The recent decision by the U.S. District Court for the Northern District of California in Haptic Inc. v. Apple Inc. highlights a crucial aspect of royalty analysis in patent litigation. On June 3, the court denied Apple’s request for production of communications related to damages models between Haptic and its litigation funder. Apple contended these communications were pertinent to determining a reasonable royalty. However, the court’s decision emphasizes the fundamental principle that the function and context in which an estimate is used significantly influence its evidentiary value. This principle may often be overlooked, yet its importance cannot be overstated for those engaged in crafting and analyzing damage estimates.
This case serves as an important precedent regarding the boundaries of what can be deemed discoverable in litigation. Rick Eichmann of Secretariat Advisors elaborates on this principle, arguing that estimates provided by funders should not be used directly in royalty calculations due to their distinct purpose and context. For further insights, Eichmann’s analysis can be read in more detail at Law360.