Three patent infringement awards of $1 billion or more topped The National Law Journal affiliate VerdictSearch’s Top 100 Verdicts of 2012. Intellectual property verdicts represented the largest category in number and dollar value last year. The category has contributed one verdict higher than $1 billion in each of the three prior years. But this year’s list was notable in that three verdicts reached the $1 billion mark or higher, and all of them came out of high-stakes trials.The billion-dollar awards dominated this year’s total — a reflection of how pervasive technology has become in the nation’s economy, said Van Beckwith, a Dallas senior partner at Baker Botts, which had two successful patent infringement verdicts on the list last year. "Much of that technology is technology we all use every day," he said. "Many of these products are wildly popular. If you have infringement, and it goes against you with a jury, the numbers can be huge."
Products liability verdicts continued their downward spiral, falling 73 percent, while medical malpractice verdicts jumped a startling 140 percent, with 14 awards on the list — second only to intellectual property in number. Some outlier verdicts also boosted dollar totals in fraud, nursing home abuse and dram-shop cases.
$1 BILLION AND COUNTING…
To be sure, verdicts worth billions aren’t new to the list. The largest verdicts in 2011 were for $150.4 billion, $2.3 billion and $1.5 billion. But the first two cases were outliers since the defendants were not represented at trial.
In intellectual property last year, the total dollar amount of nearly $4.4 billion was significantly more than the value of verdicts in other areas. It was 17 percent less than in 2011, but that year’s total was driven by the $2.3 billion outlier verdict. Without that case, intellectual property verdicts would have been up by more than 45 percent from 2011.
At No. 1 was Carnegie Mellon Univer­sity’s nearly $1.17 billion award on December 26 against Marvell Technology Group Ltd. The case, in federal court in Pittsburgh, revolved around two patents related to integrated circuit technology. The jury also found that Marvell willfully infringed, so Carnegie Mellon has sought to triple the damages. Carnegie Mellon’s attorneys, K&L Gates partners Douglas Greenswag in Seattle and Patrick McElhinny in Pittsburgh, declined to comment. At the time of the verdict, Carnegie Mellon said it "did not undertake this suit lightly and once we undertook it we did not pursue it lightly."
APPLE V. SAMSUNG
In the No. 2 case, a jury in San Jose, Calif., awarded almost $1.05 billion on August 24 to Apple Inc. in its battle against Samsung Electronics Co. Ltd. over patents tied to smartphone and tablet devices. The jury found Samsung, maker of the Galaxy phone, had willfully infringed six patents but ruled against Apple on its claims of antitrust violations and breach of contract. The jury also denied Samsung’s infringement counterclaims against Apple and upheld the validity of Apple’s patents.
Since the award, U.S. District Judge Lucy Koh denied Apple’s move to ban Samsung’s infringing products from sale in the United States. She also threw out the jury’s finding that Samsung had willfully infringed, which prevents Apple from seeking triple damages. And on March 1, she slashed the total award to $598.9 million after agreeing with Samsung that the jury improperly calculated damages as to half the products at issue in the case. Lead plaintiff attorney William Lee, a partner in Wilmer Cutler Pickering Hale and Dorr’s Boston office, referred calls to Apple. Calls to Apple spokespeople were not returned.
"Samsung and Marvell are far from over," wrote John Quinn, a partner at Los Angeles-based Quinn Emanuel Urquhart & Sullivan, in an email to The National Law Journal. His firm represented both companies in their high-profile losses last year. Samsung, he wrote, will take its case "to the [U.S. Court of Appeals for the] Federal Circuit and the Supreme Court if we need to."
Marvell has similar plans. Quinn said 80 percent of the damages in that verdict were for sales outside the United States that "should not be recoverable."
In addition to Marvell and Apple, Quinn Emanuel lost a nearly $30.5 million patent verdict in Virginia that made the list at No. 66. That case, in which the firm represented AOL Inc., Google Inc. and others, was brought by I/P Engine Inc., which asserted claims over its search-engine patents. But the year wasn’t all that bad: The firm also won a $50 million case in Delaware for Shelbyzyme LLC, owner of a patent used in therapies to treat a genetic disorder called Fabry disease, against Genzyme Corp. The verdict was No. 46. And of the 34 cases and arbitrations tried last year, the firm won 24, Quinn wrote. Most, he said, were for defendants.
"Plaintiffs verdicts generate the big headlines," he wrote. "It is a fact of life that defense verdicts just do not generate nearly as much publicity. On balance, we try more cases representing defendants than plaintiffs and have saved our clients far more in defense verdicts than the verdicts we have given up."
The third-highest verdict of $1 billion came in the decidedly less high-tech field of genetically modified soybeans. On August 1, a federal jury in St. Louis ruled for Monsanto Co. in a case alleging E.I. du Pont de Nemours and Co. had infringed on a patent that allows seeds to be resistant to its pesticide. [See Page 13.]
PRODUCTS CASES DOWN
Some trends continued last year. In 2011, products liability verdicts, once among the categories with the largest awards, dropped by 24 percent to $1.38 billion. In 2012, the trend accelerated — products liability verdicts plummeted to less than $373 million, and the number of awards dropped from 19 to nine.
The largest award was a $75.4 million verdict, coming in at No. 34, in a wrongful-death smoker case in Fort Lauderdale, Fla., against Big Tobacco. Beckwith, of Baker Botts, said tort reform has limited the ability of plaintiffs attorneys to bring lucrative products liability cases, and more defendants have settled these cases.
But medical malpractice verdicts, once a tort reform target, totaled more than $1 billion in 2012, up from $430 million the year before. The largest award also topped last year’s: $178.4 million to a man who suffered brain injuries after problems arose during his weight-loss surgery.Brian Cummings, of counsel to Levine, Orr and Geracioti in Nashville, Tenn., who represented defendant Memorial Hospital of Jacksonville, Fla., while at Gideon, Cooper & Essary in Nashville, did not return a call for comment.
Plaintiffs attorney Thomas Edwards, a senior partner at Edwards & Ragatz in Jacksonville, said medical malpractice verdicts are up because insurance carriers are forcing more cases to trial and medicine has become more institutionalized, leading to more errors.
"In the medical malpractice arena, you’d find an increasing number of trials across the board," he said. "We’re seeing more big verdicts, but also more defense verdicts."
As in past years, California was the most popular venue, with Los Angeles courts alone contributing 10 of the top verdicts.
Some types of cases had high values due to outlier verdicts. Fraud verdicts, for instance, totaled $1.16 billion last year — the second-largest category in dollar amount — but that included a $956.6 million verdict for Liberty Media Corp. on June 25 against Vivendi Universal S.A. for having inflated its stock before the 2001 purchase of USA Holdings Inc. Final judgment, including prejudgment interest, was entered on January 17 for roughly $1 billion (the verdict was rendered in euros).
Beckwith declined to comment about the case, in which Baker Botts represented Liberty Media; his colleague, Michael Calhoon, a partner in Washington who handled the case, did not return a call for comment. Vivendi, which has appealed, has said it "strongly believes that it did no wrong and intends to pursue its appeal to the fullest extent possible."
Jurors in the case knew about a separate verdict in 2010 finding that Vivendi had misled shareholders about its financial condition from 2000 to 2002. Vivendi attorney James Quinn, co-chairman of the litigation practice at Weil, Gotshal & Manges in New York, declined to comment beyond saying: "We’ll vigorously pursue appeals in both cases."
Another outlier case was in nursing home abuse, where two cases totaled $1.1 billion, one of which was a $900 million verdict for a man who ended up having a leg amputated after suffering pressure sores and infections while at a nursing home in Gainesville, Fla. Bennie Lazzara Jr. of Wilkes & McHugh in Tampa, Fla., who obtained both verdicts, did not return a call for comment. In both cases, the defendants were not represented at trial.
Another outlier was a $716 million verdict awarded to the parents of a Florida man who was killed by a high school senior who got in his Camaro after buying beer at a local convenience store. The man’s parents had sued the owners of the convenience store, who weren’t represented at trial.
The verdict is the sole award in a dram-shop case to make the list. The store owners have since filed for Chapter 7 bankruptcy protection. But for his clients, said plaintiffs attorney William Gilbert of Dano & Gilbert in Moses Lake, Wash., the case was never about money. "They want to see penalties for people who sell alcohol to minors," he said.
Amanda Bronstad can be contacted at firstname.lastname@example.org.