Free Report and Recommendations - District Court of California - California

Case 3:07-cv-05525-JSW

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 JENS ERIK SORENSEN, as Trustee of SORENSEN RESEARCH and DEVELOPMENT TRUST, ) ) ) ) ) Plaintiff(s), ) ) v. ) ) FIRST INTERNATIONAL DIGITAL ) INC., an Illinois Corp., ) and DOES 1-100, ) ) Defendant(s). ) ) UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA

No. C07-5525 JSW (BZ)

AMENDED REPORT AND RECOMMENDATION RE PLAINTIFF'S REQUEST FOR ENTRY OF DEFAULT JUDGMENT

On January 4, 2007, plaintiff filed this action against defendant alleging infringement of United States Patent No. 4,935,184 ("'184 patent"). Plaintiff effected service of After

process against defendant on November 9, 2007.

defendant failed to respond to the complaint, and upon plaintiff's request, the Clerk of this court entered defendant's default under Rule 55(a) on January 10, 2008. Plaintiff's motion for a default judgment was referred to me on January 11, 2008 by Judge Jeffrey S. White and a hearing was set for March 5, 2007. Plaintiff appeared at the 1

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hearing.

No appearance was made by defendant.

Pursuant to Rule 55 (b)(2) of the Federal Rules of Civil Procedure, a court may enter default judgment against a party when default has already been entered by the Clerk. default, defendant is deemed to have admitted the well-pleaded averments of the complaint, except for those regarding the amount of damages. Fed.R.Civ.P.8(d); TeleVideo By its

Systems, Inc. v. Heidenthal, 826 F.2d 915, 917-18 (9th Cir. 1987). Plaintiff claims defendant infringed the `184 patent in violation of 35 U.S.C. § 295. It seeks damages in the form

of reasonable royalties and requests the court to treble the damages. Having reviewed the complaint, I find that

plaintiff's allegations are sufficiently well pled to establish that the accused products infringed plaintiff's patent. I therefore recommend that a judgment of

infringement be entered. As for damages, there is no precise formula to which a court must adhere when determining the damages based on reasonable royalty. Georgia-Pacific Corp. v. U.S. Plywood

Corp., 318 F. Supp. 1116, 1132 (S.D.N.Y. 1970), modified and aff'd, 446 F.2d 295 (2d Cir.), cert. denied, 404 U.S. 870 (1971), cited with approval in Parental Guide of Texas v. Thomson, Inc., 446 F.3d 1265, 1270 (Fed. Cir. 2006). However, the patent owner is required to prove the amount of reasonable royalty damages by relevant evidence in the record, not by pure conjecture. Georgia-Pacific at 1121. At

the hearing, plaintiff presented evidence, under seal, that 2

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it lost of royalties in an amount over $500,000.

The figure

was reached by multiplying the amount of units sold by the price of the unit and the royalty rate at which plaintiff typically licenses its patent. Plaintiff also seeks to enhance damages based on 35 U.S.C. § 284 which allows the court to enhance the damages up to three times the amount requested. Case law requires

plaintiff to show clear and convincing evidence that the defendant willfully infringed the `184 patent. Braun, Inc.

v. Dynamics Corp. Of America, 975 F.2d 815, 822 (Fed. Cir. 1992). In determining willful infringement the court must Id.

look at the totality of the circumstances.

Here, plaintiff points to a letter sent to defendant in 2004 in which plaintiff informed defendant of the substantial likelihood that it was infringing on `184 patent. While this

letter is some evidence of defendant's willful infringement, plaintiff could not provide any conclusive information about the number of accused products that were sold after the letter was sent. Rather, plaintiff's complaint suggests that

defendant stopped producing the products after the letter was sent. (Pl. Compl. ¶ 40.) Because plaintiff has not

satisfied its burden of establishing a willful violation of the patent through clear and convincing evidence, I recommend that damages not be trebled. Plaintiff asks for reasonable attorneys fees in the amount of $2,512.50 pursuant to 35 U.S.C. § 285. The statute

allows the court to grant fees to the prevailing party in exceptional cases, at its discretion. 3 Plaintiff has failed

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to provide any evidence that this is an exceptional case. For the reasons set forth above, I RECOMMEND that judgment be entered against defendant First International Digital, Inc. finding infringement and awarding damages in the amount of $500,000. DATED: March 7, 2008 Bernard Zimmerman United States Magistrate Judge

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