After finding willful infringement, a court may enhance damages under Section 284 of the Patent Act. This post deals primarily with the role of the judge and the jury in the willfulness and enhancement determination.
From 2007-16, In Re Seagate was the law for finding willfulness. Willfulness under Seagate first required the patentee showing that the infringer acted despite an objectively high likelihood that its actions constituted infringement of a valid patent. After this showing of objective recklessness, the patentee then had to show that the risk of infringement was either known or so obvious that it should have been known to the accused infringement. Id.
The Supreme Court in Halo rejected the Seagate test as “unduly rigid,” such that the test insulated “some of the worst patent infringers from any liability for enhanced damages.” Under Halo, objective unreasonableness is no longer required to find willfulness. Rather, the “subjective willfulness of a patent infringer, intentional or knowing, may warrant enhanced damages, without regard to whether his infringement was objectively reckless.” Halo.
The jury finds subjective willfulness. “[T]here is a right to a jury trial on the willfulness question.” WBIP v. Kohler. Halo did not “chang[e] the established law that the factual components of the willfulness question should be resolved by the jury.” WBIP; see also Richardson v. Suzuki Motor (“Willfulness of behavior is a classical jury question of intent. When trial is had to a jury, the issue should be decided by the jury.”). Halo, however, changed the first step of the willfulness inquiry. “[U]nder Halo, the district court no longer determines as a threshold matter whether the accused infringer’s defenses are objectively reasonable. Rather, the entire willfulness determination is to be decided by the jury.” Exmark v. Briggs & Stratton.
The judge decides to enhance damages. “[D]istrict courts enjoy discretion in deciding whether to award enhanced damages, and in what amount.” WCM v. IPS. “Awards of enhanced damages are not to be meted out in a typical infringement case, but are instead designed as a punitive or vindictive sanction for egregious infringement behavior.” Id. Thus, “an award of enhanced damages does not necessarily flow from a willfulness finding.” Presidio v. AM. Technical Ceramics. Rather, the district court has discretion, given the “overall circumstances of the case”, “to determine whether the conduct is sufficiently egregious to warrant enhanced damages.” Id. A jury need not consider willfulness before a district court denies enhancing damages. Exergen v. Kaz (affirming denial of enhanced damages, despite that the jury didn’t consider subjective willfulness).
Appellate review. “A jury’s willfulness finding is a question of fact reviewed for substantial evidence.” Georgetown Rail v. Holland. And a “district court’s decision to award enhanced damages upon a finding of willful infringement is reviewed for abuse of discretion.” Id.
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Addendum (subsequent relevant Federal Circuit cases):
Appellate review:
Party waived right to challenge finding of no willfulness despite change in law (Ultratec v. Sorenson)
Willfulness and enhancement vacated, but exceptionality finding affirmed (SRI International v. Cisco)
Liability as to one claim does not support general damages, willfulness finding, enhancement, or attorney fees (Omega Patents v. CalAmp)