Arctic Cat Inc. v. Bombardier Recreational Products Inc. et al

Filing 211

ORDER AND OPINION granting in part and denying in part 160 Motion for Supplemental Damages, Ongoing Royalty, and Periodic Accounting; denying 169 Motion for Judgment as a Matter of Law; denying 169 Motion for New Trial( Mediation Deadline 9/2/2016., Status Report due by 11/14/2016.). Signed by Judge Beth Bloom on 8/12/2016. (lrz)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
Case No. 14-cv-62369-BLOOM/Valle
ARCTIC CAT INC.,
Plaintiff,
v.
BOMBARDIER RECREATIONAL
PRODUCTS, INC., and BRP U.S. INC.,
Defendants.
_________________________________/
ORDER
THIS CAUSE is before the Court upon two Motions: (1) Defendants Bombardier
Recreation Products, Inc. and BRP U.S. Inc.’s (hereinafter, referred to together as “BRP” or
“Defendant”) Renewed Motion for Judgment as a Matter of Law (or “JMOL”) or for a New
Trial, ECF No. [169] (the “Defendant’s Motion”); and (2) Plaintiff Arctic Cat Inc.’s (“Plaintiff”
or “Arctic Cat”) Motion for (A) Accounting of Supplemental Damages, (B) Post-Judgment
Ongoing Royalty, and (C) Periodic Accounting through Expiration of the ‘545 Patent (defined
below), ECF No. [160] (the “Plaintiff’s Motion”). The Court entered Final Judgment in the
above-styled case on June 13, 2016, ECF No. [157] (the “Judgment”), and denied BRP’s Motion
to Vacate the Judgment on July 27, 2016, ECF No. [200] (“Order Denying Motion to Vacate”).
The Court has reviewed the Motions, all supporting and opposing submissions and exhibits, the
record, and the applicable law, and is otherwise fully advised. For the reasons set forth below,
Defendant’s Motion is denied, and Plaintiff’s Motion is granted in part and denied in part.

Case No. 14-cv-62369-BLOOM/Valle
I. Background
Following a ten-day jury trial, a verdict issued in the above-styled case, finding BRP
liable to Plaintiff Arctic Cat Inc. (“Plaintiff” or “Arctic Cat”) for willful infringement through the
sale of certain models of personal watercraft under the name, Sea-Doo, which incorporated an
off-throttle assisted steering technology (the “Infringing PWCs”). See ECF No. [153] (Jury
“Verdict,” dated June 1, 2016). Therein, the jury concluded that BRP infringed ten claims in
Arctic Cat’s Patents, United States Patent Numbers 6,793,545 (“the ‘545 Patent”), and 6,568,969
(“the ‘969 Patent”). See id. at 1-2. The jury further held that BRP failed to prove its invalidity
defenses of anticipation, obviousness, and enablement. Id. at 2-3. As to damages, the jury
identified October 16, 2008, as the proper starting date, and $102.54 as the reasonable royalty
per unit sold to which Arctic Act is entitled. The parties stipulated to the number of units sold
since October 16, 2008, to wit, 151,790. See ECF No. [149] (trial minutes, May 31, 2016).
Moreover, the jury found, by clear and convincing evidence, that BRP infringed the
above-listed claims “with reckless disregard of whether such claim was infringed or was invalid
or unenforceable.” Verdict at 4. The issue of subjective willfulness reached the jury after the
Court found objective willfulness by clear and convincing evidence, pursuant to the two-part
Seagate test, in its Order Denying JMOL, ECF No. [148] (“Order Denying JMOL”) (citing In re
Seagate Tech., LLC, 497 F.3d 1360, 1371 (Fed. Cir. 2007)). 1 Coincidentally, the Supreme Court
issued a ruling shortly after the conclusion of trial that, inter alia, discarded the Seagate test for
willfulness as inconsistent with Section 284 of the Patent Act. See Halo Elecs., Inc. v. Pulse
1

Under the first, objective prong of this test, a patent owner must “show by clear and convincing
evidence that the infringer acted despite an objectively high likelihood that its actions constituted
infringement of a valid patent.” Seagate, 497 F.3d at 1371. Under the second, subjective prong, the
patentee must demonstrate, also by clear and convincing evidence, that the risk of infringement “was
either known or so obvious that it should have been known to the accused infringer.” Of course, any
consideration of the Seagate test was limited to the Court’s Order Denying JMOL, and oral argument on
the same – and did not affect any other aspect of the trial.

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Case No. 14-cv-62369-BLOOM/Valle
Elecs., Inc., 136 S. Ct. 1923, 1926 (2016) (citing 35 U.S.C. § 284).

Halo held that “an

independent showing of objective recklessness should [not] be a prerequisite to enhanced
damages” and that a determination as to enhancement should be governed by the preponderance
of the evidence standard that “has always” governed all other aspects of patent-infringement
litigation. 136 S. Ct. at 1926-27. This decision, importantly, did not impact the validity of the
Judgment in this case because, as the Court explained, “where both objective willfulness and
subjective willfulness were found by clear and convincing evidence, a more lenient inquiry as to
subjective willfulness, without the additional hurdle imposed by the objective willfulness
inquiry, and by the lesser preponderance of the evidence standard, would reach the same result.”
Judgment at 3. Furthermore, Halo only reaffirmed the subjective willfulness inquiry that was
submitted to the jury in this case. 136 S. Ct. at 1933 (“The subjective willfulness of a patent
infringer, intentional or knowing, may warrant enhanced damages, without regard to whether his
infringement was objectively reckless.”).
Pursuant to the applicable law, including the issuance of Halo, and after due
consideration of the totality of the circumstances, the Court held that the Verdict entitled Arctic
Cat to the trebling of damages and, thus, directed BRP to return $46,693,639.80, along with any
applicable interest, to the Plaintiff. See generally Judgment. Post-Judgment, the Defendant
renews its Motion for JMOL or, alternatively, requests a new trial, under Rules 50(b) and 59,
respectively, of the Federal Rules of Civil Procedure.

At the same time, Plaintiff seeks

imposition of supplemental damages, a post-judgment ongoing royalty, and periodic accounting
through expiration of the ‘545 Patent. The Court now endeavors to resolve the parties’ two
competing requests.

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II. Legal Standard
A. Rule 50
“Under Rule 50, a party’s motion for judgment as a matter of law can be granted at the
close of evidence or, if timely renewed, after the jury has returned its verdict, as long as there is
no legally sufficient evidentiary basis for a reasonable jury to find for the non-moving party.”
Chaney v. City of Orlando, Fla., 483 F.3d 1221, 1227 (11th Cir. 2007) (internal quotations
omitted; alterations adopted) (citing Fed. R. Civ. P. 50). The standard by which the motion is
reviewed is the same regardless of whether the motion is brought pursuant to Rule 50(a) or
50(b). Id. (citing Cleveland v. Home Shopping Network, Inc., 369 F.3d 1189, 1192 (11th Cir.
2004); Arthur Pew Constr. Co. v. Lipscomb, 965 F.2d 1559, 1563 (11th Cir. 1992); 9A Charles
Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 2537 (2d ed. 1995)). Where a
post-verdict motion for JMOL “pertains uniquely to patent law,” it is reviewed under Federal
Circuit law as opposed to the law of the regional circuit, Junker v. Eddings, 396 F.3d 1359, 1363
(Fed. Cir. 2005); on the other hand, evidentiary rulings and denials of motions for JMOL are
reviewed under the law of the regional circuit. See Retractable Tech., Inc. v. Becton, Dickinson
and Co., 653 F.3d 1296, 1302 (Fed. Cir. 2011) (“In reviewing evidentiary rulings and denials of
motions for JMOL, we apply the law of the regional circuit.”); Liquid Dynamics Corp. v.
Vaughan Co., 449 F.3d 1209, 1218 (Fed. Cir. 2006) (applying regional circuit law when
reviewing a Daubert ruling).
To succeed under Rule 50(b), the movant has the burden to prove that there is indeed
only “one reasonable conclusion as to the verdict.”

Lipphardt v. Durango Steakhouse of

Brandon, Inc., 267 F.3d 1183, 1186 (11th Cir. 2001). In other words, “the facts and inferences
[of a case must] point so overwhelmingly in favor of the movant that reasonable people could not

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Case No. 14-cv-62369-BLOOM/Valle
arrive at a contrary verdict.” Millette v. DEK Techs., Inc., -- F. Supp. 2d --, 2011 WL 5331708,
at *2 (S.D. Fla. Nov. 7, 2011). When reviewing a motion under Rule 50, the Court is obligated
to review the evidence in the light most favorable to the non-moving party. See Hanes v.
Greyhound Lines, Inc., 316 F. App’x 841, 842 (11th Cir. 2008) (citing Daniel v. City of Tampa,
38 F.3d 546, 549 (11th Cir. 1994)); Sherrod v. Palm Beach Cnty. Sch. Dist., 424 F. Supp. 2d
1341, 1344 (S.D. Fla. 2006) (“[The Court] must view the evidence in a light most favorable to
the plaintiff, and must not weigh the evidence nor assess witness credibility.”) (citing Reeves v.
Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150 (2000)).
B. Rule 59
“A post-judgment motion may be treated as made pursuant to either Fed. R. Civ. P. 59 or
60 – regardless of how the motion is styled by the movant – depending on the type of relief
sought.” Mays v. U.S. Postal Serv., 122 F.3d 43, 46 (11th Cir. 1997). A party cannot, however,
use a post-judgment motion “to relitigate old matters, raise argument or present evidence that
could have been raised prior to the entry of judgment.” Michael Linet, Inc. v. Vill. of Wellington,
Fla., 408 F.3d 757, 763 (11th Cir. 2005) (citing Stone v. Wall, 135 F.3d 1438, 1442 (11th Cir.
1998)).
Among other relief, a court may grant a new jury trial under Rule 59 “for any reason for
which a new trial has heretofore been granted in an action at law in federal court.” Fed. R. Civ.
P. 59(a). For instance, a party may assert that “the verdict is against the weight of the evidence,
that the damages are excessive, or that, for other reasons, the trial was not fair to the party
moving.” Montgomery Ward & Co. v. Duncan, 311 U.S. 243, 251 (1940). Thus, a motion for
new trial should be granted “when the verdict is against the clear weight of the evidence or will
result in a miscarriage of justice, even though there may be substantial evidence which would

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prevent the direction of a verdict.” Brown v. Sheriff of Orange Cnty., Fla., 604 F. App’x 915
(11th Cir. 2015) (per curiam) (quoting Lipphardt, 267 F.3d at 1186); see Tucker v. Hous. Auth. of
Birmingham Dist., 229 F. App’x 820, 826 (11th Cir. 2007) (“[N]ew trials should not be granted
on evidentiary grounds unless, at a minimum, the verdict is against the great – not merely the
greater – weight of the evidence.”); Dudley v. Wal-Mart Stores, Inc., 166 F.3d 1317, 1320 n.3
(11th Cir. 1999) (holding that, because a “less stringent standard applies to a motion for a new
trial than to a motion for a judgment as a matter of law,” the failure to meet the Rule 59 standard
is fatal to the Rule 50(b) standard) (citation omitted).
Additionally, a motion for a new jury trial “may raise questions of law arising out of
alleged substantial errors in admission or rejection of evidence or instructions to the jury.”
Montgomery Ward, 311 U.S. at 251. Jury instructions merit a new trial where the instructions
give the jury “a misleading impression or inadequate understanding of the law and the issues to
be resolved.” Steger v. Gen. Elec. Co., 318 F.3d 1066, 1081 (11th Cir. 2003) (quoting Stuckey v.
Northern Propane Gas Co., 874 F.2d 1563, 1571 (11th Cir. 1989)); see U.S. S.E.C. v. Big Apple
Consulting USA, Inc., 783 F.3d 786, 804 (11th Cir. 2015) (instructing that reversal on
instructions only occurs where there is “substantial and ineradicable doubt as to whether the jury
was properly guided in its deliberations”) (quoting McCormick v. Aderholt, 293 F.3d 1254, 1260
(11th Cir. 2002)).
“[G]ranting motions for new trial touches on the trial court’s traditional equity power to
prevent injustice and the trial judge’s duty to guard the integrity and fairness of the proceedings
before [her].” Sherrod v. Palm Beach Cnty. Sch. Dist., 237 F. App’x 423, 424 (11th Cir. 2007)
(quoting Christopher v. Florida, 449 F.3d 1360, 1366 n.4 (11th Cir. 2006)).

Ultimately,

“motions for a new trial are committed to the discretion of the trial court.” Montgomery v. Noga,

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168 F.3d 1282, 1295 (11th Cir. 1999); Steger, 318 F.3d at 1081 (citing Deas v. PACCAR, Inc.,
775 F.2d 1498, 1503 (11th Cir. 1985)) (“A district court is permitted wide discretion in
considering a motion for new trial based on an erroneous jury instruction.”).
III. Discussion
A. Defendant’s Motion
At the close of Arctic Cat’s case-in-chief and prior to the Court’s submission of this
matter to the jury, BRP moved for JMOL under Rule 50(a). Renewing arguments from its
summary judgment motion, the Defendant argued that Arctic Cat failed to present legally
sufficient evidence from which a reasonable jury could find infringement, willfulness, damages,
and marking. 2 Furthermore, the Defendant submitted that it had presented sufficient evidence on
its obviousness invalidity defense to warrant JMOL in its favor. Citing many of the same
reasons for its denial of summary judgment, the Court denied BRP’s Rule 50(a) motion. See
ECF No. [148].
This is now the third time, albeit now through the lenses of Rules 50(b) and 59, that the
Court has reviewed BRP’s repackaged arguments, sub-arguments, and support as to obviousness,
infringement, willfulness, damages, and marking, with no material change in the evidence or the
law. 3 Fed. R. Civ. P. 50(b), 59. And, for the third time, BRP’s arguments fail. See, e.g.,
Johnson v. Breeden, 280 F.3d 1308, 1318 (11th Cir. 2002) (citing Abel v. Dubberly, 210 F.3d
1334 (11th Cir. 2000)) (“Where there is no change in the evidence, the same evidentiary dispute
that got the plaintiff past a summary judgment motion asserting [a particular argument] will

2

BRP contended then, and continues to argue now, that Arctic Cat bears the burden on marking pursuant
to 35 U.S.C. § 287(a).
3
Of course, no material change in the law other than the issuance of Halo, which changed the appropriate
standard for willfulness as discussed infra and in the Court’s Order Denying Motion to Vacate.

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Case No. 14-cv-62369-BLOOM/Valle
usually get that plaintiff past a Rule 50(a) motion asserting the [same argument], although the
district court is free to change its mind.”).
The Defendant has not carried its burden in showing that there is “only one reasonable
conclusion” – of no liability – as to the Verdict in this case. See Nat’l Union Fire Ins. Co. of
Pittsburgh, PA v. All Am. Freight, Inc., No. 14-CV-62262, 2016 WL 3787638, at *4 (S.D. Fla.
July 6, 2016) (finding that defendant failed to meet standard for renewed JMOL). Ultimately,
and as this Court has already concluded, the Verdict is consistent with both the manifest weight
of the evidence and the applicable law. See ECF Nos. [119], [148], [200] (Order Denying
Summary Judgment, Order Denying JMOL, Order Denying Motion to Vacate, respectively);
Fed. R. Civ. P. 50(b), 59. Indeed, the Court “will not second-guess the jury or substitute [the
Court’s] judgment for its judgment[, as BRP essentially requests, because the V]erdict is
supported by sufficient evidence.” Lipphardt, 267 F.3d at 1186 (quoting Gupta v. Florida Bd. of
Regents, 212 F.3d 571, 582 (11th Cir.), cert. denied, 531 U.S. 1076 (2000)); see, e.g., Bozeman
v. Pollock, -- F. Supp. 3d --, 2015 WL 5016510, at *11 (S.D. Fla. Aug. 25, 2015) (“Although
Defendants would have the jury believe that the situation [plaintiff] found herself in had no
effect on her mental state, the jury was free to draw a different conclusion based on the evidence
presented.”).
In fact, in the entirety of its forty-five page Motion, BRP raises only two fresh
considerations, related to jury instructions on willfulness and marking. See generally Motion.
The Court now addresses each claim in turn.
First, in line with the Defendant’s arguments in its Motion to Vacate, ECF No. [158],
BRP argues that the Verdict cannot stand, because the jury was instructed pursuant to the nowoverruled Seagate standard. However, as addressed above as well as in painstaking detail in the

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Court’s Order Denying Motion to Vacate, the instruction provided to the jury on willful
infringement pertained only to subjective willfulness, reading as follows:
In this case, Arctic Cat argues both that BRP infringed and further that
BRP infringed willfully. If you have decided that BRP has infringed, you must go
on and address the additional issue of whether or not the infringement was willful.
Willfulness requires you to determine by clear and convincing evidence that BRP
acted recklessly. To prove that BRP acted recklessly, Arctic Cat must prove by
clear and convincing evidence that BRP actually knew or should have known that
its actions constituted an unjustifiably high risk of infringement of a valid and
enforceable patent.
To determine whether BRP had this state of mind, consider all the facts
which may include but are not limited to whether or not BRP acted in accordance
with the standards of commerce for its industry, whether or not BRP intentionally
copied a product of Arctic Cat that is covered by the ‘545 patent or the ‘969
patent, whether or not there is a reasonable basis to believe that BRP did not
infringe or had a reasonable defense to infringement, whether or not BRP made a
good-faith effort to avoid infringing the ‘545 patent and the ‘969 patent. For
example, whether BRP attempted to design around the ‘545 patent and the ‘969
patent; whether or not BRP tried to cover up its infringement.
And BRP argues it did not act recklessly because it relied on a legal
opinion that advised BRP either, one, that the product did not infringe the ‘545
patent or the ‘969 patent or, two, that the ‘545 patent and/or the ‘969 patent was
invalid. You must evaluate whether the opinion was of a quality that reliance on
its conclusions was reasonable.
ECF No. [182-10] (June 1, 2016, Trial Transcript) at 44:16-45:18 (jury instruction); Halo, 136 S.
Ct. at 1933 (“The subjective willfulness of a patent infringer, intentional or knowing, may
warrant enhanced damages, without regard to whether his infringement was objectively
reckless.”).
BRP does not and cannot explain how Halo impacts the instruction given to the jury on
willful infringement or why, under Halo, anything in the instruction is incorrect – other than, of
course, the clear and convincing standard. However, this standard could have only benefited
BRP in that the jury members were directed to hold the evidence introduced at trial to a more
scrutinizing standard than is now applicable to willfulness, to wit, the preponderance of the
evidence standard. Indeed, the absence of any meaningful argument to this effect is telling. See
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Case No. 14-cv-62369-BLOOM/Valle
generally Motion; ECF No. [194] (BRP Reply). The Defendant cannot escape the fact that the
jury found subjective willfulness, even using a clear and convincing evidentiary standard. See
Judgment at 2-3; Order Denying Motion to Vacate. Therefore, it is clear that the willfulness
instruction did not in any way provide “a misleading impression or inadequate understanding of
the law and the issues to be resolved.” Steger, 318 F.3d at 1081. No relief – whether in the form
of vacatur, JMOL, or a new trial – is warranted under these facts.
Second, the Defendant claims that the Court’s marking instruction was erroneous. See
Motion at 44-45. The jury instruction entitled, “Date Damages Begin,” states, in relevant part:
Arctic Cat must prove that it is more likely than not that BRP actually was
notified of the claim for patent infringement as of the date alleged by Arctic Cat. .
. . If you find that Arctic Cat and its licensees did mark substantially all of their
products with the patent number, then October 16, 2008 is the date for the start of
damages calculations. If, however, you find that Arctic Cat and its licensees did
not mark substantially all of those products with the patent number, then Arctic
Cat did not provide notice in this way. . . .
ECF No. [151] (Jury Instructions) at 31-32.
The parties developed and stipulated to this marking instruction. BRP initially proposed
an additional concluding sentence to this paragraph imposing the burden of showing no patented
article on Arctic Cat. See ECF Nos. [106], [78]. But, the Defendant dropped this request in a
subsequent Joint Proposed Jury Instruction.

See ECF No. [146] (Joint Proposed Jury

Instructions) at 76. BRP made no objection to the omission of this sentence during the Court’s
charging conference. See ECF No. [182-10] (June 1, 2016, Trial Transcript) at 14:6-19:14
(objections to Court’s draft jury instructions). Likewise, BRP made no objection to the Court’s
inclusion of the question as to whether Honda manufactured and sold a “patented article” on the
jury verdict form – and, in fact, argued for its inclusion.

See id. at 8:14-9:21, 6:23-14:5

(generally discussing § 287 marking language on Court’s draft verdict form). The Defendant,

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therefore, waived any argument that the jury was not properly instructed on the requirements of
35 U.S.C. § 287(a)). Id. at 19:13-14 (Ms. Rodman: “Your Honor, we don’t see anything else on
our end.”); see Heath v. Suzuki Motor Corp., 126 F.3d 1391, 1394 (11th Cir. 1997) (“Failure to
object to the instructions on these grounds before the jury retired constituted a waiver.”).
Furthermore, notwithstanding this waiver, the Court notes that, contrary to Defendants’
argument, the jury was properly instructed as to burden in establishing marking and notice under
35 U.S.C. § 287(a). See Order Denying Summary Judgment at 59 4 (adopting “the better view”
that the burden of production does not shift to a plaintiff to show compliance with a marking
statute) (quoting Sealant Sys. In’l, Inc. v. TEK Glob. S.R.L., No. 5:11-CV-00774-PSG, 2014 WL
1008183, at *30 (N.D. Cal. Mar. 7, 2014), rev’d in part on other grounds, Sealant Sys. Int’l, Inc.
v. TEK Glob., S.R.L., 616 F. App’x 987 (Fed. Cir. 2015) (citing Oracle Am., Inc. v. Google Inc.,
Case No. 3:10-cv-03561-WHA, 2011 WL 5576228, at *2 (N.D. Cal. Nov. 15, 2011)).
BRP makes no other argument that has yet to be addressed after the full presentation of
evidence in this case. See, e.g., Michael Linet, 408 F.3d at 763 (noting that a Rule 59 motion
cannot be used to “relitigate old matters”); American Home Assur. Co. v. Glenn Estess &
Associates, Inc., 763 F.2d 1237, 1239 (11th Cir. 1985) (explaining that Rule 59(e) motions do
not afford an unsuccessful litigant “two bites at the apple”); Amegy Bank Nat. Ass’n v. DB
Private Wealth Mortgage, Ltd., No. 2:12-CV-243-FTM-38CM, 2014 WL 1876208, at *2 (M.D.
Fla. May 9, 2014), aff’d sub nom., Amegy Bank Nat. Ass’n v. Deutsche Bank Alex.Brown, 619 F.
App’x 923 (11th Cir. 2015) (“The jury has reasonably made a determination based on the
evidence and thus the Court will not substitute the jury’s judgment. Pursuant to Rule 50(b), this
motion is due to be denied.”). Particularly when viewed in the light most favorable to Arctic
4

“Indeed, otherwise, a defendant’s general allegations could easily instigate a fishing expedition for the
patentee in order to stave off pursuit of damages for infringement. This theory also comports with the
general allocation of burden to proof for defenses at common law.” Id.

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Cat, as the non-moving party, the Verdict and Judgment are supported by overwhelming
evidence as presented at trial and filed on the record during the duration of this action. See, e.g.,
Lipphardt, 267 F.3d at 1186. BRP, therefore, is not entitled to judgment as a matter of law or to
a new trial.
B. Plaintiff’s Motion
Plaintiff’s post-judgment Motion argues that sections 283 and 284 of the Patent Act
entitle Arctic Cat, as the prevailing party, to (A) an award of supplemental damages for BRP’s
sales of the Infringing PWCs from April 30, 2016, through June 14, 2016 (the date of Judgment),
at an enhanced rate; (B) entry of an ongoing royalty for BRP sales of the Infringing PWCs from
the date of Final Judgment through expiration of the ‘545 Patent; and (C) periodic accountings of
sales of such PWCs through expiration of the ‘545 patent. See 35 U.S.C. §§ 283, 284. BRP
opposes all relief sought by the Plaintiff. See ECF No. [175] (“BRP Response”). Importantly,
however, BRP does not contest that it is continuing to infringe the ‘545 Patent through sales of
the Infringing PWCs through the date of judgment, and onwards.
1. Supplemental Damages
District courts “have discretion to award damages for periods of infringement not
considered by the jury.” Whitserve, LLC v. Computer Packages, Inc., 694 F.3d 10, 38 (Fed. Cir.
2012); see 35 U.S.C. § 284 (“[W]hen the damages are not found by a jury, the court shall assess
them.”). Here, the jury found a per unit reasonable royalty rate of $102.54 for BRP’s past
infringement. See Verdict. During trial, both parties’ damages experts agreed that BRP sold
151,790 Infringing PWCs between October 16, 2008 5 and April 30, 2016, the date of the most
current sales data disclosed by BRP. See ECF No. [161-1] (May 18, 2016, Trial Transcript) at
136:16-137:1 (Arctic Cat damages expert); ECF No. [161-2] (May 31, 2016, Trial Transcript) at
5

This date accounted for the 6-year time limitation imposed by 35 U.S.C. § 286.

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27:1-4 (BRP damages expert). The jury further found that BRP’s past infringement was willful,
which ultimately persuaded the Court, after careful consideration of the totality of the
circumstances, to treble the damages awarded by the jury, as provided by § 284. As this
enhancement amounted to an effective royalty rate of $307.62 per unit, the Court assessed the
total disclosed enhanced damages at $46,693,639.80, representing the product of 307.62 and
151,790. See Final Judgment.
Arctic Cat, therefore, is also entitled to supplemental damages based on undisclosed
infringing sales of the Infringing PWCs occurring after April 30, 2016, through the date of final
judgment, June 14, 2016. See Carnegie Mellon Univ. v. Marvell Tech. Group, Ltd., No. 09-cv290, 2014 WL 13220154, at *4 (W.D. Pa. March 31, 2014), rev’d on other grounds, 807 F.3d
1283 (Fed. Cir. 2015) (“[A] prevailing patentee is due the damages for uncalculated pre-verdict
sales through the date of the entry of judgment. The Court finds that supplemental damages are
properly awarded . . . because the jury did not have the opportunity to assess them due to a lack
of financial information regarding [the defendant’s] ongoing sales of Accused [products] at the
time of trial.”) (citation omitted). Specifically, Arctic Cat submits that the royalty for BRP sales
of Infringing PWCs from April 30, 2016, through June 14, 2016, should be assessed at the
implied royalty rate of $307.62, resulting from BRP’s willful infringement – and the Court
agrees.

Such pre-judgment sales of BRP’s Infringing PWCs are willful infringements, as

determined by the jury, and, thus, are appropriately included in Arctic Cat’s Verdict. As set forth
in the Declaration of Walter Bratic, the estimated number of units from April 30, 2016, through
the date of judgment is 4,848 infringing units. See ECF No. [162] (Bratic Declaration or “Bratic
Decl.”) ¶ 5; ECF No. [162-3] (calculations). Assessed at the royalty rate effectively employed
by the Final Judgment, Arctic Cat is awarded supplemental damages for the period between May

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1, 2016, and June 14, 2016, in the amount of $1,491,385. See Bratic Decl. ¶ 6. The Plaintiff
next seeks prospective relief for alleged ongoing infringement post-Judgment.
2. Ongoing Royalty
Arctic Cat submits – and BRP does not contest – that the Defendant is continuing to
manufacture and sell its Infringing PWCs.

See ECF No. [161-4] (May 17, 2016, Trial

Transcript) at 198:15-22; see also ECF No. [161-3] (BRP Reports Fiscal Year 2017 First-Quarter
Results, June 9, 2016). Indeed, the Plaintiff set forth a prayer for ongoing injunctive relief in its
First Amended Complaint to account for this very possibility. ECF No. [36] (requesting that the
Court “enter orders preliminarily and permanently enjoining BRP and its officers, agents,
directors, servants, employees, attorneys, representatives, parents, subsidiaries, affiliates, and all
of those in active concert, privity or participation with them and their successors and assigns,
from infringing the ‘545 patent”). BRP appears to oppose any such relief, although it is unclear
on what grounds.

See BRP Response at 2 (“Even where a permanent injunction is not

appropriate, a court need not award an ongoing royalty. However, if the Court awards an
ongoing royalty in this case, it should be no more than the reasonable royalty that the jury
awarded Arctic Cat – $102.54 per unit.”)
District courts “may grant injunctions in accordance with the principles of equity to
prevent the violation of any right secured by patent, on such terms as the court deems
reasonable.” 35 U.S.C. § 283. However, in lieu of an injunction prohibiting BRP from using the
life-saving innovations of the ‘545 patent, Arctic Cat seeks an ongoing royalty rate for BRP’s
sales of all Infringing PWCs from June 15, 2016, through expiration of the ‘545 patent. See SCA
Hygiene Prods. Aktiebolag v. First Quality Baby Prods., LLC, 807 F.3d 1311, 1332-33 (Fed. Cir.
2015) (en banc), cert. granted, 136 S. Ct. 1824 (May 2, 2016) (“[A]bsent egregious

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Case No. 14-cv-62369-BLOOM/Valle
circumstances, when injunctive relief is inappropriate, the patentee remains entitled to an
ongoing royalty.”). This is one of “several types of relief for ongoing infringement that a court
can consider.” Whitserve, 694 F.3d at 38 (“(1) [I]t can grant an injunction; (2) it can order the
parties to attempt to negotiate terms for future use of the invention; (3) it can grant an ongoing
royalty; or (4) it can exercise its discretion to conclude that no forward-looking relief is
appropriate in the circumstances.”); see Telcordia Techs., Inc. v. Cisco Sys., Inc., 612 F.3d 1365,
1379 (Fed. Cir. 2010) (“If the district court determines that a permanent injunction is not
warranted, the district court may, and is encouraged, to allow the parties to negotiate a
license.”)); Paice LLC v. Toyota Motor Corp., 504 F.3d 1293, 1315 n.16 (Fed. Cir. 2007)
(finding that an ongoing royalty is a form of equitable relief authorized under § 283).
Setting an appropriate ongoing royalty rate, “of course, is a matter committed to the
sound discretion of the district court.” Amado v. Microsoft Corp., 517 F.3d 1353, 1364 n.2 (Fed.
Cir. 2008); see Paice, 504 F.3d at 1315. A district court must, nonetheless, take care to provide a
“concise but clear explanation of its reasons” supporting the rate set. Amado, 517 F.3d at 1362
(citing Hensley v. Eckerhart, 461 U.S. 424, 437 (1983)); Paice, 504 F.3d at 1315 (same).
Ongoing royalties are determined based on the assumption that the parties engage in a postverdict negotiation, with the jury’s damages award as a starting point:
Because the Court is using the jury’s determination of a . . . royalty rate . . . as a
starting point, the Court focuses on any new evidence that was not before the jury
and additionally any changed circumstances (other than willfulness) between a
hypothetical negotiation that occurred [when infringement began] (which the jury
determined) and a hypothetical negotiation that would occur . . . after the
judgment (which this Court is determining).

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Case No. 14-cv-62369-BLOOM/Valle
Mondis Tech. Ltd. v. Chimei InnoLux Corp., 822 F. Supp. 2d 639, 647 (E.D. Tex. 2011), aff’d
sub nom. Mondis Tech. Ltd. v. Innolux Corp., 530 F. App’x 959 (Fed. Cir. 2013); 6 see Fresenius
USA, Inc. v. Baxter Int’l, Inc., 582 F.3d 1288, 1303 (Fed. Cir. 2009) (instructing district court on
remand to determine royalty that would result from a post-verdict hypothetical negotiation
between the parties); Apple, Inc. v. Samsung Elecs. Co., No. 12-CV-00630-LHK, 2014 WL
6687122, at *4 (N.D. Cal. Nov. 25, 2014) (“Courts have used the Georgia-Pacific factors to
evaluate a post-verdict hypothetical negotiation for ongoing royalties.”).

In this case, the

Verdict’s reasonable royalty rate for past damages, that is, $102.54 per infringing unit, shall set
the floor for negotiations. See Mondis, 822 F. Supp. 2d at 647, n.8; Telcordia, 612 F.3d at 1377
(“[T]his court gives ‘broad deference to the conclusions reached by the finder of fact.’”) (quoting
Monsanto Co. v. McFarling, 488 F.3d 973, 981 (Fed. Cir. 2007)).
Rather than evaluate a post-verdict hypothetical negotiation, however, the Court finds
that the best course is to require that the parties engage in an actual one. See Paice, 504 F.3d at
1315 (“[T]he district court may wish to allow the parties to negotiate a license amongst
themselves regarding future use of a patented invention before imposing an ongoing royalty.”).
Following this guidance, the Court will order the parties to attend mediation in order to negotiate
the terms of a license, within the framework of the Georgia-Pacific factors, 7 as to post-judgment
6

See Paice, 504 F.3d at 1316 (“[T]he fact that monetary relief is at issue in this case does not, standing
alone, warrant a jury trial.”)
7
Georgia-Pacific factors: “1. The royalties received by the patentee for the licensing of the patent in suit,
proving or tending to prove an established royalty. 2. The rates paid by the licensee for the use of other
patents comparable to the patent in suit. 3. The nature and scope of the license, as exclusive or nonexclusive; or as restricted or non-restricted in terms of territory or with respect to whom the manufactured
product may be sold. 4. The licensor’s established policy and marketing program to maintain his patent
monopoly by not licensing others to use the invention or by granting licenses under special conditions
designed to preserve that monopoly. 5. The commercial relationship between the licensor and licensee,
such as, whether they are competitors in the same territory in the same line of business; or whether they
are inventor and promoter. 6. The effect of selling the patented specialty in promoting sales of other
products of the licensee; that existing value of the invention to the licensor as a generator of sales of his
non-patented items; and the extent of such derivative or convoyed sales. 7. The duration of the patent and

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Case No. 14-cv-62369-BLOOM/Valle
infringement of the ‘545 Patent. At this stage, all additional relief requested by Arctic Cat,
including the imposition of a periodic accounting, must be denied, pending the outcome of the
parties’ licensing discussions.
IV. Conclusion
Accordingly, it is ORDERED AND ADJUDGED as follows:
1. BRP’s Renewed Motion for Judgment as a Matter of Law or for a New Trial,
ECF No. [169], is DENIED.
2. Arctic Cat’s Motion for Supplemental Damages, Ongoing Royalty, and
Periodic Accounting, ECF No. [160], is GRANTED IN PART AND
DENIED IN PART consistent with this opinion.
3. The parties shall attempt to NEGOTIATE terms for future use of the
Infringing PWCs. Towards that end, they are directed to select a mediator and
schedule a date, time, and place for mediation no later than September 2,
2016. The parties shall submit a mediation report indicating the results of the
mediation within seven days of the scheduled mediation.

the term of the license. 8. The established profitability of the product made under the patent; its
commercial success; and its current popularity. 9. The utility and advantages of the patent property over
the old modes or devices, if any, that had been used for working out similar results. 10. The nature of the
patented invention; the character of the commercial embodiment of it as owned and produced by the
licensor; and the benefits to those who have used the invention. 11. The extent to which the infringer has
made use of the invention; and any evidence probative of the value of that use. 12. The portion of the
profit or of the selling price that may be customary in the particular business or in comparable businesses
to allow for the use of the invention or analogous inventions. 13. The portion of the realizable profit that
should be credited to the invention as distinguished from non-patented elements, the manufacturing
process, business risks, or significant features or improvements added by the infringer. 14. The opinion
testimony of qualified experts. 15. The amount that a licensor (such as the patentee) and a licensee (such
as the infringer) would have agreed upon (at the time the infringement began) if both had been reasonably
and voluntarily trying to reach an agreement; that is, the amount which a prudent licensee – who desired,
as a business proposition, to obtain a license to manufacture and sell a particular article embodying the
patented invention – would have been willing to pay as a royalty and yet be able to make a reasonable
profit and which amount would have been acceptable by a prudent patentee who was willing to grant a
license.” Georgia-Pacific Corp. v. U.S. Plywood Corp., 318 F. Supp. 1116, 1120 (S.D.N.Y. 1970).

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4. No later than November 14, 2016, the parties shall file a joint report
indicating the negotiated terms of any licensing agreement reached.
DONE AND ORDERED in Miami, Florida, this 12th day of August, 2016.

____________________________________
BETH BLOOM
UNITED STATES DISTRICT JUDGE
Copies to: Counsel of Record

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