Page 115 - Intellectual Property Disputes

comity.’" fn 15 In its ruling, the appellate court observed that "the Supreme Court ‘ordinarily construes
ambiguous statutes to avoid unreasonable interference with the sovereign authority of other nations’"
and that "‘the right conferred by a patent under [United States] law is confined to the United States and
its territories.’" fn 16

Practically, the practitioner should work closely with client’s counsel to understand the particular facts
and assumptions that the practitioner may be asked to make with regard to foreign sales. If the inclusion
of foreign sales into the damages analysis is, or could be, disputed, it may be appropriate to develop
separate scenarios that either include or exclude such sales.

Pre-Issuance Damages

In 2015, the Federal Circuit made an initial ruling on the Provisional Rights section of the Patent Statute,
which allows a plaintiff to obtain damages prior to patent issuance. As noted in Section 154(d), "a patent
shall include the right to obtain a reasonable royalty from any person who, during the period beginning
on the date of publication of the application . . . and ending on the date the patent is issued–(A)(i) makes,
uses, offers for sale, or sells in the United States the invention as claimed in the published patent
application or imports such an invention into the United States . . . and (B) had actual notice of the
published patent application." The statute also requires that the "invention as claimed in the patent is
substantially identical to the invention as claimed in the published patent application." In Rosebud, the
court ruled that the circumstantial evidence introduced by Rosebud was not sufficient to prove that
Adobe had actual knowledge of the published application and reiterated that proof of "constructive
notice" is insufficient to prove actual notice. fn 17 The "substantially identical" requirement of Section
154(d) has not been fully resolved. In a nonprecedential case, Innovention Toys, LLC v. MGA Entm’t,
Inc., 611 Fed. Appx. 693, 695 (Fed. Cir. 2015), the court explained that "[C]laims are ‘identical’ to their
original counterparts if they are ‘without substantive change’" and determining substantive change is
based on the scope of claims, not different words.

Patent Exhaustion

The issue of patent exhaustion is a legal question. However, this legal issue may affect the damages
period or the assumption regarding which of the defendant’s products infringe. Therefore, this section
provides certain information regarding relevant case decisions to assist the forensic practitioner in
understanding this issue.

The doctrine of patent exhaustion limits the patent rights that survive the initial authorized sale of a
patented item. In other words, once a licensee is licensed to sell a product, subsequent purchasers of the
licensee’s product are covered by the original license and cannot be subject to claims of infringement or
damages. Exhaustion is triggered only by a sale authorized by the patent owner.

fn 15 Id. (citing City of Chicago v. Int'l Coll. of Surgeons, 522 U.S. 156 (1997)).
fn 16 Id.(citing F. Hoffmann-La Roche, Ltd. v. Empagran S.A., 542 U.S. 155 (2004) and NTP, Inc. v. Research In Motion, Ltd., 418
F.3d 1282, 1313 (Fed. Cir. 2005)).

fn 17 Rosebud LMS Inc. v Adobe Sys. Inc., No 2015-1428, (Fed. Cir. 2016).

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