The plaintiff is a technology licensing company that owned a number of patents relating to data compression for storage devices. Its claims against Citrix related to methods of use as opposed to apparatus claims, meaning that the sale of Citrix’s products did not, in and of itself, constitute infringement. As such, Citrix was not accused of direct infringement, but rather of inducing infringement by end users.
Econ One was retained by counsel for Citrix to calculate royalty damages stemming from the sale of Citrix’s accused products. In conducting his analysis, Charles Mahla was asked to account for the likely infringement by end users when calculating the royalty base. Additionally, because a substantial percentage of Citrix’s sales of the accused products were made to users outside the U.S., Dr. Mahla also recognized that royalty damages would be limited to sales to those end users who were practicing the infringing method within the U.S. This approach was consistent with a recent en banc ruling from the U.S. Court of Appeals for the Federal Circuit in Cardiac Pacemakers, Inc. and Guidant Sales Corp., et al. v. St. Jude Medical, Inc., and Pacesetter, Inc. The Court in that case ruled that damages cannot be assessed against an alleged infringer of method claims if those methods are practiced outside of the U.S. Dr. Mahla submitted an expert report and provided deposition testimony prior to the case being settled.