Entire Profits of Infringing Products Proper Measure of Damages for Design Patent Infringement: Federal Circuit | Practical Law

Entire Profits of Infringing Products Proper Measure of Damages for Design Patent Infringement: Federal Circuit | Practical Law

In Apple Inc., v. Samsung Electronics Co., the US Court of Appeals for the Federal Circuit, among other things, affirmed the district court's holdings on patent infringement of the design patents in suit and the corresponding damages award. The Federal Circuit affirmed that Samsung's entire profits from the infringing products was the proper damages award.

Entire Profits of Infringing Products Proper Measure of Damages for Design Patent Infringement: Federal Circuit

by Practical Law Intellectual Property & Technology
Published on 19 May 2015 • USA (National/Federal)
In Apple Inc., v. Samsung Electronics Co., the US Court of Appeals for the Federal Circuit, among other things, affirmed the district court's holdings on patent infringement of the design patents in suit and the corresponding damages award. The Federal Circuit affirmed that Samsung's entire profits from the infringing products was the proper damages award.
On May 18, 2015, in Apple Inc., v. Samsung Electronics Co., the US Court of Appeals for the Federal Circuit affirmed in part and reversed in part the US District Court for the Northern District of California's jury verdict on patent infringement, validity, trade dress and other claims (Nos. 2014-1335, 2015-1029, (Fed. Cir. May 18, 2015)). Among other things, the Federal Circuit affirmed the district court's holding on infringement of the design patents at issue and the award of Samsung Electronics Co.'s entire profits as damages for the infringement.
The design patents at issue, US Design Patent Nos. D618,677, D593,087 and D604,305, claim certain design elements on the surface of Apple Inc.'s iPhone. The district court upheld jury findings, over Samsung's post-trial motions, that Samsung's smartphones infringed these patents and the entire profits on the infringing smartphones was the proper measure of damages.
On appeal, among other things, Samsung argued that the damages were improperly calculated because:
  • Under basic causation principles, damages should have been limited to the profit attributable to the infringement.
  • Apple failed to establish that infringement of its design patents caused any of Samsung's sales or profits.
  • Consumers chose Samsung's smartphones based on a host of other factors.
  • Even if the entire profits was an appropriate measure of damages, the calculation should be limited to profits on the portion of the product that incorporates the patent, in this case, the smartphone shells.
The Federal Circuit affirmed the district court's design patents infringement damages ruling. The Federal Circuit explained:
  • 35 U.S.C. § 289 explicitly authorizes the award of total profit from a product bearing the patented design, and the clear statutory language prevents adopting a causation rule.
  • The innards of Samsung's smartphones were not sold separately from the shells to ordinary purchasers. Therefore, the district court was not required to limit the damages to the profits for the smartphone shells.
  • The district court did not commit legal error in its jury instruction on damages.
Consequently, the Federal Circuit affirmed the district court's ruling on the design patent damages.