Juniper Networks Inc. has prevailed in a jury trial on a patent infringement claim that cybersecurity company Finjan Inc. had valued at $60-70 million.
An Irell & Manella team led by partner Jonathan Kagan persuaded U.S. District Judge William Alsup of the Northern District of California to exclude all of Finjan’s damages evidence. Jurors then found Dec. 14 that Juniper’s cloud-based scanning systems did not infringe claim 10 on Finjan’s patent on a malware runtime monitoring system.
Finjan has a track record of decent success in the Bay Area. It won a $39.5 million verdict against Blue Coat Systems in 2015—later settled following a reduction in damages on appeal—and a $15 million verdict against Sophos Inc. in 2016 that featured the same 8,777,494 patent from last week’s trial. Finjan states on its website that it has generated more than $350 million from licensing its IP.
“We’re disappointed, but not discouraged,” Finjan Chief Intellectual Property Office Julie Mar-Spinola said Monday afternoon. She noted that post-trial motions lay ahead, and that Finjan is asserting other claims against Juniper that have yet to be tried.
Juniper and Irell had argued that the accused product, a cloud-based malware protection service called Sky ATP that’s offered as an add-on to Juniper’s SRX Gateways, generated only $1.8 million in revenues during the damages period. “The notion that Juniper would have agreed to pay Finjan $60-$70 million on sales of $1.8 million defies basic laws of economics,” Juniper argued in a motion signed by Irell partner Rebecca Carson.
Irell argued that Finjan’s expert, Kevin Arst, had improperly calculated damages based on all SRX gateways, whether enabled with Sky ATP or not, and on related cost savings.
Alsup apparently agreed—he excluded Arst’s testimony, though his reasoning is under seal. Although he stated throughout the proceedings that experts aren’t necessary in his view to prove damages, he ultimately excluded lay testimony from Finjan executives as to the patent’s licensing value.
Along with Kagan and Carson, Juniper’s team included partner Alan Heinrich and associates Josh Glucoft, Casey Curran, Sharon Song and Kevin Wang. Finjan was represented by regular outside counsel at Kramer Levin Naftalis & Frankel.
The case was tried under Alsup’s “shootout” format, in which he instructs the plaintiff to assert what it considers its strongest claim and the defendant to attack the weakest. The idea is to develop guidance for the parties on the value of all the asserted claims while educating Alsup about the patents. In many cases both claims get decided on summary judgment. Alsup did grant summary judgment of non-infringement on Juniper’s chosen claim, but found factual issues that had to be submitted to a jury on Finjan’s claim.
Finjan v. Juniper Networks had drawn attention on the IP blog Patently-O because Alsup had indicated he would submit part of Juniper’s claim that the patent is ineligible under Section 101 to the jury. But the parties subsequently stipulated that Alsup could decide patent eligibility after trial. Given the outcome on damages and non-infringement, it’s not clear if Alsup will rule on eligibility.