In this California district court pretrial order, Judge Whyte excluded plaintiff Synthes lost profits claim. Here, the accused Spinal Kinetics products were primarily sold in Germany, and the judge clearly agrees that but for theinfringement, those sales would have gone to a Synthes product. The problem is that the sales would have been made by Synthes’ European distribution chain, which is not a party to the litigation. The court describes how, despite this situation, Synthes constructs a “fictional supply chain wherein [the relevant] ProDisc products destined for Europe could have been manufactured in the United States then artificially funneled through Synthes USA, LLC for no other reason than to make its lost profits claim.” As a result, Synthes USA may only recover reasonable royalty damages.
Case: Synthes (USA) v. Spinal Kinetics Inc., 5-09-cv-01201 (ND CA, August 19, 2011, Order) (Whyte)