New Law

Submitted by patentadmin on Tue, 11/16/2010 - 22:10

As a general rule, a plaintiff in a civil action has a duty to “mitigate” (lawyerspeak for “minimize or alleviate”) damages. If the defendant can show that the plaintiff failed to mitigate damages, the plaintiff’s recovery may be reduced. Note the use of the qualifying phrase, “[a]s a general rule.” Recently a plaintiff argued that the duty to mitigate damages did not apply in cases of patent infringement. (IMX, Inc. v. E-Loan, Inc. et al.)

E-Loan, the defendant in a patent infringement suit, alleged, in its defense, that the plaintiff, IMX, had failed to mitigate damages. IMX responded that “failure to mitigate damages is not a defense in a patent infringement case.” In support of this position, IMX asserted that “it cannot find any case law discussing this defense in the context of patent infringement and certain treatises on patent law do not discuss it.” It further argued that this “makes sense because … a patent holder has no recourse when faced with an infringer but to seek a license and, if one is declined to sue for infringement.” IMX was not able, however, “to cite to the Court any authority finding that such a defense may not be raised in a patent infringement case.”

The Court found these arguments to be “without merit.” “It is entirely appropriate for a defendant to assert a failure to mitigate damages when considering what amount of cooperation is appropriate for Plaintiff [IMX], the injured party in this action.”

That sounded like a clear win for E-Loan, right? Well, not exactly! The Court went on to qualify its decision by opining that, “[s]uch a defense may rarely be relevant in a patent infringement case …”

THE LESSON TO BE LEARNED: The absence of contrary authority or precedent DOES NOT mean that your new theory or argument will be accepted or adopted by the Court.

Submitted by Anonymous (not verified) on Tue, 11/23/2010 - 09:47


From this summary, though, it's difficult to understand exactly what position the court is actually taking. But perhaps that's the court's intention ...?

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