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CalAmp dodges second multi-million dollar patent verdict at Fed Circ.

3 minute read

The United States Court of Appeals for the Federal Circuit is seen in Washington, D.C., U.S., August 30, 2020. REUTERS/Andrew Kelly

  • Evidence of similar licenses didn't support $4.5 million award
  • District court shouldn't have excluded CalAmp expert testimony
  • Second time Fed Cir has sent case back

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(Reuters) - Telematics company CalAmp Corp escaped a multi-million dollar damages award for the second time in an infringement dispute with a patent holding company on Tuesday, after the U.S. Court of Appeals for the Federal Circuit vacated a Florida jury's $4.5 million verdict and ordered a new trial on damages.

The amount of the award wasn't justified by Omega Patents LLC's evidence and a federal judge wrongly excluded testimony from a CalAmp expert, U.S. Circuit Judge Sharon Prost wrote for a three-judge panel.

Omega's attorneys Megan Woodworth of Venable and Brian Gilchrist of Allen, Dyer, Doppelt, & Gilchrist didn't immediately respond to a request for comment, nor did CalAmp or its attorney Constantine Trela of Sidley Austin.

Georgia-based Omega owns patents related to a system for controlling vehicle functions remotely compatible with multiple vehicles. The sole inventor on all of the patents is Omega's president, Kenneth Flick.

Irvine, California-based CalAmp specializes in tracking assets like vehicle fleets. Omega sued CalAmp in 2013 in Orlando, Florida federal court, arguing CalAmp's Location Messaging Units, which use GPS to track vehicles, infringed its patents.

A jury found in 2016 that CalAmp infringed four Omega patents willfully and awarded Omega nearly $3 million in damages, which the court eventually increased to nearly $15 million. The Federal Circuit vacated the award and sent the case back for a new trial in 2019, finding issues with several aspects of the decision.

After a second trial, a jury awarded Omega more than $4.5 million in royalties in 2019 for infringing one of the patents. U.S. District Judge Paul Byron is presiding over the Florida case.

CalAmp appealed again, challenging the reasonableness of the damages award and the decision to exclude its expert's rebuttal testimony, among other things.

Prost, joined in the opinion by Circuit Judges Timothy Dyk and Todd Hughes in part, agreed with CalAmp that the jury's $5-per-unit royalty award didn't "apportion," or separate, the non-infringing aspects of CalAmp's products from the infringing ones.

Omega argued it didn't need to show apportionment because every component of CalAmp's product is covered by the patent. But even if they have the same components, Prost said Omega still had to apportion "between the improved and conventional features of the accused product."

Prost also said that CalAmp's product has conventional components that aren't covered by the patent, and that Omega failed to show the patented improvement drove demand for it.

Omega also lost on its argument that its blanket policy of licensing its patents at $5 per unit made the award reasonable. Omega's "fundamental problem" was that the licensing agreements it presented didn't justify a $5-per-unit royalty for a license to the single patent at issue, largely because the agreements covered several patents each, Prost said.

The district court's exclusion of a CalAmp expert's testimony on damages in the second trial based solely on its preclusion from the first trial was also improper, Prost said.

The panel also affirmed that CalAmp infringed the patent, and found that its customers didn't infringe another Omega patent.

In a partial dissent, Hughes said the evidence of Omega's other licenses was enough to support the award, and that excluding CalAmp's expert testimony was justified because CalAmp didn't challenge the order on its first appeal and the Federal Circuit's earlier decision "likewise failed to mention it."

The case is Omega Patents LLC v. CalAmp Corp, U.S. Court of Appeals for the Federal Circuit, No. 20-1793.

For Omega: Megan Woodworth of Venable; and Brian Gilchrist of Allen, Dyer, Doppelt, & Gilchrist

For CalAmp: Constantine Trela of Sidley Austin

Blake Brittain reports on intellectual property law, including patents, trademarks, copyrights and trade secrets. Reach him at blake.brittain@thomsonreuters.com

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