Federal Circuit (last Shepardized on 2/27/06)
Liquid Dynamics Corp. v. Vaughan Co., No. 05-1105 (Fed. Cir. June 1, 2006). Liquid Dynamics ("LD") sues Vaughan, alleging infringement of its patent on submerged agitator used in slurry tanks. To show that Vaughan's product reproduces "substantially helical flow path" of LD's patented product, LD introduces testimony from expert "Lueptow," whose Computational Fluid Dynamics (CFD) modeling supports that conclusion. Trial court admits testimony and jury finds for LD. Admissibility affirmed. Reliability of CFD analysis is generally recognized in scientific community, and expert's choice of parameters went to weight, not admissibility.
MicroStrategy, Inc. v. Bus. Objects, S.A., 429 F.3d 1344 (Fed. Cir. 2005). MicroStrategy sues Business Objects for patent infringement and related business torts. Trial court excludes testimony from MicroStrategy's damages expert David E. Yurkewich and renders judgment in favor of Business Objects on most claims. Exclusion affirmed. Expert ignored other potential factors contributing to MicroStrategy's business misfortunes, including not only severe financial difficulties associated with "dot com" bubble burst but also accounting errors resulting in downward readjustment of MicroStrategy's earnings reports and decline in its stock price from high of $313/share to low of 49¢/share.
Dal-Tile Corp. v. United States, 424 F.3d 1286 (Fed. Cir. 2005). Mexican company exports wall tiles to United States. Customs Service says they should be classified as ceramics (duty rate of about 20%). Mexican company says they should be classified as mineral substances (no duty). Classification hinges on whether tiles meet tariff schedule's definition for ceramics: "body if reheated to pyrometric cone 020 would not become more dense, harder, or less porous." When tested by Customs, tiles meet that test. When tested by Mexican company, they don't. Court of International Trade, applying Daubert factors, concludes that company's testing methods are more reliable, based on company's use of larger sample and its employment of control samples. Affirmed. Court of International Trade properly applied Daubert factors.
Imonex Servs., Inc. v. W.H. Munzprufer Dietmar Trenner GMBH, 408 F.3d 1374 (Fed. Cir. 2005). Trial court permits defendants' expert to opine on operating income attributable to infringement in patent case. Admissibility affirmed. Plaintiff offered no testimony of its own re Daubert factors. No abuse of discretion.
Cal. Fed. Bank v. United States, 395 F.3d 1263 (Fed. Cir.), cert. denied, 126 S. Ct. 344 (2005). Bank sues United States for breach of contract, alleging that congressional enactment of FIRREA breached earlier agreement by FSLIC that net liabilities of thrifts acquired by bank in aftermath of savings-and-loan crisis could be counted as regulatory capital and amortized over substantial period of time. By way of damages, bank alleges that it suffered lost profits when required to sell numerous adjustable rate mortgages (ARM's) to meet new regulatory capital requirements. Government denies that ARM's were sold because of breach, relying in part on expert economic testimony from Prof. Daniel Fischel and Dr. William Hamm. Trial court rules for government after bench trial. Bank appeals. Admissibility affirmed. Government's expert testimony explained why bank might have chosen to sell ARM's even in absence of breach, and also why their sale did not necessarily result in loss to bank. This was helpful to trier of fact, and testimony was not lacking in sound scientific basis.
Utah Med. Prods., Inc. v. Graphic Controls Corp., 350 F.3d 1376 (Fed. Cir. 2003). In patent infringement trial, district court excludes testimony on reasonable royalty from defense expert. Jury finds infringement and awards damages to patentee. Exclusion affirmed. District court legitimately concluded that other industry license agreements on which expert relied were not true comparables.
State Contracting & Eng'g Corp. v. Condotte Am., Inc., 346 F.3d 1057 (Fed. Cir. 2003). Sued for patent infringement, construction contractors offer testimony on reasonable royalty from damages expert Herbert W. Larson. District court excludes testimony and jury awards damages against contractors. Exclusion affirmed. District court did not abuse discretion in light of expert's admission that he had no experience placing values on patents and had no knowledge re reasonable royalties for construction patents.
Atmel Corp. v. Silicon Storage Tech., Inc., No. 02-1522 (Fed. Cir. Sept. 12, 2003) (unpublished). Plaintiff in patent infringement suit offers testimony from damage experts Stephen Degnan and Dr. Marc Vellrath. District court declines to conduct Daubert hearing and admits testimony, and jury finds for plaintiff. Admissibility affirmed. No abuse of discretion.
Dow Chem. Co. v. Mee Indus, Inc., 341 F.3d 1370 (Fed. Cir. 2003). In bench trial of patent infringement suit, district court excludes testimony on damages from plaintiff Dow's expert ("Mr. Pirc"), and then rules that because Dow has not carried its burden to prove damages, none can be awarded. Reversed. Dow does not challenge Daubert exclusion on appeal, but argues that other record evidence supports damages. Dow is correct. On finding of infringement, district court must award damages not less than reasonable royalty under 35 U.S.C. § 284, and statute explicitly states that although district court "may" receive expert testimony for that purpose, expert testimony is not required. Should Dow prove infringement on remand, district court should award such reasonable damages as existing record supports.
Micro Chem., Inc. v. Lextron, Inc., 317 F.3d 1387 (Fed. Cir. 2003). Plaintiff in patent infringement suit offers testimony from damages expert Edward Fiorito. Jury awards damages. Admissibility affirmed. Plaintiff says defendants waived objections, but defendants secured definitive rulings on their evidentiary objections either before or at trial. However, district court's ruling admitting testimony did not abuse trial court's discretion. Defendants fault expert for failing to base his testimony on "reliable facts." But defendants confuse Rule 702's requirement of basis in "sufficient facts or data" with Daubert's reliability requirement. Where facts are in legitimate dispute, Rule 702 does not authorize district court to exclude testimony because it credits one version of facts over another. Nor was expert's methodology suspect. Expert permissibly based his estimate on hypothetical royalty negotiation between patentee and infringer.
Maxwell v. Angel-Etsoff of Cal., Inc., No. 01-1601 (Fed. Cir. Dec. 13, 2002) (unpublished). Footwear infringes patent. Jury awards damages to plaintiff after hearing plaintiff testify as expert re number of infringing shoes sold. Admissibility affirmed. Defendant complaints that trial court did not qualify plaintiff as expert under Daubert, and it is true that plaintiff's estimate of number of infringing shoes raises several questions, especially regarding her reliance on overall sales figures rather than individual invoices. But many of those questions result from defendant's own practices, which, suspect or not, resulted in destruction of evidence defendant says would support its position. Sufficient evidence supported jury's damage award.
Seaboard Lumber Co. v. United States, 308 F.3d 1283 (Fed. Cir. 2002). In litigation over lumber companies' failure to perform timber sales contracts with United States, Court of Claims admits testimony from government expert, Scott Olmstead, re damages. Admissibility affirmed. Government urges that Daubert does not even apply in bench trials. It is true that bench trials pose no risk of jury confusion, but Daubert's requirements of relevance and reliability must still be satisfied. Here, however, government expert estimated damages by reference to time value of money, and companies themselves employed same basic methodology. Trial judge properly found that any deficiencies in expert's methods went "only to the fine tuning of a relatively minor credit," and did not abuse discretion in admitting testimony under circumstances.
Tex. Digital Sys., Inc. v. Telegenix, Inc., 308 F.3d 1193 (Fed. Cir. 2002), cert. denied, 538 U.S. 1058 (2003). Patent holder in infringement suit offers expert testimony from J. Carl Cooper re damages, and jury finds for patent holder. Admissibility affirmed. Defendant complains that expert's profit calculations did not rely on correct cost figures, but trial court actually refused to allow expert's report until he adopted cost figures supplied by defendant. Other complaints about expert's methods and premises go to weight, not admissibility.
Helms v. Sec'y of Health & Human Servs., No. 00-5110 (Fed. Cir. May 29, 2001) (unpublished). In proceedings under National Childhood Vaccine Injury Act, plaintiff's neuropathologist blames plaintiff's encephalopathy on vaccine, whereas HHS's neuropathologist blames suffocation. Special master finds for HHS. Court of Federal Claims remands, because unclear on how special master applied Daubert in evaluating plaintiff's evidence. Special master again finds for HHS, and Court of Federal Claims now affirms, because special master presented rational analysis of evidence. Affirmed. Review of special master's factual findings under Vaccine Act is highly deferential, with affirmance required unless special master's ruling was arbitrary and capricious.
Biotec Biologische Naturverpackengun GmbH & Co. v. Biocorp, Inc., 249 F.3d 1341 (Fed. Cir. 2001). Engineering experts in patent dispute differ on how to count crystalline content in thermostatically processable starch. Should trial court have specifically instructed jury on which diffraction peaks to ignore in calculating crystalline content of relevant products? Admissibility affirmed. Trial court's job is not to remove evidence from hearing of jury, but to ensure that expert evidence is relevant and reliable. It would contravene fundamental principles of fairness and due process to withhold evidence of disparate scientific opinion from jury.
Networld, L.L.C. v. Centraal Corp., 242 F.3d 1347 (Fed. Cir. 2001). In awarding summary judgment in patent infringement case, district court relies on defendant's expert's technical explanations and reaches conclusions consistent with expert's own conclusions in construing claim. Affirmed. Plaintiff did not challenge factual correctness of expert's technical explanations of computer systems at issue, but merely differed with expert on legal issues of claim construction and infringement. As to technical explanations, district court cannot be faulted for relying on only expert evidence presented. Expert evidence on technical aspects of patented inventions may assist district courts in dealing with complex technologies outside court's expertise (citing Daubert). As to claim construction, district court's construction was independently supported by patent specification and prosecution history.
Union Pac. Res. Co. v. Chesapeake Energy Corp., 236 F.3d 684 (Fed. Cir. 2001). In patent infringement trial conducted in Northern District of Texas prior to amendment of Fed. R. Evid. 701 in 2000 to bar lay opinion testimony calling for specialized knowledge within scope of Fed. R. Evid. 702, defendant calls eight witnesses who testify on enablement, over plaintiff's objection, without being treated as experts. Judge finds for defendants. Admissibility affirmed. Federal Circuit reviews evidentiary decisions under law of circuit where trial was conducted. Fifth Circuit has permitted lay opinion founded on specialized knowledge, where opinion derives from personal perception and is one that normal person would form from those perceptions. Witnesses here had extensive experience in relevant industry, and worked for companies that contributed to prior art. Because they "may have testified based on their own personal experiences," any alleged prejudicial error does not rise to level of abuse of discretion.
Utah Med. Prods., Inc. v. Clinical Innovations Assoc., No. 00-1140 (Fed. Cir. Dec. 13, 2000) (unpublished). To prove falsity of advertising in Lanham Act claim, plaintiff offers testimony from biomedical engineer that "sensor-tipped" catheters would have pressure transducers in their tip. District court excludes testimony as irrelevant and awards summary judgment to defendants. Exclusion affirmed. Expert admitted he did no research on meaning that "sensor-tipped" would carry to consumers of intrauterine catheters or in context of ads.
Am. Imaging Servs., Inc. v. Intergraph Corp., No. 99-1485 (Fed. Cir. June 12, 2000) (unpublished), cert. denied, 531 U.S. 1071 (2001). Plaintiff in patent infringement action disputes qualifications of defense computer expert, William Snider, to opine on interrupt vector tables. Admissibility affirmed. Expert was certified software programmer with many years of experience.
U.S. Valves, Inc. v. Dray, 212 F.3d 1368 (Fed. Cir. 2000). Inventor grants corporation exclusive license on patent but later begins selling patented items himself. At trial in patent dispute, licensee corporation offers testimony from economist [?] who employs computer model to project future damages. Admissibility questioned. Record does not indicate whether district court considered expert's damages testimony or whether district court conducted any Daubert analysis. However, testimony was irrelevant in any event, because district court enjoined future license violations by inventor. Moreover, in circumstances of case, estimates of future damages would be conjectural.