Patent infringement award against Nintendo cut in half

Posted
by Charles Miller

Earlier this year, a jury awarded Tomita Technologies more than $30 million in damages for its claims that the Nintendo 3DS gaming console created and sold by Nintendo infringed on a patent owned by Tomita, U.S. Patent No. 7,417,664 (the “‘664 patent”). Following the verdict, Nintendo filed motions seeking judgment as a matter of law or a new trial as to liability or, alternatively, remittitur or a new trial as to damages. The federal judge overseeing the case has now granted Nintendo’s motion for remittitur or a new trial on damages. By August 23, 2013, Tomita must inform the court in writing of its choice whether to accept a $15.1 million damage award or whether to proceed to a new trial on damages.

Tomita’s patent relates to technology developed for providing 3-D images without the need for 3-D glasses. Tomita alleged that Nintendo uses the ‘664 patent’s technology in the 3DS’s game console’s two outer cameras. Thus, only the 3DS’s camera application (which allows the user to take and view 3D photos and videos) and the augmented reality game card application (which allows some games to be superimposed over realworld images captured by the 3DS’s cameras) are at issue. The 3DS’s other applications, including its 3D display, do not rely on the ‘664 patent.

The court concluded that the jury’s $30.2 million damages award was “intrinsically excessive” and unsupported by the evidence presented at trial. Although the jury’s award amounted to a royalty rate of just under three percent of the sale price of the 3DS, which is less than that paid to Tomita under the licensing agreement presented to the jury as a “comparable” agreement, the court ruled “there are special circumstances relating to the 3DS that strongly suggest that such a royalty rate is excessive this context.” In its August 14, 2013 Order, the court wrote:

To begin with, the evidence at trial showed that the 3DS console is not itself profitable. … Although Tomita’s expert testified that Nintendo derives substantial profits from the sale of games designed solely for the 3DS and therefore those profits should be considered determining the profitability of the 3DS gaming system as a whole, the evidence at trial also established that the vast majority of games designed for the 3DS do not require or even utilize the technology covered by the ‘664 patent. … Thus, it seems that the jury, in coming to such a substantial damages award, likely weighed too heavily the somewhat unrelated profit that Nintendo earns on games for the 3DS.

The court found that “it surpasses reasonable belief that Nintendo would, in a hypothetical negotiation, agree to a reasonable royalty payment anywhere near as large as that awarded by the jury.” The court found that the jury’s damages award was “at least twice as large as the amount a reasonable jury could have awarded based on the evidence presented at trial.”

As noted, the court gave Tomita the choice between accepting either a remittitur of the damages award from $30.2 million to $15.1 million or undertaking a new trial on damages. The court denied other requests from Nintendo, including overturning the jury’s verdict or granting a new liability trial.

Intellectual Property Law and Our Law Firm

At Heygood, Orr & Pearson, our attorneys have handled numerous patent matters including prosecuting claims for infringement, as well as for interfered-with patent rights. We have handled claims brought by a large local company for infringement of its rail car patent, claims by a local inventor for infringement of her patent for a childcare product and claims by an Israeli company against a Fortune 500 company for infringement of its wireless technology patent. Our firm has also represented a client suing a large American pharmaceutical company for interfering with its patent rights to liposome technology. In addition, firm attorney John “Jay” Pate is licensed to prosecute patents before the U.S. Patent and Trademark Office.

Beyond our specific experience in the field of intellectual property, our ability to prosecute patent infringement action is aided by our extensive trial experience in general. While technical knowledge and familiarity with patent rules is a must for attorneys handling patent infringement claims, there is no substitute for courtroom experience.

At Heygood, Orr & Pearson, our seasoned litigators have the experience to take even the most complex patent case and explain it in terms a jury can understand. We have a track record of proven success representing businesses large and small. Several of our trial lawyers are board certified* and many of them have been selected as Super Lawyers in the State of Texas for several years in a row.** Our firm is AV rated, the highest legal and ethical ranking available from the leasing law firm ranking service, Martindale-Hubbell.

If you or your company is in need of representation in an intellectual property matter, contact us for a free consultation by calling toll-free at 1-877-446-9001, or by completing the free case evaluation form located on this page.

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Michael Heygood, James Craig Orr, Jr. and Eric Pearson are all Board Certified in Personal Injury Trial Law — Texas Board of Legal Specialization.

** Michael Heygood, James Craig Orr, Jr. and Eric Pearson were selected to the Super Lawyers List, a Thomson Reuters publication, for the years 2003 through 2013.