Carnegie Mellon Univ. v. Marvell Tech. Group, Ltd.

Although the facts used by the jury to conclude that Marvell willfully infringed Carnegie's patents also satisfied many of the Reed factors the size of the jury’s damage award in relation to Marvell’s market capitalization and cash reserves justified limiting the enhanced damages multiplier to 1.23.

Opinion (Fisher): Carnegie Mellon sued Marvell alleging infringement of two of its semiconductor patents. A jury decided that: the patents were valid, Marvell infringed the patents, and that the infringement was willful. The jury awarded $1.17 billion in damages. Carnegie Mellon moved for supplemental damages, enhanced damages, and for a permanent injunction or an ongoing royalty. A court has discretion to award up to treble damages in appropriate circumstances. Willful infringement is an appropriate basis for awarding enhanced damages. Because the jury found that Marvell’s infringement was willful the court concluded that enhanced damages were appropriate. To establish the amount of enhanced damages a court considers the nine Reed factors: 1) whether copying was deliberate, 2) good faith belief of non-infringement, 3) behavior in litigation, 4) financial condition of infringer, 5) closeness of the case, 6) duration of the misconduct, 7) any remedial action, 8) whether the infringer was motivated to harm the patentee, and 9) whether the infringer attempted to conceal the infringement. The Court found that the facts that established Marvell’s willfulness also served to establish factors 1, 2, 7, and 9. Factors 3, 5, 6, and 8 were found to be neutral. The Court also weighed the size of the jury award and Marvell’s market capitalization and cash reserves from which it determined that an award of double or treble damages could threaten Marvell’s continuing operations. Accordingly, the Court limited its enhanced damages awarded to 23% of verdict-damages or $287 million. In part because there was no other source of products embodying the patents, the Court denied Carnegie’s motion for an injunction, instead it awarded an ongoing royalty of $0.50 per chip. Finally, the Court awarded supplemental damages of $80 million. In total, Carnegie was awarded $1.54 billion in damages.