Supreme Court Hints Favoring Discretion For Boosting Penalties for Patent Infringement 

The U.S. Supreme Court recently heard arguments from Halo Electronics Inc. v. Pulse Electronics, No. 14-1513 and Stryker Corp. v. Zimmer Inc. et al, No. 14-1520 and indicated their inclination to give federal judges more discretion to boost penalties for patent infringement.

During oral arguments before the high court, Stryker, a medical device maker, and Halo, which makes circuit board transformers, argued for enhanced damages up to triple the original damages because the infringement of their patents was willful.

The U.S. Court of Appeals for the Federal Circuit denied enhanced damages stating that a patent owner must prove a defendant acted despite a high likelihood of infringement and had no reasonable explanation for doing so.

From the oral argument at the Supreme Court, several of the justices indicated they might be willing to relax that standard, giving federal judges increased discretion. Chief Justice John Roberts called the elaborate test at the Federal Circuit “surprising” and said “courts have been used to dealing with discretionary standards for a long time.”

In addition, Justice Elena Kagan said the existing elaborate standard might serve as an incentive for patent infringement because it gives willful violators a way to escape liability.

This was the first intellectual property case heard by the eight Supreme Court justices following the Feb. 13 death of Justice Antonin Scalia.