The Supreme Court has significantly reigned in patent litigation and damages over the past few years-acting where Congress seemingly has been unable to do so. However, the Court just granted certiorari in two (now one combined) cases Halo Electronics, Inc. v. Pulse Electronics, Inc. and Stryker Corp. v. Zimmer, Inc.
The petitioners are asking the Court to strike down the Federal Circuit's "rigid two-part test" for deciding willful infringement. Specifically, the Federal Circuit's existing test requires proof by clear and convincing evidence that the infringer acted in bad faith and that its defenses were objectively unreasonable, while the Patent Act states in general terms that "the court may increase the damages up to three times the amount found or assessed." In a bad sign for the existing test, the Court has already struck down a similarly "rigid" test for awarding prevailing party attorneys' fees in patent cases in Highmark and Octane Fitness.
These cases may signal a reversal in the recent trend of court opinions making the legal landscape less favorable for patent litigation. If the Court makes it easier for patent holders to obtain enhanced damages this could lead to an increase in the number of cases filed, particularly of the "David" vs. "Goliath" patent disputes which may not have been pursued in the past.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
