The Increasing Use of Challenges to Expert Evidence Under Daubert and Rule 702 in Patent Litigation

• Jurisdiction: United States,Federal
• Citation: Vol. 22 No. 2
• Publication year: 2015

The Increasing Use of Challenges to Expert Evidence Under Daubert and Rule 702 in Patent Litigation

Douglas G. Smith

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Smith: The Increasing Use of Challenges to Expert Evidence Under Daubert

THE INCREASING USE OF CHALLENGES TO EXPERT EVIDENCE UNDER DAUBERT AND RULE 702 IN PATENT LITIGATION

Douglas G. Smith^*

Table of Contents

I. Introduction..........................................................................................346

II. The Principles Articulated in Daubert......................................347

III. The Expanding Application Of Daubert in Patent Cases............................................................................................................350

A. Damages..............................................................................................351

1. The Federal Circuit's Damages Framework......................................352
2. The District Courts...........................................................................356

a. Apportionment of Damages.......................................................356
b. Relevance of Underlying Data....................................................358
c. Reliability of Underlying Data and Analysis.............................359
d. Lack of Evidentiary Support.....................................................361
e. Intersection with Patent Law.....................................................363
f. Expert Qualifications................................................................364

B. Liability...............................................................................................365

1. The Federal Circuit...........................................................................365
2. The District Courts...........................................................................365

a. Reliability and Scientific Support...............................................366
b. General Acceptance and Scientific Support...................................368
c. Opinions Contrary to Claim Construction.................................369
d. Parties' Intent............................................................................371
e. Expert Qualifications................................................................372

IV. Conclusion...............................................................................................372

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I. Introduction

The Supreme Court's decision in Daubert v. Merrell Dow Pharmaceuticals¹ has had wide-ranging impact. Codified in Federal Rule of Evidence 702, federal courts are now required to act as "gatekeepers" to ensure that expert evidence is both relevant and reliable. Courts have applied the principles articulated in the Daubert decision in an ever-expanding range of cases, including not only product liability and mass tort cases where the doctrine was originally developed,² but also antitrust, securities, commercial, and environmental contamination cases.³ Indeed, any case in which scientific or technical expert evidence is presented is a candidate for a challenge under Daubert to the reliability and relevance of a party's expert evidence.

Decisions regarding the admissibility of expert evidence under Rule 702 and Daubert are frequently dispositive. Wherever expert testimony is submitted or required to establish various elements of a plaintiff's claim, review by the trial court under Rule 702 and Daubert has the potential to bar plaintiff's claims in part or in their entirety. Even where Daubert motions are not completely successful, they can have the effect of significantly shaping the issues for trial. Accordingly, parties in large-scale litigation frequently expend great effort in litigating the scientific and technical basis for their claims before the trial judge.

Thus, it comes as no surprise that parties in patent litigation are increasingly challenging the admissibility of expert testimony under Rule 702 and Daubert. These challenges initially focused on the plaintiff's damages case, gaining support with the Federal Circuit decisions in Lucent,⁴ ResQNet,⁵ Uniloc,⁶ and LaserDynamics⁷ and building on the common-law principle that damages may not be speculative. However, challenges to other types of expert testimony are increasingly common. Thus, for example, litigants have challenged proffered expert testimony on infringement, claim construction, and enablement. Given

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that Daubert presents another opportunity for a litigant to derail or limit an opponent's claims, the frequency of such challenges, which can have significant impact on the litigation, is only likely to increase. Indeed, recent decisions in high-profile patent cases have only added to the likelihood that litigants will seek to invoke Daubert in future cases.

Part II of this Article discusses the general principles articulated in Daubert and subsequent decisions interpreting Rule 702. These decisions provide significant guidance regarding general principles that may be applied in assessing the relevance and reliability of proffered scientific evidence, including in the patent context. The Supreme Court has made clear that the scrutiny of expert evidence under Rule 702 and Daubert is rigorous, designed to ensure that any expert testimony upon which a party seeks to rely is both relevant and reliable, and that the expert is qualified to offer the opinions for which the expert is being offered.

Part III then discusses application of Daubert in the context of patent litigation, beginning first with its application to expert opinions regarding damages and then its expansion into other areas of expert testimony. As in other areas, many of the principles applied in analyzing Daubert issues in the patent context are not unique. Courts seek to ensure that an expert's testimony is sufficiently reliable to be admissible and that the expert's opinions are sufficiently related to the issues in the case. Nonetheless, patent cases present a whole new set of circumstances in which Daubert principles may be applied, given the wide range of experts that frequently testify in such cases and the unique role of the courts in deciding other threshold matters.

II. The Principles Articulated in Daubert

Under Rule 702 and Daubert, federal trial courts must serve as gatekeepers to ensure that any and all scientific testimony or evidence admitted is not only relevant, but reliable.⁸ As the Supreme Court recognized in its subsequent decision in Weisgram v. Marley, under Rule 702, expert testimony must meet "exacting standards of reliability."⁹ The burden is on the proponent of expert testimony to show by a preponderance of proof that the expert meets each of the Daubert requirements.¹⁰ The requirements apply not only to purely "scientific" evidence, but to all expert testimony involving "technical" or "other

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specialized" knowledge.¹¹ In patent cases, the district court looks to the law of the regional circuit in determining the admissibility of expert evidence under Rule 702 and Daubert.¹²

Among other things, Rule 702 requires that expert witnesses (1) base their opinions upon sufficient facts or data, (2) develop their opinions using reliable principles and methods, and (3) apply those principles and methods reliably to the facts of the case.¹³ In addition, expert witnesses must be qualified by knowledge, skill, experience, training, or education to offer their opinions.¹⁴ Expert opinions that fail to meet these requirements are inadmissible.¹⁵

The text of Rule 702 provides some guidance with respect to the nature of the inquiry. The rule requires that an expert's testimony be based on "scientific . . . knowledge,"¹⁶ which courts have interpreted as implying that the expert's opinions have a "grounding in the methods and procedures of science."¹⁷ Expert testimony cannot be based on mere "subjective belief or unsupported speculation."¹⁸

Accordingly, under Rule 702's reliability prong, proposed testimony must be supported by "appropriate validation"—what the Supreme Court in Daubert labeled " 'good grounds,' based on what is known."¹⁹ An expert's mere assurance that the expert has utilized generally accepted principles is insufficient.²⁰ Rather, there must be some independent basis for concluding that the expert's opinions meet the requirements under Rule 702.

Not only must expert opinion be based on sufficient facts and data, but it must be "the product of reliable principles and methods" that are reliably applied to the facts of the case.²¹ "[T]he reliability analysis applies to all aspects of an expert's testimony: the methodology, the facts underlying the expert's opinion, [and] the link between the facts and the conclusion."²² In sum, an

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expert must "employ[ ] in the courtroom the same level of intellectual rigor that characterizes the practice of an expert in the relevant field."²³

Under Daubert's relevance prong, expert evidence must assist the trier of fact to understand the evidence or to determine a fact in issue. The Supreme Court has characterized this language as imposing, among other things, a requirement of "fit" between the expert's proposed testimony and the facts and circumstances of the case.²⁴ In other words, an expert's opinion must be "sufficiently tied to the facts of the case that it will aid the jury in resolving a factual dispute."²⁵ As the Supreme Court explained in General Electric Co. v. Joiner, expert testimony is inadmissible where "there is simply too great an analytical gap between the data and the opinion proffered."²⁶ "[N]othing in either Daubert or the Federal Rules of Evidence requires a district court to admit opinion evidence that is connected to existing data only by the ipse dixit of the expert."²⁷

Finally, the expert must be qualified to offer each of the expert's opinions.²⁸ In assessing this prong under Rule 702, courts seek to ensure that the expert has specific qualifications that fit the specific opinions the expert is...