Corning Optical Communications Wireless Ltd. v. Solid, Inc. et al., 5:14-cv-03750 (Magistrate Paul Grewal) (April 14, 2015)

The days of "wait until we serve our expert report" to reveal damages figures might be over, at least if your case is in front of Judge Grewal.  Patent damages present an especially difficult situation for the parties to calculate damages without discovery, since damages theories will turn, in part, on information known only to the opposing party, such as revenues, sales and licensing practices.  Moreover, though the Patent Local Rules contain extensive disclosure requirements on patent liability issues, they do not contain any similar requirements for the disclosure of damages contentions prior to expert discovery.

Nevertheless, Judge Grewal recently granted plaintiff Solid's motion to compel more detailed responses to damages-related interrogatories.  He reasoned that "proportionality is part and parcel of just about every discovery dispute," and therefore found that the requested damages discovery is necessary to understand the case's worth and to resolve discovery disputes.  Accordingly, he ordered plaintiff to provide responses to a detailed damages interrogatory propounded by the defendants, including:

  1. The amount of damages under each asserted damages theories (including lost profits and reasonable royalty);
  2. Apportionment of damages between defendants and each asserted patent;
  3. For each asserted patent, the time period which plaintiff seeks damages;
  4. If plaintiff is seeking both lost profits and reasonable royalty, the basis for claiming both;
  5. Identification of witnesses and documents plaintiffs rely on to support the damages claims;
  6. If claiming lost profits, the facts to support its theory,  including identity and amount of plaintiff's products on which it claims to have lost profits;
  7. For reasonable royalty, the facts to support its theory, including the date of the hypothetical negotiation, any allegedly comparable licenses, the term of the reasonable royalty sought and any other Georgia-Pacific factors on which plaintiff intends to rely.

Judge Grewal also appreciated that there may be new information that may come to light to drastically alter plaintiff's position, but found that in such a situation, supplementation is appropriate.  In the meantime, at least in Judge Grewal's court, hiding the ball on damages is no longer allowed.

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