On remand from the Federal Circuit for re-trial on the issues of obviousness and anticipation, Judge Robinson denied defendant Acushnet Company’s renewed motion for summary judgment and Daubert motion, she granted in part and denied in part Acushnet Company’s motions in limine and granted plaintiff Callaway Golf Company’s motions in limine. Callaway Golf Company v. Acushnet Company, C. A. No. 06-091-SLR, Memo. Op. (D. Del. Mar. 3, 2010). The technology at issue in this case was Acushnet’s Titlest Pro V1, Pro V1* and Pro V1x golf balls. The Federal Circuit reversed the court’s entry of summary judgment of no anticipation, vacated the obviousness judgment based on irreconcilably inconsistent jury verdicts, and remanded for a new trial.
The court denied defendant’s motion for summary judgment on anticipation finding that the asserted piece of prior art known as the “Nesbitt” patent does not explicitly anticipate plaintiff’s patent. Defendant’s argument was that certain measurements taken on balata balls would “teach a person of skill in the art that a polyurethane cover must invariably have the same Shore D hardness.” The court found that “[a]side from attorney argument, no evidence (let alone Nesbitt) cited by Achushnet makes that causative leap, to wit, that if A equals B, and A equals C, then C equals B.” Id. at 7.
On remand, Acushnet renewed its Daubert motion to exclude the expert testimony of plaintiffs’ damages expert, Brian Napper. Defendant moved to disqualify Mr. Napper for (1) failing to create the “but for” world of lost profits starting at the first date of infringement; and (2) failing to account for what players using the infringing balls would play with in the absence of that ball (the so-called “premium market”). Specifically, Acushnet argued that the expert did not include in his analysis what defendant would have offered at the first date of infringement if the Pro V1 ball was not available, how the market would have responded to that offering or what the market would have looked like if they withdrew the Pro V1 in 2003. Id. at 12. Judge Robinson stated that “[t]o credibly demonstrate that Acushnet would have had viable, non-infringing alternatives to offer in 2001 – as well as to predict how the market would have responded to these alternatives by 2003 – is an exercise that may be appropriate, but certainly is not one that is mandatory in light of its speculative nature.” Id. at 13. The court further found the reasoning in Mr. Napper’s report to be grounded on “real world facts, and therefore, acceptable.” Id. “For any economic hypothesis to account for all variables is not possible, let alone required.” Id. (emphasis in original).
Defendant also argued that the expert calculated lost profits on sales by companies that do not own the patents-in-suit. In response, the court held that “where the profits of a wholly-owned subsidiary flow up to the parent, inclusion of such profits is appropriate.” Id.
The court granted defendant’s motion to exclude evidence of defendant’s new Pro V1 balls, which defendant offered as a non-infringing alternative, and therefore, defendant argued was relevant to commercial success and damages. The court found this evidence lacks foundation since it was not vetted through discovery and therefore the use of such evidence would be unduly prejudicial to plaintiff. Id. at 13 n.14.
Frequently, parties dispute how far a plaintiff can go in “bolstering” the validity its own patents. Plaintiff in this case, agreed that it would not reference the fact that three PTO examiners considered the patents-in-suit. The court further held that plaintiff should not make any reference to the on-going reexam of the patents-in-suit and that plaintiff cannot speculate as to the extent to which prior art that was before the PTO was actually considered. Id. at 14.