By Andrew Longstreth
NEW YORK (Reuters) - As Marvell Technology Group Ltd embarks on a legal process to void a $1.17 billion damages verdict in a patent dispute with Carnegie Mellon University, it has some reasons to be optimistic.
The verdict was delivered on Wednesday by a jury in Pittsburgh, which found that Marvell had infringed two patents owned by Carnegie Mellon related to how accurately hard-drive circuits read data from high-speed magnetic disks.
On Thursday, Marvell said that it would seek to overturn the verdict through post-trial motions at the district court.
Marvell also said that, if necessary, it would appeal to the U.S. Court of Appeals for the Federal Circuit. That court, which oversees appeals in patent infringement cases, has proven willing to throw out large verdicts in the recent past.
Brian Love, a professor at Santa Clara University School of Law who specializes in patent law, said damages awards are reversed about 20 percent of the time on appeal. Further, he said, "the larger a damages award is, the more susceptible it is to attack." The award is one of the largest by a U.S. jury in a patent infringement case.
Other large verdicts have not held up on appeal. In February 2011, Abbott Laboratories, for example, succeeded in overturning a $1.67 billion verdict against it in a patent infringement verdict won by a Johnson & Johnson unit.
That verdict, the largest ever by a jury in U.S. patent infringement litigation, was delivered in 2009 by a jury in Texas which found that Abbott's arthritis drug Humira had infringed the Johnson & Johnson unit's patent. But the Federal Circuit ruled that the patents at issue were invalid and thus could not be infringed.
Microsoft Corp has also successfully cut down big patent infringement verdicts delivered against it. In 2007, it was hit with a $1.52 billion verdict in a case brought by Alcatel-Lucent SA over patents related to digital music technology.
But, after post-trial motions, the judge who oversaw the case set aside the verdict, finding that Microsoft's Windows Media Player did not infringe the patents held by Alcatel-Lucent. The Federal Circuit affirmed his decision.
It's unclear which issues Marvell will raise in its post-trial motions and appeals. In a statement on Thursday the company said it did not infringe Carnegie Mellon's patents and that those patents could not have practically been used in its products.
Legal experts said Marvell's lawyers could attack the jury's damages calculation. Love of Santa Clara Law noted that the award exceeds Marvell's annual profits and is more than one quarter of the company's market capitalization.
"The law of patent damages is fuzzy, and leaves parties leeway to argue for damages amounts that differ drastically, often by 100-fold and sometimes much more," he said.
Because it received precisely what it requested, an amount calculated by an outside expert based on assumptions that could later be questioned, this award may be in "greater jeopardy than usual," Love said.
Marvell may contest the jury's finding that it willfully infringed the patents, which allows Judge Nora Barry Fischer to treble the damages owed to Carnegie Mellon.
In a decision issued in June, the Federal Circuit gave judges discretion in determining whether infringement was willful. Before that decision, willfulness was often left entirely up to juries.
"Typically that is a focal point of post-trial motions," said Donald Dunner, a patent attorney who is not involved in the case.
Marvell may also renew arguments it made in a motion seeking a mistrial earlier this month based on allegedly improper arguments made by Carnegie Mellon's lawyers during closing arguments. Judge Fischer denied the motion, but said she would consider it at the conclusion of the trial "in light of the entire record, argument, and legal authority." (Reporting by Andrew Longstreth; Editing by Phil Berlowitz)