Cyntec Company, Ltd. v. Chilisin Electronics Corp. et al

Filing 317

ORDER by Judge Hamilton re post-trial motions.(pjhlc3, COURT STAFF) (Filed on 5/6/2022)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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CYNTEC COMPANY, LTD.,

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Case No. 18-cv-00939-PJH

Plaintiff,

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v.

ORDER RE POST-TRIAL MOTIONS

CHILISIN ELECTRONICS CORP., et al.,

Re: Dkt. Nos. 285, 286, 288, 294

Defendants.

United States District Court
Northern District of California

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Before the court are the post-trial motions filed by the parties in the above-

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captioned case. Defendants Chilisin Electronics Corp. and Chilisin America Ltd.

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(collectively “Chilisin”) filed a renewed motion for judgment as a matter of law under Rule

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50(b) (Dkt. 285) and a motion for a new trial under Rule 59 (Dkt. 286). Plaintiff Cyntec

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Company Ltd. (“Cyntec”) filed a motion for permanent injunction and enhanced damages

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(Dkt. 288). Chilisin also filed a motion to seal in connection with its opposition to Cyntec’s

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motion for permanent injunction and enhanced damages (Dkt. 294). The matters are

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fully briefed and suitable for resolution without oral argument. Having read the papers

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filed by the parties and carefully considered their arguments and the relevant legal

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authority, and good cause appearing, the court rules as follows.

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BACKGROUND
This is a patent case, in which Cyntec filed suit against Chilisin for infringement of

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patents relating to electronic chokes. After a seven-day trial, a jury returned a verdict in

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Cyntec’s favor, finding that Chilisin willfully infringed every asserted claim of the patents-

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in-suit. See Dkt. 269. The jury awarded the full amount of damages sought by Cyntec,

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namely, $1,552,493 in lost profits and $320,463 in reasonable royalties, for a total

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damages award of $1,872,956. See id.
Before the court are the parties’ post-trial motions, as described above.

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DISCUSSION

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Chilisin’s renewed motion for judgment as a matter of law under Rule 50 (Dkt. 285)

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A.

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Legal standard
Judgment as a matter of law is appropriate when “a party has been fully heard on

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an issue during a jury trial and the court finds that a reasonable jury would not have a

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legally sufficient evidentiary basis to find for the party on that issue ....” Fed. R. Civ. P.

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United States District Court
Northern District of California

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50(a)(1); see also Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 149 (2000).
A party must make a motion for judgment as a matter of law under Rule 50(a)

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before a case is submitted to the jury. If the judge denies or defers ruling on the motion,

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and if the jury then returns a verdict against the moving party, the party may renew its

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motion under Rule 50(b). In ruling on the renewed motion, the court may either “allow

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judgment on the verdict, if the jury returned a verdict,” or “order a new trial,” or “direct the

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entry of judgment as a matter of law.” Fed. R. Civ. P. 50(b).

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The standard for judgment as a matter of law “mirrors” that for granting summary

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judgment. Reeves, 530 U.S. at 150. The court “should review all of the evidence in the

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record,” but “may not make credibility determinations or weigh the evidence.” Id.; see

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also Josephs v. Pac. Bell, 443 F.3d 1050, 1062 (9th Cir. 2006). The court should give

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credence to the evidence favoring the non-moving party, as well as that evidence

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supporting the moving party that is uncontradicted and unimpeached, to the extent that it

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comes from disinterested witnesses. Reeves, 530 U.S. at 151.

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The test applied is whether the evidence permits only one reasonable conclusion,

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and that conclusion is contrary to the jury's verdict. Josephs, 443 F.3d at 1062. The

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verdict must be upheld if the evidence is adequate to support the jury’s conclusion, even

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if it is also possible to draw a contrary conclusion from the same evidence. Johnson v.

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Paradise Valley Unified Sch. Dist., 251 F.3d 1222, 1227 (9th Cir. 2001). The court “may
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not substitute its view of the evidence for that of the jury.” Id. (citing Gilbrook v. City of

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Westminster, 177 F.3d 839, 856 (9th Cir. 1999)).
Because it is a renewed motion, a proper post-verdict Rule 50(b) motion is limited

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to the grounds asserted in the pre-deliberation Rule 50(a) motion. Thus, a party cannot

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properly “raise arguments in its post-trial motion for judgment as a matter of law under

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Rule 50(b) that it did not raise in its pre-verdict Rule 50(a) motion.” EEOC v. Go Daddy

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Software, Inc., 581 F.3d 951, 961 (9th Cir. 2009) (citing Freund v. Nycomed Amersham,

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347 F.3d 752, 761 (9th Cir.2003)).
While Rule 50(b) “may be satisfied by an ambiguous or inartfully made motion”

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under Rule 50(a), a party must still put the opposing party and the court on adequate

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notice of the basis for its motion. See Go Daddy Software, 581 F.3d at 961; Freund, 347

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F.3d at 761.

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B.

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Analysis
1.

Infringement
a.

Specific accused products

Chilisin’s first argument is that the court should enter judgment as a matter of law

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“on products Cyntec did not analyze.” Dkt. 285 at 8. Specifically, Chilisin argues that

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fourteen of the 310 accused products contain at least one powder that Cyntec did not

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test. See Dkt. 25 at 8.

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Cyntec first responds that Chilisin has waived its argument with respect to the

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fourteen accused products in question by not raising it as part of its original Rule 50(a)

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motion. See Dkt. 297 at 8 (citing Trial Transcript (Trial Tr.) at 866:1-879:21, 1260:10-

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1262:23). Cyntec further argues that Chilisin’s argument fails on the merits, because

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Cyntec’s expert, Dr. Paul Kohl, testified that he analyzed the characteristics of all

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accused products, including the fourteen products in Chilisin’s motion.

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The court agrees that Chilisin’s Rule 50(a) motion did not raise the issue of

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whether Cyntec failed to test powders included in fourteen of the accused products.

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Chilisin’s first Rule 50(a) motion on August 27, 2021 did not raise the argument, nor did
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Chilisin’s “renewed” Rule 50(a) motion on August 31, 2021 raise the issue. See Trial Tr.

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vol. 5 (Dkt. 260) at 866-81; vol. 7 (Dkt. 266) at 1260-63. Accordingly, this argument is

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waived and may not be raised on this renewed motion under Rule 50(b). See Freund,

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347 F.3d at 761.

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Moreover, even if the court were to consider the merits of Chilisin’s motion on this

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issue, giving credence to the evidence of the non-moving party, Chilisin has not shown

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that the evidence permits only one reasonable conclusion, and that conclusion is contrary

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to the jury's verdict. As Cyntec argued, its expert testified that he reviewed the material

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specifications for each of the powders used in the accused products, and that “the larger
alloy powder is harder in every case than the smaller iron powder.” See Trial Tr. vol. 3

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Northern District of California

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(Dkt. 255) at 378:25-379:2, 404:1-19.

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Accordingly, Chilisin’s renewed motion for judgment as a matter of law is DENIED

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as to its argument that Cyntec did not prove infringement for fourteen of the accused

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products.

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b.

Infringement of the ’037 patent by direct sales

Next, Chilisin argues that the court should grant judgment as a matter of law that

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direct sales do not infringe the ’037 patent. See Dkt. 285 at 9. Chilisin argues that the

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’037 patent is a method patent, and that “there is no dispute Chilisin manufactures the

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accused chokes entirely outside of the United States,” and “thus Cyntec’s only viable

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theory at trial was that Chilisin induced others to import chokes.” Id.

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Chilisin’s argument relies on a quotation from Cyntec’s counsel during trial stating

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that “with regard to the ’037 patent, we are only asserting induced infringement.” See

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Dkt. 285 at 9 (citing Trial Tr. vol. 5 at 868:23-869:3). However, the full trial transcript

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shows that Cyntec’s counsel corrected himself, stating “with regards to the ’037 patent . .

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. we did assert [direct] infringement under 271(g) in our infringement contentions, just to

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be clear.” See Trial Tr. vol. 5 (Dkt. 260) at 869:18-23.

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Cyntec’s opposition brief further argues that, after the hearing, Cyntec clarified
with Chilisin via email that it had not withdrawn or waived its claim for direct infringement
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under section 271(g), and cited portions of its pretrial papers disclosing the substance of

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the theory. See Dkt. 297 at 11 (citing Dkt. 298, Ex. 3). Cyntec argues that “Chilisin did

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not respond to that email or dispute its contents.” Id. at 11.

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In its reply, Chilisin does not discuss Cyntec’s corrective statement in the trial

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transcript or the email sent by Cyntec to Chilisin after the Rule 50(a) hearing, instead only

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arguing that Cyntec has waived its argument for infringement under section 271(g). See

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Dkt. 306 at 8. Chilisin further argues, for the first time in reply, that “the court never

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instructed the jury on relevant exceptions to section 271(g), such as the exception that a

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product is non-infringing if it becomes ‘a trivial and non-essential component of another
product.’” Id. at 9. However, Chilisin provides no basis for the court to conclude that

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such an instruction would have been relevant on the “trivial and non-essential

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component” exception, such that a reasonable jury would not have a legally sufficient

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evidentiary basis to find for Cyntec on that issue.

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Because Chilisin’s motion on this issue is premised on its argument that “Cyntec’s

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theory for the ’037 patent was limited to inducement,” (See Dkt. 285 at 9) and because

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the record shows that Chilisin was aware of Cyntec’s intent to proceed under a theory of

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direct infringement under section 271(g), Chilisin’s motion is DENIED.

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c.

The “by means of” limitation

Chilisin’s next argument is that Cyntec has not shown that Chilisin infringed the “by

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means of” element of the asserted claims. Chilisin first re-argues the substance of its

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claim construction argument, that hardness must be the primary factor affecting the

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formation temperature, rather than having just an “effect or impact” on the temperature.

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See Dkt. 285 at 10.

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As an initial matter, Cyntec correctly points out that Chilisin’s original Rule 50(a)

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motion did not ask the court to amend its original claim construction. See Trial Tr. at

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873:20-23. However, in its reply, Chilisin acknowledges that it “is not seeking

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reconsideration here,” and clarifies that it is discussing the claim construction as

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background “because it is the first step in performing an infringement analysis.” See Dkt.
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306 at 10. Given the representations in Chilisin’s reply, the court will not address the

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substance of Chilisin’s argument regarding claim construction of the “by means of” term.

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Chilisin next argues that “Cyntec failed to show hardness has an impact on the

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accused chokes’ formation temperature.” See Dkt. 285 at 11. Specifically, Chilisin

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argues that “[g]iven that the causal relationship between hardness difference and

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formation temperature was expressly claimed, under the court’s construction, Cyntec

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must prove that the hardness difference in Chilisin’s products is a cause of their lower

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formation temperature.” Id.

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Northern District of California

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Chilisin then provides a more robust version of its current argument:
In order to understand Cyntec’s lack of proof, it is instructive to review the
portion of the trial transcript where Cyntec’s expert actually analyzed the
disputed limitation. When Cyntec’s infringement expert performed his
analysis of “limitation 1E” of the ’312 patent (the “by means of” limitation),
he only relied on a single piece of evidence: Exhibit 50. Cyntec’s expert
testified that Exhibit 50 shows Chilisin’s mixed powder chokes have better
performance than a single-powder choke without annealing, but that does
not answer the critical question: what caused that better performance and
lack of annealing? Was it the size differences between the magnetic
powders, was it the hardness difference, or was it something else? Exhibit
50 does not say, and indeed the exhibit says nothing about hardness
whatsoever. There is also nothing in Exhibit 50 about formation
temperature, and nothing about what caused a given product to form at a
given temperature.
Cyntec’s analysis for claim 1 of the ’037 patent was even more sparse. Its
expert gave ipse dixit testimony that hardness has an impact on formation
temperature, but for support he referred back to his prior testimony on claim
1 of the ’312 patent. As noted, that prior testimony relied on a single exhibit
that says nothing about hardness and nothing about formation temperature.
This was Cyntec’s entire analysis of this critical, disputed limitation, and it
was plainly deficient. At most, Cyntec’s expert showed the accused chokes
have certain performance characteristics, but its own asserted patents say
those same performance characteristics could be caused by size
differences, not hardness differences.
See Dkt. 285 at 11-12 (emphasis added and internal citations omitted).
Chilisin’s current argument bears little resemblance to the argument made in its

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Rule 50(a) motions. This was the substance of Chilisin’s initial Rule 50(a) motion on

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August 27, 2021:
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No infringement of any claim that includes the "by means of" limitation. We
have had this argument with plaintiffs a number of times. We think the claim
is clear.
Prior to the trial, all the witnesses seemed to agree that the claim related to
the forming step and that the differences in hardness of the particles has to
impact the temperature at which the choke is formed. All of the evidence is
that the chokes are formed at room temperature regardless of the powders
that are used. There can be no infringement of that step if the chokes with
a single powder are molded at room temperature and the chokes with a
dual powder are molded at room temperature.
…
And their argument that you don't have to later perform an annealing step to
meet the performance characteristics of a customer is nowhere in the claim,
and we don't think any reasonable jury can conclude the products infringe.
Trial Tr. vol. 5 (Dkt. 260) at 873:16-874:3, 874:9-13 (emphasis added).
During the hearing on Chilisin’s “renewed” Rule 50(a) motion on August 31,
Chilisin simply reasserted its original grounds for the motion:
You know this one is coming, the no infringement of the "by means of"
limitation of the ’312 and ’037 patent. There is no way for Cyntec to prove,
and they have not proven, that we infringed the "by means of" limitation
under the Court's interpretation of that term.
Trial Tr. vol. 7 (Dkt. 266) at 1261:11-15.

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To summarize, the argument made in Chilisin’s Rule 50(a) motion was an

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argument that there was no temperature change in the first place, because “the chokes

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are formed at room temperature.” Trial Tr. vol. 5 (Dkt. 260) at 873:20-25. That was also

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the argument made during Chilisin’s closing argument to the jury. See, e.g., Trial Tr. vol.

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7 (Dkt. 266) at 1219:21-1221:25 (“All the chokes are molded at room temperature, and,

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therefore, the hardness difference has no impact on the temperature at which the choke

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is formed or molded.”)

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Chilisin’s current argument on its Rule 50(b) motion is a causation argument,

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arguing that any “performance characteristics” such as a lower temperature were not

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necessarily caused by a hardness difference, but could have been caused by a size

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difference or other difference(s). See, e.g., Dkt. 285 at 13 (“Nothing in Cyntec’s evidence

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shows whether it was size, hardness, or something else that led to the formation
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temperatures used for each accused product.”). This was an argument that Chilisin

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made, and the court rejected, during summary judgment. See, e.g., Dkt. 170 at 20-22

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(“Defendants offer one broad argument as to why their devices do not infringe on

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plaintiff’s claims: there is no evidence that forming the magnetic body of the choke at a

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temperature lower than the melting point of the wire is the result of the hardness

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difference between two magnetic powders used to form the choke.”) (“defendants argue

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that Kohl’s opinion does not differentiate between the size difference and the hardness

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difference as having the desired effect”).

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As a threshold matter, the court concludes that Chilisin’s current Rule 50(b) motion
on the “by means of” issue is based on an entirely different premise than its Rule 50(a)

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Northern District of California

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motion. Given that Rule 50(b) specifically provides that any motion be a “renewed” Rule

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50(a) motion, the shifting-sands nature of Chilisin’s “by means of” argument creates a

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procedural hurdle in that it now “raise[s] arguments in its post-trial motion for judgment as

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a matter of law under Rule 50(b) that it did not raise in its pre-verdict Rule 50(a) motion.”

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Go Daddy Software, 581 F.3d at 961 (citing Freund, 347 F.3d at 761). For that reason

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alone, the court concludes that Chilisin’s Rule 50(b) motion must be DENIED as to the

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“by means of” issue.

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Moreover, even if the court were to reach the merits of the “by means of” issue,

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the record shows that this issue is not suited for judgment as a matter of law. Chilisin’s

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own motion argues that the “testimony at trial confirmed that both size and hardness

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difference may impact formation temperature,” and that under the court’s construction,

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Cyntec need only show that hardness have “an effect or impact,” even if it is not “the

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primary or most significant factor.” See Dkt. 285 at 10, 13; see also, e.g., Trial tr., vol. 3

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(Dkt. 255) at 394:5-8, 404:14-17, 405:5-13. Based on the trial testimony, the jury found

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that Chilisin’s accused products did meet the “by means of” limitation, and Chilisin has

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given the court no basis to conclude that “the evidence permits only one reasonable

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conclusion, and that conclusion is contrary to the jury's verdict.” Instead, Chilisin appears

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to be asking the court to conduct its own weighing of the evidence and to reach a
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conclusion contrary to the jury’s. Accordingly, even if the court were to reach the merits

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of Chilisin’s argument, Chilisin does not satisfy the standard for judgment as a matter of

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law under Rule 50(b).

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Chilisin makes an additional argument that Cyntec’s infringement theory “relies on

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irrelevant evidence.” See Dkt. 285 at 14. As before, Chilisin’s argument is primarily one

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of causation. It argues that “[a]ll of Cyntec’s evidence, including its own internal testing,

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varied both size and hardness together,” and thus, “it is impossible for Cyntec to say

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which of the two caused the lower formation temperatures it observed.” Id. at 15.

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Chilisin again asks, “what causes reduced formation temperatures? Is it size differences,

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hardness differences, or something else entirely?” Id.
For the same reasons discussed above, the parties presented evidence regarding

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the effect of the hardness difference on the formation temperature, and the jury found

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that the accused products fell within the scope of the claim as construed by the court.

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Chilisin has provided no basis for concluding that “the evidence permits only one

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reasonable conclusion, and that conclusion is contrary to the jury's verdict.” Accordingly,

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for the same reasons mentioned above, even if the court were to reach the merits of

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Chilisin’s argument on the “by means of” issue, Chilisin does not satisfy the standard for

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judgment as a matter of law under Rule 50(b).

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2.

Damages
a.

Lost profits

Next, Chilisin argues that the court should grant judgment as a matter of law of no

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lost profits damages. See Dkt. 285 at 16. Specifically, Chilisin raises three arguments

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regarding lost profits. First, Chilisin argues that Cyntec “presented no evidence it would

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have made all the sales it purportedly lost to Chilisin in the ‘but for’ world.” See id. at 16.

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Next, Chilisin argues that “Cyntec’s market share analysis is unfounded.” Id. at 18.

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Finally, Chilisin argues that “Cyntec’s importation percentages are unfounded.” Id. at 21.

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As an initial matter, only one damages-related argument was raised in Chilisin’s
first Rule 50(a) motion on August 27, 2021. See Trial Tr. vol. 5 (Dkt. 260) at 866-77.
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Specifically, the only damages-related issue raised at the August 27 hearing was the

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issue related to importation of the accused products manufactured outside of the United

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States. See id. at 876:13-879:7.
However, when Chilisin made its “renewed” Rule 50(a) motion on August 31,

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2021, it stated that it was raising “two damages issues.” See Trial Tr. vol. 7 (Dkt. 266) at

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1261:16-19. The first issue was “no damages for any – all of the sales made outside of

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the United States.” Id. Chilisin’s counsel then stated:
Second damages issue, no lost profits, failure by Cyntec to prove the share
of sales that Cyntec would have made but for Chilisin’s sale of the accused
products.

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Id. at 1261:20-22.
Given that Rule 50(a) provides that a motion “may be made at any time before the

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case is submitted to the jury,” the court concludes that the additional damages-related

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issue raised by Chilisin at the August 31 hearing is properly included within the scope of

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the present Rule 50(b) motion. And as the court understands it, that “second damages

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issue” raised at the August 31 hearing corresponds with the first issue raised in Chilisin’s

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present motion, namely, that Cyntec “presented no evidence it would have made all the

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sales it purportedly lost to Chilisin in the ‘but for’ world.”

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However, neither of Chilisin’s Rule 50(a) motions raised the issues that Chilisin

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now raise regarding the Cyntec’s market share analysis – specifically, the contentions

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that Cyntec failed to “accurately defin[e] the relevant market” and to “recreate sales for

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the entire marketplace for the relevant damages period.” See Dkt. 285 at 20-21.

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Because these were not arguments raised in any Rule 50(a) motion, the court concludes

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that they are waived, and Chilisin’s Rule 50(b) motion is DENIED to the extent it is based

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on challenging Cyntec’s market share analysis.1 And to the extent that Chilisin did

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preserve a general “market share” argument by using the word “share” at the August 31

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Moreover, even if the court were to consider the merits of a standalone argument
regarding Cyntec’s market share analysis, its argument would fail for the same reasons
as its arguments regarding the but-for analysis, as discussed below.
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hearing, the court concludes that such argument overlaps with Chilisin’s first argument

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that Cyntec failed to prove that it would have made sales “but-for” the infringement. See

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Trial Tr. vol. 7 (Dkt. 266) at 1261:16-22 (asserting argument of “failure by Cyntec to prove

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the share of sales that Cyntec would have made but for Chilisin’s sale of the accused

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products.”).

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That leaves two issues for the court’s analysis: (1) the but-for analysis, and (2) the

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importation rate issue. On issue (1), Chilisin argues that Cyntec must show that it would

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have made Chilisin’s sales “but for” the alleged infringement, and Chilisin argues that

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“Cyntec cannot meet this burden because it introduced no evidence that its products
were qualified as replacements for all of Chilisin’s 310 accused chokes.” See Dkt. 285 at

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16. Chilisin also argues that “Cyntec’s lost profits theory is fatally flawed because Cyntec

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introduced no evidence at trial that it had gone through a ‘design win’ process to sell

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chokes to all of the customers who purchased the accused Chilisin chokes.” Id. at 17.

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In its opposition, Cyntec argues that “Chilisin’s argument is incorrect because it

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ignores the fact that Cyntec proffered evidence at trial showing that Cyntec was the

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market incumbent, not Chilisin, and that Chilisin was trying to copy Cyntec products that

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had already been qualified by brand companies.” See Dkt. 297 at 18. Cyntec then cites

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numerous trial exhibits showing “Chilisin discussing its efforts to ‘cross’ (meaning copy)

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Cyntec’s patented products.” Id. (citing exhibits).

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The court agrees that the evidence at trial included many examples of Chilisin

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discussing efforts to make their products in line with the specifications of Cyntec’s

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products. See, e.g., Trial Ex. 122 (“will mettle same dimensions with Cyntec’s . . . we will

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try to meet theirs as close as possible.”); Trial Ex. 1363 (products’ “characteristics need

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to completely match Cyntec characteristics”); Trial Ex. 57 (products “need to be exactly

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the same (sorry, no room for negotiation because the client prefers Cyntec)”.) Given that

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evidence, there was more than a reasonable basis for the jury to conclude that Cyntec

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would have made Chilisin’s sales but for the alleged infringement. Accordingly, Chilisin’s

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motion is DENIED on this issue.
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Turning to issue (2) regarding the importation rate, Chilisin argues that “Cyntec

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gave the jury no reliable evidence regarding importation rates.” See Dkt. 285 at 21.

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Chilisin first challenges the SEC data cited by Cyntec’s expert, arguing that it does not

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break down importation rates on a product-by-product basis. Id. Chilisin then further

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challenges data from the Gartner research firm, arguing that it is “irrelevant.” Id. at 22.

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In its opposition, Cyntec first argues that it is required to prove damages only to a
“reasonable certainty, not mathematical precision.” See Dkt. 297 at 22. Cyntec then

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argues that even Chilisin’s own witnesses confirmed the reliability of data from the

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Gartner firm. See Dkt. 297 at 22. Cyntec argues that ‘[w]hat Chilisin is doing is

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challenging the weight that should be placed on the Gartner data,” which is “not

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acceptable at this stage of the proceeding” when the court “may not weigh the evidence

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or assess credibility.” Id. Cyntec further argues that its damages expert considered the

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Gartner data, which did provide specific information on types of products, in conjunction

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with the SEC filings “to confirm the accuracy and reasonableness of the importation

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information.” Id.

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The court concludes that Chilisin is asking the court to substitute its view for that of

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the jury here. The parties presented their competing arguments regarding whether

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Cyntec had proven damages to a reasonable certainty, and the jury found that the

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importation data to be sufficiently reliable on which to base a damages award. There

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was substantial evidence for the jury’s verdict, and it is not the case that the evidence

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permitted only one reasonable conclusion, which is contrary to the jury’s verdict.

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Accordingly, Chilisin’s Rule 50(b) motion is DENIED on this issue.

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b.

Royalty base and rate

Chilisin then argues that “the court should grant judgment as a matter of law on
Cyntec’s royalty base and rate.” See Dkt. 285 at 24.
First, Chilisin argues that “the court should limit Cyntec’s royalty base” because

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“over 95% of Cyntec’s reasonable royalty damages base came from estimated

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importation by third parties.” Dkt. 285 at 24. Chilisin argues that the “importation
12

1

percentages are speculative,” and thus judgment as a matter of law should be granted to

2

remove those sales from the royalty base.

3

This argument is the same in substance as the importation-rate argument made in

4

connection with lost-profits damages, and the court rejects it for the same reason.

5

Cyntec did provide evidence regarding importation rates, and the jury accepted that

6

evidence, and the court finds no basis to overturn the jury’s verdict on this issue. Thus,

7

Chilisin’s Rule 50(b) motion is DENIED as to the royalty base issue.

8
9
10

United States District Court
Northern District of California

11

Next, Chilisin argues that “the court should limit Cyntec’s royalty rate.” See Dkt.
285 at 25. Chilisin argues that “Cyntec has no valid support” for the 5% royalty rate
awarded by the jury. Id.
Chilisin did not raise any issue related to the royalty rate in either of its Rule 50(a)

12

motions. See Trial Tr. vol. 5 (Dkt. 260) at 866-881, vol. 7 (Dkt. 266) at 1260-1263.

13

Thus, the court finds that this issue is waived, and may not be raised on a renewed Rule

14

50(b) motion, and Chilisin’s motion is DENIED as to the royalty rate issue.
c.

15

Damages period

16

Next, Chilisin argues that “the court should grant judgment as a matter of law

17

limiting the damages period.” See Dkt. 285 at 26. Chilisin argues that “all damages

18

should start on December 17, 2017, the date Chilisin first received notice of the asserted

19

patents.” Id.

20

Regarding direct sales, Chilisin’s argument is based on its earlier argument that

21

“Cyntec’s infringement theory for the ’037 patent was that Chilisin induced others to

22

import infringing chokes.” See Dkt. 285 at 26. However, as discussed above, Chilisin

23

relies on a single quote from Cyntec’s counsel that he corrected at the same hearing (in

24

fact, the correction is on the same page of the trial transcript as the initial misstatement).

25

See Trial Tr. vol. 5 (Dkt. 260) at 869. Thus, this argument is rejected for the same

26

reasons discussed above, Chilisin’s Rule 50(b) motion is DENIED to the extent it seeks

27

to exclude damages for the ’037 patent from before December 17, 2017.

28

Chilisin’s remaining arguments on this issue are arguments that were not raised
13

1

during either of its Rule 50(a) motions, and are being raised for the first time on this Rule

2

50(b) motion. Specifically, Chilisin argues that damages for direct sales under the ’312

3

patent cannot begin before December 2017 because Cyntec’s products were not marked

4

with its patent numbers, and further argues that indirect sales damages should not begin

5

until December 2017. See Dkt. 285 at 27.

6

As discussed above, the only damages-related issues raised in Chilisin’s Rule

7

50(a) motions related to (1) importation rates, and (2) the but-for analysis. Because

8

Chilisin may not raise arguments on this motion that were not raised in its Rule 50(a)

9

motions, Chilisin’s motion on these other issues regarding limitation of the damages

10

period is DENIED.

United States District Court
Northern District of California

11

3.

Willfulness

12

Finally, Chilisin argues that the court should grant judgment as a matter of law of

13

no willful infringement. Chilisin argues that willful infringement requires “egregious cases

14

of misconduct beyond typical infringement,” and argues that the standard is not met here.

15

See Halo Elecs., Inc. v. Pulse Elecs., Inc., 136 S.Ct. 1923, 1935 (2016).

16

When Chilisin initially moved for judgment as a matter of law on August 27, 2021,

17

the parties appeared to agree that Cyntec’s willfulness claim would be limited to the time

18

after December 2017. Specifically, Cyntec’s counsel stated that “[t]he willfulness claim,

19

Your Honor, we would limit to after receipt of the notice letter.” Trial Tr. vol. 5 (Dkt. 260)

20

at 872:13-14; see also id. at 872:20-22 (“And so we believe that willfulness would be

21

proper after the receipt of the letter, and we would be willing to limit our willfulness case

22

to the date period after that.”)

23

Cyntec now argues that Chilisin “withdrew its motion” as a result of the previous

24

exchange, and thus “abandoned its motion on this issue,” preventing it from raising the

25

argument on this motion. See Dkt. 297 at 26.

26

However, at the August 31 hearing, when Chilisin re-asserted its Rule 50(a)

27

motion, it continued to assert a willfulness argument. Specifically, Chilisin argued on its

28

‘renewed’ Rule 50(a) motion: “Third is the no willfulness, no evidence of any willful,
14

1

wanton, malicious, bad faith, deliberate, consciously wrong, flagrant, or characteristic of a

2

pirate behavior.” Trial Tr. vol. 7 (Dkt. 266) at 1261:7-9.
Because Chilisin continued to assert its willfulness argument even after the parties

3
4

agreed to limit the temporal scope of Cyntec’s willfulness claim, the court concludes that

5

Chilisin has not waived or abandoned its argument on willfulness.
On the merits, Chilisin now argues that willful infringement requires “egregious

6
7

cases of misconduct beyond typical infringement” and that “there is no evidence that

8

anything egregious happened” in this case. See Dkt. 285 at 27.
Cyntec points to numerous trial exhibits showing that Chilisin intended to copy

9

Cyntec’s products, including emails stating that their products “need to completely match

11
United States District Court
Northern District of California

10

Cyntec characteristics” because clients “prefer Cyntec.” See Dkt. 297 at 27 (citing trial

12

exhibits). Cyntec argues that the evidence presented at trial was “more than adequate

13

evidence on which the jury could find willful infringement,” and the court agrees. That

14

evidence will be discussed more fully below, in the context of Cyntec’s motion for

15

permanent injunction and enhanced damages.

16

As before, Chilisin appears to be asking the court to weigh the evidence differently

17

than the jury did, rather than meeting its burden under Rule 50 to show that the evidence

18

permits only one reasonable conclusion, and that conclusion is contrary to the jury's

19

verdict. Accordingly, Chilisin’s Rule 50(b) motion is DENIED as to willfulness.
For the reasons discussed above, Chilisin’s motion for judgment as a matter of law

20
21

under Rule 50(b) is DENIED in full.

22

Chilisin’s motion for new trial under Rule 59 (Dkt. 286)

23

A.

24

Legal standard
Whether to grant a new trial is a matter of the trial court’s discretion. City

25

Solutions, Inc. v. Clear Channel Communications, 365 F.3d 835, 843 (9th Cir. 2004).

26

The court may grant a motion for a new trial even if the verdict is supported by substantial

27

evidence, if it concludes that the verdict is contrary to the clear weight of the evidence, is

28

based on evidence which is false, or would result in a miscarriage of justice. Silver Sage
15

1

Partners, Ltd. v. City of Desert Hot Springs, 251 F.3d 814, 819 (9th Cir. 2001); see also

2

Molski v. M.J. Cable, Inc., 481 F.3d 724, 729 (9th Cir. 2007). The court may weigh the

3

evidence and may evaluate the credibility of the witnesses, and is not required to view

4

the evidence from the perspective most favorable to the prevailing party. United States v.

5

Kellington, 217 F.3d 1084, 1095 (9th Cir. 2000).
However, where a movant claims that a verdict is against the clear weight of the

6

evidence, doubts about the correctness of the verdict are not sufficient grounds for a new

8

trial. Landes Constr. Co., Inc. v. Royal Bank of Canada, 833 F.2d 1365, 1372 (9th Cir.

9

1987). “Courts are not free to reweigh the evidence and set aside the jury verdict merely

10

because the jury could have drawn different inferences or conclusions or because judges

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United States District Court
Northern District of California

7

feel that other results are more reasonable.” Tennant v. Peoria & Pekin Union Ry. Co.,

12

321 U.S. 29, 35 (1944). The trial court, after having given full respect to the jury's

13

findings, must have a definite and firm conviction that the jury has made a mistake.

14

Landes Constr. Co., 833 F.2d at 1371-72 (citations omitted).

15

B.

16

Analysis
Chilisin’s first argument is that, if the court denies Chilisin’s Rule 50(b) motion, it

17

alternatively requests a new trial on each issue. For the same reasons set forth in the

18

court’s denial of Chilisin’s Rule 50(b) motion, and for the additional reason that Chilisin

19

has not met its burden to show that the judgment on any issue contradicts the clear

20

weight of the evidence, the court also DENIES Chilisin’s Rule 59 motion for a new trial to

21

the extent it is based on the same grounds raised in the Rule 50(b) motion.

22

Chilisin also raises two additional grounds for seeking a new trial: (1) invalidity of

23

the patents-in-suit for anticipation and obviousness, and (2) remittitur as an alternative to

24

a new trial on damages. See Dkt. 286 at 5.

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1.

Invalidity
a.

Anticipation

Regarding invalidity by anticipation, Chilisin first argues that it “established at least
a triable case of anticipation by inherency.” See Dkt. 286 at 8. Chilisin points to the
16

1

Shafer reference as disclosing “a first powdered iron” and “a second powdered iron” with

2

“differing electrical characteristics . . . to maximize its efficiency.” See id. Chilisin further

3

argues that “Cyntec’s arguments at trial against Schafer [sic] never foreclosed

4

anticipation or inherency as a matter of law.” See Dkt. 286 at 10.
In its opposition, Cyntec argues that Chilisin had the burden to show anticipation

5
6

by clear and convincing evidence, not just the “mere possibility” of anticipation. See Dkt.

7

296 at 7-8 (citing ATEN Int’l Co. v. Uniclass Tech. Co., 932 F.3d 1364, 1368 (Fed. Cir.

8

2019)). Cyntec further argues that an “anticipation by inherency” argument requires the

9

evidence to “make clear that the missing descriptive matter is necessarily present.” Dkt.
296 at 8 (emphasis added by Cyntec); see also Allergan, Inc. v. Apotex Inc., 754 F.3d

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United States District Court
Northern District of California

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952, 960-61 (Fed. Cir. 2014); Finnigan Corp. v. Int’l Trade Comm’n, 180 F.3d 1354, 1365

12

(Fed. Cir. 1999) (inherency “may not be established by probabilities or possibilities. The

13

mere fact that a certain thing may result from a given set of circumstances is not

14

sufficient.”).
Given the high standard to show anticipation by clear and convincing evidence,

15
16

the court concludes that Chilisin has not met its burden to show the right to a new trial on

17

anticipation, and thus Chilisin’s motion is DENIED as to invalidity by anticipation.
b.

18

Obviousness

Regarding invalidity by obviousness, Chilisin argues that its expert explained why

19
20

the Shafer reference, in combination with the Nakamura reference or other references,

21

would have rendered the asserted claims obvious. See Dkt. 286 at 11. Chilisin further

22

argues that its expert “demonstrated a motivation to combine Shafer with Nakamura.” Id.

23

at 12.

24

In its opposition, Cyntec argues that “the evidence demonstrated that there was no

25

motivation to combine the Shafer and Nakamura references,” because “the high

26

temperature treatment discussed in Nakamura was for a wholly different reason than the

27

ones discussed” in the patents-in-suit. See Dkt. 296 at 11 (citing Forest Labs., LLC v.

28

Sigmapharm Labs., LLC, 918 F.3d 928, 934 (Fed. Cir. 2019)). Cyntec also argues that
17

1

Chilisin’s own expert “acknowledged that the central problem that the inventors of the

2

’037 and ’312 patents sought to solve was not at issue at all in the Nakamura reference.”

3

Dkt. 296 at 12.
As with anticipation, given the high standard of clear and convincing evidence that

4
5

needs to be met by a party asserting obviousness, the court concludes that Chilisin has

6

not met its burden to show the right to a new trial on obviousness, and thus Chilisin’s

7

motion is DENIED as to invalidity by obviousness.
2.

9

Chilisin’s final argument on this motion is that “the court should order remittitur.”

10

See Dkt. 286 at 14. Chilisin explains that this motion is based on the same arguments

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United States District Court
Northern District of California

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Remittitur

made in its Rule 50(b) motion related to (1) lost profits, and (2) the royalty rate. Id. The

12

court concludes that Chilisin has not met its burden to show that the jury’s verdict on

13

these issues is contrary to the clear weight of the evidence, and thus Chilisin’s motion is

14

DENIED.
For the reasons discussed above, Chilisin’s motion for a new trial under Rule 59 is

15
16

DENIED in full.

17

Cyntec’s motion for permanent injunction and enhanced damages (Dkt. 288)

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A.

Motion for permanent injunction

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1.

Legal standard

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A patentee seeking a permanent injunction must make a four-part showing: (1) it

21

suffered an irreparable injury; (2) remedies available at law, such as monetary damages,

22

are inadequate to compensate for that injury; (3) the balance of hardships between the

23

plaintiff and defendant shows that a remedy in equity is warranted; and (4) the public

24

interest would not be disserved by a permanent injunction. eBay v. MercExchange,

25

L.L.C., 547 U.S. 388, 391 (2006).

26
27
28

2.

Analysis

Cyntec argues that all four factors weigh in favor of granting an injunction in this
case. As an initial matter, Chilisin asks the court to stay resolution of Cyntec’s motion
18

1

while it attempts to seek production of an alleged agreement with Apple. See Dkt. 294-6

2

at 24-26. Chilisin’s attempt to seek discovery on that issue has already been denied, and

3

the court will not stay consideration of Cyntec’s motion on that basis. See Dkt. 304.

4
5

a.

Irreparable harm

On the first factor, Cyntec argues that it has suffered irreparable harm and will

6

continue to do so unless Chilisin is enjoined. See Dkt. 288-1 at 12. Cyntec argues that

7

courts have found irreparable harm have considered factors such as (1) whether the

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United States District Court
Northern District of California

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patentee and alleged infringer are in direct competition, (2) whether the patentee lost
market share due to the competition, (3) whether the patentee was unwilling to license its
technology, and (4) whether the alleged infringement affected the patentee’s ability to
compete in the design win process. See Dkt. 288-1 at 12-16 (citing Broadcom Corp. v.
Emulex Corp., 732 F.3d 1325, 1336 (Fed. Cir. 2013); Douglas Dynamics, LLC v. Buyers
Prods. Co., 717 F.3d 1336, 1345 (Fed. Cir. 2013); i4i Ltd. v. Microsoft Corp., 598 F.3d
831, 861 (Fed. Cir. 2010)).
Regarding direct competition, Cyntec cites a number of trial exhibits showing that
Chilisin sought to directly compete with Cyntec. See Dkt. 288-1 at 13-14 (citing, e.g.,
Trial Ex. 1363 (Chilisin email stating that products “need to completely match Cyntec
characteristics”), Trial Ex. 117 (Chilisin stating “we have lowering our cost than their
major supplier (Cyntec) in order to get into the business”)).
Cyntec also argues that the design win process leads to an “incumbency effect”
which compounds the harm to the patentee. See Dkt. 288-1 at 14-16 (citing Broadcom,
732 F.3d at 1336).
In its opposition, Chilisin first argues that Cyntec’s delay in bringing this lawsuit

23

shows a lack of irreparable harm. See Dkt. 294-6 at 12-14. As to direct competition,

24

Chilisin argues that “the actual scope of competition is unclear.” Id. at 14. Chilisin then

25

argues that it “did not engage in predatory pricing” and that “Cyntec’s copying evidence is

26

irrelevant.” Id. at 17-18.

27
28

In its reply, Cyntec argues that Chilisin has not presented evidence of any delay.
See Dkt. 307 at 3. Cyntec argues that it sent a demand letter to Chilisin in December
19

1

2017, and then filed suit three months later. Id. Cyntec argues that there is no evidence

2

that, prior to that, Cyntec had obtained the accused products and analyzed them for

3

infringement. Id.

4

Overall, the court concludes that the first factor weighs in favor of an injunction.

5

Chilisin’s arguments do not undermine the extensive evidence at trial that Chilisin did

6

directly compete with Cyntec, including through the design win process. In particular, the

7

fact that Chilisin designed its products to “completely match Cyntec characteristics”

8
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10

United States District Court
Northern District of California

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shows that the parties were in competition. See Trial Ex. 1363; see also Trial Ex. 122
(“will mettle same dimensions with Cyntec’s . . . we will try to meet theirs as close as
possible.”); Trial Ex. 57 (products “need to be exactly the same (sorry, no room for
negotiation because the client prefers Cyntec)”.) The court further notes that the Federal
Circuit has considered a jury award of lost profit damages to be an implicit finding of
direct competition. See Presidio Components, Inc. v. American Technical Ceramics
Corp., 702 F.3d 1351, 1363 (Fed. Cir. 2012). The court thus concludes that Cyntec has
shown that it would suffer irreparable harm in the absence of an injunction.
b.

Adequacy of monetary damages

As to the second eBay factor, Cyntec argues that monetary damages are
inadequate to compensate it for ongoing and future infringement. See Dkt. 288-1 at 1618. Cyntec argues that monetary damages cannot remedy Cyntec’s loss of customer
goodwill and exclusivity, and that the full extent of Chilisin’s infringement “defies
valuation.” Id. In particular, Cyntec focuses on the fact that it has never licensed its
patents to any third party, “electing instead to enjoy the exclusivity offered by its patent
rights.” Id. at 16 (citing Dkt. 288, Ex. C at 159-60).
In its opposition, Chilisin argues that “the scope of proven harm is limited,” and
that “Cyntec offers no proof of lost exclusivity or goodwill.” See Dkt. 294-6 at 20-22.
Overall, the court concludes that the second factor weighs in favor of an injunction.

26

In particular, the court notes that Cyntec was unwilling to license patents-in-suit, and

27

Chilisin does not appear to respond to that argument. The court thus concludes that

28

Cyntec has shown that monetary damages are inadequate to compensate it for Chilisin’s
20

1
2
3

infringement.
c.

Balance of hardships

As to the third eBay factor, Cyntec argues that the balance of hardships tips in

4

favor of an injunction. See Dkt. 288-1 at 18-19. Cyntec points to trial testimony showing

5

the relative importance of the patented technology to Cyntec’s business, as well as

6

testimony showing that Chilisin is a more diversified business. Id.

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United States District Court
Northern District of California

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In its opposition, Chilisin argues that Cyntec is a wholly-owned division of a
company that is larger than Chilisin. See Dkt. 294-6 at 22. Chilisin also argues that “the
parties’ settlement history shows a lack of any need for court intervention.” Id. at 23.
Overall, the court concludes that the third eBay factor weighs in favor of an
injunction. Cyntec’s evidence has shown the hardships that it would face in the absence
of an injunction, and Chilisin has not presented evidence that it would suffer harm that
would tip the balance of hardships in its favor. Accordingly, the court concludes that
Cyntec has shown that the balance of hardships favors an injunction.
d.

Public interest

As to the fourth eBay factor, Cyntec argues that the public interest favors
“upholding Cyntec’s patent rights and granting the narrow injunction.” See Dkt. 288-1 at
19-20. Cyntec emphasizes the fact that the proposed injunction is “narrowly tailored,
takes effect prospectively, and applies only to Chilisin (and not its customers).” Id. at 19.
Cyntec argues that the limited nature of the proposed injunction ensures that “the
products that are already in Chilisin’s customers’ hands do not need to be destroyed, and
customers may continue to use them without any restrictions.” Id.
Cyntec further argues that the infringing products are not “goods which require any

23

deferential treatment, such as medical devices or other items that may raise health and

24

safety concerns.” See Dkt. 288-1 at 20. Cyntec also argues that an injunction would not

25

create any supply chain shortages because Cyntec has the manufacturing capacity to

26

meet any additional demand that would result from an injunction. Id.

27
28

In its opposition, Chilisin argues that the public interest would not be served by
Cyntec’s proposed injunction. See Dkt. 294-6 at 23-24. Chilisin first argues that the
21

1

injunction would prevent it from “ensuring that customers who lawfully purchased chokes

2

received necessary information and updates, for example.” Id. Second, Chilisin argues

3

that the proposed injunction contains no express limits on extraterritoriality, and proposes

4

new language regarding activity outside of the United States. Id. at 24.

5

In its reply, Cyntec states that it is “willing to confer with Chilisin to reach

6

agreement on a narrow exception allowing the conveyance of safety information.” See

7

Dkt. 307 at 9. As to extraterritoriality, Cyntec argues that its proposed injunction already

8

“specifically covers only infringing activity in the United States.” Id.
Overall, the court concludes that the public interest weighs in favor of an

9
10

United States District Court
Northern District of California

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injunction. As Cyntec points out, the Federal Circuit has held that “the public interest
nearly always weighs in favor of protecting property rights in the absence of
countervailing factors, especially when the patentee practices his inventions.” See Apple
Inc. v. Samsung Elecs. Co. Ltd., 809 F.3d 633, 647 (Fed. Cir. 2015).
Having considered the eBay factors, the court concludes that Cyntec has made a
sufficient showing, and its motion for permanent injunction is GRANTED, subject to the
following: in its reply, Cyntec represents that it is willing to revise its proposed injunction
to create a narrow exception allowing for the conveyance of safety information. See Dkt.
307 at 9. The court thus directs Cyntec to submit a proposed revised injunction
incorporating such an exception. Thus, while Cyntec’s motion for permanent injunction is
granted based on the showing made in the papers, the injunction remains subject to the
court’s approval of the form of the proposed injunction. Cyntec shall have fourteen (14)
days from the date of this order to submit a revised proposed injunction.
B.

Enhanced damages

23

1.

24

Courts have the discretion to “increase the damages up to three times the amount

25

found or assessed.” 35 U.S.C. § 284. “The paramount determination in deciding to grant

26

enhancement and the amount thereof is the egregiousness of the defendant's conduct

27

based on all the facts and circumstances.” Read Corp. v. Portec, Inc., 970 F.2d 816,

28

826-27 (Fed. Cir. 1992), abrogated in part on other grounds by Markman v. Westview

Legal standard

22

1

Instruments, Inc., 517 U.S. 370 (1996). The Read court set forth the following factors for

2

courts to consider when deciding whether to award enhanced damages:

3

(1) whether the infringer deliberately copied the ideas or design of another,

4
5

(2) whether the infringer, when he knew of the other's patent protection,
investigated the scope of the patent and formed a good-faith belief that it was
invalid or that it was not infringed,

6

(3) the infringer’s behavior as a party to the litigation,

7

(4) defendant's size and financial condition,

8
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United States District Court
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(5) closeness of the case,
(6) duration of defendant's misconduct,
(7) remedial action by the defendant,
(8) defendant's motivation for harm, and
(9) whether defendant attempted to conceal its misconduct.
Read, 970 F.2d at 826; see also SRI Int’l, Inc. v. Cisco Systems, Inc., 14 F.4th 1323,
1330 (Fed. Cir. 2021) (citing and applying the Read factors).
2.

Analysis

As to factor (1), Cyntec argues that Chilisin deliberately copied its design, pointing
to trial exhibits showing that Chilisin sought to “completely match Cyntec characteristics.”
See Dkt. 288-1 (citing, e.g., Trial Ex. 56, 57, 120, 122, 1363). Chilisin argues that “there
has been no copying” because there is no evidence that Chilisin tested the powders in
Cyntec’s products. See Dkt. 294-6 at 27. Because Chilisin does not meaningfully rebut
Cyntec’s evidence of copying, the court concludes that the first Read factor weighs in
favor of enhanced damages.
As to factor (2), Cyntec argues that Chilisin offered no evidence of any good faith
belief of non-infringement or invalidity. See Dkt. 288-1 at 22-23. Cyntec argues that
there is no evidence in the record that Chilisin conducted any investigation into Cyntec’s
concerns. Id. at 22. Chilisin argues that it had a good faith belief of non-infringement and
invalidity, pointing to the arguments made in its motion for judgment as a matter of law
and motion for a new trial. The court concludes that the second Read factor does not
23

1

weigh either for or against enhanced damages.

2

As to factor (3), Cyntec argues that “Chilisin advanced meritless invalidity

3

defenses that needlessly consumed the court’s time and drove up litigation costs.” See

4

Dkt. 288-1 at 23-24. Specifically, Cyntec points to Chilisin’s indefiniteness defense,

5

which was emphasized in pretrial papers and mentioned in Chilisin’s opening statement,

6

but “entirely abandoned” in its trial presentation. Id. Chilisin argues that it “litigated in

7

good faith.” See Dkt. 294-6 at 28-29. With regard to indefiniteness, Chilisin argues that

8

“even up through pretrial, the parties were still arguing over the meaning of the ‘by means

9

of’ limitation” and “[i]ndefiniteness was part of that claim construction dispute.” Id.
Chilisin contends that “[o]nce the court issued its construction, indefiniteness became

11
United States District Court
Northern District of California

10

moot.” Id.

12

The court concludes that the third Read factor weighs in favor of enhanced

13

damages. Chilisin’s argument regarding indefiniteness highlights the unreasonableness

14

of its own conduct. Chilisin argues that “once the court issued its construction,

15

indefiniteness became moot,” but even though the court issued its construction in June

16

2019 and its summary judgment order in September 2020, Chilisin continued to litigate

17

the issue through the start of trial. See, e.g., Dkt. 83, 170. In fact, the court specifically

18

noted that Chilisin had attempted, on multiple occasions, to reopen claim construction.

19

See Dkt. 192. Ahead of a status conference in May 2021, Chilisin filed a case

20

management statement asking for an additional claim construction hearing on the “open

21

claim construction issue” regarding the “by means of” term. See Dkt. 181. At the status

22

conference, the court made clear that there was no “open claim construction issue,” as

23

the claims were construed in May 2019, and denied any request to reopen claim

24

construction. See Dkt. 183. The court then directed the parties to submit a proposed jury

25

instruction on the “by means of” term, but rather than submit a jury instruction, “Chilisin

26

submitted a newly-proposed claim construction.” See Dkt. 192 at 1. The court stated

27

that “Chilisin’s attempt to reopen claim construction is untimely and directly contrary to

28

the court’s instructions at the case management conference.” Id. at 1-2. Overall, the
24

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court concludes that Chilisin’s litigation conduct with regard to indefiniteness and

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construction of the “by means of” term is sufficient to weigh the third Read factor in favor

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of enhanced damages.

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As to factor (4), Cyntec argues that “Chilisin’s size and financial condition are

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sufficiently large to favor enhanced damages.” See Dkt. 288-1 at 24-25. Cyntec argues

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that Chilisin’s own documents show that its annual revenue exceeds $252 million. Id. at

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25 (citing Trial Ex. 129). Chilisin’s opposition brief does not address this Read factor.

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The court concludes that the fourth Read factor weighs in favor of enhanced damages.

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As to factor (5), Cyntec argues that “this case was not close.” Cyntec argues that
“the jury ultimately rejected each of Chilisin’s non-infringement defenses, found Chilisin to

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be a willful infringer, and awarded Cyntec the full measure of damages requested.” See

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Dkt. 288-1 at 25. Chilisin argues that this was a close case, pointing to its Rule 50(b)

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motion for judgment as a matter of law and Rule 59 motion for a new trial. See Dkt. 294-

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6 at 29. The court concludes that the fifth Read factor weighs in favor of enhanced

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damages.

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As to factors (6) and (7), Cyntec argues that “despite the duration of misconduct,

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Chilisin has taken no remedial action.” See Dkt. 288-1 at 25-26. In particular, Cyntec

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points to trial exhibits showing that Chilisin continued to copy Cyntec’s technology even

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after learning of Cyntec’s patents and continued to sell the infringing products at least

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through trial. See Trial Ex. 57, A-808. Chilisin argues that it investigated Cyntec’s claims

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after receiving the December 2017 notice letter, and suggests that it did not need to stop

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selling the accused products because “Chilisin had been selling those products for nearly

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three years before Cyntec sent its letter.” See Dkt. 294-6 at 29-30. Because Cyntec’s

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evidence shows that, even after this suit was filed, Chilisin continued to make their

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products “exactly the same” as Cyntec’s, with “no room for negotiation because the client

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prefers Cyntec,” the court concludes that the sixth and seventh Read factors weigh in

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favor of enhanced damages. See Trial Ex. 57 at 2.

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As to factor (8), Cyntec argues that Chilisin intended to harm Cyntec. See Dkt.
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288-1 at 26-27. Cyntec again points to trial evidence showing that Chilisin deliberately

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copied Cyntec’s products and sought to undercut Cyntec on price. Id. (citing Trial Ex. 57,

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105, 107, 117, 132, 1363). Chilisin argues that there is no evidence that Chilisin intended

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to harm Cyntec. See Dkt. 294-6 at 30. Based on the evidence cited by Cyntec, the court

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concludes that the eighth Read factor weighs in favor of enhanced damages.

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Cyntec’s motion does not address the ninth and final Read factor.

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Having considered the Read factors, the court concludes that the totality of the

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circumstances weigh in favor of enhanced damages. In particular, as mentioned above,

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the evidence showing that Chilisin sought to deliberately copy Cyntec’s products as
closely as possible even well after the filing of this lawsuit. See, e.g., Trial Ex. 57.

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Accordingly, Cyntec’s motion for enhanced damages is GRANTED, and the court will

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multiply all applicable damages by a factor of three.

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However, there is an issue with the amount of trebled damages sought by Cyntec.

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The jury awarded Cyntec $1,552,493 in lost profits and $320,463 in reasonable

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royalties, for a total damages award of $1,872,596. See Dkt. 269 at 4. The amount of

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the jury’s award was the same as that in the summary of damages submitted at trial by

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Cyntec’s damages expert. See Trial Ex. 1342. Cyntec’s expert’s summary was in turn

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based on calculations of direct sales damages and indirect sales damages. See Trial Ex.

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1300, 1301, 1343, 1344.
Cyntec’s direct sales damages calculations for both lost profits and reasonable

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royalty include damages going back to November 2016. See Trial Ex. 1300, 1301.

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However, as discussed above, Cyntec conceded during trial that its willfulness claim is

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limited to any infringement after Chilisin’s receipt of Cyntec’s notice letter in December

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2017. See Trial Tr., vol. 5 (Dkt. 260) at 872:13-14 (“The willfulness claim, Your Honor,

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we would limit to after receipt of the notice letter.”). Thus, to the extent that Cyntec’s

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motion seeks trebling of the entire jury damages award of $1,872,596, including damages

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from before December 2017, that request goes beyond the scope of Cyntec’s willfulness

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claim.
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Accordingly, while Cyntec’s motion for enhanced damages is GRANTED, and the

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court will apply a multiplier of three to a subset of the awarded damages, the court will not

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apply the multiplier to the entire amount awarded by the jury, given that no enhanced

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damages are appropriate for the time period before notice to Chilisin in December 2017.

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Instead, the court has reviewed the damages breakdowns submitted as trial exhibits, and

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has determined that $1,840,144 represents the amount of damages from 2018 onwards.

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See Trial Ex. 1342 (citing Trial Ex. 1300, 1301, 1343, 1344). Applying the multiplier of

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three to only that amount, then adding back the non-trebled damages, results in a total

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lost profits damages award of $4,602,671 and a total reasonable royalties award of
$950,573, for a total damages award of $5,553,244. The court therefore revises its prior

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judgment to reflect a total damages award of $5,553,244.

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Motion to seal (Dkt. 294)

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Chilisin filed a motion to seal portions of its brief in opposition to Cyntec’s motion

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for permanent injunction and enhanced damages, and to seal three supporting exhibits.

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See Dkt. 294. Pursuant to Civil Local Rule 79-5, Cyntec filed a supporting declaration

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narrowing the request, arguing that only portions of one exhibit should be sealed, but that

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the remaining exhibits and the opposition brief need not be sealed. See Dkt. 302.

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Because Cyntec does not seek sealing of the information in Chilisin’s opposition

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brief, the motion to seal is DENIED as to that request, and Chilisin shall file an

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unredacted version of the opposition brief on the public docket. As to the limited portion

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of Exhibit H for which Cyntec maintains a claim of confidentiality due to concerns about

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business competitors having access, the motion to seal is GRANTED.

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CONCLUSION
For the reasons set forth above, Chilisin’s Rule 50(b) motion for judgment as a

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matter of law (Dkt. 285) is DENIED, Chilisin’s Rule 59 motion for a new trial (Dkt. 286) is

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DENIED, Cyntec’s motion for permanent injunction and for enhanced damages (Dkt. 288)

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is GRANTED subject to the court’s approval of a revised proposed injunction, and

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Chilisin’s motion to seal (Dkt. 294) is GRANTED in part and DENIED in part.
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As directed above, Cyntec is to submit a revised version of its proposed injunction
within fourteen (14) days of the date of this order.
IT IS SO ORDERED.
Dated: May 6, 2022
/s/ Phyllis J. Hamilton
PHYLLIS J. HAMILTON
United States District Judge

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