Situations When Written Opinions of Counsel Could Spare You a Patent-Related Headache
Written opinions of counsel are gaining renewed interest as a valuable tool for avoiding enhanced damages for willful patent infringement following the Halo decision.…
September 20, 2017 at 07:33 AM
4 minute read
The original version of this story was published on Law.com
Written opinions of counsel are gaining renewed interest as a valuable tool for avoiding enhanced damages for willful patent infringement following the Halo decision. A written opinion may set forth the factual and legal basis for finding a third party patent not infringed, invalid, and/or unenforceable. However, to be effective, the timing of the opinion may be critical.
In 2016, the U.S. Supreme Court issued a decision in the case of Halo Electronics, Inc. v. Pulse Electronics, Inc. making it easier for courts to find willful infringement in patent cases and award enhanced damages. Prior to Halo, district courts were guided by the so-called Seagatetest in which plaintiff patent holders had to “show by clear and convincing evidence that the infringer acted despite an objectively high likelihood that its actions constituted infringement of a valid patent” and that the risk of infringement “was either known or so obvious that it should have been known to the accused infringer.” Under the Seagate test, an infringer could effectively escape an assessment of enhanced damages for willful infringement by constructing an objectively reasonable infringement defense at the time of trial.
In Halo, the Court found that the test's objective prong placed too narrow a restriction on district courts' discretion, and “excludes from discretionary punishment many of the most culpable offenders.” Although implying that enhanced damages “should generally be reserved for egregious cases typified by willful misconduct,” the Court indicated that “subjective willfulness of a patent infringer, intentional or knowing, may warrant enhanced damages, without regard to whether his infringement was objectively reckless.” Thus, by directing the inquiry on the subjective culpability of the infringer, Halo focuses attention on the infringer's state of mind at the time the infringing actions occurred with knowledge of the patent—as opposed to the time of trial. As a result, infringement defendants can no longer rely solely on reasonable litigation-inspired defenses to prevent a finding of willfulness and possible treble damages.
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