Patent Case Summaries September 22, 2021

Patent Case Summaries | Week Ending September 17, 2021

A weekly summary of the precedential patent-related opinions issued by the Court of Appeals for the Federal Circuit and the opinions designated precedential or informative by the Patent Trial and Appeal Board.

Omega Patents, LLC v. CalAmp Corp., No. 2020-1793, -1794 (Fed. Cir. (M.D. Fla.) Sept. 14, 2021). Opinion by Prost, joined by Dyk. Opinion dissenting in part by Hughes.

Omega sued CalAmp for infringement of four patents relating to “multi-vehicle-compatible systems” that can remotely control various vehicle functions. A first jury trial was held and then, following an appeal and remand by the Federal Circuit, a second jury trial was held.

In the second jury trial, the jury found, as pertinent here, that CalAmp directly infringed one patent (the ’278 patent) but did not induce infringement of a second patent (the ’885 patent), and awarded a per-unit royalty. The district court upheld the jury verdict and awarded Omega an ongoing per-unit royalty. CalAmp then appealed on issues of infringement and damages, and Omega cross appealed the district court’s determination of the ongoing royalty rate.

The Federal Circuit first addressed the finding that CalAmp did not induce infringement of the ’885 patent. Although the jury found no induced infringement, the jury determined that CalAmp’s customers directly infringed, which “serve[d] as a predicate to Omega’s induced-infringement theory.” Omega did not appeal the finding of no induced infringement, but CalAmp sought to overturn the predicate finding of direct infringement by its customers.

The Federal Circuit declined to review the predicate finding of direct infringement because “the final judgment of no induced infringement is not before us,” and the court reviews “judgments, not opinions or predicate findings.” Nonetheless, the Federal Circuit vacated the finding since the issue of direct infringement became moot when Omega elected not to appeal the finding of no induced infringement. The court explained that the “equitable remedy of vacatur” was warranted because appellate review became “unavailable to CalAmp through no action or fault of its own.”

Next, addressing direct infringement of the ’278 patent, the Federal Circuit rejected CalAmp’s arguments that (1) the district court improperly permitted Omega’s technical expert to testify beyond the scope of his report, and (2) Omega presented an improper “device code” theory to the jury.

Lastly, addressing damages, the Federal Circuit remanded for a new trial (thus mooting Omega’s cross appeal as to the ongoing royalty rate). The Federal Circuit ruled that the district court abused its discretion in precluding CalAmp’s damages expert from offering rebuttal testimony. Also, the Federal Circuit ruled that the jury’s per-unit royalty rate did not reflect apportionment, explaining that “Omega failed to show the incremental value of the ’278 patent (or that the patented improvement drove demand for the entire accused product), rendering the jury’s damages award unsustainable.” Here, there was “no question” that the accused devices included conventional components that warranted apportionment.

Judge Hughes dissented in part. In his view, the district court properly excluded CalAmp’s damages expert from offering rebuttal testimony. Also, Judge Hughes explained that the evidence presented by Omega constituted sufficient evidence to support the jury’s per-unit royalty, and the majority’s apportionment analysis was “too restrictive.” Judge Hughes would have upheld the jury’s damages award and the district court’s determination of the ongoing royalty rate.

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