Sunoco Partners Marketing & Terminals L.P. v. Powder Springs Logistics, LLC, et al.

The Patent Act provides that if a patent owner proves infringement, courts “shall award the claimant damages adequate to compensate for the infringement.” 35 U.S.C. § 284. Damages are “adequate to compensate for infringement when they place the patent owner in as good a position as he would have been in if the patent had not been infringed.” WesternGeco LLC v. ION Geophysical Corp., 585 U.S. 407, 417 (2018) (quotation marks omitted). Despite that, the Federal Circuit does not permit patentees to recover lost profits merely by proving that the infringement caused them to lose reasonably foreseeable sales. After proving that, patentees also must subtract the hypothetical “value” of non-patented services or things that are sold with the patented technology from their lost profits claims. This leaves them with less than the value of the sales. Patent damages often require expert testimony. In the Federal Circuit, courts must exclude experts if they rely on facts contradicted by record evidence, even if record evidence cuts both ways. The questions presented are:

1. Whether the Federal Circuit’s standard for recovery of lost profits damages violates 35 U.S.C. § 284.

2. Whether Rule 702 requires courts to exclude expert testimony when record evidence is contrary to a critical fact upon which the expert relied, as the Federal Circuit holds, or whether juries should determine whether facts upon which an expert relied are true, as all other Circuits have held.