (Ohio) 1976, 536 F.2d 1115, 191 U.S.P.Q. 486. Patents 319(3)

179. ---- Willfulness, increased damages

Competitor's development and sale of its infringing products that were not at risk of objectively high likelihood of infringement was not willful infringement of patent, and thus enhanced damages could not be permitted for infringement. Innogenetics, N.V. v. Abbott Laboratories, C.A.Fed. (Wis.) 2008, 512 F.3d 1363, 85 U.S.P.Q.2d 1641, rehearing and rehearing en banc denied. Patents 319(3)

Proof of willful patent infringement permitting enhanced damages at least requires a showing of objective recklessness. In re Seagate Technology, LLC, C.A.Fed. (N.Y.) 2007, 497 F.3d 1360, 83 U.S.P.Q.2d 1865, certiorari denied 128 S.Ct. 1445, 170 L.Ed.2d 275. Patents 319(3)

Finding of “willfulness” for purpose of enhanced award of damages for patent infringement requires fact finder to find that clear and convincing evidence shows that infringer acted in disregard of patent and had no reasonable basis for believing it had right to do the acts. American Medical Systems, Inc. v. Medical Engineering Corp., C.A.Fed. (Wis.) 1993, 6 F.3d 1523, 28 U.S.P.Q.2d 1321, rehearing denied, in banc suggestion declined , certiorari denied 114 S.Ct. 1647, 511 U.S. 1070, 128 L.Ed.2d 366. Patents 319(3)

Sufficient evidence existed upon which reasonable jury could have found willful infringement by clear and convincing evidence, where there had been extensive litigation history before Patent and Trademark Office (PTO), all of which had found that inventor was rightful inventor and patent holder, and defendant competitor relied on same references to support its invalidity defense that PTO previously had found to not invalidate inventor's invention. Bard Peripheral Vascular, Inc. v. W.L. Gore & Associates, Inc., D.Ariz.2008, 586 F.Supp.2d 1083. Pat- ents 312(8)

Factors court may take into consideration when determining whether, and to what extent, to exercise its discretion to award enhanced damages for defendant's willful infringement of patent include: (1) whether infringer deliberately copied ideas or design of another; (2) whether infringer, when he knew of other's patent protection, investigated patent's scope and formed good-faith belief that it was invalid or that it was not infringed; (3) infringer's behavior as party to litigation; (4) infringer's size and financial condition; (5) closeness of case; (6) duration of infringer's misconduct; (7) any remedial action by infringer; (8) infringer's motivation for harm; and (9) whether infringer attempted to conceal its misconduct. IMX, Inc. v. LendingTree, LLC, D.Del.2007, 469

F.Supp.2d 203, on reconsideration in part 2007 WL 1232184. Patents 319(3)

Willful infringement of patent for thermal analysis instrument, as evidenced by infringer's post-injunction manufacture and sale of accused devices, warranted award of enhanced damages; damage award for post-injunction infringing sales would be increased by factor of two. TA Instruments, Inc. v. Perkin-Elmer Corp., D.Del.2003, 2003 WL 21262378. Patents 319(3)

Patentee was entitled to an enhancement of 25% percent on the award of damages for willful patent infringement in light of defendant's lack of a good faith belief that its product did not infringe, defendant's continual infringed over the course of several years without having taken any remedial measures, defendant's presumptive motivation to harm patentee as its only market competitor, and defendant's size and financial condition. TruePosition Inc. v. Andrew Corp., D.Del.2008, 568 F.Supp.2d 500. Patents 319(3)

Finding of willfulness is alone sufficient to support award of increased damages in patent infringement suit, though finding of willfulness does not mandate trebling of damages. Devon Distributing Corp. v. Miner, S.D.Iowa 2007, 525 F.Supp.2d 1089. Patents 319(3)

Substantial evidence supported jury's finding that competitor willfully infringed patent directed to a method in which microorganisms obtained from a saline environment were grown in fermentor with a culture medium, including evidence that competitor continued to ship into the United States thousands of pounds of nutritional fatty acid made by accused process, after it had notice of patent and in spite of its statements to patentee regarding its switching the sodium salt in its culture medium. Martek Biosciences Corp. v. Nutrinova Inc., D.Del.2007, 520 F.Supp.2d 537. Patents 312(8)

Award of enhanced damages was not warranted in patent infringement case, where competitor's infringement was not willful and competitor did not engage in any misconduct during litigation. Allan Block Corp. v. E. Dillon & Co., D.Minn.2007, 509 F.Supp.2d 795, affirmed 287 Fed.Appx. 109, 2008 WL 3822564. Patents 319(3)

Award of enhanced damages based on jury finding of wilful patent infringement was appropriate; despite opinion letter from counsel, jury could have believed that patent owner had proved deliberate copying, competitors abused claim construction process, issue of infringement or invalidity was not close, competitors started infringing patent on day that it was issued and continued to do so although design around was quick and cheap solution, competitors priced their product at zero in order to harm owner's business, and competitors did not take remedial action. Muniauction, Inc. v. Thomson Corp., W.D.Pa.2007, 502 F.Supp.2d 477, stay denied 2007 WL 2406950, stay granted 2007 WL 2827915, reversed in part , vacated in part 532 F.3d 1318, 87 U.S.P.Q.2d 1350, rehearing and rehearing en banc denied , petition for certiorari filed 2008 WL 5459193. Patents 319(3)

Modest, though not substantial, enhancement of damages was appropriate for competitor's willful infringement of patents directed to method of transforming data in extract, transform, and load (ETL) process of building data warehouse using “transformation objects;” jury rejected competitor's contention that it relied in good faith on opinion of counsel, and competitor did not take any intermediate remedial action to remove particular feature at issue from its product, but issues of willfulness and patent invalidity were close questions, there was no contention that competitor deliberately copied patent holder's ideas, and patent holder did not point to any negative behavior by competitor during litigation. Informatica Corp. v. Business Objects Data Integration, Inc., N.D.Cal.2007, 489 F.Supp.2d 1075. Patents 319(3)

Generic drug manufacturer's filing of abbreviated new drug application (ANDA) could not constitute grounds for determination that manufacturer willfully infringed existing patent, even if manufacturer deliberately copied claimed elements of patents. Wyeth v. Ranbaxy Laboratories Ltd., D.N.J.2006, 448 F.Supp.2d 607. Patents 249.1

Infringer's actions in infringing design patent for ornamental cabinet were not willful as required to entitle patentee to increased damages under Patent Act; infringer was a company in the business of “knocking off” or producing designs similar to an existing item and selling them at lower prices, and president of infringer testified that he often made changes to or “designed around” patented designs and that he felt free to manufacture a cabinet substantially similar to patentee's because it was not a dramatically unusual design, and there were very few truly original furniture designs. Bernhardt L.L.C. v. Collezione Europa USA, Inc., M.D.N.C.2006, 436 F.Supp.2d 739. Patents 319(3)

Court properly enhanced damages attributable to infringement of patent by subsequent version of accused device, since jury reasonably concluded that all of patent owner's lost profits, even profits lost to sales of subsequent version, were attributable to infringement by original device, and jury also found that infringement by original device was willful. Engineered Products Co. v. Donaldson Co., Inc., N.D.Iowa 2004, 335 F.Supp.2d 973, affirmed in part, vacated in part and remanded 147 Fed.Appx. 979, 2005 WL 2090662. Patents 319(3)

Clothing retailer's continued importation and sale of accused garments, after notice of potential infringement of fabric patent, demonstrated willfulness of infringement, for purpose of determining whether award of enhanced damages was warranted; retailer relied only on non-expert's comparison of patent claims to accused garments, and did not cease importing garments court's claim construction made finding of infringement inevitable. Do- mestic Fabrics Corp. v. Sears, Roebuck & Co., E.D.N.C.2004, 326 F.Supp.2d 694, dismissed 122 Fed.Appx. 518, 2005 WL 545714. Patents 319(3)

Neither award of attorney fees nor enhancement of damages for infringement of pharmaceutical patents was warranted, despite jury's finding that infringement was willful; infringer did not deliberately copy patents or engage in litigation misconduct, case was close, and infringer made no attempt to conceal its activities. Tristrata Technology, Inc. v. ICN Pharmaceuticals, Inc., D.Del.2004, 314 F.Supp.2d 356, dismissed 101 Fed.Appx. 341, 2004 WL 1385868. Patents 319(3); Patents 325.11(3)

Patentee was entitled to have its damages award doubled for willful infringement; defendant, which deliberately copied the invention, did not rely on counsel's opinion in good faith because it managed the information given to him and did not share with him the best information that was known to it, defendant would not be materially im- pacted by an award of enhanced damages, case for literal infringement was not a close one, and defendant did not take prompt remedial efforts after learning of the lawsuit. nCUBE Corp. v. SeaChange Intern., Inc., D.Del.2004, 313 F.Supp.2d 361, affirmed 436 F.3d 1317, 77 U.S.P.Q.2d 1481, rehearing and rehearing en banc denied. Patents 319(3)

Willful patent infringer's conduct was sufficiently culpable to warrant enhancement of damages by factor of 0.5, but not treble damages; although infringement was clear, and infringer had neither conducted adequate investigation when notified of possible infringement nor taken effective post-verdict remedial action, infringing device was independently created and infringer had made no attempt to conceal its misconduct. NTP Inc. v. Research in Motion, Ltd., E.D.Va.2003, 270 F.Supp.2d 751, 67 U.S.P.Q.2d 1594, subsequent determination 2003 WL 23100883, amended 2003 WL 22746080. Patents 319(3)

In determining whether willfulness exists, as required to support award of increased damages in patent infringement case, court must examine totality of the circumstances, including the following: infringer's deliberate copying of ideas to another; infringer's knowledge of patent rights of another; any good faith belief of invalidity or non-infringement formed by infringer after investigation of patent rights of another; and infringer's behavior as litigant. E.I. DuPont De Nemours and Co. v. Monsanto Co., D.Del.1995, 903 F.Supp. 680, affirmed 92 F.3d 1208. Patents 319(3)

Infringement of patent for ultrasonic material level measurement system was not willful, precluding award of enhanced damages, where infringer relied on opinion of patent counsel and its own evaluation of patent in concluding that its product was not infringing, and did not engage in unduly burdensome litigation conduct. Endress Hauser, Inc. v. Hawk Measurement Systems Pty. Ltd., S.D.Ind.1995, 892 F.Supp. 1123, affirmed 122 F.3d 1040, 43 U.S.P.Q.2d 1849. Patents 319(3)

Competitor's infringement of patented implant prosthesis was willful, for purposes of awarding enhanced damages in infringement case; competitor deliberately copied ideas and designs of patent, failed to investigate scope of patent or seek opinion of competent patent counsel upon learning of patent, did not have good faith belief that patent was invalid at time it launched its product, and continued pattern of deliberately disregarding patentee's rights during course of litigation. Stryker Corp. v. Intermedics Orthopedics, Inc., E.D.N.Y.1995, 891 F.Supp. 751, affirmed 96 F.3d 1409, 40 U.S.P.Q.2d 1065, rehearing denied , in banc suggestion declined. Patents 319(3)

Finding of willful patent infringement supported enhancement of damages by 10%, rather than award of treble damages, where any copying of patented devices was recklessly indifferent rather than intentional, infringer had conducted patent searches and obtained attorney opinion regarding patentability and asserted counterclaims and affirmative defenses that were not frivolous or in bad faith, and large enhancement of damages could have driven infringer out of business. Virginia Panel Corp. v. Mac Panel Co., W.D.Va.1995, 887 F.Supp. 880, affirmed 133 F.3d 860, 45 U.S.P.Q.2d 1225, rehearing denied, in banc suggestion declined , certiorari denied 119 S.Ct. 52, 525 U.S. 815, 142 L.Ed.2d 40. Patents 319(3)

Competitor's willful infringement of patent for system of attaching mated pairs of shoes warranted enhanced damages in patent infringement action; competitor did not investigate scope of patent or make good faith effort to design around patent claims, and continued to infringe after express notice, after suit was filed, after jury verdict finding of willful infringement was returned. Maxwell v. J. Baker, Inc., D.Minn.1995, 879 F.Supp. 1007, affirmed in part , vacated in part 86 F.3d 1098, 39 U.S.P.Q.2d 1001, rehearing denied, in banc suggestion declined , certiorari denied 117 S.Ct. 1244, 520 U.S. 1115, 137 L.Ed.2d 327. Patents 319(3)

There was insufficient willfulness on part of infringer to justify awarding increased damages for infringement of patent for process of preparing microfiltration membrane, except to extent clearly infringing product was manu-

factured following commencement of litigation, though infringer made extraordinarily extensive use of patent in its own process in seeking to design around patent, and infringer never consulted counsel. Pall Corp. v. Micron Separations, Inc., D.Mass.1992, 792 F.Supp. 1298, affirmed in part, modified in part and reversed in part 66 F.3d 1211, 36 U.S.P.Q.2d 1225, rehearing denied, certiorari denied 117 S.Ct. 1243, 520 U.S. 1115, 137 L.Ed.2d 326. Patents 319(3)

In determining whether patent infringement was willful so as to warrant increase in damages, court must consider totality of circumstances, including whether infringers deliberately copied ideas or design of another, whether infringers, when they knew of other's patent protection, investigated scope of patent and formed a good- faith belief that it was invalid or that it was not infringed, and what was infringers' behavior as parties to litigation. T.A. Pelsue Co. v. Grand Enterprises, Inc., D.Colo.1991, 782 F.Supp. 1476, 25 U.S.P.Q.2d 1001. Patents 314(3)

Finding of willful patent infringement will support award of increased damages; however, such a finding does not mandate increased damages. Oiness v. Walgreen Co., D.Colo.1991, 774 F.Supp. 1277, 21 U.S.P.Q.2d 1654, affirmed in part , vacated in part 980 F.2d 742, 26 U.S.P.Q.2d 1548, rehearing denied, certiorari denied 113 S.Ct. 1849, 507 U.S. 1032, 123 L.Ed.2d 473, on remand 838 F.Supp. 1420, 30 U.S.P.Q.2d 1383. Patents 319(3)

Defendant's willful infringement of patent warranted increase in reasonable royalty rate of 50%. H.B. Fuller Co. v. National Starch and Chemical Corp., D.Minn.1988, 689 F.Supp. 923, 7 U.S.P.Q.2d 1753. See, also, McDer- mott v. Omid Intern., S.D.Ohio 1988, 723 F.Supp. 1228, 13 U.S.P.Q.2d 1147, affirmed 883 F.2d 1026. Patents 319(3)

Determination of willfulness of infringement, for purposes of statutory enhancement of damages in patent infringement action, depends upon totality of circumstances; important factors to be considered include whether infringer, when he knew of the other's patent protection, investigated scope of patent and formed good-faith belief that it was invalid or that it was not infringed, whether infringer deliberately copied ideas or design of another, and infringer's behavior as a party to litigation. Windsurfing Intern., Inc. v. Fred Ostermann GmbH, S.D.N.Y.1987, 668 F.Supp. 812, 4 U.S.P.Q.2d 1429, affirmed 1 F.3d 1214, 27 U.S.P.Q.2d 1671, rehearing denied, on remand 850 F.Supp. 224, 30 U.S.P.Q.2d 1949, reconsideration denied. Patents 319(3)

Patent infringer's actions were willful, so that patentee's lost profits would be doubled, but were not so egregious as to warrant tripling of damages, where infringer had actual notice of the patent, began disseminating word of availability of his machine prior to receiving advice from patent counsel, relied on incomplete or informal opinion that machine did not infringe, and deliberately withheld existence of machine during settlement negotiations in regard to prior machine. Chisum v. Brewco Sales and Mfg., Inc., W.D.Ky.1989, 726 F.Supp. 1499, 13 U.S.P.Q.2d 1657, affirmed 915 F.2d 1583. Patents 318(3)

Defendant, who wilfully violated consent decree enjoining it from infringing patent, was liable for amount of royalty that plaintiff would have received if its patented product had been installed under license and for multiplier of 100 percent as well as for costs and reasonable attorney fees. Construction Products Corp. v. Hahn Builders, Inc., E.D.Wis.1983, 573 F.Supp. 639, 223 U.S.P.Q. 1023. Patents 318(3); Patents 320; Pat- ents 325.1

Defendant's infringement of patent for portable loam screening apparatus was not willful, and did not support award of enhanced damages or attorney fees; despite patentee's contention that defendant copied patented

device, defendant made specific changes deemed adequate by counsel to avoid infringement. Read Corp. v. Portec, Inc., C.A.Fed. (Del.) 1992, 970 F.2d 816, 23 U.S.P.Q.2d 1426, rehearing denied , rehearing in banc declined. Patents 319(3); Patents 325.11(3)

Where competitor's division stopped paying royalties after it learned that dominant firm in business had questioned validity of patent, and where opinion of outside counsel was also sought and it was to the effect that patent was invalid, and in this context division ceased its royalty payments and attempted to renegotiate the license and only after these negotiations broke down and after it learned that dominant firm had obtained a royalty-free license did competitor bring declaratory judgment suit seeking declaration that patent was invalid and nonin- fringed, its infringement was intentional in the sense that it was not inadvertent but facts did not make out a wilful infringement such as would establish basis on which to award damages in excess of those intended to compensate patent holder for its loss. Eltra Corp. v. Basic Inc., C.A.6 (Ohio) 1979, 599 F.2d 745, 202 U.S.P.Q. 630, certiorari denied 100 S.Ct. 297, 444 U.S. 942, 62 L.Ed.2d 308, 204 U.S.P.Q. 608. Patents 319(3)

One unintentionally infringing patent cannot retain any profit therefrom and must make good the damage, and one intentionally infringing will be punished beyond the profit and damage. American Foundry & Mfg. Co. v. Josam Mfg. Co., C.C.A.8 (Mo.) 1935, 79 F.2d 116. Patents 319(3)

Under totality of circumstances, failure of infringer to seek advice of counsel, prior to adopting an “aggressive strategy,” established that patent infringement was willful, for purposes of determining whether to award increased damages for patent infringement, where infringer proceeded with its infringement on assumption that patents in question were valid and would be infringed, and intentionally undertook risk of importing infringing products in hope that a court would hold the patent invalid or that patent owner would grant license. Kloster Speedsteel AB v. Crucible Inc., C.A.Fed. (Pa.) 1986, 793 F.2d 1565, 230 U.S.P.Q. 81, 231 U.S.P.Q. 160, certiorari denied 107 S.Ct. 882, 479 U.S. 1034, 93 L.Ed.2d 836, on remand 701 F.Supp. 1157, 10 U.S.P.Q.2d 1190. Patents 312(8)

Patentee was entitled to increased damages under 35 U.S.C.A. § 284 for willful infringement where, although alleged infringer's president was informed of patentee's specific allegation of infringement and was given copy of the patent, alleged infringer's president took no affirmative steps, through consultation with counsel or otherwise, to ascertain whether it was infringing the patent, and where alleged infringer deliberately continued infringing because patentee was subsidiary of another corporation. CPG Products Corp. v. Pegasus Luggage, Inc., C.A.Fed. (Fla.) 1985, 776 F.2d 1007, 227 U.S.P.Q. 497. Patents 319(3)

Evidence, including proof that infringer relied on issuance of its own patent, which cited infringed patent as pri- or art and that infringer could reasonably have felt that its activities fell within its own claims that were pat- entably distinct, supported district court's conclusion that owner of infringed patent was not entitled to “increased damages” under 35 U.S.C.A. § 284 for willful infringement. King Instrument Corp. v. Otari Corp., C.A.Fed.1985, 767 F.2d 853, 226 U.S.P.Q. 402, certiorari denied 106 S.Ct. 1197, 475 U.S. 1016, 89 L.Ed.2d 312. Patents 312(10)

Patent holder was not entitled to increased damage award for infringement of tailpipe hanger and bracket patents based upon willfulness of patent infringer; patent holder failed to show that infringement was willful. Nickson Industries, Inc. v. Rol Mfg. Co., Ltd., C.A.Fed. (Conn.) 1988, 847 F.2d 795, 6 U.S.P.Q.2d 1878. Patents 319(3)

If patent infringement is willful, increased damages may be awarded at the discretion of the district court, and

amount of increase, up to three times, may be set in exercise of that same discretion. Ryco, Inc. v. Ag-Bag Corp., C.A.Fed. (Neb.) 1988, 857 F.2d 1418, 8 U.S.P.Q.2d 1323. Patents 319(3)

Evidence that determination of infringement had already been made, that alleged infringer had been enjoined from further infringement, and that specific test procedure used was not specifically discussed with counsel supported finding that infringement resulting from running tests on machine using patent device was willful so as to warrant award of treble damages to holder of patent. Paper Converting Mach. Co. v. Magna-Graphics Corp., C.A.Fed. (Wis.) 1986, 785 F.2d 1013, 228 U.S.P.Q. 938. Patents 312(10)

Manufacturer willfully infringed patent for L-shaped head for high pressure impingement mixing of polyureth- ane, and would be assessed treble damages, where manufacturer's heads were nearly identical to that described in patent, manufacturer produced no development drawings of its design, manufacturer knew competitor was marketing patented heads, and manufacturer attempted to insulate itself from discovery process by assigning patent to subsidiary after infringement action was commenced. Afros S.p.A. v. Krauss-Maffei Corp., D.Del.1987, 671 F.Supp. 1402, 5 U.S.P.Q.2d 1145, reargument denied 671 F.Supp. 1458, 5 U.S.P.Q.2d 1145, affirmed 848 F.2d 1244. Patents 319(3)

Even if patent for fan assembly had been valid and had been infringed, infringement was not “willful,” and treble or increased damages would not have been awarded, where only evidence introduced by patent owner tending to demonstrate willful infringement was fact that patent had appeared in widely circulated publication some nine years before patent owner began to develop fan assembly and no evidence was offered that alleged infringer or its predecessors actually were aware of patent rights or civil article. Torin Corp. v. Philips Industries, Inc., S.D.Ohio 1985, 625 F.Supp. 1077, 228 U.S.P.Q. 465. Patents 319(3)

Treble damages for a patent infringement were not awarded where record did not support determination that defendants acted willfully and wantonly or deliberately and intentionally infringed without investigating validity and scope of the patent and defendants did not intentionally copy plaintiff's patent but, albeit unsuccessfully, tried to design around it. Rolls-Royce Ltd. v. GTE Valeron Corp., E.D.Mich.1985, 625 F.Supp. 343, 228 U.S.P.Q. 489, affirmed 800 F.2d 1101, 231 U.S.P.Q. 185. Patents 319(3)

Fact that alleged infringer questioned validity of patent did not constitute willful infringement warranting direction that plaintiff's damages for infringement be trebled. General Motors Corp. v. Dailey, C.C.A.6 (Mich.) 1937, 93 F.2d 938. See, also, Aerosol Research Co. v. Scovill Mfg. Co. (A. Schrader's Son Division), C.A.Ill.1964, 334 F.2d 751.

Infringement of design patents depicting low-back upholstered chairs was “willful and deliberate,” entitling patentee to treble amount of compensatory damages under 35 U.S.C.A. § 284, where, inter alia, the infringing chairs were virtually identical to their patented counterparts, there was both substantial evidence that infringer had direct access to patentee's chairs at time the infringing chairs were designed and evidence that infringer knew of patentee's patent rights in the patented chairs. Pacific Furniture Mfg. Co. v. Preview Furniture Corp., M.D.N.C.1985, 626 F.Supp. 667, 228 U.S.P.Q. 235, affirmed 800 F.2d 1111, 231 U.S.P.Q. 67. Patents 319(3)

In view of fact that defendants explicitly marketed accused filter units as “interchanges” for plaintiffs' patented filter unit, infringement was willful, for purposes of double damages, and defendants' conduct raised case to “exceptional” level for purposes of attorney fees award to patent holder. Brunswick Corp. v. Filters, Inc. (Louisiana), S.D.Tex.1983, 569 F.Supp. 1368, 219 U.S.P.Q. 891. Patents 319(2); Patents 325.11(3)

Awards of increased damages for patent infringement are to be made sparingly and only upon a clear showing of deliberate infringement but award is proper where infringement is willful, intentional, and deliberate, as where patented device is faithfully copied. American Safety Table Co. v. Schreiber, C.A.2 (N.Y.) 1969, 415 F.2d 373, 163 U.S.P.Q. 129, certiorari denied 90 S.Ct. 683, 396 U.S. 1038, 24 L.Ed.2d 682, 164 U.S.P.Q. 225. Patents 319(3)

Where defendant corporation knew of plaintiff corporation's patents in question and designed its structure with plaintiff's structure in mind, and its resulting patent infringement could be termed to nothing other than wilful and deliberate, a predicate was laid for increased damages to be considered after accounting by defendant. Wurl- itzer Co. v. Electrokey, Inc., N.D.Tex.1974, 380 F.Supp. 576, 184 U.S.P.Q. 212. Patents 319(3)

Except for purpose of increasing damages when infringement of plant patent is willful, knowledge or intent is not material. Kim Bros. v. Hagler, S.D.Cal.1958, 167 F.Supp. 665, 120 U.S.P.Q. 210, affirmed 276 F.2d 259, 125 U.S.P.Q. 44. Patents 227

Where defendant's sale of nail plates was intimately connected with, and an integral part of, the inducement of infringement of patent for hip fixation device used by orthopedic surgeons and the defendant had surreptitiously, willfully and intentionally counterfeited nail plate, the patent owner was entitled to an award of treble damages for the sale of the nail plate, whether such sale was direct or inducement infringement. Deyerle v. Wright Mfg. Co., C.A.6 (Tenn.) 1974, 496 F.2d 45, 181 U.S.P.Q. 685. Patents 319(3)

District court was authorized to award double damages to patentee for lost profits because of defendant's “knowing and willful violation” of injunction against infringement. Dow Chemical Co. v. Chemical Cleaning, Inc., C.A.5 (La.) 1970, 434 F.2d 1212, 167 U.S.P.Q. 513, certiorari denied 91 S.Ct. 1621, 402 U.S. 945, 29 L.Ed.2d 113, 169 U.S.P.Q. 528. Patents 326(4)

In patent infringement actions questions of wilfulness, deliberateness, and increased damages should properly await final judgment. Swofford v. B & W, Inc., C.A.5 (Tex.) 1964, 336 F.2d 406, 142 U.S.P.Q. 291, certiorari denied 85 S.Ct. 653, 379 U.S. 962, 13 L.Ed.2d 557, 144 U.S.P.Q. 780. See, also, McLemore v. Southern Imple- ment Mfg. Co., D.C.Miss.1964, 227 F.Supp. 272, affirmed 350 F.2d 244. Patents 319(3)

Where defendants' infringement of plaintiffs' patented process for refining copper in a converter was willful and deliberate during period when findings of fact and conclusions of law were entered in an action upholding validity of patent, damages assessed against defendants with respect to said period would be doubled. Brian Jackson Associates, Inc. v. San Manuel Copper Corp., D.C.Ariz.1969, 305 F.Supp. 66, 163 U.S.P.Q. 198. Patents 275

Thirty-percent enhancement of damages was appropriate where hair dryer manufacturer's infringement of patent protective mechanism in electrically operated devices under doctrine of equivalents was willful, but not in bad faith; manufacturer obtained an opinion of counsel and also received assurances from the licensor of the accused technology, which had a contractual obligation to indemnify it for any damages that it sustained in a patent infringement suit. Gaus v. Conair Corp., S.D.N.Y.2003, 2003 WL 223859, Unreported, reversed 363 F.3d 1284, 70 U.S.P.Q.2d 1380, rehearing and rehearing en banc denied , certiorari denied 125 S.Ct. 346, 543 U.S. 927, 160 L.Ed.2d 226. Patents 319(3)

180. ---- Particular cases, increased damages

Doubling of damages awarded against willful patent infringer was not abuse of discretion; infringer, as former licensee of patent, had failed to conduct reasonable and independent investigation of patent's coverage, infringer was large company with extensive financial means, and it made attempt to remedy infringement. Metabolite Laboratories, Inc. v. Laboratory Corp. of America Holdings, C.A.Fed. (Colo.) 2004, 370 F.3d 1354, 71 U.S.P.Q.2d 1081, rehearing and rehearing en banc denied , certiorari granted in part 126 S.Ct. 543, 546 U.S. 975, 163 L.Ed.2d 458, order vacated on reconsideration 126 S.Ct. 601, 546 U.S. 999, 163 L.Ed.2d 501, certiorari dismissed as improvidently granted 126 S.Ct. 2921, 548 U.S. 124, 165 L.Ed.2d 399, 79 U.S.P.Q.2d 1065. Pat- ents 319(3)

District court's award of enhanced damages to patentee for infringement, which enhanced damages for pre-trial infringement by 50% and doubled damages for infringement post-verdict until entry of the permanent injunction, was not abuse of discretion, but represented reasonable measurement of culpability of infringer's conduct. Stryker Corp. v. Davol Inc., C.A.Fed. (Mich.) 2000, 234 F.3d 1252, 57 U.S.P.Q.2d 1133, rehearing and rehearing en banc denied. Patents 319(3)

Imposition of enhanced damages in amount of fifty percent of jury's award was warranted in action alleging infringement of patent relating to method and system for trading loans, even though question of defendant's infringement was close, and there was no evidence of deliberate copying, where defendant did not investigate patent's scope and form good faith belief of invalidity or noninfringement for over four years after learning of patent, defendant undertook no remedial action, even after jury verdict against it, and defendant's financial condition was such that it would not be jeopardized by enhanced damages award. IMX, Inc. v. LendingTree, LLC, D.Del.2007, 469 F.Supp.2d 203, on reconsideration in part 2007 WL 1232184. Patents 319(3)

Doubling of jury's substantial damages award was warranted on motion for enhanced damages in patent infringement lawsuit, where eight out of nine factors used in considering enhanced damages weighed in favor of enhancement, jury rendered verdict of willful infringement, and there were no mitigating circumstances. Mu- niauction, Inc. v. Thomson Corp., W.D.Pa.2007, 502 F.Supp.2d 477, stay denied 2007 WL 2406950, stay granted 2007 WL 2827915, reversed in part , vacated in part 532 F.3d 1318, 87 U.S.P.Q.2d 1350, rehearing and rehearing en banc denied , petition for certiorari filed 2008 WL 5459193. Patents 319(3)

Generic drug manufacturer could be subjected to enhanced damages in connection with its filing of abbreviated new drug application (ANDA) if patentee could ultimately prevail and prove additional circumstances, other than willful infringement. Wyeth v. Ranbaxy Laboratories Ltd., D.N.J.2006, 448 F.Supp.2d 607. Patents 319(3)

Jury's finding that patent infringement was not willful, for purpose of awarding enhanced damages, was not clearly erroneous, and thus plaintiff was not entitled to new trial on issue, even though defendant had relied on extremely limited attorney opinion and had, prior to issuance of patent, misappropriated plaintiff's trade secrets. Cargill, Inc. v. Sears Petroleum & Transport Corp., N.D.N.Y.2005, 388 F.Supp.2d 37, appeal dismissed 163 Fed.Appx. 894, 2006 WL 197472. Patents 323.3

Patentee was entitled to have its damages award doubled where defendant, upon notice of its alleged infringing activity, failed to investigate the scope of the patent, did not stop using technology or a feature because of a patent held by others, rarely, if ever, performed patent searches before launching into its products once it was aware of their potentially infringing products, and did not exercise its duty of care to obtain competent legal advice regarding their potentially infringing activity; other aggravating factors against defendant included the prolonged

nature of defendant's infringement, its failure to discontinue its infringement once notified of patentee's lawsuit, and its failure to take remedial action to remedy its alleged infringement. Lucent Technologies, Inc. v. New- bridge Networks Corp., D.Del.2001, 168 F.Supp.2d 269. Patents 319(3)

Plaintiff was entitled to additional $75,000 in damages as well as agreed upon liquidated damages of $2,500 per door as result of defendant's violation of terms of consent judgment prohibiting defendant from making, using, or selling doors having rotationally molded top edge infringing upon plaintiff's patent, where it was clear that other doors manufactured and sold by defendant, in addition to those specifically proven to have rotational molding on top edge, contained some rotational molding on top edge. Chase Industries, Inc., Durus Div. v. Frommelt Industries, Inc., N.D.Iowa 1992, 806 F.Supp. 1381. Patents 319(3)

In patent infringement action, plaintiff was entitled to treble damages where defendant made no effort to ascertain scope of the patent, or its validity after plaintiff sent two demand letters to defendant. Leinoff v. Louis Mi- lona & Sons, Inc., S.D.N.Y.1983, 556 F.Supp. 280, 220 U.S.P.Q. 799, affirmed in part, vacated in part and reversed in part on other grounds 726 F.2d 734, 220 U.S.P.Q. 845. Patents 319(3)

Where defendant's infringement of design patent was not willful and wanton, patent had probably not been issued when defendant directed another to make a copy of such patent and admittedly had not been adjudicated before the action for infringement, and a master and federal judge had found that patent invalid so that validity was doubtful at best until passed upon by court of appeals, and long before patent was held to be valid defendant had changed its model in attempt to avoid infringing, and while some of alleged business methods of defendants were reprehensible, at best, so also was the use plaintiff made in its advertising of master's report, trial court in its discretion would not allow plaintiff to recover attorney's fees or treble damages. Sel-O-Rak Corp. v. Henry Hanger & Display Fixture Corp. of America, S.D.Fla.1958, 159 F.Supp. 769, 117 U.S.P.Q. 245, affirmed 270 F.2d 635, 123 U.S.P.Q. 3. Patents 319(3); Patents 325.11(3)

Though plaintiff's patents relating to permanent adjustable dockboards had been infringed, plaintiff was not entitled to treble damages where case was not an exceptional one within § 285 of this title. Kelley Co., Inc. v. Rite- Hite Corp., E.D.Wis.1973, 353 F.Supp. 1053, 177 U.S.P.Q. 6. Patents 319(3); Patents 325.11(3)

181. Interest, damages--Generally

Where award of damages to patentee for an infringement is made upon basis of a reasonable royalty, interest runs from date when damages are liquidated and not from date of last infringement. Duplate Corp. v. Triplex Safety Glass Co. of North America, U.S.Pa.1936, 56 S.Ct. 792, 298 U.S. 448, 80 L.Ed. 1274. See, also, Triplex Safety Glass Co. of North America v.Duplate Corporation, C.C.A.Pa.1940, 110 F.2d 326; General Motors Cor- poration v. Dailey, C.C.A.Mich.1938, 93 F.2d 938; Collins v. Hupp Motor Car Corporation, C.C.A.Mich.1927, 22 F.2d 27; K. W. Ignition Co. v. Temco Electric Motor Co., C.C.A.Ohio 1922, 283 F. 873, certiorari denied 43 S.Ct. 247, 260 U.S. 746, 67 L.Ed. 493; B. F. Goodrich Co. v. Consolidated Rubber Tire Co., C.C.A.Ill.1918, 251 F. 617, certiorari denied 38 S.Ct. 582, 247 U.S. 519, 62 L.Ed. 1246; Enterprise Mfg. Co. v. Shakespeare Co., D.C.Mich.1942, 47 F.Supp. 859, affirmed 141 F.2d 916. Patents 319(1)

Interest should be allowed on damages from date of filing of master's report, whereby amount of damages was ascertained. Crosby Steam-Gauge & Valve Co. v. Consolidated Safety-Valve Co., U.S.Mass.1891, 12 S.Ct. 49, 141 U.S. 441, 35 L.Ed. 809. See, also, Humidity Control Co. v. Mengel Body Co., D.C.N.J.1935, 13 F.Supp. 185. Patents 319(4)

In patent cases, the trial court has discretion to award interest from the date of the last infringement. Milgo Elec- tronic Corp. v. United Business Communications, Inc., C.A.10 (Kan.) 1980, 623 F.2d 645, 206 U.S.P.Q. 481, certiorari denied 101 S.Ct. 794, 449 U.S. 1066, 66 L.Ed.2d 611, 208 U.S.P.Q. 376. Patents 319(4)

Under the rule that interest should run from the date damages are liquidated absent exceptional circumstances, plaintiffs who successfully prosecuted patent infringement action were entitled to interest commencing on the date master's report was filed. Wahl v. Carrier Mfg. Co., Inc., C.A.7 (Ind.) 1975, 511 F.2d 209, 184 U.S.P.Q. 516. Interest 39(1)

Court did not err in denying interest from time infringement occurred. Maloney-Crawford Tank Corp. v. Sauder Tank Co., Inc., C.A.10 (Kan.) 1975, 511 F.2d 10, 185 U.S.P.Q. 80. Patents 319(4)

In enacting this section authorizing award of damages to claimant to compensate for infringement together with interest and costs as fixed by the court, Congress did not purport to require interest from dates on which royalties would normally have been paid. Georgia-Pacific Corp. v. U. S. Plywood-Champion Papers, Inc., C.A.2 (N.Y.) 1971, 446 F.2d 295, 170 U.S.P.Q. 369, certiorari denied 92 S.Ct. 105, 404 U.S. 870, 30 L.Ed.2d 114, 171 U.S.P.Q. 322. Patents 319(4)

District judge, in patent infringement suit in which additional damages were awarded for willful infringement, did not abuse his discretion by awarding interest from date of filing of report rather than from date of last infringement. General Elec. Co. v. Sciaky Bros., Inc., C.A.6 (Mich.) 1969, 415 F.2d 1068, 163 U.S.P.Q. 257. Pat- ents 319(4); Patents 325.11(2.1)

Generally, interest on an award for patent infringement should run from date damages are liquidated, rather than date of last infringement. Union Carbide Corp. v. Graver Tank & Mfg. Co., C.A.7 (Ind.) 1960, 282 F.2d 653, 127 U.S.P.Q. 3, certiorari denied 81 S.Ct. 692, 365 U.S. 812, 5 L.Ed.2d 691, 129 U.S.P.Q. 557, certiorari denied 81 S.Ct. 695, 365 U.S. 812, 5 L.Ed.2d 691, 128 U.S.P.Q. 557, on remand 243 F.Supp. 358, 145 U.S.P.Q. 446. See, also, Union Carbide Corp. v. Graver Tank & Mfg. Co., C.A.Ind.1965, 345 F.2d 409. Patents 319(4)

Interest on unliquidated claim for damages in a patent infringement suit is allowable from time of infringement only under special circumstances and in court's discretion, even though damages awarded are computed on basis of reasonable royalty. Randolph Laboratories v. Specialties Development Corp., C.A.3 (N.J.) 1954, 213 F.2d 873, 102 U.S.P.Q. 140, certiorari denied 75 S.Ct. 91, 348 U.S. 861, 99 L.Ed. 678, 103 U.S.P.Q. 424, certiorari denied 75 S.Ct. 91, 348 U.S. 861, 99 L.Ed. 678, 103 U.S.P.Q. 425. Patents 319(4)

Interest should run from date damages are liquidated in absence of exceptional circumstances. Dixie Cup Co. v. Paper Container Mfg. Co., C.C.A.7 (Ill.) 1948, 169 F.2d 645, 78 U.S.P.Q. 222. See, also, Ellipse Corp. v. Ford Motor Co., D.C.Ill.1978, 461 F.Supp. 1354, affirmed 614 F.2d 775, certiorari denied 100 S.Ct. 2160, 446 U.S. 939, 64 L.Ed.2d 792; Mathey v. United Shoe Machinery Corporation, D.C.Mass.1944, 54 F.Supp. 694.

Interest from date that royalty would have been payable upon infringing foot sock production must be added to damages for infringement of reissue patent for style of foot socks and applicable rate of interest was six percent per annum as required by state law. Wayne-Gossard Corp. v. Moretz Hosiery Mills, Inc., W.D.N.C.1976, 447 F.Supp. 12, 199 U.S.P.Q. 87, affirmed 573 F.2d 191, 200 U.S.P.Q. 12. Patents 319(4)

Under this section authorizing an award of damages to a claimant to compensate for infringement together with interest and costs as fixed by the court, district judge had power to award interest from date of last infringement.

Minnesota Mining & Mfg. Co. v. Berwick Industries, Inc., M.D.Pa.1975, 393 F.Supp. 1230, 185 U.S.P.Q. 536, affirmed 532 F.2d 330, 190 U.S.P.Q. 209.

Interest on patent infringement damages and misappropriation of trade secret damages based upon reasonable royalties was allowable from time royalty should have been paid where misappropriation was unconscionable, willful and in bad faith, thus presenting special circumstances. Carter Products, Inc. v. Colgate-Palmolive Co., D.C.Md.1963, 214 F.Supp. 383, 136 U.S.P.Q. 348, 136 U.S.P.Q. 577. Interest 39(4)

Damages being unliquidated, interest on award fixing infringer's liability to patentee would not begin until final judgment confirming master's report on accounting reference. Excel Auto Radiator Co. v. Bishop & Babcock Mfg. Co., N.D.Ohio 1953, 123 F.Supp. 315, 102 U.S.P.Q. 74, affirmed 212 F.2d 586, 102 U.S.P.Q. 52, certiorari denied 75 S.Ct. 37, 348 U.S. 823, 99 L.Ed. 649, 103 U.S.P.Q. 424. Patents 319(4)

In patent infringement action in Virginia federal district court, interest on damages allowed should run only from time of filing of special master's report, and judgment should follow Virginia rule that the legal rate which judgments carry is 6 percent in absence of controlling provisions in a statute or contract, notwithstanding rate recom- mended in report was 5 percent. Kaltenbach v. Chesapeake & Ohio Ry. Co., E.D.Va.1941, 43 F.Supp. 819, modified on other grounds 124 F.2d 375. Patents 319(4)

Except for contract interest setting the rate, or action involving a statutory rate, interest is not allowed as such, but is simply an incident of the measure of the amount of damage caused by delay in payment, which, rather than being fixed by the legal rate of six percent depends upon the particular facts of the case. Hartford Nat. Bank & Trust Co. v. E. F. Drew & Co., D.C.Del.1960, 188 F.Supp. 347, 127 U.S.P.Q. 243, affirmed 290 F.2d 589, 129 U.S.P.Q. 204, certiorari denied 82 S.Ct. 45, 368 U.S. 825, 7 L.Ed.2d 29, 131 U.S.P.Q. 498. Damages 125; Interest 1

Patent owner was not entitled to interest on money it had to pay on monies it borrowed over period involved which would not have been necessary if patent had not been infringed and it had made additional sales since supporting data was too speculative. Central Soya Co., Inc. v. Geo. A. Hormel & Co., W.D.Okla.1983, 581 F.Supp. 54, 219 U.S.P.Q. 878, affirmed 723 F.2d 1573, 220 U.S.P.Q. 490. Patents 318(5)

Interest on damages assessed upon reasonable royalty basis is discretionary. Merrell Soule Co. v. Powdered Milk Co. of America, C.C.A.2 (N.Y.) 1925, 7 F.2d 297. See, also, Consolidated Rubber Tire Co. v. Diamond Rubber Co. of New York, D.C.N.Y.1915, 226 F. 455, affirmed 232 F. 475. Patents 319(4)

The item of interest on an appropriator's capital investment is not to be used as an instrument of punishment in a trade secret case, the monetary recovery being provided as a remedy for the wrongful appropriation, and the interest on capital which the appropriator invests in his endeavor should be allowed in an effort to arrive at a real- istic determination of the actual costs in the standard of comparison analysis of plaintiff's damages. International Industries, Inc. v. Warren Petroleum Corp., C.A.3 (Del.) 1957, 248 F.2d 696, 115 U.S.P.Q. 104, 115 U.S.P.Q. 159, certiorari dismissed 78 S.Ct. 529, 355 U.S. 943, 2 L.Ed.2d 523. Damages 114

Exceptional circumstances warranted allowance of interest to patentee against infringer on unliquidated items of lost lease profits, reasonable royalty awards and installation fees where infringer knew or must have known that the offering of its infringing machines at the rate offered would ruin patentee as infringer's only competitor in a distinctive field which patentee would have had all for himself but for the infringer's tortious conduct. Mathey v. United Shoe Machinery Corp., D.C.Mass.1944, 54 F.Supp. 694. Patents 319(4)

In suit for patent infringement allowance of compound interest upon amount of actual damages awarded had been discretionary under former §§ 67 and 70 of this title and circumstances. Grant Paper Box Co. v. Russell Box Co., D.C.Mass.1952, 106 F.Supp. 616, 94 U.S.P.Q. 96, affirmed 203 F.2d 177, 97 U.S.P.Q. 19, certiorari denied 74 S.Ct. 37, 346 U.S. 821, 98 L.Ed. 347, 99 U.S.P.Q. 491, rehearing denied 74 S.Ct. 216, 346 U.S. 905, 98 L.Ed. 404. Patents 319(4)

Where in giving judgment for infringement of a patent profits are utilized as a measure of compensation instead of a royalty or license fee, interest will not be allowed. Imperial Machine & Foundry Corporation v. U.S., Ct.Cl.1930, 69 Ct.Cl. 667.

182. ---- Computation of interest, damages

Annual compound interest, rather than simple interest, would be used in awarding prejudgment interest in patent infringement action. Mars, Inc. v. Coin Acceptors, Inc., D.N.J.2007, 513 F.Supp.2d 128. Interest 60

Appropriate rate of prejudgment interest on damage award for willful infringement of design patent was average rate patentee had paid for loans during period of infringement, rather than lower United States treasury bill rate. Rocket Jewelry Box, Inc. v. Quality Intern. Packaging, Inc., S.D.N.Y.2005, 403 F.Supp.2d 288, appeal dismissed 178 Fed.Appx. 12, 2006 WL 1072017. Interest 31

Evidence that patent's assignee would be required to pay one percent above prime rate to borrow funds and that licensee was paying at or above prime rate to borrow funds during period patent was infringed supported use of prime rate to compute award of prejudgment interest in patent infringement case. CVI/Beta Ventures, Inc. v. Tura LP, E.D.N.Y.1995, 905 F.Supp. 1171, reversed in part , vacated in part 112 F.3d 1146, 42 U.S.P.Q.2d 1577, rehearing and suggestion for rehearing en banc denied 120 F.3d 1260, 43 U.S.P.Q.2d 1860, certiorari denied 118 S.Ct. 1039, 522 U.S. 1109, 140 L.Ed.2d 105. Interest 31

Prime interest rate at time of infringement was appropriate rate of prejudgment interest in patent infringement case, rather than amount specified in competitor's contract with purchaser of infringing machine, rate set by state statute, or where patentee's “cost of capital.” Valmet Paper Machinery, Inc. v. Beloit Corp., W.D.Wis.1995, 895 F.Supp. 1158, 39 U.S.P.Q.2d 1878, reversed 105 F.3d 1409, 41 U.S.P.Q.2d 1619, opinion amended on rehearing 112 F.3d 1169, certiorari denied 118 S.Ct. 626, 522 U.S. 1028, 139 L.Ed.2d 606, rehearing denied , in banc suggestion declined. Interest 31

Prejudgment interest awarded to patentee in infringement case would be compounded, where incremental profits patentee would have earned on lost sales over infringement period would have been invested in manner resulting in yearly accrued growth. Stryker Corp. v. Intermedics Orthopedics, Inc., E.D.N.Y.1995, 891 F.Supp. 751, affirmed 96 F.3d 1409, 40 U.S.P.Q.2d 1065, rehearing denied , in banc suggestion declined. Interest 60

Alleged infringer's method of calculating prejudgment interest, which compounded interest annually, attempted to conform individual sales amounts to evidence presented at trial, and assumed infringing sales occurred con- tinuously throughout each period, rather than patentee's method, would be used in calculating prejudgment interest in infringement suit, where patentee's method compounded interest quarterly, assumed sales evenly dis- tributed among each period, and assumed that all sales occurred at beginning of each period. Virginia Panel Corp. v. Mac Panel Co., W.D.Va.1995, 887 F.Supp. 880, affirmed 133 F.3d 860, 45 U.S.P.Q.2d 1225, rehearing denied, in banc suggestion declined , certiorari denied 119 S.Ct. 52, 525 U.S. 815, 142 L.Ed.2d 40. Interest 39(2.6)

Interest on award of damages in patent infringement action was to be compounded quarterly, rather than monthly, absent any reason to compound interest component of award more frequently than three-month matur- ity length of Treasury bills. BIC Leisure Products, Inc. v. Windsurfing Intern., Inc., S.D.N.Y.1991, 774 F.Supp. 832, 21 U.S.P.Q.2d 1548, affirmed 1 F.3d 1214, 27 U.S.P.Q.2d 1671, rehearing denied, on remand 850 F.Supp. 224, 30 U.S.P.Q.2d 1949, reconsideration denied. Patents 319(4)

In suit for infringement of patent governing process used in cold forming metal car parts by pressure, award of interest, or delay damages, at prevailing corporate bond rate on royalty payments as of date those payments became due, calculated yearly, was not an abuse of discretion. Devex Corp. v. General Motors Corp., C.A.3 (Del.) 1981, 667 F.2d 347, 212 U.S.P.Q. 643, certiorari granted 102 S.Ct. 2267, 456 U.S. 988, 73 L.Ed.2d 1283, certiorari denied 102 S.Ct. 2270, 456 U.S. 990, 73 L.Ed.2d 1285, rehearing denied 106 S.Ct. 212, 474 U.S. 890, 88 L.Ed.2d 181, affirmed 103 S.Ct. 2058, 461 U.S. 648, 76 L.Ed.2d 211, 217 U.S.P.Q. 1185. Patents 319(1); Patents 319(4)

Master had no authority in patent infringement suit to penalize defendant by compounding interest on profits allowed plaintiff. Baseball Display Co. v. Star Ballplayer Co., C.C.A.3 (N.J.) 1929, 35 F.2d 1. Patents 318(5)

Prejudgment interest at rate of “prime minus 2” percent, compounded on lost profits and reasonable royalty, would be awarded to patentee in infringement case. Minco, Inc. v. Combustion Engineering, Inc., E.D.Tenn.1995, 903 F.Supp. 1204, affirmed 95 F.3d 1109, 40 U.S.P.Q.2d 1001, rehearing denied , in banc suggestion declined. Interest 31; Interest 60

In determining profits arising from sale of infringing devices as a measure of damages for the infringement, the infringing company was entitled to an allowance of interest only on its “net worth”, which was the remainder after deduction of liabilities from assets, and infringing company was not entitled to interest on amounts borrowed by infringing company from company which owned all of stock of infringing company and which received at end of each year, all of net profits and then loaned them to infringing company for use in the business. W. H. Miner, Inc., v. Peerless Equipment Co., C.C.A.7 (Ill.) 1940, 115 F.2d 650, certiorari denied 61 S.Ct. 615, 312 U.S. 687, 85 L.Ed. 1125. Patents 319(4)

Patent holder was entitled to interest on its damage award in patent infringement suit involving Coriolis mass flowmeters based on interest rates applicable to its parent corporation's sweep account since money the patent holder would have earned but for infringement would have been placed in that account and would have earned that interest. Micro Motion, Inc. v. Exac Corp., N.D.Cal.1991, 761 F.Supp. 1420, 19 U.S.P.Q.2d 1001. Patents 319(4)

Although award for patent infringement was based on hypothetical license entered into immediately on issuance of patent, patentee was not automatically entitled to interest on royalties that should have been paid from that time to judgment; trial court did not abuse its discretion in awarding interest only from date of filing of special master's report to date of judgment. Foster v. American Mach. & Foundry Co., C.A.2 (N.Y.) 1974, 492 F.2d 1317, 182 U.S.P.Q. 1, certiorari denied 95 S.Ct. 58, 419 U.S. 833, 42 L.Ed.2d 59, 183 U.S.P.Q. 321, rehearing denied 95 S.Ct. 648, 419 U.S. 1061, 42 L.Ed.2d 659. Patents 319(4)

In action for accounting for profits resulting from infringement, any judgment rendered for plaintiff should bear interest, at the rate of 6 percent per annum from the date of the filing of the master's revised report and the judgment when entered should also bear interest at the rate of 6 percent per annum. Gotham Silk Hosiery Co. v. Art-

craft Silk Hosiery Mills, C.C.A.3 (Del.) 1944, 147 F.2d 209. Interest 22(3); Interest 38(1); Patents 318(5)

There was no error in specifying interest rate on infringement award at 4 percent rather than usual state rate of 6 percent. Bros. Inc. v. W. E. Grace Mfg. Co., C.A.5 (Tex.) 1963, 320 F.2d 594, 138 U.S.P.Q. 357. Patents 319(4)

183. ---- Good faith, interest, damages

Award of prejudgment interest on unliquidated patent infringement damages was not proper where officers of allegedly infringing corporations had held bona fide and reasonable beliefs that patents were not being infringed and several bona fide defenses to validity and enforcement of patent were asserted. Columbia Broadcasting Sys- tem, Inc. v. Zenith Radio Corp., C.A.7 (Ill.) 1976, 537 F.2d 896, 192 U.S.P.Q. 68. Patents 319(4)

Patent holder was not entitled to award of prejudgment interest on infringement damages where there was no showing of bad faith on part of infringer. Medtronic, Inc. v. Catalyst Research Corp., D.C.Minn.1982, 547 F.Supp. 401, 216 U.S.P.Q. 687. Interest 39(2.20)

Defendants in “exceptional” case in which patent was found unenforceable due to inequitable conduct during prosecution of patent were entitled to prejudgment and postjudgment interest in light of scope and significance of plaintiffs' bad faith; plaintiffs had withheld several potentially invalidated references from Patent and Trade- mark Office (PTO) with intent to deceive PTO, and were involved in various acts of litigation misconduct, including destruction of relevant files and obstruction of discovery, and one plaintiff's testimony throughout litigation was at best less than truthful. Molins PLC v. Textron, Inc., D.Del.1993, 840 F.Supp. 306, 30 U.S.P.Q.2d 1054, vacated and remanded 48 F.3d 1172, 33 U.S.P.Q.2d 1823, rehearing denied. Interest 39(2.20); In- terest 39(3)

184. ---- Increased damages, interest

There was no conflict in awarding both prejudgment interest and treble damages in patent infringement suit. Pa- per Converting Machine Co. v. Magna-Graphics Corp., C.A.Fed.1984, 745 F.2d 11, 223 U.S.P.Q. 591, on remand 631 F.Supp. 660, 228 U.S.P.Q. 524. Interest 39(2.20); Patents 319(3)

Although plaintiffs, patent owner and its exclusive licensee were entitled to treble damages for infringement, the amounts of the judgment interest was based only on the amount of lost profits and was not to be trebled. Saf- Gard Products, Inc. v. Service Parts, Inc., D.C.Ariz.1980, 491 F.Supp. 996, 206 U.S.P.Q. 976. Patents 318(3)

Patent holder was entitled to three times amount of damages found in light of willful nature of infringement, but was not entitled to prejudgment interest on increased damages. Fromson v. Citiplate, Inc., E.D.N.Y.1988, 699 F.Supp. 398, 9 U.S.P.Q.2d 1506, affirmed 886 F.2d 1300, 12 U.S.P.Q.2d 1299. Patents 319(3)

Where enhanced portion of damage award was punitive in character because it was assessed for willful infringement of patents, award of prejudgment interest on punitive portion of damage award was improper. Underwater Devices Inc. v. Morrison-Knudsen Co., Inc., C.A.Fed.1983, 717 F.2d 1380, 219 U.S.P.Q. 569. Patents 319(4)

Prejudgment interest does not apply to any enhanced or punitive portion of damage award in patent infringement

case; however prejudgment interest does apply to recoveries for both lost profits and reasonable royalty. Minco, Inc. v. Combustion Engineering, Inc., E.D.Tenn.1995, 903 F.Supp. 1204, affirmed 95 F.3d 1109, 40 U.S.P.Q.2d 1001, rehearing denied , in banc suggestion declined. Interest 39(2.20); Interest 39(2.55)

185. ---- Prejudgment interest, damages

Patentee was entitled to prejudgment interest at rate of 12% per annum not compounded on $446,182.40 award, under Rhode Island law, in action against game manufacturer alleging infringement of polyhedral dice, and interest would run from the date of infringement to the date of judgment. Bowling v. Hasbro, Inc., D.R.I.2008, 582 F.Supp.2d 192. Interest 60

Appropriate prejudgment interest rate to be awarded to plaintiff in patent infringement action was Federal Re- serve average prime rate, compounded annually, rather than United States Treasury Bill (T-Bill) rate, despite defendant's contention that plaintiff was not only deprived of use of additional royalty income it would have received, but was also relieved of risks associated with investing that income. IMX, Inc. v. LendingTree, LLC, D.Del.2007, 469 F.Supp.2d 203, on reconsideration in part 2007 WL 1232184. Interest 31

Three-month Treasury bill (T-Bill) rate would be used in awarding prejudgment interest for patent infringement where patentee put forth no evidence that it borrowed money; three-month T-Bill rate represented a benchmark as the shortest term, risk-free investment available to ordinary investors. Mars, Inc. v. Coin Acceptors, Inc., D.N.J.2007, 513 F.Supp.2d 128. Interest 31

Patentee that prevailed on claims for infringement of its patents for a telephone routing system was not entitled to award of prejudgment interest, where patentee waited almost three years and nine months to file suit after issuance of reissue patent found to be infringed, and during the delay, patentee's attorney took positions on its patents that were different from those that were successfully asserted at trial, and infringers were investing in a telephone routing system based on a different business model than patentee and were developing their presence in the marketplace. 800 Adept, Inc. v. Murex Securities, Ltd., M.D.Fla.2007, 505 F.Supp.2d 1327, affirmed in part, vacated in part and reversed in part 539 F.3d 1354, 88 U.S.P.Q.2d 1065, rehearing and rehearing en banc denied , petition for certiorari filed 2009 WL 46535. Interest 39(2.20)

Award of prejudgment interest on compensatory damages award was warranted at prime rate, plus one percent weighted average interest rate, compounded yearly, over period of infringement of patent, since patent owner would not have been forced to borrow money had competitor not infringed and that was actual rate at which patent owner borrowed money during period of infringement, and thus that rate most accurately reflected full compensatory award to owner. Muniauction, Inc. v. Thomson Corp., W.D.Pa.2007, 502 F.Supp.2d 477, stay denied 2007 WL 2406950, stay granted 2007 WL 2827915, reversed in part , vacated in part 532 F.3d 1318, 87 U.S.P.Q.2d 1350, rehearing and rehearing en banc denied , petition for certiorari filed 2008 WL 5459193. In- terest 31; Interest 60

Alleged infringer was not prejudiced by any delay attributable to holder of patents related to methods of treating wrinkles and other skin conditions by the regular, topical application of alpha hydroxyacids (AHAs) in various

formulations, as would justify withholding an award of prejudgment interest in patent infringement action, on ground that holder was allegedly responsible for undue delay in prosecuting the lawsuit. Tristrata Technology, Inc. v. Mary Kay, Inc., D.Del.2006, 423 F.Supp.2d 456, affirmed 214 Fed.Appx. 979, 2007 WL 200933. Interest 39(2.20)

Prevailing patent infringement plaintiff was entitled to prejudgment interest, at state law rate, absent showing that it had unduly delayed initiation of litigation. Engineered Products Co. v. Donaldson Co., Inc., N.D.Iowa 2004, 330 F.Supp.2d 1013, amended in part 335 F.Supp.2d 973, affirmed in part, vacated in part and remanded 147 Fed.Appx. 979, 2005 WL 2090662. Interest 31; Interest 39(2.20)

Willful patent infringer was liable for prejudgment interest, from date patentee filed infringement suit, at rate of six percent per annum, on compensatory portion of damage award. Domestic Fabrics Corp. v. Sears, Roebuck & Co., E.D.N.C.2004, 326 F.Supp.2d 694, dismissed 122 Fed.Appx. 518, 2005 WL 545714. Interest 31; In- terest 39(2.20)

Owner of e-commerce patents, having prevailed in infringement action, was entitled to recover prejudgment interest on damage award at one-year Federal Treasury rate, compounded quarterly; there was no evidence that owner had been forced to borrow money at any higher rate. Mercexchange, L.L.C. v. eBay, Inc., E.D.Va.2003, 275 F.Supp.2d 695, affirmed in part , reversed in part 401 F.3d 1323, 74 U.S.P.Q.2d 1225, rehearing and rehearing en banc denied , certiorari granted 126 S.Ct. 733, 546 U.S. 1029, 163 L.Ed.2d 567, vacated and remanded 126 S.Ct. 1837, 547 U.S. 388, 164 L.Ed.2d 641, 78 U.S.P.Q.2d 1577, on remand 188 Fed.Appx. 993, 2006 WL 2036554. Interest 31; Interest 39(2.20); Interest 60

Appropriate rate of prejudgment interest on compensatory damage award in patent infringement suit was prime rate. NTP Inc. v. Research in Motion, Ltd., E.D.Va.2003, 270 F.Supp.2d 751, 67 U.S.P.Q.2d 1594, subsequent determination 2003 WL 23100883, amended 2003 WL 22746080. Interest 31

Holder of design patent, who had prevailed on infringement claim and had elected to recover infringer's profits, was entitled to prejudgment interest on award; infringer had benefitted from use of profits to which it was not entitled. Rocket Jewelry Box, Inc. v. Quality Intern. Packaging, Ltd., S.D.N.Y.2003, 250 F.Supp.2d 333, motion denied 2003 WL 21910888, affirmed in part, vacated in part and remanded 90 Fed.Appx. 543, 2004 WL 260998, on remand 403 F.Supp.2d 288. Patents 319(4)

Prejudgment interest is ordinarily allowed in patent infringement cases, extending from date of infringement to date of judgment. Ristvedt-Johnson, Inc. v. Brandt, Inc., N.D.Ill.1992, 805 F.Supp. 557. Interest 39(2.20)

Prejudgment interest in patent infringement action could only be awarded on compensatory element of damages, and could not be awarded on enhanced additional damages. Beatrice Foods Co. v. New England Printing and Lithographing Co., C.A.Fed. (Conn.) 1991, 923 F.2d 1576, 17 U.S.P.Q.2d 1553. Patents 319(4)

Prejudgment interest in a patent case is not limited to damages measured by a royalty. Lummus Industries, Inc. v. D.M. & E. Corp., C.A.Fed. (N.C.) 1988, 862 F.2d 267, 8 U.S.P.Q.2d 1983. Interest 39(2.20)

Magistrate abused his discretion by failing to award prejudgment interest, where alleged patent infringer failed to provide any circumstances which excused such award. Laitram Corp. v. Cambridge Wire Cloth Co., C.A.Fed. (Md.) 1986, 785 F.2d 292, 228 U.S.P.Q. 935, certiorari denied 107 S.Ct. 85, 479 U.S. 820, 93 L.Ed.2d 39. Pat- ents 319(4)

District court improperly refused to award prejudgment interest on basis that there were no “exceptional circumstances” relative to patent infringement suit; therefore, remand was appropriate for further consideration in light of United States Supreme Court decision providing that a court's authority to award prejudgment interest is not restricted to exceptional circumstances. Deere & Co. v. International Harvester Co., C.A.Fed.1983, 710 F.2d 1551, 218 U.S.P.Q. 481. Interest 39(2.20); Patents 324.60

Where remedial damages measure loss incurred by plaintiff as of time of infringement of patent, award of prejudgment interest serves remedial purpose by making plaintiff whole for intervening loss of use of money he would have had, at date of infringement, but for defendant's unlawful acts. Trio Process Corp. v. L. Goldstein's Sons, Inc., C.A.3 (Pa.) 1981, 638 F.2d 661. Patents 319(4)

In patent infringement action, trial court's finding of willful and deliberate infringement provided a basis for awarding prejudgment interest running from the date of the last infringement. Milgo Electronic Corp. v. United Business Communications, Inc., C.A.10 (Kan.) 1980, 623 F.2d 645, 206 U.S.P.Q. 481, certiorari denied 101 S.Ct. 794, 449 U.S. 1066, 66 L.Ed.2d 611, 208 U.S.P.Q. 376. Patents 319(4)

Award of prejudgment interest to patentee in action for infringement of magnetic resonance imaging (MRI) device would be based on average 52-week United States Treasury bill rate for period in question, and would be computed daily and compounded annually. Fonar Corp. v. General Elec. Co., E.D.N.Y.1995, 902 F.Supp. 330, 41 U.S.P.Q.2d 1088, affirmed in part , reversed in part 107 F.3d 1543, 41 U.S.P.Q.2d 1801, rehearing denied, in banc suggestion declined , certiorari denied 118 S.Ct. 266, 522 U.S. 908, 139 L.Ed.2d 192. Interest 31; In- terest 56; Interest 60

Prejudgment interest on damages for patent infringement would be calculated at end of quarter in which sales occurred, plus another 30 days, rather than at end of each month, as common licensing agreements in industry provided for quarterly calculations, with payments due 30 days after quarter's close, thus, quarterly calculation was better estimation of time value of money that patent holder lost. Grain Processing Corp. v. American Maize- Products Co., N.D.Ind.1995, 893 F.Supp. 1386, 37 U.S.P.Q.2d 1299, affirmed in part , vacated in part 108 F.3d 1392, on remand 979 F.Supp. 1233, 44 U.S.P.Q.2d 1782. Interest 56

Patentee was entitled to prejudgment interest at rate of 3% over prevailing Treasury Bill rate, compounded daily, which represented cost of money to patentee during relevant period, in infringement action against competitor that infringed patent for dual-terminal automotive replacement battery, in view of expert testimony offered by patentee and infringer's failure to offer contrary testimony, and infringer's failure to establish claim that patentee improperly denied it discovery on interest issue. GNB Battery Technologies, Inc. v. Exide Corp., D.Del.1995, 886 F.Supp. 420, affirmed 78 F.3d 605, 38 U.S.P.Q.2d 1506. Interest 31; Interest 39(2.20); Interest 60

Prejudgment interest should ordinarily be awarded in patent infringement case to fully compensate plaintiff for infringement. Oscar Mayer Foods Corp. v. Conagra, Inc., W.D.Wis.1994, 869 F.Supp. 656, 31 U.S.P.Q.2d 1173, affirmed 45 F.3d 443, 35 U.S.P.Q.2d 1278, rehearing denied, in banc suggestion declined , certiorari denied 116 S.Ct. 62, 516 U.S. 812, 133 L.Ed.2d 25. Interest 39(2.20)

As part of compensatory damages in patent infringement action, patent holder was entitled to prejudgment interest on total reasonable royalties due him. Ramos v. Biomet, Inc., S.D.Fla.1993, 828 F.Supp. 1570, affirmed in part , reversed in part 69 F.3d 553, rehearing denied, rehearing denied , in banc suggestion declined. Interest 39(2.20); Interest 56

Prevailing patent infringement plaintiff's claim for prejudgment interest would not be reduced on ground that it was responsible for delays in resolution of case, absent sufficient factual basis to attribute any delay in litigation to one party or the other, or to suggest that delay should lead to forfeiture of portion of measure of damages intended to make plaintiff whole. Mars, Inc. v. Conlux USA Corp., D.Del.1993, 818 F.Supp. 707, 28 U.S.P.Q.2d 1161, affirmed 16 F.3d 421. Interest 39(2.20)

Patent owner did not engage in any conduct, such as dilatory action during discovery, that would justify denial of prejudgment interest in patent infringement action. Ristvedt-Johnson, Inc. v. Brandt, Inc., N.D.Ill.1992, 805 F.Supp. 557. Interest 39(2.20)

Prejudgment interest would be awarded both on lost profits and reasonably royalty portions of damage award for infringement of patent on process for preparing microfiltration membrane, absent any justification for withholding such award. Pall Corp. v. Micron Separations, Inc., D.Mass.1992, 792 F.Supp. 1298, affirmed in part, modified in part and reversed in part 66 F.3d 1211, 36 U.S.P.Q.2d 1225, rehearing denied, certiorari denied 117 S.Ct. 1243, 520 U.S. 1115, 137 L.Ed.2d 326. Interest 39(2.20)

Award of prejudgment interest is within discretion of court. Smith Corona Corp. v. Pelikan, Inc., M.D.Tenn.1992, 784 F.Supp. 452, affirmed 1 F.3d 1252, rehearing denied , in banc suggestion declined. Interest 39(2.10)

District court may award prejudgment interest in patent infringement case at rate above statutory rate where claimant has affirmatively demonstrated that higher rate should be used. Brooktree Corp. v. Advanced Micro Devices, Inc., S.D.Cal.1990, 757 F.Supp. 1101, 18 U.S.P.Q.2d 1703. Patents 319(4)

Patent holder was entitled to prejudgment interest for infringement by sole buyer of infringing display cases at rates established under statute requiring Internal Revenue Service to use adjusted prime rate in compensating tax payers for overpayments, compounded daily, from the dates on which infringing display cases were purchased. Trans-World Mfg. Corp. v. Al Nyman & Sons, Inc., D.Del.1986, 633 F.Supp. 1047, 229 U.S.P.Q. 873. Patents 319(4)

Exceptional circumstances, including fact that plaintiff who challenged validity of patent did not respond to offer to enter into license agreement and that it proceeded to sell its infringing device in substantial quantities, justified award of prejudgment interest to patentee. Railroad Dynamics, Inc. v. A. Stucki Co., E.D.Pa.1983, 579 F.Supp. 353, 218 U.S.P.Q. 618, affirmed 727 F.2d 1506, 220 U.S.P.Q. 929, certiorari denied 105 S.Ct. 220, 469 U.S. 871, 83 L.Ed.2d 150, 224 U.S.P.Q. 520. Interest 39(2.20)

Award of prejudgment interest was appropriate in case for accounting for damages for patent infringement, calculated at 12 percent from date patent holder would have delivered its machines to customers. Paper Converting Mach. Co. v. Magna-Graphics Corp., E.D.Wis.1983, 576 F.Supp. 967, 220 U.S.P.Q. 1057, affirmed in part , vacated in part 745 F.2d 11, 223 U.S.P.Q. 591, on remand 631 F.Supp. 660, 228 U.S.P.Q. 524. Patents 319(4)

Exclusive patent licensee was entitled to compensation for a delay in form of prejudgment interest on infringement award where although damages were not liquidated in a literal sense they were, at the time they accrued, ascertainable in that licensee's witnesses testified that they could have calculated its per unit profits at end of each year in the accounting period and infringer was able to calculate its profits at least six years after the fact simply by referring to its financial statements and sales records and there was no indication that infringer's variable cost differed substantially from those of the manufacturer licensee. Saf-Gard Products, Inc. v. Service Parts,

Inc., D.C.Ariz.1980, 491 F.Supp. 996, 206 U.S.P.Q. 976. Patents 318(5)

Trial court abused its discretion by awarding prejudgment interest on patent owner's entire damages award for infringement, including projection of future damages, because award of interest on projected lost profits constituted compensation for losses owner had not yet suffered and thus violated compensatory purpose of prejudgment interest. Oiness v. Walgreen Co., C.A.Fed. (Colo.) 1996, 88 F.3d 1025, 39 U.S.P.Q.2d 1304, rehearing denied, in banc suggestion declined , certiorari denied 117 S.Ct. 951, 519 U.S. 1112, 136 L.Ed.2d 838. Interest 39(2.20)

Holder of patent for a sailboard design, which recovered damages for its infringement, was entitled to prejudgment interest at the Treasury Bill rate from time to time; patentee did not demonstrate that interest at higher rate was necessary to compensate it for economic loss caused by the infringement. BIC Leisure Products, Inc. v. Windsurfing Intern., Inc., S.D.N.Y.1991, 761 F.Supp. 1032, 19 U.S.P.Q.2d 1922, modified on other grounds on reconsideration 774 F.Supp. 832, 21 U.S.P.Q.2d 1548, affirmed 1 F.3d 1214, 27 U.S.P.Q.2d 1671, rehearing denied, on remand 850 F.Supp. 224, 30 U.S.P.Q.2d 1949, reconsideration denied. Interest 31; Interest 39(2.20)

Patentee's six-year delay in commencing infringement suit, knowing that competitor was infringing its tow truck patents, believing that patents were invalid, did not preclude award of prejudgment interest in infringement case, but warranted application of lesser amount of prejudgment interest than patentee's most optimistic calculation; delay exposed competitor to significantly larger award of reasonable royalty damages, and patentee failed to show that its pursuit of other infringement litigation prevented it from suing competitor. Century Wrecker Corp. v. E.R. Buske Mfg. Co., Inc., N.D.Iowa 1996, 913 F.Supp. 1256. Interest 39(2.20); Interest 56

Patentee's alleged unlawful attempt to extend scope of its claims in patent for dual-terminal automotive replacement battery did not warrant depriving patentee of prejudgment interest in infringement action. GNB Battery Technologies, Inc. v. Exide Corp., D.Del.1995, 886 F.Supp. 420, affirmed 78 F.3d 605, 38 U.S.P.Q.2d 1506. In- terest 39(2.20)

Plaintiffs were not entitled to prejudgment interest on damage award in patent infringement action where damages were recovered for future lost profits rather than past or present lost profits and award thus placed plaintiffs in better position than they would have been in had infringement never occurred. Oiness v. Walgreen Co., D.Colo.1991, 774 F.Supp. 1277, 21 U.S.P.Q.2d 1654, affirmed in part , vacated in part 980 F.2d 742, 26 U.S.P.Q.2d 1548, rehearing denied, certiorari denied 113 S.Ct. 1849, 507 U.S. 1032, 123 L.Ed.2d 473, on remand 838 F.Supp. 1420, 30 U.S.P.Q.2d 1383. Patents 319(4)

Under statute providing for interest on patent infringement damages, plaintiff could be awarded prejudgment interest not only on damages for lost profits but also on damages for lost marketing opportunities. Water Techno- logies Corp. v. Calco, Ltd., N.D.Ill.1987, 658 F.Supp. 980, 1 U.S.P.Q.2d 1872. Patents 319(4)

Patentee's failure to remove its patent notice from its wheelbarrows for one and one-half years after patent expired did not preclude an award to patentee of prejudgment interest, as infringer failed to show it suffered from that failure to remove. Radio Steel & Mfg. Co. v. MTD Products, Inc., C.A.Fed. (Ohio) 1986, 788 F.2d 1554, 229 U.S.P.Q. 431. Patents 319(4)

District court erred in awarding prejudgment interest to patentee, as prevailing party in patent infringement suit, at the rate that was in effect on the date of the award, rather than the rate in effect on the date infringement

began; the court's use of such rate did not ensure that patentee was placed in as good a position as it would have been had infringer entered into a reasonable royalty agreement. Hockerson-Halberstadt, Inc. v. Propet USA, Inc., C.A.Fed.2003, 62 Fed.Appx. 322, 2003 WL 1795641, Unreported. Interest 31

Award of prejudgment interest to inventor, who established willful infringement of patent for protective mechanism in electrically operated devices, would not include period of pretrial delay which was attributable solely to inventor; delay allowed inventor's damages to escalate while defendant continued to sell the infringing devices. Gaus v. Conair Corp., S.D.N.Y.2003, 2003 WL 223859, Unreported, reversed 363 F.3d 1284, 70 U.S.P.Q.2d 1380, rehearing and rehearing en banc denied , certiorari denied 125 S.Ct. 346, 543 U.S. 927, 160 L.Ed.2d 226. Patents 319(4)

186. ---- Stay of action, interest, damages

Prevailing patent infringement plaintiff was entitled to prejudgment interest on damage award, calculated from date infringement claim was filed through date of judgment, but excluding period during which action was stayed pending reexamination by Patent Office. Bowers v. Baystate Technologies, Inc., D.Mass.2000, 112 F.Supp.2d 185, affirmed 320 F.3d 1317, certiorari denied 123 S.Ct. 2588, 539 U.S. 928, 156 L.Ed.2d 606. In- terest 39(2.20)

In patent infringement suit, period during which case was stayed pending decision in another case brought by the same patent holder was improperly excluded from period for which prejudgment interest was awarded, even though plaintiff had jointly sought stay with defendant, where plaintiff had originally opposed stay and joined in the stay request only after Panel on Multidistrict Litigation denied motion to consolidate discovery proceedings and suggested that parties seek a stay, and where delay was not undue or unjustified but furthered conservation of judicial and attorney resources. Allen Archery, Inc. v. Browning Mfg. Co., C.A.Fed. (Utah) 1990, 898 F.2d 787, 14 U.S.P.Q.2d 1156. Interest 39(2.20)

Patentee was not entitled to prejudgment interest for period that proceedings were stayed due to infringer's bank- ruptcy. Curtis Mfg. Co., Inc. v. Plasti-Clip Corp., D.N.H.1995, 933 F.Supp. 107, reversed 135 F.3d 778. Interest 39(2.20); Interest 54

187. ---- Time period for interest, damages

Where profits from sale of infringing device had to be apportioned because infringed patent covered only an improvement on prior art, damages were not liquidated until master's report was filed and interest ran only from such date. Perrine v. Burdick, C.C.A.8 (Minn.) 1943, 138 F.2d 861. Patents 318(5)

Interest is recoverable on sum allowed in accounting from date of master's report. MacBeth Evans Glass Co v. L E Smith Glass Co, D.C.Pa.1927, 21 F.2d 553, modified on other grounds 23 F.2d 459. See, also, Krentler- Arnold Hinge Last Co. v. Leman, D.C.Mass.1928, 24 F.2d 423. Patents 318(5)

Allowance of interest from date of master's findings in patent infringement suit on amount found to be due is not improper. Producers' & Refiners' Corporation v. Lehmann, C.C.A.8 (Wyo.) 1927, 18 F.2d 492. Patents 318(5)

Where the appellate court has made a different finding from the trial court as to profits recoverable, and has also awarded damages not allowed below, interest should date from final decree. Dowagiac Mfg. Co. v. Deere &

Webber Co., C.C.A.8 (Minn.) 1922, 284 F. 331. Patents 318(5)

Where there is a genuine controversy, interest on profits runs from the date of the master's report. Vandenburgh v. Concrete Steel Co, C.C.A.2 (N.Y.) 1921, 278 F. 607, certiorari granted 42 S.Ct. 186, 257 U.S. 632, 66 L.Ed. 407, reversed on other grounds 43 S.Ct. 335, 261 U.S. 16, 67 L.Ed. 512. See, also, Stromberg Motor Devices Co. v. Detroit Trust Co., C.C.A.Ill.1931, 44 F.2d 958; Turrill v. Illinois Cent. R. Co., C.C.Ill.1880, 20 F. 912. Patents 318(5)

Where infringement was not wanton or deliberate, interest on the profits runs only from the date of the master's report. Oehring v. Fox Typewriter Co., C.C.A.2 (N.Y.) 1918, 251 F. 584, 163 C.C.A. 578, rehearing denied 254 F. 774.

Profits bear interest from the time they were wrongfully detained. Burdett v. Estey, C.C.Vt.1880, 3 F. 566, reversed 3 S.Ct. 531, 109 U.S. 633, 27 L.Ed. 1058. Patents 318(5)

Just like the royalty payments awarded, prejudgment interest in patent infringement action accrued at time of the infringement, regardless of subsequent litigation events not attributable to delay caused by either party. Mars, Inc. v. Coin Acceptors, Inc., D.N.J.2007, 513 F.Supp.2d 128. Interest 39(2.20)

In absence of special circumstances, an award of profits for misappropriation of trade secrets does not bear interest until the amount is liquidated, and where the matter has been referred to a master, interest is usually allowed from the date of filing of the master's report, and any allowance of interest from an earlier date must be based upon equitable considerations. Carter Products, Inc. v. Colgate-Palmolive Co., D.C.Md.1963, 214 F.Supp. 383, 136 U.S.P.Q. 348, 136 U.S.P.Q. 577. Interest 39(2.20)

In patent infringement action, interest would be allowed from date on which master's report in accounting proceeding was filed rather than from date of expiration of patent involved. Clair v. Kastar, Inc., S.D.N.Y.1946, 70 F.Supp. 484, 73 U.S.P.Q. 347. Patents 318(5)

Profits usually do not draw interest without order of the court before the final decree, or at least before the filing of the master's report, as such profits are generally regarded in the light of unliquidated damages. Steam Stone Cutter Co. v. Windsor Mfg. Co., C.C.Vt.1880, 22 F.Cas. 1174, No. 13336. See, also, Crosby Steam Gage, etc., Co. v. Consolidated Safety Valve Co., Mass.1891, 12 S.Ct. 49, 141 U.S. 441, 35 L.Ed. 809; Yale Lock Mfg. Co. v. Sargent, N.Y.1886, 6 S.Ct. 934, 117 U.S. 536, 29 L.Ed. 954; Mowry v. Whitney, Ohio 1872, 14 Wall. 620, 20 L.Ed. 860; Turrill v. Michigan Southern, etc., R. Co., Mich.1864, 1 Wall. 620, 17 L.Ed. 668; Silsby v. Foote, N.Y.1857, 20 How. 378, 15 L.Ed. 953; Emigh v. Baltimore, etc., R. Co., C.C.Md.1881, 4 Hughes, U.S., 271, 6 F. 283.

188. ---- Review

Request of successful party in patent infringement action for interest on its recovery was not timely where made for first time on appeal. Hap Corp. v. Heyman Mfg. Co., C.A.1 (R.I.) 1966, 361 F.2d 329, 149 U.S.P.Q. 588. Patents 319(4)

189. Restitution

Competitor of owner of patent relating to video compression technology on cell phones, that obtained an implied license of patent through court order finding it infringed patent, but allowing it to avoid an immediate injunction

by making royalty payments, was entitled to return of royalties, plus interest, after court order was later reversed based on a finding that the patent was invalid; patent laws should not allow an ultimately losing patentee to benefit from a mistaken decision of the court. Broadcom Corp. v. Qualcomm Inc., C.D.Cal.2008, 585 F.Supp.2d 1187. Patents 218(1)

Patent licensee was not entitled to restitution of royalties on theory that patentee's false and misleading repres- entations to Patent Office [now Patent and Trademark Office] reflected in file wrapper were material misrepresentations which induced licensee to take a license, where it did not appear that licensee investigated the file wrapper before taking license, so there was no direct reliance by licensee on any false or misleading statements or nondisclosure contained therein. Transitron Electronic Corp. v. Hughes Aircraft Co., D.C.Mass.1980, 487 F.Supp. 885, 205 U.S.P.Q. 799, affirmed 649 F.2d 871, 210 U.S.P.Q. 161. Patents 218(1)

III. COSTS

Accounting fees, items of costs 216 Additional costs 228 Appellate costs, items of costs 217 Apportionment or division 229 Collection 232 Copies, items of costs 218 Costs generally 211 Discretion of court 212 Dismissal of action 230 Drawings and charts, items of costs 219 Interest on costs 233 Items of costs 215-227 Items of costs - Generally 215 Items of costs - Accounting fees 216 Items of costs - Appellate costs 217 Items of costs - Copies 218 Items of costs - Drawings and charts 219 Items of costs - Litigation expenses 220 Items of costs - Models 221 Items of costs - Pictures and photostats 222 Items of costs - Printing expenses 223 Items of costs - Prior art search 224 Items of costs - Reference expenses 225 Items of costs - Reporter's fees 226 Items of costs - Witness fees and mileage 227 Litigation expenses, items of costs 220 Models, items of costs 221 Nominal damage awards 231 Persons entitled to recover 213

Persons liable 214 Pictures and photostats, items of costs 222 Printing expenses, items of costs 223 Prior art search, items of costs 224 Reference expenses, items of costs 225 Reporter's fees, items of costs 226 Witness fees and mileage, items of costs 227

211. Costs generally

Aside from usual items embraced in allowance of costs, there is no authority for award of other “expenses” in patent infringement case. Continental Can Co. v. Anchor Hocking Glass Corp., C.A.7 (Ill.) 1966, 362 F.2d 123, 150 U.S.P.Q. 1. Patents 325.11(1)

Incidental costs about a matter completely disposed of may be given on interlocutory hearing. Avery v. Wilson, C.C.W.D.N.C.1884, 20 F. 856.

Allowance of costs in patent infringement suit is an equity matter. Emerson v. National Cylinder Gas Co., D.C.Mass.1957, 147 F.Supp. 543, 112 U.S.P.Q. 163, affirmed 251 F.2d 152, 116 U.S.P.Q. 101. Patents 325.1

To indemnify a patentee in damages, the jury may allow actual cost in suits relating to it. Pierson v. Eagle Screw Co., C.C.R.I.1844, 19 F.Cas. 672, No. 11156. See, also, Allen v. Blunt, C.C.Mass.1846, Fed.Cas. No. 217; Knight v. Gavit, C.C.Pa.1846, Fed.Cas. No. 7,884; Contra, Parker v. Hulme, C.C.Pa.1849, Fed.Cas. No. 10,740.

212. Discretion of court, costs

Matter of costs in a patent infringement action rests in discretion of federal district court. Emerson v. National Cylinder Gas Co., C.A.1 (Mass.) 1958, 251 F.2d 152, 116 U.S.P.Q. 101. Patents 325.1

In patent infringement suit, where depositions were not taken in court but at other places and before other officers and by different stenographers whose pay for services was not governed by federal law, party taking the depositions was entitled to have expenditures allowed as costs in such reasonable amounts as trial court, in the exercise of its sound discretion, might determine if trial court thought that depositions were reasonably necessary. W. F. & John Barnes Co. v. International Harvester Co., C.C.A.7 (Ill.) 1944, 145 F.2d 915, certiorari denied 65 S.Ct. 687, 324 U.S. 850, 89 L.Ed. 1410. Patents 325.12

The assessment of costs of accounting in patent infringement suit is within sound judicial discretion of district court, whose decision should not be reversed unless such discretion has clearly been abused. Perrine v. Burdick, C.C.A.8 (Minn.) 1943, 138 F.2d 861. Patents 324.54; Patents 325.1

The matter of assessment of costs for taking of depositions in patent infringement suit was a matter within discretion of trial court. Dee Co. v. Sun Oil Co., C.C.A.5 (Tex.) 1942, 125 F.2d 63. Patents 325.12

Awarding of costs in patent infringement suit was in district court's discretion. General Tire & Rubber Co. v. Fisk Rubber Corp., C.C.A.6 (Ohio) 1939, 104 F.2d 740, certiorari denied 60 S.Ct. 101, 308 U.S. 581, 84 L.Ed. 487. See, also, Algren Watch Findings Co. v. Kalinsky, 197 F.2d 69; White Cap Co. v. Owens-Illinois Glass Co., C.A.Ohio 1953, 203 F.2d 694, certiorari denied 74 S.Ct. 128, 346 U.S. 876, 98 L.Ed. 383; Duplate Corpora-

tion v. Triplex Safety Glass Co. of North America, C.C.A.Pa.1935, 81 F.2d 352, modified on other grounds 56 S.Ct. 792, 298 U.S. 448, 80 L.Ed. 1274; Michigan Carton Co. v. Sutherland Paper Co., C.C.A.Mich.1928, 29 F.2d 179. Costs 13; Patents 325.1

Whether defendant in patent infringement suit would have been allowed costs of appeal in respect to those patents as to which defendant prevailed rested in discretion of court of appeals, since allowance of costs had not been governed by former § 71 of this title [now § 288 of this title], disallowing costs to plaintiff, where no disclaimer of invalid claims was filed with Patent Office [now Patent and Trademark Office] before bringing suit. John W. Gottschalk Mfg. Co. v. Springfield Wire & Tinsel Co., C.C.A.1 (Mass.) 1935, 75 F.2d 907. Patents 325.15

It is within court's discretion to assess auditor's expense against willful infringer as punishment for infringement. Reed Roller Bit Co. v. Hughes Tool Co., C.C.A.5 (Tex.) 1926, 12 F.2d 207. Patents 325.8

Each case must be disposed of on its own merits, and the matter of costs rests in the discretion of the court. Indi- vidual Drinking Cup Co. v. Public Service Cup Co., C.C.A.2 (N.Y.) 1918, 250 F. 620, 162 C.C.A. 636.

Taxation of costs and expenses in a patent infringement action is discretionary. McGraw Edison Co. v. Central Transformer Corp., E.D.Ark.1961, 196 F.Supp. 664, 130 U.S.P.Q. 189, affirmed 308 F.2d 70, 135 U.S.P.Q. 53. Patents 325.1

Where plaintiff suing for patent infringement sought injunction and damages and defendants filed counterclaims against plaintiff and against additional defendants named in counterclaims for unfair competition and violation of antitrust laws, and parties stipulated that costs and expenses of special reference should be borne by losing party with no part being borne by additional defendants and partial judgment was entered finally determining that patents were valid and that there had been no unfair competition or violation of antitrust laws, the court had power in its discretion to award plaintiff its taxable costs up to date of such judgment, and court would not exercise its discretion to delay taxation of costs notwithstanding that proceeding to determine damages was pending and that appeal was pending and that costs were in a large amount and that defendants had already posted substantial bond against any damages that might be awarded in plaintiff's favor. Deering, Milliken & Co v. Temp- Resisto Corp, S.D.N.Y.1959, 169 F.Supp. 453. Federal Civil Procedure 2742.1; Patents 325.14; Anti- trust And Trade Regulation 117

Where parties to action for patent infringement and unfair competition stipulated to include trial testimony in record on defendants' appeal from adverse judgment, and defendants ordered stenographic transcript of trial testimony and paid for transcript and there was no understanding relative to whether plaintiff was to share such expense, and plaintiff lost on defendants' appeal, trial court in exercise of its discretion would direct plaintiff to pay entire cost of transcript. Knickerbocker Plastic Co. v. Allied Molding Corp., S.D.N.Y.1949, 96 F.Supp. 358, 88 U.S.P.Q. 208. Patents 325.15; Antitrust And Trade Regulation 117

In patent infringement action, allowance of costs for premiums paid to sureties on bonds delivered by defendant obtaining adjournments incident to issuance of commission to take testimony in Germany, would be denied in exercise of court's discretion, where testimony obtained under commission was never presented or used at trial, and plaintiff lost considerable time by virtue of adjournments, notwithstanding that plaintiff's patents were even- tually found to be invalid. Standard Brands v. National Grain Yeast Corp., D.C.N.J.1940, 36 F.Supp. 60. Patents 325.11(1)

Costs in an equity suit were within court's discretion, and were not made obligatory by former §§ 67 and 70 of this title or rule 54, Federal Rules of Civil Procedure Title 28. B.B. Chemical Co. v. Cataract Chemical Co., W.D.N.Y.1941, 2 F.R.D. 159. Federal Civil Procedure 2724

Where complainant succeeds as to some and is defeated as to other patents, the costs are in the discretion of the court, to be awarded according to the circumstances of the case and will usually be made proportionate to the final result. Yale & G. Mfg. Co. v. North, C.C.Conn.1867, 30 F.Cas. 776, No. 18123. See, also, Perkins Electric Switch Mfg. Co. v. Yost Electric Mfg. Co., C.C.Ohio 1910, 189 F. 625; Draper Co. v. American Loom Co., C.C.Mass.1909, 169 F. 298; Tesla Electric Co. v. Scott, C.C.Pa.1900, 101 F. 524.

213. Persons entitled to recover, costs

Though no direct marketplace damages resulting from anticompetitive acts were proved, where competitor was placed in the position of having to choose from among the alternatives that it cease competing, take a license from plaintiff or defend an infringement action and where competitor chose to defend the action brought by plaintiff and in the course of the proceedings established the existence of fraud in connection with procurement of patent, circumstances established a causal connection between patent infringement suit and antitrust activities and warranted district court in concluding, as a matter of law, that competitor was entitled to recover as damages for antitrust, violations costs and expenses of defending the infringement suit. Kearney & Trecker Corp. v. Cin- cinnati Milacron Inc., C.A.6 (Ohio) 1977, 562 F.2d 365, 195 U.S.P.Q. 402. Antitrust And Trade Regulation 985

Refusal to award costs to defendants was not an abuse of discretion where defendants, although they succeeded in having plaintiffs' patent, which they were charged with infringing, declared invalid, were found to have adopted a service mark confusingly similar to a mark previously used by plaintiffs. Allen v. Standard Crankshaft & Hydraulic Co., C.A.4 (N.C.) 1963, 323 F.2d 29, 139 U.S.P.Q. 20. Patents 325.4; Trademarks 1750

Refusal of district court to award costs to patentee, suing for infringement and unfair competition, was not abuse of discretion even though judgment was predominantly in his favor where judgment held certain patent claims invalid and determined that certain items did not infringe patents. Pursche v. Atlas Scraper & Engineering Co., C.A.9 (Cal.) 1961, 300 F.2d 467, 132 U.S.P.Q. 104, certiorari denied 83 S.Ct. 251, 371 U.S. 911, 9 L.Ed.2d 170, 135 U.S.P.Q. 502, rehearing denied 83 S.Ct. 499, 371 U.S. 959, 9 L.Ed.2d 507, 135 U.S.P.Q. 502. Patents 325.4; Antitrust And Trade Regulation 117

Where patent had expired prior to judgment in infringement suit, plaintiff would not be entitled to injunction, and where defendant was not shown to have known of the patent and offered to pay all damages, costs should not be taxed against defendant. Freedman v. Friedman, C.A.4 (Md.) 1957, 242 F.2d 364, 113 U.S.P.Q. 1. Patents 317; Patents 325.10

Where plaintiff brought infringement suit against corporation and two individual defendants, and plaintiff offered no evidence against individuals and consented to dismissal of suit against them, and on appeal patent was held invalid, corporation could recover no costs incurred on behalf of individuals for investigation of prior art made for corporation as well as individuals. Aeration Processes v. Walter Kidde & Co., C.A.2 (N.Y.) 1949, 177 F.2d 772, 83 U.S.P.Q. 403. Patents 325.15

Where one of 14 claims of patent was found to be valid and infringed, though remainder of claims were found to be invalid, awarding of costs to patentee was not abuse of discretion. Refrigeration Engineering v. York Corp.,

C.C.A.9 (Cal.) 1948, 168 F.2d 896, 78 U.S.P.Q. 315, certiorari denied 69 S.Ct. 133, 335 U.S. 859, 93 L.Ed. 406, 79 U.S.P.Q. 455. Patents 325.2

Company recovering for infringement of two patents was not entitled to costs attributable to patent as to one claim of which it filed disclaimer after suing. Bassick Mfg. Co. v. Adams Grease Gun Corporation, C.C.A.2 (N.Y.) 1931, 52 F.2d 36, affirmed 54 F.2d 285, certiorari granted 52 S.Ct. 312, 285 U.S. 531, 76 L.Ed. 926, certiorari dismissed 52 S.Ct. 495, 286 U.S. 567, 76 L.Ed. 1298. Patents 325.2

Defendant succeeding in respect to one patent was entitled to costs in lower court, regardless of plaintiff's success as to patent respecting which disclaimers were filed. Sachs v. Hartford Elec. Supply Co., C.C.A.2 (Conn.) 1931, 47 F.2d 743, certiorari denied 51 S.Ct. 648, 283 U.S. 854, 75 L.Ed. 1461. Patents 325.4

Patent owner recovering for infringement of certain claims was entitled to costs, though the suit included other claims not upheld in requested notice of those relied on. Bassick Mfg. Co. v. United Grease Gun Corporation, E.D.N.Y.1929, 40 F.2d 549. Patents 325.2

In patent infringement suit, allowance of full costs to plaintiff, who prevailed only on two claims of one patent, was not abuse of discretion. Overman Cushion Tire Co. v. Goodyear Tire & Rubber Co., C.C.A.2 (N.Y.) 1930, 40 F.2d 460. Patents 325.4

In a suit for infringement of a patent, where complainant was entitled to an injunction at the time of the filing of the bill, and such relief was denied only because of the expiration of the patent pendente lite, complainant is entitled to costs regardless of its right to recover damages for the infringement. American Caramel Co. v. White, C.C.A.7 (Ill.) 1915, 234 F. 328, 148 C.C.A. 230. Patents 325.4

In a suit for infringement of two patents, where defendant prevails as to one, he is entitled to the same costs as though there had been a separate suit thereon. Roth v. Harris, C.C.A.2 (N.Y.) 1909, 168 F. 279, 93 C.C.A. 581. Patents 325.7

Where complainant succeeds only upon an issue of trivial importance, costs will not be allowed. Marks Ad- justable Folding-Chair Co. v. Wilson, C.C.S.D.N.Y.1890, 43 F. 302. Costs 32(3); Patents 325.4

Costs are always awarded to the successful party, unless there has been something in his conduct which renders such a course inequitable and unjust. Bunker v. Stevens, C.C.N.J.1885, 26 F. 245. Patents 325.4

In patent infringement suit, defendant was entitled to a partial award of costs and attorney's fees in amount of $50,000 in light of patent assignee's inequitable conduct and false statements of material fact to Patent and Trademark Office, and in light of fact that lawsuit itself was not originally brought in bad faith and fact that additional fees and costs would be awarded defendant on antitrust counterclaim. Solvex Corp. v. Freeman, W.D.Va.1977, 459 F.Supp. 440, 199 U.S.P.Q. 726. Patents 325.11(4)

Court which rendered judgment for defendant in patent case and awarded it damages based on reasonable royalty of 10 percent, would deny costs, taking into consideration as one factor various overreaching claims of defendant as to amount of damages as well as its efforts to include in accounting before master various other parties who were not parties to litigation. Marks v. Polaroid Corp., D.C.Mass.1964, 237 F.Supp. 425, 144 U.S.P.Q. 630. Patents 325.4

Defendant found not guilty of infringement as charged by plaintiff was entitled to costs but was not entitled to

attorneys' fees in absence of a showing of misuse of the patent by the patentee. A. E. Staley Mfg. Co. v. Old Rock Distilling Co., W.D.Mo.1963, 223 F.Supp. 798, 140 U.S.P.Q. 312. Patents 325.4; Patents 325.11(4)

Plaintiffs were entitled to costs and attorneys' fees on defendant's unsuccessful motion for mitigation of damages for patent infringement and for application of the rule de minimis non curat lex. Zysset v. Popeil Bros., Inc., N.D.Ill.1961, 199 F.Supp. 594, 131 U.S.P.Q. 178. Patents 325.11(3)

Where infringement had been enjoined and defendant attempted to change infringing device after seeking advice of counsel and advising holder of patent what he intended to do, but changed device was identical in appearance, performed identically same function in identically same manner as infringing device, holder of patent was entitled to such profits as defendant made from manufacture of device, together with reasonable attorney's fee and expense of presenting matter to court. Town v. Willis, W.D.Mo.1950, 89 F.Supp. 437, 85 U.S.P.Q. 15. Patents 318(1); Patents 325.1

In patent infringement suit, where interlocutory judgment was based on findings for plaintiff on both unfair competition and patent infringement, report of special master of amount of defendant's profits and plaintiff's reasonable counsel fee would be adopted, and plaintiff would be entitled to recover from defendant such profits, counsel fee, and costs. Garreau v. Genua, D.C.Conn.1948, 88 F.Supp. 573, 85 U.S.P.Q. 155. Patents 322

Plaintiff who was successful in patent infringement suit was entitled to costs and disbursements. Hazeltine Re- search v. Admiral Corp., N.D.Ill.1949, 87 F.Supp. 72, 83 U.S.P.Q. 340, affirmed 183 F.2d 953, 86 U.S.P.Q. 289, certiorari denied 71 S.Ct. 239, 340 U.S. 896, 95 L.Ed. 650, 87 U.S.P.Q. 431, rehearing denied 71 S.Ct. 292, 340 U.S. 916, 95 L.Ed. 662, 87 U.S.P.Q. 431. See, also, U.S. Gypsum Co. v. Dale Industries Inc., D.C.Mich.1966, 260 F.Supp. 78; Emerson v. National Cylinder Gas Co., D.C.Mass.1957, 147 F.Supp. 543, affirmed 251 F.2d 152. Patents 325.4

Where patent was held valid and infringed in respect to eight claims and invalid in respect to one claim, plaintiffs in patent infringement suit were entitled to their costs. Mueller v. Campbell, S.D.Ohio 1945, 68 F.Supp. 464. Patents 325.1

In patent infringement action, where court determined that patent was invalid and not infringed, defendant could not recover on counterclaim for expenses incurred by reason for three prior actions relating to the patent where evidence did not establish that the prior actions brought in name of another were in fact instituted by or for plaintiff in present action. Cornell v. Chase Brass & Copper Co., S.D.N.Y.1943, 48 F.Supp. 979, affirmed 142 F.2d 157. Patents 316

Where disclaimer of defendant in patent infringement suit was filed after counterclaim was filed, it might de- prive defendant of costs on counterclaim if court found claims as restricted by disclaimer to be valid and infringed. American Morgan Co. v. Joy Mfg. Co., W.D.Pa.1939, 31 F.Supp. 419. Patents 156

In suit for infringement of patents and trademarks and for unfair competition, corporate defendant would not be allowed any part of its costs or disbursements although it prevailed on all counts except one where president who was in control of corporation did not make a good impression with his testimony, on only real question of fact involved which was ruled against defendant, all other matters being decided on questions of law. Scovill Mfg. Co. v. U.S. Electric Mfg. Corporation, S.D.N.Y.1940, 31 F.Supp. 115. Patents 325.4; Trademarks 1750

Where patent infringement suits based upon same infringement, one against retailer and the other against manufacturer, had been tried together, defendants were not each entitled to bill of costs as if there had been independent trials. Reidenbach v. A.I. Namm & Son, E.D.N.Y.1938, 25 F.Supp. 235, affirmed 99 F.2d 1013. Patents 325.9

It is not the usual practice to allow costs to either party where several claims or patents are involved in the suit, and upon some of these the plaintiff has been successful and on others unsuccessful. Yale & G. Mfg. Co. v. North, C.C.Conn.1867, 30 F.Cas. 776, No. 18123. See, also, Trussell Mfg. Co. v. S.E. & M. Vernon, D.C.N.Y.1926, 11 F.2d 289, affirmed 18 F.2d 1022; American Bank Protection Co. v. Electric Protection Co., C.C.Minn.1910, 181 F. 350, modified on other grounds 184 F. 916, certiorari denied 31 S.Ct. 723, 220 U.S. 619, 55 L.Ed. 612; Green v. Lynn, C.C.Mass.1897, 81 F. 387; Thomson-Houston Electric Co. v. Elmira etc., R. Co., C.C.N.Y.1895, 71 F. 886; Edison Electric Light Co. v. Electric Engineering, etc., Co., C.C.N.Y.1894, 60 F. 401; Marks Adjustable Folding Chair Co. v. Wilson, C.C.N.Y.1890, 43 F. 302; Schmid v. Scovill Mfg. Co., C.C.N.Y.1889, 37 F. 345; Fay v. Allen, C.C.N.Y.1885, 24 F. 804; Hayes v. Bickelhoupt, C.C.N.Y.1884, 21 F. 567.

214. Persons liable, costs

Patentee who obtained has patent without full disclosure to the Patent Office [now Patent and Trademark Office] and who used upon the invalid patent was the wrongdoer and was properly ordered to pay defendants' taxable costs, regardless of the fact that the manufacturer of the allegedly infringing device was footing defendants' litigation and thus was paying their costs. Pickering v. Holman, C.A.9 (Cal.) 1972, 459 F.2d 403, 173 U.S.P.Q. 583. Patents 325.10

District court in allowing plaintiff, in patent infringement suit, which had filed disclaimers as to certain of claims sued on, to recover only one-half of its costs, and in taxing defendant $5 for each of its overruled exceptions to the master's report, did not abuse its discretion. General Tire & Rubber Co. v. Fisk Rubber Corp., C.C.A.6 (Ohio) 1939, 104 F.2d 740, certiorari denied 60 S.Ct. 101, 308 U.S. 581, 84 L.Ed. 487. Costs 13; Patents 325.4

Defendant, appealing from decree in patent infringement suit, was liable for costs up to time of appeal where defendant, by its answer to plaintiffs' interrogatories requiring a drawing of devices manufactured by defendant, presented a drawing and plan wholly different from that actually used, even though presentation was the result of a mistake. Shull Perforating Co. v. Cavins, C.C.A.9 (Cal.) 1938, 94 F.2d 357. Patents 325.1

Taxation of costs entirely against defendants in accounting proceeding for profits and damages for infringement of patent was not abuse of discretion, though defendants were innocent infringers. Duplate Corporation v. Triplex Safety Glass Co of North America, C.C.A.3 (Pa.) 1935, 81 F.2d 352, certiorari granted 56 S.Ct. 668, 297 U.S. 702, 80 L.Ed. 990, affirmed as modified on other grounds 56 S.Ct. 792, 298 U.S. 448, 80 L.Ed. 1274. Pat- ents 325.1

Holding that owner of all the stock of patent infringing corporations was liable for accounting costs and profits was not authorized by appellate court's mandate directing that interlocutory decree against corporations be modified in certain other respects. Zell v. Bankers' Utilities Co., C.C.A.9 (Cal.) 1935, 77 F.2d 22. Patents 324.60

In patent infringement accounting suit, where false cost cards introduced by infringer to accentuate costs of

manufacture and attempt of patentee to overthrow their figures occasioned considerable part of effort and evidence in accounting, charging entire cost of accounting to infringer was proper. Levin Bros. v. Davis Mfg. Co., C.C.A.8 (Minn.) 1934, 72 F.2d 163. Patents 318(4.1)

Plaintiff, establishing only accidental manufacture of infringer article in limited number, is liable for all costs. Meurer Steel Barrel Co. v. Boyle Mfg. Co., D.C.Cal.1925, 9 F.2d 92. Patents 325.4

A defendant, who pleads a large number of patents as anticipations, will be required to specify those on which he seriously relies, under penalty of being taxed with the costs. Grand Rapids Showcase Co. v. Straus, S.D.N.Y.1915, 229 F. 199. Patents 325.1

It is only in exceptional cases that court will relieve one of joint wrongdoers from full liability for costs. Vrooman v. Penhollow, C.C.A.6 (Ohio) 1911, 186 F. 495, 108 C.C.A. 502.

Where infringement by two defendants involved only sales of devices manufactured by another defendant and the formers' acts were limited in extent, damages for infringement would be assessed only against defendant manufacturer; however, since the selling defendants asserted the same groundless defenses of noninfringement and urged the same untenable positions regarding invalidity and forced patent holder and its licensee to pursue ten years of litigation, attorney fees and costs would be assessed against the defendants jointly and severally. Saf-Gard Products, Inc. v. Service Parts, Inc., D.C.Ariz.1980, 491 F.Supp. 996, 206 U.S.P.Q. 976. Patents 319(1); Patents 325.10; Patents 325.11(3)

Defendant corporation, which admitted infringement of plaintiff's patent by its sale of paper company's product, was liable for costs of patent infringement action. McCullough v. Norcross-Eldridge, Inc., D.C.Vt.1966, 260 F.Supp. 919, 151 U.S.P.Q. 459. Patents 319(1); Patents 325.10

Patentees who brought unsuccessful infringement action in good faith belief in validity of patent were not chargeable with costs. Collins v. Owen, N.D.Iowa 1961, 199 F.Supp. 61, 132 U.S.P.Q. 230, affirmed 310 F.2d 884, 136 U.S.P.Q. 51. Patents 325.10

In determining damages for infringement of process patent, costs of accounting including fee allowed to the master should be taxed as costs to be paid by the infringer. Elrick Rim Co. v. Cheek, S.D.Cal.1961, 195 F.Supp. 496, 131 U.S.P.Q. 8. Patents 325.8

In action seeking declaratory judgment that plaintiff's manufacture of a device did not infringe defendant's patent, wherein defendant counterclaimed (successfully) to recover for infringement, costs would be charged to plaintiff as the losing party. Excel Auto Radiator Co. v. Bishop & Babcock Mfg. Co., N.D.Ohio 1953, 123 F.Supp. 315, 102 U.S.P.Q. 74, affirmed 212 F.2d 586, 102 U.S.P.Q. 52, certiorari denied 75 S.Ct. 37, 348 U.S. 823, 99 L.Ed. 649, 103 U.S.P.Q. 424. Patents 325.4

Although licensee was successful in its suit to declare patent invalid on ground that alleged invention was in public use more than one year prior to date of patent application, where licensee had acted unconscionably in dealing with licensor after it had notice of prior public use, and had injured licensor by its failure to be candid and open with licensor and Patent Office [now Patent and Trademark Office] as was required of an option holder of an exclusive license agreement, licensee would be ordered to pay costs and expenses of licensor in prosecuting patent and interference proceedings and in defending patent against alleged infringers, as well as loss of royalties from date of termination of royalty payments to date of judgment declaring patent invalid. Atlas Chemical

Industries, Inc. v. Moraine Products, Inc., E.D.Mich.1972, 350 F.Supp. 353, 175 U.S.P.Q. 693, affirmed in part , reversed in part 509 F.2d 1, 184 U.S.P.Q. 281. Declaratory Judgment 388

215. Items of costs--Generally

Charges for telephone calls and, ordinarily, for postage are not recoverable as costs. Wahl v. Carrier Mfg. Co., Inc., C.A.7 (Ind.) 1975, 511 F.2d 209, 184 U.S.P.Q. 516. Federal Civil Procedure 2740

Damage to plaintiff in preparing case on defendant's failure seasonably to plead anticipating foreign patent was chargeable against defendant. Nash Engineering Co. v. Trane Co., D.C.Mass.1927, 22 F.2d 868. Patents 325(3)

Allowance to plaintiff for overhauling defendant's books cannot be sustained where defendant realized no profits. Merrell Soule Co. v. Powdered Milk Co. of America, C.C.A.2 (N.Y.) 1925, 7 F.2d 297.

In an infringement suit, where a party extends the cross-examination of his adversary's witnesses beyond legitimate limits, the court may properly take such fact into account in taxing the costs. National Cash Register Co. v. Gratigny, C.C.A.6 (Ohio) 1914, 213 F. 463, 130 C.C.A. 109. Patents 325.1

Docket fee, certified copy of file wrapper, contents of patent in suit, and certified copies of six other patents were not properly taxable items. Ryan v. Gould, C.C.S.D.N.Y.1887, 32 F. 754.

Court, in patent infringement suit, may allow as costs items of defendant's expense not specifically allowed by statute where such expenses are incurred because of vexatious and unwarranted prosecution of suit with full knowledge of invalidity of patent during entire prosecution. Smith v. James Mfg. Co., W.D.N.Y.1937, 21 F.Supp. 636. Patents 325.11(1)

216. ---- Accounting fees, items of costs

In action for profits resulting from infringement of patent where plaintiff was required to use expert witness and accountants because of defendant's deliberate destruction of most of its books and records after commencement of the action, allowance of fees and expenses to one accountant in the sum of $2,665.50 and to another firm of accountants in the sum of $10,314.07 to be paid by the defendant was proper. Gotham Silk Hosiery Co. v. Art- craft Silk Hosiery Mills, C.C.A.3 (Del.) 1944, 147 F.2d 209. Patents 325.8

In infringement suit, refusal to allow fees of plaintiffs' accountants was sustained. National Brake & Elec. Co. v. Christensen, C.C.A.7 (Wis.) 1930, 38 F.2d 721, certiorari denied 51 S.Ct. 36, 282 U.S. 864, 75 L.Ed. 764. Pat- ents 325.11(1)

Charges of expert accountant were properly taxed against complainant, where necessitated by unfounded charges against defendant's accounts. Excelsior Steel Furnace Co. v. F. Meyer & Bro. Co., C.C.A.7 (Ill.) 1929, 36 F.2d 447. Patents 325(11)

In patent infringement suit, in which accounting was had for defendants' profits realized from selling infringing structures, plaintiffs' accountant fee should not be charged against defendants, though allowed by master and court. Fairbanks, Morse & Co. v. American Valve & Meter Co., C.C.A.7 (Ill.) 1929, 34 F.2d 869, certiorari denied 50 S.Ct. 86, 280 U.S. 604, 74 L.Ed. 649.

Plaintiff in accounting on patent suit was not entitled to allowance for accountant, making separate statement of account differing materially from defendant's, as to which there was reconciliation subsequently. Fairbanks, Morse & Co v. American Valve & Meter Co, C.C.A.7 (Ill.) 1926, 18 F.2d 716, certiorari granted 47 S.Ct. 770, 274 U.S. 735, 71 L.Ed. 1336, reversed on other grounds 48 S.Ct. 317, 276 U.S. 305, 72 L.Ed. 584.

Defendants were not chargeable with per diem rate paid accountants who testified in support of account prepared. Standard Scale & Supply Co. v. Cropp Concrete Machinery Co., C.C.A.7 (Ill.) 1925, 6 F.2d 447. Patents 325.8

Where accountant's employment was necessitated by inaccuracy of defendant's returns concerning his business, the expense thereof should be assessed against him. Flat Slab Patents Co. v. Turner, C.C.A.8 (Minn.) 1922, 285 F. 257, certiorari denied 43 S.Ct. 700, 262 U.S. 752, 67 L.Ed. 1215. Patents 325.11(1)

Costs of accounting as to profits and damages arising from patent infringement were assessable against defendant infringers as matter of course, where plaintiff prevailed before master. Triplex Safety Glass Co of North America v. Duplate Corporation, W.D.Pa.1934, 10 F.Supp. 420, modified 81 F.2d 352, certiorari granted 56 S.Ct. 668, 297 U.S. 702, 80 L.Ed. 990, affirmed as modified 56 S.Ct. 792, 298 U.S. 448, 80 L.Ed. 1274. Patents 325.8

217. ---- Appellate costs, items of costs

Because infringer's brief relied on reverse statement of law of infringement, ignored numerous and unanimous contrary authorities called to its attention by patentee's main brief, distorted a quotation, and presented an estoppel argument based on that distortion, infringer would be required to pay to patentee an amount double patentee's costs on appeal. Amstar Corp. v. Envirotech Corp., C.A.Fed.1984, 730 F.2d 1476, 221 U.S.P.Q. 649, certiorari denied 105 S.Ct. 306, 469 U.S. 924, 83 L.Ed.2d 240, 224 U.S.P.Q. 616. Patents 325.15

Appellee in patent infringement and trade regulation case was entitled to costs where lower court's results were correct. Bentley v. Sunset House Distributing Corp., C.A.9 (Cal.) 1966, 359 F.2d 140, 149 U.S.P.Q. 152. Patents 325.15; Antitrust And Trade Regulation 117

Where defendant profited by research and labor of plaintiff's assignor, it was a proper exercise of discretion for district court to deny defendant attorney's fees and costs, even though patent was held to be invalid in suit for patent infringement, and court of appeals, in affirming judgment for defendant, would do the same with regard to costs in the court of appeals. Dole Refrigerating Co. v. Amerio Contact Plate Freezers, Inc., C.A.3 (N.J.) 1959, 265 F.2d 627, 121 U.S.P.Q. 159. Patents 325.11(4); Patents 325.15

In action for patent infringement, awarding plaintiff costs on the first appeal was proper notwithstanding defendants won the case on retrial, and the fact that the record on the second appeal was to a great extent composed of the same physical record used on the first appeal pursuant to stipulation of the parties, where without the stipulation defendants could have been taxed for the costs of two records of the first appeal had the plaintiff been unwilling to stipulate to using the same record, and had the plaintiff completely won the second appeal. Stearns v. Tinker & Rasor, C.A.9 (Cal.) 1957, 252 F.2d 589, 116 U.S.P.Q. 222. Patents 325.15

Where patent had expired prior to judgment in infringement suit, defendant's knowledge of the patent was not shown and defendant offered to pay all damages for infringement, which amounted to only $41.33, costs of plaintiff's appeal, which was brought for purposes other than recovery of small amount of damages and was not

contested by defendant, would be taxed against plaintiff. Freedman v. Friedman, C.A.4 (Md.) 1957, 242 F.2d 364, 113 U.S.P.Q. 1. Patents 325.15

Where, in patent infringement action, defendant obtained stay of judgment by giving supersedeas bond, premium paid to surety company was necessary part of defendant's costs and on reversal was properly allowed and taxes as such. Lunn v. F. W. Woolworth Co., C.A.9 (Cal.) 1954, 210 F.2d 159. Patents 325.15

Where provision for division of costs was embodied in judgment dismissing patent infringement suit, defendant, who prosecuted no appeal from such judgment, could not challenge such decision upon plaintiff's appeal. White Cap Co. v. Owens-Illinois Glass Co., C.A.6 (Ohio) 1953, 203 F.2d 694, 97 U.S.P.Q. 192, certiorari denied 74 S.Ct. 128, 346 U.S. 876, 98 L.Ed. 384, 99 U.S.P.Q. 492. Patents 324.52

In patent infringement action wherein dismissal of case with prejudice on plaintiff's motion gave defendant basic relief for which he asked in his answer except for ordinary costs, defendant could not qualify as a party ag- grieved since no appeal lies from mere denial of such costs. A.B. Dick Co. v. Marr, C.A.2 (N.Y.) 1952, 197 F.2d 498, 93 U.S.P.Q. 486, certiorari denied 73 S.Ct. 169, 344 U.S. 878, 97 L.Ed. 680, 95 U.S.P.Q. 417, rehearing denied 73 S.Ct. 282, 344 U.S. 905, 97 L.Ed. 699, 95 U.S.P.Q. 417. Appeal And Error 151(2)

Where defendant in patent infringement suit was not an appellant, court of appeals could not consider argument that defendant should have been permitted to recover additional costs and expenses incurred in preparing for trial for that phase of case which plaintiff dismissed. Standard Oil Co. of California v. Tide Water Associated Oil Co., C.C.A.3 (Del.) 1946, 154 F.2d 579, 69 U.S.P.Q. 41. Patents 324.52

Where both parties to suit involving patent and trademark infringement had prevailed in part in lower court and judgment was affirmed on appeal, the trial judge's decision denying costs to either side will be affirmed and neither side will be awarded costs of appeal. Brunswick-Balke-Collender Co. v. American Bowling & Billiard Corp., C.C.A.2 (N.Y.) 1945, 150 F.2d 69, certiorari denied 66 S.Ct. 99, 326 U.S. 757, 90 L.Ed. 455. Patents 325.15; Trademarks 1750

In patent infringement suit, unsuccessful appellant's liability for costs was not required to be limited to one-half the costs of printing the record on appeal on the ground that appellee had stuffed the record by including unnecessary evidence and patents therein. Bellavance v. Frank Morrow Co., C.C.A.1 (R.I.) 1944, 140 F.2d 419, rehearing denied 141 F.2d 378, certiorari denied 64 S.Ct. 1144, 322 U.S. 742, 88 L.Ed. 1575, rehearing denied 64 S.Ct. 1283, 322 U.S. 772, 88 L.Ed. 1596. Patents 325.15

Where disclaimer as to patent claim held invalid by district court was not entered in Patent Office [now Patent and Trademark Office] by patentee before bringing infringement suit, wherein other claims were held valid and infringed by interlocutory decree, he is not entitled to costs in either district court or court of appeals on defendant's appeal from such decree. United Shoe Machinery Corp. v. Mathey, C.C.A.1 (Mass.) 1941, 117 F.2d 331. Patents 325.2

Plaintiff in patent infringement suit who had been partially successful on appeal held not entitled to costs of appeal, where no disclaimer of invalid claims had been filed in Patent Office [now Patent and Trademark Office] before bringing suit, since former § 71 of this title [now § 288 of this title], disallowing costs when disclaimer of invalid claims was not filed with Office before bringing suit, was mandatory. John W. Gottschalk Mfg. Co. v. Springfield Wire & Tinsel Co., C.C.A.1 (Mass.) 1935, 75 F.2d 907. Patents 325.15

Plaintiff in patent infringement suit succeeding on appeal was entitled to costs regardless of disclaimers filed pending determination in lower court. Sachs v. Hartford Elec. Supply Co., C.C.A.2 (Conn.) 1931, 47 F.2d 743, certiorari denied 51 S.Ct. 648, 283 U.S. 854, 75 L.Ed. 1461. Patents 325.15

Appellate court cannot order bill dismissed with costs as to claims withdrawn before entry of decree. Judelson v. Hill Laundry Equipment Co., C.C.A.2 (N.Y.) 1927, 22 F.2d 262. Patents 325.6

Complainants must limit their decrees and decretal orders to precisely what was determined under penalty of being subjected to costs on appeal therefrom. Hatch Storage Battery Co. v. Electric Storage Battery Co., C.C.A.1 (Mass.) 1900, 100 F. 975, 41 C.C.A. 133. Patents 325.1

218. ---- Copies, items of costs

In patent infringement suit, prevailing party was entitled to allowance as costs for certified copies of applications and file wrappers of patents other than those in the suit, where file wrappers were those of patents issued on applications filed prior to that of the particular patents in suit against which they were pleaded and actually matured into patents after the filing of corresponding patent in suit. W. F. & John Barnes Co. v. International Harvester Co., C.C.A.7 (Ill.) 1944, 145 F.2d 915, certiorari denied 65 S.Ct. 687, 324 U.S. 850, 89 L.Ed. 1410. Patents 325.11(6)

Charges for file history of patents in suit were properly taxed against unsuccessful plaintiff. Cincinnati Traction Bldg. Co. v. Westinghouse Air Brake Co., W.D.Pa.1939, 27 F.Supp. 329. Patents 325.11(1)

Copies of patents either that of the plaintiff or others, procured by the defendant, could not be taxed as costs to the plaintiff. Woodruff v. Barney, C.C.S.D.Ohio 1862, 30 F.Cas. 518, 1 Bond 528, No. 17986. Costs 178; Costs 182; Patents 325.1

Copies of plaintiff's models and papers, which he is not obliged to produce, when obtained by defendant, are proper items of costs. Hathaway v. Roach, C.C.Mass.1846, 11 F.Cas. 818, 2 Woodb. & M. 63, No. 6213. See, also, Wooster v. Handy, C.C.N.Y.1885, 23 F. 49; Hussey v. Bradley, C.C.N.Y.1864, Fed.Cas. No. 6,946a; Woodruff v. Barney, C.C.Ohio 1862, Fed.Cas. No. 17,986. Costs 178; Patents 325.11(6)

In patent infringement action, costs which defendant incurred in copying prosecution histories of patents in suit, in amount of $28.88, as well as motion copying charges of $120.96, were reasonable charges that were properly taxable against patent holder as costs, once defendant prevailed on its claims of non-infringement. Pehr v. Rub- bermaid, Inc., D.Kan.2000, 196 F.R.D. 404. Patents 325.11(6)

After defendant successfully defended patent holder's infringement claims, photocopying expenses which defendant incurred in responding to patent holder's discovery requests were not taxable as costs, as charges for copies of papers “necessarily obtained” for use in case; because defendant possessed the original documents of which photocopies were made, it did not “obtain” papers, within meaning of federal costs provision. Pehr v. Rubbermaid, Inc., D.Kan.2000, 196 F.R.D. 404. Patents 325.11(6)

219. ---- Drawings and charts, items of costs

In patent infringement suit, successful party was entitled to allowance of costs for amount of draftsmen's charges for preparing drawing and charts. Swan Carburetor Co. v. Chrysler Corp., C.C.A.6 (Mich.) 1945, 149 F.2d 476. Patents 325.11(1)

In patent infringement action, expense incurred by successful defendant, in providing simplified drawings to clarify drawings of patents bearing on issues, was recoverable as costs. Appliance Inv. Co. v. Western Electric Co., C.C.A.2 (N.Y.) 1932, 61 F.2d 752. Patents 325.11(6)

Expense of illustrative drawing was taxable. Barber-Coleman Co. v. Withnell, D.C.Mass.1928, 28 F.2d 543. Pat- ents 325(11)

Sketches introduced by witnesses are not taxable as costs. Wooster v. Handy, C.C.S.D.N.Y.1885, 23 F. 49.

In patent infringement action, the test of whether a chart expense should be taxable as costs under § 1920 of Title 28, is the extent to which it was reasonable to go to furnish real assistance to the court. Emerson v. Nation- al Cylinder Gas Co., D.C.Mass.1957, 147 F.Supp. 543, 112 U.S.P.Q. 163, affirmed 251 F.2d 152, 116 U.S.P.Q. 101. Patents 325.11(6)

An item in successful defendants' bill of costs for $73, charged by draftsman for making three drawings from which large court charts were made and coloring such charts, and item of $84.49 for cost of making charts, which were helpful in court's consideration of case, were allowable and taxable as costs, by court clerk, where there was no duplication of charges, which were reasonable, and proper. Hope Basket Co. v. Product Advance- ment Corp., W.D.Mich.1952, 104 F.Supp. 444, 93 U.S.P.Q. 94. Federal Civil Procedure 2736

In patent infringement suit, costs for enlarged chart of manifold and enlarged reproductions of a figure of the patent were allowable as reasonably necessary to facilitate complete understanding of the issues. Goodrich v. Ford Motor Co., E.D.Mich.1940, 55 F.Supp. 792. Patents 325.11(6)

Much liberality and latitude should be permitted in taxing as costs the expenses incurred in the preparation of drawings and other exhibits which tend to clarify the subject matter and make the work of court less difficult and tedious on technical patent matters. Lambert v. Williams Lime Mfg. Co., E.D.Tenn.1941, 39 F.Supp. 18. Patents 325.11(6)

220. ---- Litigation expenses, items of costs

Failure of district court to award appellee expenses of suit was not error on ground that appellant's patent was obtained by fraud upon the Patent Office [now Patent and Trademark Office] in failing fully to reveal to Office prior art of which appellant was aware including his own prior patents, where the prior art which the inventor was accused of failing to reveal was not so undisputably and obviously relevant as to disclose actual knowledge that subject of proposed patent was anticipated. Duff-Norton Co. v. Ratcliff, C.A.9 (Cal.) 1966, 362 F.2d 551, 150 U.S.P.Q. 166. Patents 325.11(4)

Where patent and injunction decree against infringement were procured by plaintiff's fraud, defendants were entitled to recover legal and traveling expenses and incidental disbursements in connection with the infringement suit, as damages sustained through plaintiff's fraud. Hartford-Empire Co. v. Shawkee Mfg. Co., C.C.A.3 (Pa.) 1947, 163 F.2d 474, 74 U.S.P.Q. 252. Injunction 261

No other litigation expenses than ordinary costs of action can be allowed in suit against patent infringer for profits and damages. Sutton v. Gulf Smokeless Coal Co., C.C.A.4 (W.Va.) 1935, 77 F.2d 439. Patents 318(6)

Defendant in patent infringement action would be granted its expenses incurred in investigating matters not dis-

closed by plaintiff's answers to interrogatories where failure to answer properly could have altered outcome of case but for defendant's subsequent discovery work. Airtex Corp. v. Shelley Radiant Ceiling Co., N.D.Ill.1975, 400 F.Supp. 170, 187 U.S.P.Q. 673, affirmed 536 F.2d 145, 190 U.S.P.Q. 6. Patents 292.1(4)

Defendant in patent infringement suit, who established that plaintiffs' patent was invalid because of prior art anticipation and lack of invention, would be entitled to recover court costs, but not costs of suit. Belden v. Air Control Products, Inc., W.D.Mich.1956, 144 F.Supp. 248, 111 U.S.P.Q. 9, affirmed 249 F.2d 460, 115 U.S.P.Q. 305. Patents 325.11(1)

In action to enjoin alleged infringement of patents where the court held that the patents were invalid for want of invention the defendant was entitled to court costs but not to costs of suit. Mojonnier Bros. Co. v. Tolan Ma- chinery Co., D.C.N.J.1955, 129 F.Supp. 731, 105 U.S.P.Q. 109, affirmed 230 F.2d 850, 108 U.S.P.Q. 279. Pat- ents 325.11(1)

In action for declaratory judgment determining plaintiffs' rights as licensees under certain basket attachments patent license agreements, amounts of investigators' charges for investigating baskets being manufactured by plaintiff after expiration of attachments patent and investigation in connection with depositions taken by defendants at plaintiff's place of business in foreign state were expenses incurred by defendants in preliminary field in- vestigations and preparation for trial, and hence were not properly taxable as costs by court clerk. Hope Basket Co. v. Product Advancement Corp., W.D.Mich.1952, 104 F.Supp. 444, 93 U.S.P.Q. 94. Federal Civil Procedure 2736; Federal Civil Procedure 2738

In patent infringement action, special master properly denied plaintiffs the right to recover as a part of their costs certain litigation expenses. Kaltenbach v. Chesapeake & Ohio Ry. Co., E.D.Va.1941, 43 F.Supp. 819, modified on other grounds 124 F.2d 375. Patents 325.11(1)

221. ---- Models, items of costs

Disbursements on account of construction of models in connection with defense of suit for patent infringement can be taxed as costs against unsuccessful plaintiff only under general rule in equity that costs beyond those allowed by statute will be taxed only in exceptional circumstances, such as exist in case of fraud, oppression, bad faith, cases of fiduciary relationship, or those in which prevailing party has helped to create fund upon which costs are charged. Specialty Equipment & Machinery Corp. v. Zell Motor Car Co., C.A.4 (Md.) 1952, 193 F.2d 515, 92 U.S.P.Q. 84. Patents 325.11(6)

In a patent infringement suit, costs for models introduced by plaintiff were not allowable in absence of court order to introduce them, court rule providing for costs for models, or agreement of the parties. Reinharts, Inc., v. Caterpillar Tractor Co., C.C.A.9 (Nev.) 1938, 99 F.2d 648. Patents 325.11(6)

Expense of obtaining a model of an infringing machine cannot be deemed a taxable disbursement in favor of prevailing party. Cornelly v. Markwald, C.C.S.D.N.Y.1885, 24 F. 187. Patents 325(11)

Where both sides in patent infringement suit prepared unnecessarily elaborate exhibits, no cost would be awarded. Roller Bearing Co. of America v. Bearings, Inc., E.D.Pa.1971, 328 F.Supp. 923, 169 U.S.P.Q. 407. Patents 325.14

In patent suit, cost of constructing and shipping models could not be taxed, where models were not ordered by

court to be constructed. Galion Iron Works & Mfg. Co. v. Beckwith Machinery Co., W.D.Pa.1938, 25 F.Supp. 591. Costs 178

In absence of special circumstance, claim in defendant's bill of costs for cost of constructing a model which was introduced in evidence was disallowed. Eickhoff v. Vulcan Iron Works, M.D.Pa.1942, 2 F.R.D. 490. Patents 325.11(6)

Expense of making or procuring models for use as evidence cannot be included among the taxable costs. Parker v. Bigler, C.C.W.D.Pa.1857, 18 F.Cas. 1115, No. 10726.

222. ---- Pictures and photostats, items of costs

Charges for copies of patents, file wrappers and photoprints reasonably necessary for use in patent infringement case are recoverable as costs. Wahl v. Carrier Mfg. Co., Inc., C.A.7 (Ind.) 1975, 511 F.2d 209, 184 U.S.P.Q. 516. Patents 325.11(1); Patents 325.11(6)

Expenditures for motion pictures and photographs were taxable as costs. Victor Talking Mach. Co. v. Starr Pi- ano Co., C.C.A.2 (N.Y.) 1922, 281 F. 60, certiorari denied 43 S.Ct. 89, 260 U.S. 726, 67 L.Ed. 483.

In action for declaratory judgment determining plaintiffs' rights as licensees under certain basket attachments patent license agreements and invalidity of basket patent claimed by defendant to cover baskets manufactured by plaintiff after expiration of attachments patent, item in defendants' bill of costs for photographs of baskets, which were before court and not presented in evidence, was not properly taxable as costs by court clerk, as photographs were not reasonably necessary. Hope Basket Co. v. Product Advancement Corp., W.D.Mich.1952, 104 F.Supp. 444, 93 U.S.P.Q. 94. Federal Civil Procedure 2736

Cost of photostats of originals offered by defendant and admitted in place of originals in patent suit was improperly taxed against unsuccessful plaintiff, since plaintiff could have demanded offer of originals and was not required to pay for expense in providing copies. Cincinnati Traction Bldg. Co. v. Westinghouse Air Brake Co., W.D.Pa.1939, 27 F.Supp. 329. Patents 325.11(6)

In patent suit, cost of photostat of certain papers which were a necessary part of the evidence in the case was taxable. Galion Iron Works & Mfg. Co. v. Beckwith Machinery Co., W.D.Pa.1938, 25 F.Supp. 591. Costs 190

Undisputedly reasonable expenses in the amount of $1,466.25 incurred by successful defendant in preparation of color photographs and color slides of products which had been treated by patented process were recoverable in patent infringement action where such photographs and slides were admitted in evidence to show results of ex- periments and were relied upon by court in determining that process patent was invalid for inoperativeness. H. C. Baxter and Bro. v. Great Atlantic & Pac. Tea Co., D.C.Me.1968, 44 F.R.D. 49, 156 U.S.P.Q. 623. Patents 325.11(6)

223. ---- Printing expenses, items of costs

Where United States Court of Customs and Patent Appeals [now United States Court of Appeals for the Federal Circuit] found it necessary to consider additional material in coming to its decision, and decision of Board of Patent Interferences was affirmed, costs for printing additions to record would be assessed against unsuccessful appellant. Smith v. Stone, Cust. & Pat.App.1970, 420 F.2d 1065, 57 C.C.P.A. 884, 164 U.S.P.Q. 453. Patents

106(1)

Under the circumstances, the court of appeals would require each party to pay the cost of printing the portion of the record designated by him in patent infringement and unfair competition action. Henry Hanger & Display Fixture Corp. of America v. Sel-O-Rak Corp., C.A.5 (Fla.) 1959, 270 F.2d 635, 123 U.S.P.Q. 3. Patents 325.15; Antitrust And Trade Regulation 117

Where appellant in patent infringement suit selectively designated, both for record and for printing, portions of record which he desired, and appellee without in any manner complaining of the excessiveness of appellant's designations proceeded to make on its own account large and expensive additional designations of matter to be included in the record and later on of additional portions of record to be printed, and there were excessive designations by appellant only as to a portion of the record, appellee's motion to re-tax the whole of the printing costs against appellant or, in the alternative one-half thereof, would be denied and only one-fourth of the printing cost would be taxed against appellant and three-fourths against appellee. Gray Tool Co. v. Humble Oil & Refining Co., C.A.5 (Tex.) 1951, 190 F.2d 779. Patents 325.15

Costs on defendant's appeal from decree for plaintiff in suit for injunction and for declaratory judgment on validity and infringement of patents would be divided, but costs of printing appendix to defendant's brief would not be taxed as costs where defendant printed the record as the appendix without receiving court's permission, and in court's opinion printing of a large part thereof was entirely unnecessary. U.S. Galvanizing & Plating Equipment Corp. v. Hanson-Van Winkle-Munning Co., C.C.A.4 (W.Va.) 1939, 104 F.2d 856. Federal Civil Pro- cedure 2746

The cost of printing briefs on defendant's appeal from preliminary injunction in patent infringement suit was not an element of damages recoverable under injunction bond filed under former § 382 of Title 28 [now rule 65(c), Federal Rules of Civil Procedure, Title 28] by plaintiffs. Salvage Process Corporation v. Acme Tank Cleaning Process Corporation, C.C.A.2 (N.Y.) 1939, 104 F.2d 105, certiorari denied 60 S.Ct. 131, 308 U.S. 599, 84 L.Ed. 501. Patents 307

Under District Court rule 11, requiring all papers furnished the court in calendar causes, with certain exceptions, to be printed, and Rev. St. § 983 [now § 1920 of Title 28], which provided that the amount paid printers, etc. shall be taxed, the cost of printing the record in a patent infringement suit was taxable, though, in the absence of a rule or statute requiring such printing, the expense is not taxable. Christensen v. General Electric Co., N.D.N.Y.1918, 248 F. 284.

Where there is an established practice in district, well adhered to for many years and well known, to have record printed in contested patent causes, and to tax cost of such printing, such practice has all the force of a rule of court. Detroit Heating & Lighting Co. v. Kemp, C.C.Md.1910, 182 F. 847. Patents 325.13

One-half of cost of court's copy of transcript and cost of first of three copies procured by defendant for use of counsel and his assistants would be charged against plaintiffs instituting patent infringement action lacking merit. Young v. General Elec. Co., N.D.Ill.1951, 96 F.Supp. 109, 88 U.S.P.Q. 174. Patents 325.11(6)

In patent infringement action, alleged infringer failed to show that patent holder had forced it to incur microfilm printing costs, or that any special circumstances existed supporting an award of such costs after alleged infringer prevailed on its non-infringement claim, particularly where, once attorneys for alleged infringer advised patent holder's counsel of extreme costs associated with printing requested documents from microfilm, counsel for pat-

ent holder directed attorneys not to reproduce the microfilm on ground that it was too expensive. Pehr v. Rub- bermaid, Inc., D.Kan.2000, 196 F.R.D. 404. Patents 325.11(6)

224. ---- Prior art search

In patent infringement action, costs that defendant incurred in its prior art searches, in amount of $9,697.30, were recoverable only in part, once defendant prevailed on its claims of non-infringement; although patent copying charges of $190.00 were taxable as costs, remaining charges in amount of $9,507.30, which defendant had paid for professional services, dispatch charges, and online searching fees, were not taxable under federal costs provision. Pehr v. Rubbermaid, Inc., D.Kan.2000, 196 F.R.D. 404. Patents 325.11(1)

225. ---- Reference expenses, items of costs

There was no abuse of discretion in assessing fee of special master, to whom action for patent infringement and unfair competition had been referred for accounting, against defendants, though master took proof of items which did not enter into the findings on damages where such items would have so entered into the findings had the master or the court held other than they did on critical and contested issues. American Safety Table Co. v. Schreiber, C.A.2 (N.Y.) 1969, 415 F.2d 373, 163 U.S.P.Q. 129, certiorari denied 90 S.Ct. 683, 396 U.S. 1038, 24 L.Ed.2d 682, 164 U.S.P.Q. 225. Patents 325.8; Antitrust And Trade Regulation 117

There was no basis for dividing costs of reference where except for relatively minor dispute concerning time for commencement of damages, patentee sustained all contentions against infringer and nothing patentee did either precipitated necessity for reference nor prolonged it. Bros. Inc. v. W. E. Grace Mfg. Co., C.A.5 (Tex.) 1963, 320 F.2d 594, 138 U.S.P.Q. 357. Patents 322

In patent infringement action, record disclosed no abuse of discretion in the district court's apportionment of the master's fee equally between plaintiff and defendants. Henry Hanger & Display Fixture Corp. of America v. Sel- O-Rak Corp., C.A.5 (Fla.) 1959, 270 F.2d 635, 123 U.S.P.Q. 3. Patents 325.7

Where no damages were proved by defendant in reference to ascertain right to recover damages under injunction bond filed by plaintiffs in patent infringement suit, defendant was properly charged with costs of reference. Sal- vage Process Corporation v. Acme Tank Cleaning Process Corporation, C.C.A.2 (N.Y.) 1939, 104 F.2d 105, certiorari denied 60 S.Ct. 131, 308 U.S. 599, 84 L.Ed. 501. See, also, Hill v. Smith, C.C.Pa.1887, 32 F. 753. Patents 307

Allowance of $12,000 as compensation to master, and division of costs equally between parties of suit to enjoin infringement and for accounting, was not error in view of nature of case and time consumed. Dunkley Co. v. Central California Canneries, C.C.A.9 (Cal.) 1925, 7 F.2d 972, certiorari denied 46 S.Ct. 347, 270 U.S. 646, 70 L.Ed. 778.

Courts should be sedulous to keep within just and reasonable limits allowances to masters, referees, examiners, and officers, and in making allowances should consider the character of duty imposed, and the ability, knowledge, experience, and learning requisite to discharge of that duty. Van Kannel Revolving Door Co. v. Uhrich, C.C.A.8 (Kan.) 1924, 297 F. 363, certiorari denied 45 S.Ct. 91, 266 U.S. 604, 69 L.Ed. 463.

Fixed fee was normal rate of daily allowance for services of master in an accounting under bill of equity for patent infringement, subject to increase or reduction where particular cause is shown. Houghton v. Whitin Mach.

Works, C.C.Mass.1908, 163 F. 311. Patents 325.8

Each party should, in the first instance, pay his own costs, on a reference to ascertain profits and damages, leav- ing the question of their final disposition to be determined when the decree is entered. U.S. Printing Co. v. American Playing Card Co., C.C.Mich.1897, 81 F. 506. See, also, Panoulias v. National Equipment Co., D.C.N.Y.1915, 227 F. 1008. Patents 325(1)

Where decree finding defendant guilty of infringement is set aside upon rehearing, or upon final decree, with costs, master's fees paid by defendant for accounting should be taxed against plaintiff as part of the costs. Amer- ican Diamond Drill Co. v. Sullivan Machine Co., C.C.S.D.N.Y.1885, 32 F. 552, appeal dismissed 9 S.Ct. 794, 131 U.S. 428, 33 L.Ed. 217. Patents 325.8

Where defendants have been adjudged to be infringers, and decreed to account for gains and profits and damages, they must go forward in the accounting and bear the necessary expenses of so doing, including master's fee. Urner v. Kayton, C.C.S.D.N.Y.1883, 17 F. 539. Patents 325.8

Prevailing practice of district was to charge master's compensation on plaintiffs in the first instance, to be answered in costs if final decree is for complainant. Macdonald v. Shepard, C.C.Mass.1882, 10 F. 919. Patents 325.8

Where plaintiff in infringement case offered extensive testimony and a voluminous number of exhibits in con- tending that an award should be based on defendant's profits rather than its own damages, but abandoned some of its charges against defendant on eve of liability trial and, after suffering a reversal in part on appeal offered an extensive amount of irrelevant evidence in proceeding on remand for an accounting of damages and needlessly prolonged litigation, it was inequitable to assess entire costs of special master's compensation against defendant; rather, it was equitable that each party bear its own costs and that both parties share equally both transcript costs and master's fees and costs. Ellipse Corp. v. Ford Motor Co., N.D.Ill.1978, 461 F.Supp. 1354, 201 U.S.P.Q. 455, affirmed 614 F.2d 775, certiorari denied 100 S.Ct. 2160, 446 U.S. 939, 64 L.Ed.2d 792, 206 U.S.P.Q. 288. Pat- ents 325.10

Where doubt was raised as to whether the clerk had the power to tax fees and expenses of a reference and questions were raised as to whether such costs might properly be entered in that there had been only a final determination of issues of patent validity, unfair competition and violation of antitrust laws and that proceeding to determine damages was pending and unusually large amounts were involved, the clerk properly suggested that the matter be brought on before the court by motion rather than before the clerk of the usual course. Deering, Mil- liken & Co v. Temp-Resisto Corp, S.D.N.Y.1959, 169 F.Supp. 453. Federal Civil Procedure 2742.1; Pat- ents 325.14; Antitrust And Trade Regulation 117

In action for infringement of design patent and unfair competition, wherein plaintiff was permitted to recover the profit in amount of $54,358.09 made by defendants but was not permitted to recover attorney's fees or treble damages, master would be awarded a fee of $3,000, payment to be made half by plaintiff and half by defendants. Sel-O-Rak Corp. v. Henry Hanger & Display Fixture Corp. of America, S.D.Fla.1958, 159 F.Supp. 769, 117 U.S.P.Q. 245, affirmed 270 F.2d 635, 123 U.S.P.Q. 3. Patents 325.8

Where special master had devoted a total of 84 hours to work of reference in patent infringement action, total compensation of special master would be fixed at $2,000 to be paid by defendant infringer. Clair v. Kastar, Inc., S.D.N.Y.1946, 70 F.Supp. 484, 73 U.S.P.Q. 347. Patents 325.8

In suit for damages caused by the improper issuance of a preliminary injunction against infringement of patent, which was referred to a special master, compensation of $1,200 plus disbursements of $18.28 was allowed the master for his services. Penmac Corp. v. Falcon Pencil Corp., S.D.N.Y.1945, 62 F.Supp. 358. Federal Civil Pro- cedure 1892

226. ---- Reporter's fees, items of costs

An unsuccessful plaintiff's original objection to being taxed as costs amount paid court reporter for transcribing notes of testimony in patent suit would be formally overruled where amount was reduced by amended bill of costs, and original objection was not urged. Cincinnati Traction Bldg. Co. v. Westinghouse Air Brake Co., W.D.Pa.1939, 27 F.Supp. 329. Patents 325.14

227. ---- Witness fees and mileage, items of costs

Where federal district court held that depositions, which were taken by defendant in foreign states, related to certain devices that defendant unsuccessfully maintained were prior art, it was not an abuse of discretion by district court in denying all costs incurred by defendant in the taking of the depositions. Emerson v. National Cylin- der Gas Co., C.A.1 (Mass.) 1958, 251 F.2d 152, 116 U.S.P.Q. 101.

In patent suit involving many claims of 11 patents, all of which were finally held invalid and from which no appeal was taken, where defendants' expert witness was in attendance at the trial on 123 separate days and testified on 69 separate days and was held in readiness to testify when called or recalled by any of the parties and was recalled many times by the parties and by the court, allowance of per diem and subsistence to witness except during witness' attendance at the argument of the case was not an abuse of discretion. W. F. & John Barnes Co. v. International Harvester Co., C.C.A.7 (Ill.) 1944, 145 F.2d 915, certiorari denied 65 S.Ct. 687, 324 U.S. 850, 89 L.Ed. 1410. Patents 325.11(1)

Travel allowance for witness was properly taxed; travel allowance for party attending trial to assist in defense without testifying was not taxable as cost. Barber-Coleman Co. v. Withnell, D.C.Mass.1928, 28 F.2d 543. Pat- ents 325(11)

Fees of expert witness cannot be taxed as costs or disbursements. Cheatham Electric Switching Device Co. v. Transit Development Co., C.C.A.2 (N.Y.) 1919, 261 F. 792.

A defendant in a patent suit, whose counsel were compelled, without adequate reason, to go from Milwaukee to Denver to take the deposition of the patentee, although his place of business was in Milwaukee, and he was there a few days previously, and after the service of notice to take other testimony there, was entitled to have the unnecessary expense so incurred taxed as costs against complaint. Phoenix Knitting Works v. Rich, C.C.N.D.Ohio 1911, 194 F. 721, appeal dismissed 202 F. 1022, 120 C.C.A. 663.

An unsuccessful plaintiff's objection to being taxed as costs witness fees and mileage fees of witnesses in patent suit on ground that affidavit of defendant's agent did not assert that defendant had paid amounts taxed was overruled where affidavit sustaining costs taxed averred that witnesses were material and present at trial, since defendant, if it did not pay them, was liable for fees. Cincinnati Traction Bldg. Co. v. Westinghouse Air Brake Co., W.D.Pa.1939, 27 F.Supp. 329. Patents 325.14

228. Additional costs

In patent infringement action, where trial court made no findings of bad faith or inequitable conduct on part of infringer nor of other equitable considerations making it grossly unjust for patentee to bear burden of his own counsel fees, and there was no reason to believe that infringer did not, in good faith, doubt validity of patent involved, award of $1,000 additional attorneys' fees was improper. Faulkner v. Gibbs, C.A.9 (Cal.) 1952, 199 F.2d 635, 95 U.S.P.Q. 400. Patents 325.11(3)

In action for declaratory judgment determining plaintiffs' rights as licensees under patent license agreements, court reporter's charge of $40 for two days stenographic services in taking depositions of defendants' witnesses, including two investigators, sent by defendants to corporate plaintiff's place of business in foreign state to determine whether baskets being manufactured by such plaintiff thereat were of same type as those manufactured by it under licenses before it ceased to pay royalties, and charge fo $75, for original transcript, were properly allowable and taxable as costs, but charge of $75 for two copies of transcript furnished plaintiffs and defendants should have been disallowed by court clerk in taxing costs. Hope Basket Co. v. Product Advancement Corp., W.D.Mich.1952, 104 F.Supp. 444, 93 U.S.P.Q. 94. Federal Civil Procedure 2738

Where plaintiffs' patent infringement action lacked merit, and plaintiffs tampered with witnesses throughout trial, and misdated documents and other documents reflecting inventorship by another than the plaintiff to whom the patents were issued were consciously withheld by plaintiffs from their purported compliance with defendant's requests for documents, the defendant would be awarded, in addition to normally taxable costs, a sum which would partially reimburse defendant for defendant's expenses and substantial attorneys' fees in amount of $40,000. Young v. General Elec. Co., N.D.Ill.1951, 96 F.Supp. 109, 88 U.S.P.Q. 174. Patents 325.11(4)

In action for infringement of three patents, defendant was not entitled to allowance of additional costs and expenses incurred in preparation of its pleadings and defenses and preparation for trial as to one of patents, because defendant denied in answer to interrogatories that defendant was using patented process before plaintiff's voluntary dismissal of suit as to such patent, in absence of showing that suit was vexatious or oppressive or that plaintiff had absolute knowledge that defendant was not using such process before plaintiff informed defendant that suit on such patent would be dismissed. Standard Oil Co. of California v. Tide Water Associated Oil Co., D.C.Del.1943, 55 F.Supp. 274, affirmed 154 F.2d 579, 69 U.S.P.Q. 41. Patents 325.6

Where device claimed by defendants to show prior use had been considered in several previous cases involving other parties, defendants, for purpose of showing right to additional costs because of alleged unwarranted prosecution of patent infringement suit, were not entitled to use record to establish that plaintiff prior to filing of bill had full knowledge of alleged prior use. Smith v. James Mfg. Co., W.D.N.Y.1937, 21 F.Supp. 636. Patents 325.11(5)

229. Apportionment or division, costs

In action involving validity and infringement of patent each party was required to pay its own costs even though defendant prevailed by virtue of decision that patent was invalid, where defendant's counsel interfered with prosecution of plaintiff's case by informing witness that he need not appear in answer to summons of court since he resided outside the district and because of that witness did not appear and plaintiff was obliged to take his disposition in Chicago, and although defendant's attorney correctly advised witness that he was beyond jurisdiction of court there was ground for judge's conclusion that but for defendant's interference witness would have made a personal appearance. Inglett & Co. v. Baugh & Sons Co., C.A.4 (Va.) 1958, 261 F.2d 402, 120 U.S.P.Q. 242. Patents 325.7

Where patentee's suit for infringement was dismissed on ground that patent was invalid for want of invention, court did not abuse its discretion in dividing the costs. White Cap Co. v. Owens-Illinois Glass Co., C.A.6 (Ohio) 1953, 203 F.2d 694, 97 U.S.P.Q. 192, certiorari denied 74 S.Ct. 128, 346 U.S. 876, 98 L.Ed. 384, 99 U.S.P.Q. 492. Patents 325.7

Where appeal was well taken insofar as one ground thereof was concerned, costs would have to be divided equally between parties. Merrill v. Builders Ornamental Iron Co., C.A.10 (Colo.) 1952, 197 F.2d 16, 93 U.S.P.Q. 276. Federal Civil Procedure 2744

Where defendant's infringement was not wilful, defendant entertained good faith belief of invalidity of plaintiff's patents and such belief was sustained as to all but one patent, trial court did not abuse its discretion in assessing against plaintiff one-half costs of accounting, which determined damages on basis of reasonable royalty. Enter- prise Mfg. Co. v. Shakespeare Co., C.C.A.6 (Mich.) 1944, 141 F.2d 916. Patents 325.7

Where district court found that patents in suit were valid and infringed but denied relief on ground that plaintiff was attempting to secure a monopoly on unpatented material and by subsequent interlocutory decree granted an injunction against future infringement and an accounting on proof that plaintiff had purged itself of its illegal conduct and dismissed defendant's counterclaim seeking an injunction, costs of suit in district court and in court of appeals was properly divided equally between the parties. Sylvania Industrial Corporation v. Visking Corpor- ation, C.C.A.4 (Va.) 1943, 132 F.2d 947, certiorari dismissed 63 S.Ct. 1033, 319 U.S. 777, 87 L.Ed. 1723. Pat- ents 327(7)

In patent infringement suit, dividing the costs between the parties was not an abuse of trial court's discretion. Autographic Register Co. v. Sturgis Register Co., C.C.A.6 (Mich.) 1940, 110 F.2d 883. Patents 325.7

The dividing of costs by the trial court in a patent infringement action wherein the court determined that the patent was valid but not infringed was not abuse of discretion. H.H. Robertson Co. v. Klauer Mfg. Co., C.C.A.8 (Iowa) 1938, 98 F.2d 150. Patents 325.7

Where each party to patent infringement suit prevailed on one of two patents in suit, costs were not granted either party. Hazeltine Corporation v. Radio Corporation of America, S.D.N.Y.1931, 52 F.2d 504, affirmed 59 F.2d 203, certiorari denied 53 S.Ct. 91, 287 U.S. 642, 77 L.Ed. 556. Patents 325.4

Where the complaint in a suit for infringement established the validity of his patent and its infringement, but, owing to the peculiar circumstances of the case, was not entitled to any of the relief prayed for, the costs may be divided as deemed equitable by the court. Crier v. Innes, C.C.A.2 (Vt.) 1909, 170 F. 324, 95 C.C.A. 508. Patents 325.7

Where a suit is brought on several claims of one or more patents, and complainant obtains relief on some of the claims and fails to recover on the others, an equitable division of the costs should be made. Ide v. Trorlicht, Duncker & Renard Carpet Co., C.C.A.8 (Mo.) 1902, 115 F. 137, 53 C.C.A. 341. See, also, Closz & Howard Mfg. Co. v. J.I. Case Threshing Mach. Co., D.C.Minn.1913, 216 F. 937; J. L. Owens Co. v. Twin City Separator Co., Minn.1909, 168 F. 259, 93 C.C.A. 561; Brill v. Delaware County & P. Electric Ry. Co., C.C.Pa.1901, 109 F. 901; Corser v. Brattleboro Overall Co., C.C.Vt.1899, 93 F. 809; Green v. City of Lynn, C.C.Mass.1897, 81 F. 387, appeal dismissed 93 F. 988, 34 C.C.A. 684; Pennsylvania Diamond Drill Co. v. Simpson, C.C.Pa.1886, 29 F. 288. Patents 325.2

Where, in an accounting, the orator has recovered on the merits, and the defendant has not prevailed upon any distinct item, the costs will not be apportioned. Urner v. Kayton, C.C.S.D.N.Y.1883, 17 F. 845. See, also, North American Iron Works v. Fiske, C.C.N.Y.1887, 30 F. 622. Patents 325.7

Where the defendants were willing at the outset, and offered to pay the amount of net profits realized by them, and costs have been unnecessarily accumulated, the parties should pay their own costs, and each party pay half the master's fee. Ford v. Kurtz, C.C.N.D.Ill.1882, 12 F. 789, 11 Biss. 324. See, also, Brunswick-Balke-Collender Co. v. Klump, C.C.N.Y.1904, 131 F. 93; Lowell Mfg. Co. v. Whittall, C.C.Mass.1895, 71 F. 515. Patents 325.5

Three-fourths of costs of patent infringement suit would be taxed against defendant, and one-fourth against plaintiff, where three of four patents were held valid, two of them infringed, and fourth patent was found to be invalid but infringed if valid. Arthur J. Schmitt Foundation v. Stockham Valves & Fittings, Inc., N.D.Ala.1966, 292 F.Supp. 893, 151 U.S.P.Q. 474, affirmed 404 F.2d 13, 159 U.S.P.Q. 705, rehearing denied 420 F.2d 699, certiorari denied 90 S.Ct. 2177, 398 U.S. 965, 26 L.Ed.2d 549, 166 U.S.P.Q. 2. Patents 325.7

Where neither party entirely prevailed in suits for patent and trade-mark infringement, each party should bear its own costs. Q-Tips, Inc. v. Johnson & Johnson, D.C.N.J.1952, 108 F.Supp. 845, 95 U.S.P.Q. 264, affirmed 206 F.2d 144, 98 U.S.P.Q. 86, certiorari denied 74 S.Ct. 106, 346 U.S. 867, 98 L.Ed. 377, 99 U.S.P.Q. 491. Patents 325.7; Trademarks 1750

Where plaintiff was primarily responsible for patent infringement action lacking merit, co-plaintiff consenting to filing of action and producing his interest in any possible recovery to 20 percent would be charged with not more than 1/5 of the expenses to which defendant was unjustly put. Young v. General Elec. Co., N.D.Ill.1951, 96 F.Supp. 109, 88 U.S.P.Q. 174. Patents 325.10

Where court determined that three patents were valid and infringed and dismissed patent infringement action as to the fourth patent, plaintiff was awarded three-fourths of the costs. Cleveland Trust Co. v. Osher & Reiss, E.D.N.Y.1939, 31 F.Supp. 985, reversed 109 F.2d 917. Patents 325.7

Where evidence indicated that patentee and patent licensee unduly protracted accounting required of patent infringer and made accounting unnecessarily burdensome, the costs on the accounting would be divided between the parties. Victory Fireworks & Specialty Co. v. Commercial Novelty Co., D.C.Md.1939, 26 F.Supp. 126. Pat- ents 325.7

In patent infringement suit, each party was required to pay one-half of costs where patent was valid and infringed. Dykema v. Liggett Drug Co, W.D.N.Y.1937, 19 F.Supp. 313, reversed on other grounds 94 F.2d 648. Patents 325.7

230. Dismissal of action, costs

Under circumstances, award of costs in patent infringement action, which plaintiff had dismissed with prejudice, was not abuse of discretion, although allowance of costs for triplicate depositions seemed excessive. Sarkes Tar- zian, Inc. v. Philco Corp., C.A.7 (Ind.) 1965, 351 F.2d 557, 147 U.S.P.Q. 172. Patents 325.12

Where patent infringement suit was dismissed as to manufacturer of tractors with infringing mechanism, and final decree adjudged that remaining defendant had infringed patent by selling two infringing tractors, costs of

models and charts introduced by plaintiff without previous authorization by the court were improperly charged against remaining defendant. Reinharts, Inc., v. Caterpillar Tractor Co., C.C.A.9 (Nev.) 1938, 99 F.2d 648. Pat- ents 325.11(6)

In granting a motion to dismiss a patent infringement suit without prejudice to the bringing of a new action, the court had power to dismiss it at plaintiffs' cost. Christensen v. General Electric Co., N.D.N.Y.1918, 248 F. 284. Patents 313

It was within the discretion of the court to tax the costs of an infringement suit to defendant on its dismissal by complainant, where dismissal resulted from a change of defendant's structure, which brought it within another patent of complainant and enabled him to recover for the infringement in a suit thereon. Parker v. Stebler, C.C.A.9 (Cal.) 1917, 241 F. 589, 154 C.C.A. 365.

Where, pending a suit for infringement by the owner of a patent against the manufacturer of infringing machines, he commenced numerous suits against customers of the defendant, which were stayed by the court, and on an accounting in the principal case he recovered full damages for all sales made by the manufacturer, on his subsequent dismissal of the suits against customers, he is not entitled to recover his costs. Pomona Fruit Grow- ers' Exch. v. Stebler, C.C.A.9 (Cal.) 1917, 241 F. 123, 154 C.C.A. 123.

Where a patent infringement suit was dismissed for want of jurisdiction, no costs could be taxed. U. S. Envelope Co. v. Transo Paper Co., D.C.Conn.1916, 229 F. 576. Costs 8; Federal Civil Procedure 2728; Patents 325.1

Corporations' managing officers who specified device that was to be infringed, but did not direct the infringement nor participate in profits therefrom, should be dismissed from case without costs. Consolidated Brake-Shoe Co. v. Chicago, P. & St. L. Ry. Co., C.C.S.D.Ill.1895, 69 F. 412.

A bill for infringement of a patent filed one day before the patent expired will be dismissed with costs. Davis v. Smith, C.C.Mass.1884, 19 F. 823. Patents 325.6

As evidence did not show secretary of an association to be a shareholder, suit for infringement was dismissed as to him, but, as he answered jointly with defendants, without costs. Tyler v. Galloway, C.C.N.D.N.Y.1882, 13 F. 477.

In patent infringement action wherein plaintiff's patent was found invalid, and defendant's counterclaim on un- clean hands, fraud and misrepresentation on part of plaintiff was required to be dismissed, no costs would be awarded. Anderson Co v. Trico Products Corp, W.D.N.Y.1958, 162 F.Supp. 224, 118 U.S.P.Q. 490, affirmed 267 F.2d 700, 121 U.S.P.Q. 238, 122 U.S.P.Q. 52. Patents 325.4

Where patent infringement accounting proceeding was ordered dismissed on defendant's payment of liability disclosed by defendant's report with costs, plaintiff was not entitled to receive from defendant any part of charges of accountant under stipulation whereby defendant was not required to pay any part thereof unless plaintiff recovered more than amount reported by defendant. Trico Products Corp v. E a Laboratories, E.D.N.Y.1944, 54 F.Supp. 782. Patents 322

Where patent infringement action had been long pending and defendants had been put to great expense in preparing for trial, plaintiff's motion to dismiss without prejudice was denied in absence of offer to reimburse de-

fendants for reasonable costs of preparation for trial. American Engineering Co. v. Stoker Castings & Service, D.C.Mass.1942, 44 F.Supp. 96. Patents 313

Where plaintiffs suing for infringement of patent contended that filing date for patent went back to filing date of original application which had eventuated into prior patent of which patent involved allegedly was a continuation, defendants' request for admission which was predicated on statement which did not refer to filing date of original application was not solely a request for an “admission of fact” but was a request for an admission as to a “conclusion of law”, and hence upon entry of decree dismissing plaintiffs' complaint on the merits, defendants could not recover reasonable expenses incurred in proving matters set forth in request for admission. Tampax, Inc v. Personal Products Corp., E.D.N.Y.1941, 38 F.Supp. 663, affirmed 123 F.2d 722, certiorari denied 62 S.Ct. 946, 316 U.S. 665, 86 L.Ed. 1741, rehearing denied 62 S.Ct. 1105, 316 U.S. 710, 86 L.Ed. 1776. Patents 292.1(1)

Where plaintiff suing for patent infringement had notice of indemnity provisions in contracts pursuant to which manufacturers sold alleged infringing mills to defendant but waited until date set for trial to file motion for dismissal of infringement action on assigned ground that plaintiff wished the rights of plaintiff and manufacturers to be determined in actions between them directly, plaintiff would be required as condition of granting motion to pay to defendant the taxable costs under former § 70 of this title, and such amount on account of expenses, but not including attorney's fees, as court should deem reasonable and equitable after a hearing. Union Nat. Bank of Youngstown, Ohio v. Superior Steel Corp., W.D.Pa.1949, 9 F.R.D. 117. Patents 313

Where the complainants filed a bill on five patents, and the court found for the defendants on four, and the judges disagreed as to the fifth, the bill must be dismissed, but without costs. American Wood-Paper Co v. Heft, C.C.E.D.Pa.1867, 1 F.Cas. 740, No. 322, appeal dismissed 75 U.S. 333, 19 L.Ed. 379, 8 Wall. 333. Patents 314

231. Nominal damage awards, costs

Where the master reported no profits, and nominal damages, in a suit in equity for the infringement of a patent for a design, and, on exception by the plaintiff, the circuit [now district] court allowed a sum for damages and Supreme Court reversed its decree, the plaintiff was allowed costs in the circuit [now district] court to and including the interlocutory decree, and the defendant was allowed his costs after such decree. Dobson v. Hartford Carpet Co; Dobson v. Bigelow Carpet Co., U.S.Pa.1885, 5 S.Ct. 945, 114 U.S. 439, 29 L.Ed. 177. Costs 241; Patents 325.8

Where, on an accounting in an infringement suit, complainant is awarded only nominal damages, it may properly be taxed with all the costs of the accounting, including the hearing on exceptions to the master's report. Vic- toria Copper Min. Co. v. Rich, C.C.A.6 (Mich.) 1911, 193 F. 314, 113 C.C.A. 238. See, also, Everest v. Buffalo Lubricating Oil Co., C.C.N.Y.1887, 31 F. 742, appeal dismissed 9 S.Ct. 804, 131 U.S. 449, 33 L.Ed. 215; Kirby v. Armstrong, C.C.Ind.1881, 5 F. 801; Fisk v. West Bradley, etc., Mfg. Co., C.C.N.Y.1880, 19 Pat.Off.Gaz. 545, Fed.Cas. No. 4,830a; Garretson v. Clark, C.C.N.Y.1879, 4 B. & A.Pat.Cas. 536, Fed.Cas. No. 5,250.

Where a master reports that defendant has made no profits, and that plaintiff is entitled only to “nominal damages, with costs”, the court, in confirming his report, allowed full costs to plaintiff. Kirk v. Du Bois, C.C.Pa.1891, 46 F. 486, affirmed 15 S.Ct. 729, 158 U.S. 58, 39 L.Ed. 895.

The general rule is that where complainant recovers only nominal damages and profits the costs of the reference

are taxed against him, but the rule is subject to modification, as may be equitable. Calkins v. Bertrand, C.C.N.D.Ill.1881, 8 F. 755, 10 Biss. 445. See, also, Kansas City Hay Press Co. v. Devol, C.C.Mo.1904, 127 F. 363, appeal dismissed 137 F. 1019.

A verdict for plaintiff although for nominal damages only carries costs. Merchant v. Lewis, C.C.S.D.Ohio 1857, 17 F.Cas. 37, 1 Bond 172, No. 9437.

Where patent is sustained, and infringement found, but only nominal damages are given, plaintiff is entitled to costs, except of the reference, report, exceptions, and hearing thereon. Garretson v. Clark, C.C.N.Y.1879, 10 F.Cas. 45, No. 5250. Patents 325.3

232. Collection, costs

When a bill for infringement has been dismissed, with costs to defendant, for which an execution has issued and been returned wholly unsatisfied, a receiver will not be appointed, on motion of defendant, to take possession of the patents as equitable assets, to be disposed of for the satisfying of the decree. Thayer v. Hart, C.C.S.D.N.Y.1885, 24 F. 558. Patents 325.16

233. Interest on costs

Fact that this section fails to specifically authorize awarding interest on costs is no bar to an award of interest on costs in patent case; even if costs are not considered to be part of the judgment for purposes of section 1961 of Title 28 providing that interest shall be allowed on money judgment in a civil case recovered in district court, the court may, in its discretion, award interest on costs under this section. Devex Corp. v. General Motors Corp., D.C.Del.1983, 577 F.Supp. 429, affirmed 749 F.2d 1020, 224 U.S.P.Q. 544, certiorari denied 106 S.Ct. 68, 474 U.S. 819, 88 L.Ed.2d 55. Interest 22(9)

35 U.S.C.A. § 284, 35 USCA § 284 Current through P.L. 111-20 approved 5-15-09

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