SCOTUS round-up: Time Warner Cable owner must pay $140m damages
The US Supreme Court yesterday passed over the opportunity to hear an appeal brought by Charter Communications division Time Warner Cable (TWC), leaving the company with a hefty damages bill for infringing five-voice over internet protocol (VoIP) patents.
TWC, now under Charter’s Spectrum brand, asked the US’ highest court to grant certiorari in the case after the US Court of Appeals for the Federal Circuit last year affirmed a Kansas jury’s decision to award $140 million in damages to Sprint Communications.
The earliest commercial VoIP products appeared on the market in the 1990s, but the tech has now been more widely popularised through apps such as WhatsApp, Messenger, and other smartphone applications.
Sprint sued TWC in 2011, claiming infringement of five patents covering aspects of VoIP. The US District Court for the District of Kansas ruled in Sprint’s favour, and awarded $140 million in damages.
Apportionment
TWC appealed the ruling to the Federal Circuit, both disputing Sprint’s grounds for infringement, as well as the damages calculation.
The Charter subsidiary argued that the Sprint patents were too broad to bring infringement claims based specifically around VoIP.
According to TWC’s petition to the Supreme Court, the Sprint patents were limited to one feature only: “the ability to have voice calls with customers on the older ‘PTSN’ telephone network”.
In addition, TWC claimed that the damages award was calculated incorrectly and allowed Sprint to take a cut of its entire revenues “without apportioning between revenues attributable to Sprint’s patents and those attributable to unpatented aspects of VoIP service”.
Last year the Federal Circuit affirmed the district court, leading to TWC’s appeal to the Supreme Court.
Intel filed an amicus brief in support of TWC, arguing that the Federal Circuit’s ruling was part of an alarming trend away from the principle of apportionment.
“The Federal Circuit has increasingly tolerated damages methods and theories that sidestep apportionment, permitting patentees to pursue damages claims that wildly overshoot the value of the patented inventions at issue,” Intel argued.
In its reply, Sprint accused TWC of breaking a partnership between the two companies in 2009 to “go it alone and save billions” at a time when Charter had “no alternative” to Sprint’s patented tech.
Sprint also defended the Federal Circuit’s reasoning that the damage award was calculated based on “the value of what was taken from Sprint, not the value of unpatented features of Time Warner’s VoIP system”.
Chief justice Roberts was recused from the Supreme Court’s considerations, which resulted in a denial of certiorari. Roberts is a shareholder in Charter.
Apple, Amazon and H&M
Apple and Amazon, meanwhile, have escaped VoIP-related patent infringement claims after the US District Court for the Northern District of California last week ruled that Voip-Pal.com’s patents were directed towards an abstract idea.
Yesterday also saw the Supreme Court deny certiorari in a case in which Swedish fashion retailer H&M was accused of copying textile designs.
The court’s decision means that H&M must now face the claims, brought by Malibu Textiles, after the US Court of Appeals for the Ninth Circuit revived the company’s copying suit.
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