Carnegie Mellon Univ. v. Marvell Tech. Grp., Ltd.

• Decision Date: 31 March 2014
• Docket Number: Civil Action No. 09-290
• Parties: CARNEGIE MELLON UNIVERSITY, Plaintiff, v. MARVELL TECHNOLOGY GROUP, LTD. et al., Defendants.
• Court: U.S. District Court — Western District of Pennsylvania

CARNEGIE MELLON UNIVERSITY, Plaintiff,
v.
MARVELL TECHNOLOGY GROUP, LTD. et al., Defendants.

Civil Action No. 09-290

UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA

Date: March 31, 2014

Judge Nora Barry Fischer
MEMORANDUM OPINION

I. INTRODUCTION/BACKGROUND

This is a patent infringement case brought by Plaintiff Carnegie Mellon University ("CMU"), against Defendants Marvell Technology Group, Ltd. and Marvell Semiconductor, Inc. (collectively "Marvell"), alleging that Marvell has infringed two of its patents, U.S. Patent Nos. 6,201,839 (the "'839 Patent") and 6,438,180 (the "'180 Patent") (collectively, the "CMU Patents"), for which the Court conducted a four-week jury trial from November to December of 2012. (Docket No. 760). The jury rendered its verdict on December 26, 2012 in favor of CMU on infringement, validity and willfulness, and awarded damages in the amount of $1,169,140,271.00. (Docket No. 762).¹ The Court has continued to preside over hotly contested

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post-trial proceedings in this case, which has included extensive briefing and post-trial evidentiary submissions, a two-day motion hearing, supplemental briefing on disputed legal points and periodic joint status reports from the parties as to Marvell's continuing sales of the infringing technology. The Court has moved sequentially through the post-trial motions and issued a number of decisions, including: (1) denying Marvell's motion for a mistrial, (Docket No. 900); (2) resolving the parties' challenges to the sufficiency of the evidence supporting the jury's verdict on liability, damages and willfulness but reserving ruling on the financial penalty to be imposed as a result of Marvell's willful infringement, (Docket No. 901); and (3) denying Marvell's equitable defense of laches, which could have substantially reduced the jury's award, (Docket No. 920). All of those decisions are incorporated by reference herein. (Docket Nos. 900, 901, 920).

At this juncture, the jury's verdict of $1,169,140,271.00, which has been adopted as a judgment filed on January 14, 2013, has been sustained. (Docket Nos. 762, 769, 901). The jury's verdict represents one hundred percent (100%) of the compensatory damages sought by CMU at trial for Marvell's infringement of the patented methods. (Id.). It also signifies that the jury wholly adopted the testimony of CMU's damages expert, Catharine Lawton, who opined that a hypothetical negotiation between the parties would have resulted in a reasonable royalty of $0.50 per Accused Chip sold by Marvell during the relevant time period (the royalty base) and would result in the exact damages figure which was awarded by the jury. (Docket No. 686 at 61). Ms. Lawton's opinions have been heavily scrutinized by the Court in prior decisions (including Daubert challenges both before and during trial) and the decisions on those issues are

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likewise incorporated by reference herein. (Docket Nos. 451, 713, 901). Relevant here, Ms. Lawton's testified to the following damages computations:

Damages Period	Royalty Base	Royalty Rate	Damages
3/6/03-3/5/09	1,109,100,006	$0.50	$554,550,003
3/6/09-7/28/12	1,229,180,536	$0.50	$614,590,268
3/6/03-7/28/12	2,338,380,542	$0.50	$1,169,140,271

(Docket No. 633-1 at 7). While the post-trial motions were pending, the Court ordered a number of post-trial accountings regarding Marvell's continuing sales of Accused Chips² and the parties filed status reports providing such information. (Docket Nos. 885, 886, 904). Through this process, the parties met and conferred and generally agreed³ that Marvell has made the following sales of Accused Chips in the subsequent periods:

Period	Sales
7/29/12 - 1/14/13	159,100,576
1/15/13-8/3/13	204,652,009
8/4/13 - 11/2/13	94,390,559

(Docket Nos. 889, 907, 901 at n.136). The Court has not ordered additional status reports at this time because the same are unnecessary to the Court's present decisions. However, updated accountings will be ordered in conjunction with the Court's rulings set forth below.

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Turning back to the pending matters before the Court, all of the remaining post-trial motions involve CMU's efforts to seek to increase this substantial award and/or to seek a reasonable royalty for ongoing infringement by Marvell or enjoin it from same.⁴ CMU seeks all of the following in addition to its billion dollar jury verdict:

• supplemental damages of $79,550,288;
• prejudgment interest of up to $326,144,393.25;
• enhanced damages of up to three times the jury's verdict and supplemental damages (i.e., for a total verdict of $3,746,071,677);
• 0.14% post-judgment interest on the jury's verdict, and any supplemental damages, attorneys' fees (the issue of attorneys' fees has been deferred by the Court until any appeals are resolved), and/or prejudgment interest which may be awarded, compounded annually;
• a permanent injunction preventing Marvell from further production of any products which infringe CMU's patented methods because Marvell is allegedly a "collection risk," and,
• an on-going running royalty of up to $1.50 per chip on all of Marvell's post-judgment sales of chips containing the infringing technology.

(Docket Nos. 786, 788, 790). Marvell essentially concedes that an award of supplemental damages and post-judgment interest are appropriate in light of the jury's verdict but opposes

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CMU's requests for prejudgment interest, enhanced damages, a permanent injunction and/or a reasonable royalty on future sales of the Accused Chips. (Docket Nos. 824, 828, 833, 861-863).

CMU's requests are framed as its Motion for Prejudgment and Post-Judgment Interest, (Docket No. 788), Motion for a Permanent Injunction, Post-Judgment Royalties, and Supplemental Damages, (Docket No. 786), and Motion for a Finding of Willful Infringement and Enhanced Damages,⁵ (Docket No. 790). These matters have been completely briefed, (Docket Nos. 787; 789; 790; 793; 834; 836; 837; 850; 852; 853; 861; 862; 863), and the Court heard argument on same on May 1 and May 2, 2013. (Docket No. 873). The transcripts of these proceedings were filed on May 15, 2013. (Docket Nos. 880; 881).⁶ The parties have also submitted status reports and supplemental briefing on certain issues. (Docket No. 889, 891, 893, 896, 897, 898, 905, 906). Accordingly, these motions are now ripe for disposition. Upon careful consideration of all of the parties' submissions, oral argument, and for the following reasons, CMU's Motions [788], [786] and [790] are granted, in part, and denied, in part. More specifically,

• CMU's Motion for Prejudgment and Post-Judgment Interest [788] is granted to the extent that CMU seeks post-judgment interest under 18 U.S.C. § 1961 but denied to the extent that CMU seeks prejudgment interest under 35 U.S.C. § 284;
• CMU's Motion for a Permanent Injunction, Post-Judgment Royalties, and Supplemental Damages [786] is granted to the extent that CMU will be awarded supplemental damages in the amount of $79,550,288.00; denied to the extent that a permanent injunction is sought; and granted, in part, as the Court will order an on-going royalty of $0.50 per sale of Accused Chips by Marvell; and,
• CMU's Motion for a Finding of Willful Infringement and Enhanced Damages [790] is granted to the extent that the Court

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will award enhanced damages at a rate of 1.23 multiplied by the jury's award and supplemental damages, for a total enhancement of $287,198,828.60, but denied to the extent that CMU seeks enhanced damages at a higher rate.

II. MOTIONS SEEKING RELIEF UNDER 35 U.S.C. § 284

CMU's post-trial motions for...