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Oct 08

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Posner Opinion Provides Worthwhile Damage Guidance

In re: Apple vs. Motorola, the parties sued each other for patent infringement involving smartphones. Seventh Circuit Judge Richard Posner, sitting by designation, threw out all damage witnesses for both parties on Daubert motions. Then, since both parties lacked damages testimony, he dismissed both cases with prejudice. Interestingly, Judge Posner did not allow either party an opportunity to amend or supplement their expert reports.

Judge Posner is one of the foremost legal scholars in the United States, particularly on economic matters. He has written numerous influential opinions, written almost forty books on law and economics, teaches at the University of Chicago Law School, and is widely respected in the legal community. In an article published in The Atlantic, Judge Posner acknowledges that his opinion will certainly be appealed. This is true because of both the potentially large amounts involved, and the harshness of Judge Posner’s act of throwing both side’s case out. With the appellate opinion, the case will provide guidance no matter which way the case turns out.

The principles that got the experts in trouble are not unique to patent cases, and are actually quite common. The case provides three worthwhile damages lessons for anyone litigating a commercial damages issue. This article provides the details, but here are the headline conclusions:

  1. The expert’s methodology should use a non-litigation process
  2. Do not use impermissible hearsay
  3. Perform what is practical in the circumstances

 

About the author

David Nolte

I am a founding principal of Fulcrum Inquiry, an accounting and economic consulting firm that performs damage analysis for commercial litigation, forensic accountings, financial investigations, and business valuations. I am a Certified Public Accountant (CPA) and an Accredited Senior Appraiser (ASA), as well as having other professional credentials. I regularly serve as an expert witness involving damages measurement. My litigation-oriented resume is on Fulcrum's website.

Permanent link to this article: http://betweenthenumbers.net/2012/10/posner-opinion-provides-worthwhile-damage-guidance/

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