On May 30th, Judge Randall Rader stepped down as chief judge of the U.S. Court of Appeals for the Federal Circuit and was replaced by Judge Sharon Prost. With Prost’s appointment, one of the major questions is whether she will continue her predecessor’s emphasis on reforming the damages analysis used by experts (and practitioners) in patent litigation.
Under Rader, the Federal Circuit issued a number of rulings limiting various mechanisms used by plaintiffs to bolster their patent damages calculations. For example, during Rader’s tenure, the Federal Circuit limited the application of the entire market value rule (see e.g., Lucent v. Gateway), limited the applicability of prior licenses in the reasonable royalty analysis (see e.g., ResQNet.com v. Kaplan & Gilman) and abolished the 25 percent rule (Uniloc v. Microsoft). Also during this time, Rader issued several opinions at the district court level rejecting various damages theories offered by plaintiffs. Accordingly, the pressing question for damages experts and practitioners alike is: Will the Federal Circuit continue these trends in the area of damages now that Prost is taking over?
