2012] WILLFUL PATENT INFRINGEMENT & ENHANCED DAMAGES 419
Willful infringement is a critical issue in patent litigation. A finding of
willfulness can result in an award of enhanced damages up to triple the
amount of actual damages proven by the patentee,1 as well as the possibility
of paying the patentee’s attorney’s fees.2 Indeed, penalties in the range of
tens of millions of dollars for willful infringement are not uncommon.3
Until recently, if a potential infringer had actual knowledge of a patent,
it was obligated to satisfy “an affirmative duty to exercise due care to
determine whether or not [it] is infringing.”4 Among other things, this duty
usually compelled an accused infringer to obtain a competent opinion of
counsel before engaging in potentially infringing acts.5 Failure to do so was
likely to result in a willfulness finding.6
However, in 2007, the Federal Circuit significantly altered the standard
governing willfulness with its en banc decision in In re Seagate Technology, LLC
(“Seagate”).7 Specifically, Seagate abandoned the “affirmative duty of due
care” requirement, instead requiring the patentee to demonstrate by clear
and convincing evidence that the accused infringer was objectively reckless
in its infringement.8 It also held that potential infringers were no longer
obligated to obtain an opinion of counsel.9 As a result, knowledgeable
observers asserted that Seagate would make proving willful infringement
much more difficult, ultimately resulting in far fewer willfulness findings and
enhanced-damages awards.10 To date, however, there has been no
1. 35 U.S.C. § 284 (2006) (stating that “the court may increase the damages up to three
times the amount found or assessed”).
2. Id. § 285.
3. See, e.g., Krippelz v. Ford Motor Co., 670 F. Supp. 2d 815, 824 (N.D. Ill. 2009)
(awarding approximately $21 million in enhanced damages for willful infringement) , appeal
docketed, No. 11-1103 (Fed. Cir. Dec. 7, 2010); i4i Ltd. P’ship v. Microsoft Corp., 670 F. Supp.
2d 568, 596 (E.D. Tex. 2009) (awarding $40 million in enhanced damages for willful
infringement), aff’d as modified, 589 F.3d 1246 (Fed. Cir. 2009), opinion withdrawn and superseded
by 598 F.3d 831 (Fed. Cir. 2010), aff’d on other grounds, 131 S. Ct. 2238 (2011); Final Judgment
at 2–3, DataTreasury Corp. v. Wells Fargo & Co., No. 2:06-CV-72 (E.D. Tex. Aug. 1, 2011)
(awarding $26.6 million in enhanced damages for willful infringement).
4. Underwater Devices Inc. v. Morrison-Knudsen Co., 717 F.2d 1380, 1389 (Fed. Cir.
1983), overruled by In re Seagate Tech., LLC, 497 F.3d 1360 (Fed Cir. 2007) (en banc).
5. Id. at 1390.
6. See Kimberly A. Moore, Empirical Statistics on Willful Patent Infringement, 14 FED. CIR. B.J.
227, 239 (2004) (“If no attorney opinion is presented in defense of a willfulness charge, the
result is usually a finding of willfulness . . . .”).
7. In re Seagate Tech., LLC, 497 F.3d 1360 (Fed. Cir. 2007) (en banc), cert. denied, 552
U.S. 1230 (2008).
8. Id. at 1371.
9. Id.; see also Paul J. Heald, Optimal Remedies for Patent Infringement: A Transactional Model,
45 HOUS. L. REV. 1165, 1197 (2008) (“[Seagate] made clear that there is no affirmative duty on
the part of an exploiting firm to search for a patent, nor any duty to search for advice from
counsel on the validity of a patent that is uncovered if a search is done.”).
10. See infra notes 98–104 and accompanying text.