I/P Engine, Inc. v. AOL, Inc. et al

Filing 794

Declaration re 792 MOTION FOR AN AWARD OF PREJUDGMENT INTEREST, POST-JUDGMENT INTEREST, AND SUPPLEMENTAL DAMAGES FOR DEFENDANTS POST-DISCOVERY/PRE-VERDICT INFRINGEMENT of Stephen L. Becker, PHD. by I/P Engine, Inc.. (Attachments: # 1 Exhibit A)(Sherwood, Jeffrey)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF VIRGINIA
NORFOLK DIVISION
__________________________________________
)
)
)
Plaintiff,
)
v.
)
)
AOL, INC. et al.,
)
)
Defendants.
)
__________________________________________)
I/P ENGINE, INC.,

Civ. Action No. 2:11-cv-512

DECLARATION OF STEPHEN L. BECKER, PH.D. IN SUPPORT
OF PLAINTIFF I/P ENGINE, INC.’S MOTION FOR AN AWARD OF PREJUDGMENT
INTEREST, POST-JUDGMENT INTEREST, AND SUPPLEMENTAL DAMAGES FOR
DEFENDANTS’ POST-DISCOVERY/PRE-VERDICT INFRINGEMENT

I, Stephen L. Becker, Ph.D., declare as follows:
1.

I submitted an expert report and provided oral testimony at trial in this matter on

behalf of plaintiff I/P Engine, Inc. (“I/P Engine”). I described my qualifications in both my trial
testimony and expert report. For efficiency, I will not repeat them in this declaration. I have
personal knowledge of the facts set forth in this Declaration. If called upon to testify, I could and
would certify competently to these facts.
2.

I have been asked to calculate the prejudgment interest that would be applied to

the jury’s damages award in this matter. On November 6, 2012, the jury determined that
Defendants infringed I/P Engine’s ‘420 and ‘664 patents (“Asserted Patents”). D.I. 789 (Verdict
Form, Nov. 6, 2012). The jury awarded I/P Engine damages of $30,496,155, not including
interest. See id., at 11.

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3.

The revenue data upon which I based my damages analysis and calculations at

trial, and upon which the jury rendered its verdict, was reported by the Defendants through
September 30, 2012. Therefore, I was only able to estimate damages through this time period in
my report and at trial.
4.

The methodology that I employed in deriving my prejudgment-interest calculation

is as follows: (a) I determined the average prime interest rate, as reported by the Federal Reserve,
that prevailed during each quarter of the period since September 15, 2011 to November 6, 2012;
(b) I allocated by Defendant the proportional damages awarded by the jury to the infringing
revenues, by quarter, from the third quarter of 2011 through the third quarter of 2012; (c) I then
determined the number of quarters of interest that would be due on each of those amounts; and
(d) using the average prime interest rate, as reported by the Federal Reserve, and compounded
quarterly, I computed the amount of interest presently due on for each quarter. Using this
methodology I calculated the prejudgment interest due on the damages awarded by the jury from
September 15, 2011 to November 6, 2012 to be $643,084. See Exhibit A. If requested, I will be
able to provide a supplemental calculation through any subsequent judgment date.
5.

I have also been asked to evaluate the calculation of damages for infringement by

Defendants for the period since October 1, 2012 until the date of judgment. If provided with
supplemental U.S. revenue data for the infringing products, I would be able to provide a
calculation of damages for that time period using the same methodology and analysis that I
testified to at trial. Specifically, I would apply the apportionment percentage of 20.9%, which is
the flat going-forward apportionment percentage that I presented at trial (Trial Tr. at 820-21) to
Defendants’ total U.S. revenues from the accused systems, AdWords, AdSense For Search and
AdSense For Mobile Search (derived from the requested accounting) to determine the

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apportioned royalty base. I would then apply the reasonable royalty rate that I presented and as
awarded by the jury (Trial Tr. at 766; D.I. 789 (Verdict Form, at 11)) of 3.5% rate to the
apportioned royalty base. I would also calculate prejudgment interest on these supplemental
damages in the manner described above.

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*

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I declare under penalty of perjury that the foregoing is true and correct. Signed
November 9, 2012 in Austin, Texas.

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CERTIFICATE OF SERVICE
I hereby certify that on this 9th day of November, 2012, the foregoing DECLARATION
OF STEPHEN L. BECKER, PH.D. IN SUPPORT OF PLAINTIFF I/P ENGINE, INC.’S
MOTION FOR AN AWARD OF PREJUDGMENT INTEREST, POST-JUDGMENT
INTEREST, AND SUPPLEMENTAL DAMAGES FOR DEFENDANTS’ POSTDISCOVERY/PRE-VERDICT INFRINGEMENT was served via the Court’s CM/ECF system
on the following:
Stephen Edward Noona
Kaufman & Canoles, P.C.
150 W Main St
Suite 2100
Norfolk, VA 23510
[e-mail]
David Bilsker
David Perlson
Quinn Emanuel Urquhart & Sullivan LLP
50 California Street, 22nd Floor
San Francisco, CA 94111
[e-mail]
[e-mail]
Robert L. Burns
Finnegan, Henderson, Farabow, Garrett & Dunner, LLP
Two Freedom Square
11955 Freedom Drive
Reston, VA 20190
[e-mail]
Cortney S. Alexander
Finnegan, Henderson, Farabow, Garrett & Dunner, LLP
3500 SunTrust Plaza
303 Peachtree Street, NE
Atlanta, GA 94111
[e-mail]
/s/ Jeffrey K. Sherwood