A Waco federal jury ruled Tuesday that Intel infringed on two of VLSI’s patents, albeit not willfully.
Either way, VLSI was awarded $2.175 billion in damages. The jury began deliberating at around 9 a.m this morning and delivered the verdict at 12:30 p.m.
The jury awarded VLSI $1.5 billion for Intel’s infringement on its ‘373 patent and $675 million for infringement of its ‘759 patent. The patented technology is related to the speed and power-saving capabilities of computer chips.
The jury said the amount awarded accounts for a lump sum of all damages. Intel had argued at trial that VLSI’s ‘758 patent is invalid because the U.S. Patent and Trademark Office had failed to recognize that Intel had already invented the technology that was at the crux of the ‘759 patent. The jury did not buy that argument, ruling that Intel did not prove its case of invalidity on four different claims.
In an email, a spokesperson with Intel told The Texas Lawbook that the company “strongly disagrees” with the verdict.
“We intend to appeal and are confident that we will prevail,” Intel said.
The Lawbook awaits comment from VLSI’s owner, Fortress Investments, and its lawyers.
During Monday afternoon’s closing arguments VLSI’s lead lawyer told jurors that the parties were at trial “because our [country’s] founders had the foresight to put a provision in the U.S. Constitution to promote the progress of science.”
“Congress has passed statutes in protecting patents and inventions,” said Morgan Chu, a partner at Irell & Manella. “It’s a bargain and is simple: you disclose valuable inventions and in exchange no one can use your inventions without permission.”
The verdict marks the conclusion of the second patent infringement trial in U.S. District Judge Alan Albright’s court since he was sworn into the Western District of Texas in 2018. It’s also Judge Albright’s most closely-watched trial to date since, due to Covid-19 concerns, it was the first time he allowed the public to tune into the trial telephonically.
The judge’s first patent infringement trial took place in October and resulted in a take-nothing verdict in favor of Roku. With the Waco court’s track record now being a 1-1- split between a take-nothing defense verdict and a multibillion-dollar verdict in favor of a plaintiff, companies who may be plaintiffs in patent infringement trials may be salivating over the possibility that the Western District of Texas will follow suit of the Eastern District of Texas as being a plaintiff-friendly venue.
“Some of the thought behind plaintiffs filing patent cases in Waco was that Waco juries may be more like Eastern District of Texas juries, which have awarded significant damages in many patent cases,” Wasif Qureshi, an IP partner at Jackson Walker, recently told The Texas Lawbook. “A sizable verdict may further accelerate the flurry of patent cases being filed in Waco.”
Veteran patent litigator Derek Gilliland says the verdict will, indeed, catch the attention of patent holders and their attorneys.
“Today’s verdict upends a common belief that federal court juries in Waco are too conservative for big verdicts and are drastically different from those in East Texas. While the jury pool might be conservative politically, they still understand property rights and if the facts justify it, they will return a big verdict,” said Gilliland, a partner at Sorey, Gilliland & Hull, which has offices in both Longview and Waco.
“The verdict is noteworthy in that the original inventors and patent-holder were not the plaintiff. Rather the plaintiff was a company that acquired the patents and asserted them—though they were still supported by the original patent-holding company. So juries understand that if you own property—intellectual or otherwise—you’re still entitled to compensation when someone uses it. And that’s true even if the up-front cost of buying the property is a very small fraction of the damages beings sought.”
The legal community will have even more data to draw from later this spring; Judge Albright said recently that he has four jury trials scheduled for April. One of the jury trials will be the next installment of Intel and VLSI’s legal battle.
After reading the verdict, Judge Albright thanked the jurors for their services on behalf of himself and the lawyers for the parties. He said the jurors are now welcome to talk to whomever they want about the case but, as is standard in federal cases, informed them that the lawyers would not be talking to them.
“Your work is so incredibly important to our country and system of justice,” the judge said. “I’ve told you a number of times how impressed I was and how proud I was of how hard you worked to pay attention. This is not easy stuff, but you were here early, you stayed late, and you paid attention brilliantly through the entire thing, and I can’t thank you enough for your service.
Like he had after Monday’s closing arguments, Judge Albright thanked the lawyers, expressing how pleased he was with the conduct and performance by both sides.
“Winning or losing is no reflection on the exceptional quality of the lawyers [in this case],” Judge Albright said, as well as the “quality witnesses who appeared throughout.”
“The great thing for me is we’re all going to be together again soon to do this again, and I can’t tell you how much I look forward to it,” Judge Albright said.
Although before trial Intel had fought tooth-and-nail to transfer the case to Austin, lead Intel lawyer Bill Lee thanked Judge Albright yesterday after closings and said the Waco courthouse has been “as hospitable as could be” and that he “would come back in April,” perhaps indicating a change of heart.
Chu articulated Monday that he was equally thrilled about how Waco played out as a venue, and not just because of how accommodating the courthouse staff was to his team during trial.
“I got some magnificent restaurant recommendations for barbecue … and I look forward to trying [them],” said Chu, a Los Angelino.