“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.” WCM v. IPS. There is “no requirement that enhanced damages must follow a finding of egregious misconduct.” Id. Rather, “courts should continue to take into account the particular circumstances of each case in deciding whether” to enhance damages. Id. “Because a finding of willful infringement does not command the enhancement of damages,” the Read v. Portec factors, “although not mandatory, do assist the trial court in evaluating the degree of the infringer’s culpability and in determining whether to exercise its discretion to award enhanced damages at all, and if so, by how much the damages should be increased.” WCM.
The Read factors are:
(1) whether the infringer deliberately copied the ideas or design of another;
(3) the infringer’s behavior as a party to the litigation;
(4) the infringer’s size and financial condition;
(5) the closeness of the case;
(6) the duration of the infringer’s misconduct;
(7) remedial action by the infringer;
(8) the infringer’s motivation for harm; and
(9) whether the infringer attempted to conceal its misconduct.
This post will focus on Federal Circuit decisions involving the third Read factors: the infringer’s behavior as a party to the litigation.
| Case | Strong Evidence of Litigation Misconduct? | Enhanced Damages? | Enhancement Multiple | Notes |
| Funai Electric v. Daewoo Elec. Corp., 616 F.3d 1357 (Fed. Cir. 2010) | Yes | No | — | Enhancement was not warranted. Although defendant had committed misconduct during the litigation which led to court-imposed sanctions, the conduct on which those sanctions were based was not so severe as to justify enhanced damages. Moreover other factors favored against enhancement. |
| I4I Ltd. Partnership v. Microsoft Corp., 598 F.3d 831 (Fed. Cir. 2010) | Yes | Yes | 1.2x | Enhancement was warranted. Defendant’s counsel defied the court’s repeated admonitions, and other factors favored enhancement. |
| Amsted Industries v. Buckeye Steel Castings, 24 F.3d 178 (Fed. Cir. 1994) | Yes | Yes | 3x | Enhancement warranted primarily due to defendant’s litigation misconduct in filing meritless motions, and to deliberate copying of the patented invention. |
| Exergen Corp. v. KAZ USA, Inc., 2016-2315 (Fed. Cir. Mar. 8, 2018) | No | No | — | Enhancement was not warranted because the district court found that no litigation misconduct had occurred, no evidence of copying existed, no concealment had occurred, and the plaintiff was able to “more than adequately vindicate its rights.” |
| WCM Indus., Inc. v. IPS Corp., 2016-2211 (Fed. Cir. Feb. 5, 2018) | No | No | — | The district court erred in balancing the factors and in trebling damages. Defendant’s conduct in the litigation, among other factors, counseled against enhancement. |
| Bard Peripheral Vascular, Inc. v. W.L. Gore & Assocs., Inc., 670 F.3d 1171 (Fed. Cir. 2012) | No | Yes | 2x | Enhancement was warranted because the district court found that all Read factors except one weighed in favor of enhanced damages. The behavior of defendant in the litigation was only slightly in favor of enhanced damages. |
| Riles v. Shell Exploration and Production, 298 F.3d 1302 (Fed. Cir. 2002) | No | No | — | Enhancement was not warranted. Defendant’s litigation behavior, along with the closeness of the case, did not warrant enhancement despite evidence of copying. |
| Odetics, Inc. v. Storage Technology Corp., 185 F.3d 1259 (Fed. Cir. 1999) | No | No | — | Enhancement was not warranted because defendant engaged in no misconduct during litigation, had not copied the invention, had evinced no motivation to harm plaintiff; and had not attempted to conceal its infringement. |
| Cybor Corporation v. FAS Technologies, 138 F.3d 1448 (Fed. Cir. 1998) | No | No | — | Enhancement was not warranted because the defendant did not litigate in an inappropriate fashion; the evidence regarding willfulness and copying was weak; and the case was close. |
| Virginia Panel Corporation v. Mac Panel Co., 133 F.3d 860 (Fed. Cir. 1997) | No | Yes | 1.1x | Only a slight enhancement was warranted because defendant’s behavior as a party to the litigation was not unacceptable, and because on balance the other factors did not favor a larger enhancement. |
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