Thorne Research et al v. Atlantic Pro-Nutrients

Filing 326

MEMORANDUM DECISION and Order Denying Defendant's 276 Motion in Limine of Defendant's Motion in Limine No. 1 to Prohibit Plaintiffs from Seeking Monetary Damages, Including a Reasonable Royalty, at Trial. Signed by Judge Ted Stewart on 2/9/2018. (jwt)

IN THE UNITED STATES DISTRICT COURT FOR
THE DISTRICT OF UTAH

THORNE RESEARCH, INC. and SOFTGEL
FORMULATORS, INC.,

MEMORANDUM DECISION AND ORDER
DENYING DEFENDANT’S MOTION IN
LIMINE NO. 1 TO PROHIBIT PLAINTIFFS
FROM SEEKING MONETARY DAMAGES,
INCLUDING A REASONABLE ROYALTY,
AT TRIAL

Plaintiffs,
vs.
XYMOGEN,

CASE NO. 2:13-CV-784 TS
Judge Ted Stewart

Defendant.

This matter is before the Court on Defendant Xymogen’s Motion In Limine No. 1 to
Prohibit Plaintiffs from Seeking Monetary Damages, Including a Reasonable Royalty, at Trial.
According to Xymogen, Plaintiffs Thorne and Softgel Formulators (collectively, “Thorne”)
initially sought only an injunction and Xymogen was unaware that Thorne intended to seek
damages in the form of a reasonable royalty until Thorne filed its proposed jury instructions on
January 17, 2018. For the following reasons, the Court denies the Motion.
I.

DISCUSSION

In patent cases, there is a “presumption of damages when infringement is proven” 1 since
the statute clearly states that “[u]pon finding for the claimant the court shall award the claimant
damages adequate to compensate for the infringement, but in no event less than a reasonable

1

Dow Chemical Co. v. Mee Indus., Inc., 341 F.3d 1370, 1382 (Fed. Cir. 2003) (“The
district court’s conclusion that no damages could be awarded, in light of the presumption of
damages when infringement is proven, was in error.”); Lindemann Maschinenfabrik GmbH v.
Am. Hoist & Derrick Co., 895 F.2d 1403, 1406 (Fed. Cir. 1990) (“In patent law, the fact of
infringement establishes the fact of damage because the patentee’s right to exclude has been
violated.”).

1

royalty for the use made of the invention by the infringer . . . .” 2 “Further, section 284 is clear
that expert testimony is not necessary to the award of damages, but rather may be received as an
aid.” 3 Fact witnesses may also testify “as to various facts that may also be relevant for the
Georgia-Pacific factors used to determine damages . . . provided a foundation is shown.” 4 In
light of the relevant statute and supporting case law, the Court finds that Thorne may argue for
damages as they relate to a reasonable royalty.
There is another issue, however, as to whether Thorne may introduce evidence in support
of those arguments since the presumption of a reasonable royalty does not result in a right to put
on evidence in support of those damages. 5
“If a party fails to provide information in compliance with Federal Rule of Civil
Procedure 26(e), “the party is not allowed to use that information or witness to supply evidence
on a motion, at a hearing, or at a trial, unless the failure was substantially justified or is
harmless.” 6 “A district court need not make explicit findings concerning the existence of a
2

35 U.S.C. § 284 (emphasis added).

3

Dow Chemical Co., 341 F.3d at 1381–82 (Fed. Cir. 2015) (internal quotation marks
omitted); 35 U.S.C. § 284 (“The court may receive expert testimony as an aid to the
determination of damages or of what royalty would be reasonable under the circumstances.”).
4

Phillip M. Adams & Assoc., LLC v. Lenovo Int’l et al, No. 1:05-CV-64-TS, Docket No.
1703, at 2.
5

Info-Hold, Inc. v. Muzak LLC, 783 F.3d 1365, 1372 (“35 U.S.C. § 284 requires the
district court to award damages in an amount no less than a reasonable royalty even if the
plaintiff[s have] no evidence to proffer. We explained that, in such a case, the district court
should consider the Georgia–Pacific factors in detail, and award such reasonable royalties as the
record evidence will support.”) (internal quotation marks omitted); see also Dow Chemical Co.,
341 F.3d at 1382 (holding that the “court’s obligation to award some amount of damages does
not mean that a patentee who puts on little or no satisfactory evidence of a reasonable royalty can
successfully appeal on the ground that the amount awarded by the court is not ‘reasonable’ and
therefore contravenes section 284”); Apple Inc. v. Motorola, Inc., 757 F.3d 1286, 1327 (Fed. Cir.
2014) (“If a patentee’s evidence fails to support its specific royalty estimate, the fact finder is
still required to determine what royalty is supported by the record.”).
6

Fed. R. Civ. P. 37(c)(1).
2

substantial justification or the harmlessness of a failure to disclose.” 7 However, in exercising its
discretion, the court should consider: “(1) the prejudice or surprise to the party against whom the
testimony is offered; (2) the ability of the party to cure the prejudice; (3) the extent to which
introducing such testimony would disrupt the trial; and (4) the moving party’s bad faith or
willfulness.” 8
Inasmuch as evidence on damages has been disclosed in depositions, expert reports, or in
other ways that gave reasonable notice to Xymogen, the Court finds no violation to which Rule
37(c) would apply. Any such violation was harmless and will not prejudice Xymogen. However,
if there is evidence that has not been previously disclosed and does not comply with the above
law, Xymogen may make a timely objection to the admission of that evidence and the Court will
make a ruling at that time.
II.

CONCLUSION

It is therefore
ORDERED that Defendant’s Motion In Limine No. 1 to Prohibit Plaintiffs from Seeking

7

Woodworker’s Supply, Inc. v. Principal Mut. Life Ins. Co., 170 F.3d 985, 993 (10th Cir.

1999).
8

Id.; see also HCG Platinum, LLC v. Preferred Prod. Placement Corp., 873 F.3d 1191,
1203 (10th Cir. 2017) (“In making a discretionary decision, a court must present an explanation
for its choice sufficient to enable a reviewing court to determine that it did not act thoughtlessly,
but instead considered the factors relevant to its decision and in fact exercised its discretion.”)
(internal quotation marks omitted); Gale v. Uintah County, ---F.App’x---, 2017 WL 6397733, *5
(10th Cir. Dec. 15, 2017) (“Where a district court does not consider the Woodworker’s Supply
factors, the ‘failure to consider this criteria amounts to legal error, and we must conclude that the
district court abused its discretion on that ground alone.”) (internal quotation marks omitted).
3

Monetary Damages, Including a Reasonable Royalty, at Trial (Docket No. 276) is DENIED.
DATED this 9th day of February, 2018.
BY THE COURT:

Judge Ted Stewart

4