Federal Circuit: Objective Prong Of The Willful Infringement Test Is A Question Of Law

On June 14, 2012, the Federal Circuit issued a decision in Bard Peripheral Vascular Inc. v. W.L. Gore & Assocs. Inc., holding that the threshold objective prong of Seagate's willful infringement test is a question of law based on underlying mixed questions of law and fact and is subject to de novo review. This decision may help patent litigants obtain greater certainty regarding the scope of potential damages before proceeding to trial.

Legal Standard for Willful Infringement

In a patent case, if willful infringement is found, the court may, under 35 U.S.C. § 284, enhance damages up to three times the damages awarded. In 2007, the Federal Circuit announced a new test for willful infringement in In re Seagate Tech., 497 F.3d 1360 (Fed. Cir. 2007) (en banc). Namely, to prove willful infringement a patentee must show by clear and convincing evidence that (1) the accused infringer "acted despite an objectively high likelihood that its actions constituted infringement of a valid patent," and (2) "[the] objectively defined risk . . . was either known or so obvious that it should have been known to the accused infringer." Id. at 1371. The first prong of this test is objective, whereas the second prong is subjective and involves the accused infringer's state of mind.

Procedural History

The Bard case stems from a dispute spanning several decades concerning a patent for prosthetic vascular grafts. Bard Peripheral Vascular, Inc. v. W.L. Gore & Assocs., 670 F.3d 1171, 1175 (Fed. Cir. 2012). A jury found that W.L. Gore had willfully infringed Bard's patent and awarded damages. The district court subsequently denied W.L. Gore's motion for judgment as a matter of law ("JMOL") regarding willfulness and other issues. Id. at 1178. The court further awarded Bard enhanced damages for the willful infringement, as well as attorney's fees and other costs. Id. On appeal, the Federal Circuit initially upheld the determination of willfulness, finding that, despite several defenses offered by W.L. Gore, there was sufficient evidence to satisfy both prongs of the willful infringement test under Seagate. Id. at 1175.

W.L. Gore petitioned for rehearing and rehearing en banc, again challenging the trial court's willfulness analysis. The Federal Circuit denied full en banc review, but granted the petition "for the limited purpose of authorizing the panel to revise the portion of its opinion addressing willfulness." En Banc Order, Bard Peripheral Vascular, Inc. v. W.L...