In WesternGeco LLC v. ION Geophysical Corp, decided today, the U.S. Supreme Court held that 35 U.S.C. Sections 271(f)(2) and 284 allow a patent owner to recover damages in the form of a reasonable royalty and lost foreign profits for patent infringement.

In this case, the defendant manufactured the components in the United States, but then shipped those components (unassembled) abroad to companies for assembly and subsequent use of the assembled system.

At trial, the plaintiff presented evidence that it had lost 10 contracts due to this activity. The jury awarded $12.5 million in royalties and $93.4 million in lost profits. At issue was the extraterritoriality reach of U.S. patent law.

Authoring the opinion for the Court, Justice Thomas stated [t]he conduct in this case that is relevant to that focus clearly occurred in the United States, as it was IONs domestic act of supplying the components that infringed?WesternGeco?s?patents.?

The Court held that the lost-profits awarded to the patent owner was a domestic application of Section 284: Taken together, [Section] 271(f)(2) and [Section] 284 allow the patent owner to recover for lost foreign profits.

Author Photo

Ted Polasek

Ted was a founding partner of Polasek, Quisenberry & Errington, L.L.P. (PQE), a firm that represented patent owners and companies accused of patent infringement. For nearly 25 years, Ted’s core practice has been litigating patent infringement cases, for hourly and clients on a contingent fee or other result-oriented basis. Ted attended the South Texas College of Law and graduated cum laude with his Juris Doctorate in 1990 and received a B.S. in Chemical Engineering from the University of Texas.

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