In this long-running patent infringement case regarding check imaging technology, where a jury had found lump-sum royalty damages of $27 million, the court now considers post-verdict royalties.The court first awards supplemental damages at a rate of $0.002 per check (the implied rate from the jury verdict) for the time between trial and final judgment (the present date).
Turning to post-judgment (future) royalties, the court first rules that defendant U.S. Bank failed to prove the availability of its proposed non-infringing alternative (using Wells Fargo, a licensee, as a correspondent bank to clear checks). Thus, Dr. Hausman’s opinion relying on the Nash solution was not useful.
In reviewing the Georgia-Pacific factors, the court first finds (not unlike the Federal Circuit in ResQNet) that past litigation-related licenses are more useful than the non-litigation licenses that were produced. The court rejects (as did the jury) the opinion of plaintiff’s expert, Christopher Bokhart, that the non-litigation licenses with low-volume non-bank entities should dictate the ongoing royalty rate (here, $0.015 per check, several times higher than the jury award). The court places little weight on such non-litigation licenses where the party paid little or nothing, despite Mr. Bokhart’s conclusion “that actual payment does not affect his opinion and that ‘the important thing is that they agreed to a royalty based on use.’”
The court then works through the rest of the Georgia-Pacific factors and ultimately adjusts upwards its starting point (the jury’s verdict of $0.002/check) to reach a royalty rate of $0.005/check.
Case: Datatreasury Corporation v. Wells Fargo & Company, et. al., 2-06-cv-00072 (ED TX, August 2, 2011) (Folsom)