WESTERNGECO L.L.C. v. ION GEOPHYSICAL CORPORATION

WESTERNGECO L.L.C. v. ION GEOPHYSICAL CORPORATION,  Appeal Nos. 2013-1527, 2014-1121, -1526, & -1528 (Fed. Cir. January 11, 2019).  Before Dyk, Wallach, and Hughes.  Appealed from S.D. Tex. (Judge Ellison).  (Lost Profits; Intervening Invalidation)

Background:

WesternGeco sued ION for infringement of six claims of various patents directed to devices for marine seismic surveys.  WesternGeco builds devices and uses them to perform surveys for customers.  ION builds devices in the United States and sells them to customers outside the United States.  The jury found WesternGeco’s patents not invalid and infringed by ION under 35 U.S.C. §271(f).  The jury awarded a reasonable royalty and lost profits, but did not award enhanced damages for willful infringement.  On appeal, the Federal Circuit reversed the lost profits award and remanded with regard to enhanced damages.

On remand, enhanced damages were awarded.  WesternGeco and ION filed a stipulated Final Judgment in which they agreed to a reasonable royalty amount, enhanced damages, and, except for lost profits, not to appeal.  As to lost profits, the Supreme Court reversed the Federal Circuit, holding that an award was permissible under 271(f).

During the various trials and appeals and before the stipulated Final Judgment was filed by WesternGeco and ION, all but two of the six claims found to be infringed by ION were held by the PTAB to be anticipated or obvious in an IPR, which was affirmed by the Federal Circuit.

Issues/Holdings:

1)  Does the invalidation of four of the six claims found to be infringed affect the reasonable royalty award?

2)  Does the intervening invalidation of four of the six claims found to be infringed require a new trial on the lost profits award?  (continue reading)

Summary by:  Donald Raymond

To view additional Federal Circuit decisions, please visit our Federal Circuit Case Summaries page.