Due to the dramatic impact that the Entire Market Value Rule can have on the amount of damages (by expanding the royalty base), it stands to reason that defendants would want to know as early as possible if plaintiff will attempt to apply the EMVR rule to use a larger royalty base. This California court considered a motion by defendant HP to compel plaintiff to provide more definite responses regarding its possible use of the EMVR. HP could then presumably tailor its fact discovery and focus its expert’s work accordingly. The plaintiff’s position, not surprisingly, was that it was a matter for expert discovery, not fact discovery, and that it will be disclosed later in its expert reports. The court sided with plaintiffs, noting that HP “does not identify or specify in any real manner exactly why the discovery which it seeks must be received before the close of fact discovery.”
As a general proposition, the courts seem increasingly inclined to help the parties arrive at a general understanding of the damages issues as early as possible, as evidenced by Judge Rader’s recent comments to that effect. This might suggest that had HP been more specific about how the EMVR issues impact its fact discovery in this case, perhaps it may have gotten a more favorable ruling.
Nomadix, Inc. v. Hewlett-Packard Company, et. al., 2-09-cv-08441 (C.D. CA) (Kenton)