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Last Week In The Federal Circuit (September 13-17): More Forays Into Expert Testimony And Damages

09/24/2021 | 06:11am

Nishi Tavernier, Morrison & Foerster associate, co-authored this post.

We're still waiting (and probably will be for a little while) for the first opinion from newly confirmed Judge Tiffany Cunningham. But in the meantime, we provide below our usual weekly statistics and our case of the week-our highly subjective selection based on whatever case piqued our interest.

Precedential opinions: 2

Non-precedential opinions: 9

Rule 36: 2

Longest pending case from argument: Atilano v. McDonough, No. 20-1579 (161 days)

Shortest (non-Rule 36) pending case from argument: Tie between Apple Inc. v. Firstface Co., Ltd., No. 21-1001 and Firstface Co., Ltd. v. Apple Inc., No. 20-2347 (13 days)

Case of the week: Omega Patents, LLC v. CalAmp Corp., 20-1793, 20-1794

Panel: Judges Dyk, Prost, and Hughes, with Judge Prost writing the opinion and Jude Hughes joining in part and dissenting in part

You should read this case if: you have a matter involving technical or damages expert testimony, or damages apportionment

Our latest case of the week continues the trend of recent decisions addressing district court control of expert testimony (see Last Week in the Federal Circuit (August 23-27): Supporting Damages Expert's Testimony). In the latest case, accused infringer CalAmp argued that the district court improperly permitted patent owner Omega's technical expert to testify beyond the scope of his expert report, depriving CalAmp of adequate notice of his infringement theory and an opportunity to prepare its case in response. At trial, Omega's technical expert testified about how the accused products practice an "enabling data" limitation. But according to CalAmp, the expert's report never disclosed this testimony. The Federal Circuit rejected CalAmp's appeal challenge. It explained that the expert report specifically pointed to the accused features that were the basis for his trial testimony. That "provided enough notice to CalAmp 'to prepare its case adequately and to prevent surprise.'" The Federal Circuit highlighted that CalAmp had the opportunity to question Omega's expert about the disclosure in deposition.

The Federal Circuit similarly rejected CalAmp's argument that Omega presented the jury with an improper infringement theory on another disputed limitation. The parties had agreed to the conditions under which a "device code" claim element was met and Omega presented the jury expert and deposition testimony about that limitation. But CalAmp argued Omega also presented an improper theory with other evidence and in closing arguments. The Federal Circuit held CalAmp waived that challenge because it never objected during the trial on this ground, nor did it ask for a limiting jury instruction. 

CalAmp was more successful, however, in challenging the district court's refusal to permit CalAmp's damages expert to rebut Omega's expert testimony at trial. The district court had relied on law of the case to exclude the expert-it had prevented the expert from testifying at a first trial, and CalAmp had not directly appealed that ruling when it appealed other rulings to the Federal Circuit in a prior appeal. The Federal Circuit rejected that reasoning, because its mandate from the first appeal "explicitly instructed both parties 'to achieve clarity by clearly presenting evidence in the retrial as to compensatory damages.'" That instruction "necessarily implied that the district court was 'to consider damages consistent with the principles set forth in the opinion,' including by reconsidering prior orders regarding evidence of damages."

Finally, the Federal Circuit ordered a new trial on damages for the additional reason that Omega's damages theory failed to apportion damages based on the incremental value of the patented features. As a patent owner, Omega bore the burden of producing evidence to apportion damages between patented and unpatented features. The Court held that, although a patent owner may use a comparable license as a basis of determining an appropriate royalty, Omega "failed to adequately account for substantial 'distinguishing facts' between the proffered licenses and a hypothetical negotiation over a single-patent license." The Federal Circuit thus vacated the jury's damages award and remanded for a new trial.

Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Morrison & Foerster LLP. All rights reserved

Mr Seth Lloyd
Morrison & Foerster LLP
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