Case 2:22-md-03034-TGB ECF No. 265-17, PageID.28687 Filed 07/18/24 Page 1 of 29
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`Exhibit P
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`Case 2:22-md-03034-TGB ECF No. 265-17, PageID.28688 Filed 07/18/24 Page 2 of 29
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`UNITED STATES DISTRICT COURT
`WESTERN DISTRICT OF WASHINGTON
`AT SEATTLE
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`NXP USA, INC., and NXP B.V.,
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`CASE NO. 2:20-cv-01503-JHC
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`v.
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`IMPINJ, INC.,
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`Plaintiffs,
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`Defendant.
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`REDACTED1 ORDER RE: IMPINJ’S
`MOTION TO EXCLUDE DAVID A. HAAS
`AND NXP’S MOTION FOR PARTIAL
`SUMMARY JUDGMENT
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`There are two motions before the Court. First, Impinj moves to exclude certain opinions
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`of expert David A. Haas. See Dkt. # 296 (Impinj’s motion); see also Dkt. ## 329, 354, 412, 419
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`(NXP’s response, Impinj’s reply, NXP’s supplemental brief, and Impinj’s supplemental brief). 2
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`Second, NXP moves for partial summary judgment as to an element of its damages argument. 3
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`1 The Court provisionally sealed its initial order. Dkt. # 452. After hearing from the parties about
`what material, if any, must remain sealed in the public version of the order (Dkt. # 463), the Court hereby
`publishes this redacted version of the order.
`2 The Court refers to the sealed version of each filing throughout this order. The unsealed
`versions (which contain page numbers that correspond to the sealed versions) can be found at the
`following docket entries: Dkt. ## 286, 323, 349, 410, 417 (filings related to Impinj’s motion to exclude);
`Dkt. ## 277, 316, 340 (filings related to NXP’s motion for partial summary judgment).
`3 The Court previously ruled on several other arguments in NXP’s partial summary judgment
`motion (Dkt. ## 380, 414), but deferred ruling on this issue to consider it alongside other damages-related
`issues. See Dkt. # 414 at 35.
`REDACTED0F ORDER RE: IMPINJ’S MOTION TO
`EXCLUDE DAVID A. HAAS AND NXP’S MOTION FOR
`PARTIAL SUMMARY JUDGMENT - 1
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`Case 2:22-md-03034-TGB ECF No. 265-17, PageID.28689 Filed 07/18/24 Page 3 of 29
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`See Dkt. # 282 at 27–29 (NXP’s motion); see also Dkt. ## 319, 343 (Impinj’s response and
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`NXP’s reply).
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`For the reasons below, the Court:
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`(1) GRANTS in part and DENIES in part Impinj’s motion to exclude certain opinions
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`of David A. Haas (Dkt. # 296); and
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`(2) DENIES NXP’s partial summary judgment motion as to the damages issue (Dkt.
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`# 282 at 27–29).
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`I
`BACKGROUND
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`A.
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`Patent Background
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`
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`Two patents remain at issue in this case. First, U.S. Patent Number 7,257,092 (the ’092
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`Patent) describes an improved communication protocol between a “communication station” and
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`a “data carrier” in which an “identification data block” and “useful data” are transmitted
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`simultaneously, rather than sequentially. See ’092 Patent at 1:5–8, 11:7–17. Second, U.S. Patent
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`Number 7,347,097 (the ’097 Patent) describes a system that allows information to be stored on a
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`data carrier for a longer period of time with higher reliability, produced in part by adding a
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`“voltage-raising means” to the “information-voltage generating means” of the data carrier. See
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`’097 Patent at 2:13–23, 2:34–36. A more detailed description of the patents can be found in the
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`Court’s recent summary judgment order. See Dkt. # 414 at 3–5.
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`B.
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`Procedural History
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`This order addresses two motions. First, it addresses Impinj’s motion to exclude certain
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`opinions of NXP’s damages expert, David A. Haas. See Dkt. # 296. While styled as a Daubert-
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`style evidentiary motion, the motion raises questions of law and fact that could be addressed only
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`in a motion for summary judgment. The Court informed the parties that it would treat the motion
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`REDACTED0F ORDER RE: IMPINJ’S MOTION TO
`EXCLUDE DAVID A. HAAS AND NXP’S MOTION FOR
`PARTIAL SUMMARY JUDGMENT - 2
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`Case 2:22-md-03034-TGB ECF No. 265-17, PageID.28690 Filed 07/18/24 Page 4 of 29
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`as one for partial summary judgment and would allow the parties to provide supplemental
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`briefing. See Dkt. # 397; see also Fed. R. Civ. P. 56(f) (requiring notice and a “reasonable time
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`to respond” before considering summary judgment sua sponte); Norse v. City of Santa Cruz, 629
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`F.3d 966, 971–72 (9th Cir. 2010) (“Sua sponte grants of summary judgment are only appropriate
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`if the losing party has reasonable notice that the sufficiency of his or her claim will be in issue.”
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`(citation omitted)). Pursuant to the Court’s order, the parties provided additional briefing. Dkt.
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`# 412 (NXP’s supplemental brief); Dkt. # 419 (Impinj’s supplemental brief). The Court applies
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`the summary judgment standard in evaluating the motion.
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`Second, this order addresses one remaining argument from NXP’s motion for partial
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`summary judgment: whether, for purposes of damage calculations, there were acceptable, non-
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`infringing alternatives available to Impinj. Dkt. # 282 at 26–29. While the Court already ruled
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`on most aspects of NXP’s motion for partial summary judgment, the Court reserved ruling on
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`this issue to consider it alongside other damages-related issues. Dkt. # 414 at 35. 4
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`II
`MOTION TO EXCLUDE OPINIONS OF DAVID A. HAAS
`Impinj moves to exclude certain opinions of NXP’s damages expert, David A. Haas.
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`Dkt. # 296. As noted above, however, the Court analyzes the issues in the motion under the
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`applicable summary judgment standards.
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`The motion raises four issues: (1) whether NXP is entitled to pre-suit damages stemming
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`from infringement of the ‘097 Patent; (2) whether NXP is entitled to recover damages stemming
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`4 The Court notes that there are two other summary judgment motions pending. Dkt. ## 421, 430.
`Nothing in this order should be construed to express any opinion as to the merits of either motion. Also,
`the order at times assumes infringement arguendo so that the Court can discuss damages. Any such
`language should not be read to imply that Impinj has infringed any patent: To date, there has been no
`finding of infringement in this case.
`REDACTED0F ORDER RE: IMPINJ’S MOTION TO
`EXCLUDE DAVID A. HAAS AND NXP’S MOTION FOR
`PARTIAL SUMMARY JUDGMENT - 3
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`Case 2:22-md-03034-TGB ECF No. 265-17, PageID.28691 Filed 07/18/24 Page 5 of 29
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`from Impinj’s sales to customers outside the United States; (3) whether NXP USA has standing
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`to obtain damages; and (4) whether NXP may recover “lost profit” damages.
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`A. Availability of Pre-Suit Damages
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`NXP seeks pre-suit damages for infringement of the ’097 Patent. 5 Dkt. # 296 at 6–8.
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`Impinj asks the Court to exclude Haas’s opinions about the availability of pre-suit damages. Id.
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`The Court denies Impinj’s motion.
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`35 U.S.C. § 287(a) imposes a “marking” obligation on any patentee who produces a
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`patented product: A patentee must generally mark each patented product with the word “patent”
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`or something similar (the exact marking requirements are unimportant here). A failure to mark
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`can affect the patentee’s right to pre-suit damages. If a patentee fails to mark its patented
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`products in accordance with the statute, “no damages shall be recovered by the patentee in any
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`action for infringement, except on proof that the infringer was notified of the infringement and
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`continued to infringe thereafter, in which event damages may be recovered only for infringement
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`occurring after such notice.” 35 U.S.C. § 287(a).
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`But the statute does not apply if the patentee “never makes or sells a patented article.”
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`Arctic Cat Inc. v. Bombardier Recreational Prod. Inc., 950 F.3d 860, 864 (Fed. Cir. 2020); see
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`also id. (“[A] patentee who never makes or sells a patented article may recover damages even
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`absent notice to an alleged infringer.”). “If, however, a patentee makes or sells a patented article
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`and fails to mark in accordance with § 287, the patentee cannot collect damages until it either
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`begins providing notice or sues the alleged infringer—the ultimate form of notice—and then
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`only for the period after notification or suit has occurred.” Id. “A patentee who makes or sells
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`5 NXP appears to concede that it is not entitled to pre-suit damages for the ’092 Patent. See Dkt.
`# 296 at 7; Dkt. # 329 at 8 (NXP’s brief discussing the issue only with respect to the ’097 Patent).
`REDACTED0F ORDER RE: IMPINJ’S MOTION TO
`EXCLUDE DAVID A. HAAS AND NXP’S MOTION FOR
`PARTIAL SUMMARY JUDGMENT - 4
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`Case 2:22-md-03034-TGB ECF No. 265-17, PageID.28692 Filed 07/18/24 Page 6 of 29
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`patented articles can satisfy the notice requirement of § 287 either by providing constructive
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`notice—i.e., marking its products—or by providing actual notice to an alleged infringer.” Id.
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`According to NXP, it is entitled to pre-suit damages for the period before its marking
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`obligation arose—that is, before it began selling the UCODE 8 product, which practices the ’097
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`Patent. NXP says that the pre-suit damages period runs from October 4, 2013, through October
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`4, 2019 (when this action was filed). See Dkt. # 329 at 9 (citing 35 U.S.C. § 286). But NXP
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`only began selling the UCODE 8 product in 2017. So NXP says that it is entitled to pre-suit
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`damages from 2013 (the beginning of pre-suit damages period) until it began selling (presumably
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`unmarked) UCODE 8 products in 2017.
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`Impinj disagrees. Dkt. # 296 at 6–8. According to Impinj, the Federal Circuit’s decision
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`in Arctic Cat holds that, if at any time, a patentee sells an unmarked product (and does not
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`otherwise provide notice), the patentee may not recover any pre-suit damages.
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`Arctic Cat does not squarely answer the question presented. In Arctic Cat, the patentee
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`sold unmarked, practicing products, but then stopped selling any practicing products. 950 F.3d
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`at 864. The Court held that the “cessation of sales of unmarked products” does not “excuse[]
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`noncompliance with the notice requirement of § 287 such that a patentee may recover damages
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`for the period after sales of unmarked products ceased but before the filing of a suit for
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`infringement.” Id.
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`But here, the opposite sequence of events occurred. NXP did not sell any product
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`practicing the ’097 Patent for several years (from roughly 2013 through 2017). It then began
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`selling practicing UCODE 8 products but failed to mark them. While Arctic Cat clearly
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`precludes pre-suit damages when a patentee sells unmarked products and then stops such sales, it
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`is not clear that Arctic Cat should be read to cover the opposite sequence of events.
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`REDACTED0F ORDER RE: IMPINJ’S MOTION TO
`EXCLUDE DAVID A. HAAS AND NXP’S MOTION FOR
`PARTIAL SUMMARY JUDGMENT - 5
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`

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`Case 2:22-md-03034-TGB ECF No. 265-17, PageID.28693 Filed 07/18/24 Page 7 of 29
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`In Arctic Cat, the Federal Circuit stated that the “obligation to mark arose when [the
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`entity] began selling patented articles.” 950 F.3d at 865 (emphasis added). The court also
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`emphasized that “once a patentee begins making or selling a patented article, the notice
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`requirement attaches, and the obligation imposed by § 287 is discharged only by providing
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`actual or constructive notice.” Id. (emphasis added). These passages imply that before the
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`patentee begins making or selling a patented product, the notice requirement has not yet
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`attached. Before the notice requirement attaches, the patentee has done nothing wrong; it has no
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`obligation to mark. It would be odd to penalize NXP for its actions from 2013 to 2017 (before it
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`had an obligation to mark) because of its failure to mark beginning in 2017. As the Federal
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`Circuit explained, “[t]he statute thus prohibits a patentee from receiving any damages in a
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`subsequent action for infringement after a failure to mark.” Id. (emphasis added). As the Court
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`understands the Federal Circuit’s Arctic Cat decision, a failure to mark does not work
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`retroactively to preclude pre-suit damages for a period before any such marking obligation arose.
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`Several district court decisions support this conclusion (though some predate Arctic Cat).
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`See, e.g., Acceleron, LLC v. Dell, Inc., No. 1:12-CV-4123-TCB, 2020 WL 10353773, at *3 (N.D.
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`Ga. Mar. 31, 2020) (post-Arctic Cat, holding that pre-suit damages are available for the period
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`“before . . . the duty to mark” arose because “any failure to mark does not preclude all pre-suit
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`damages”); WiAV Sols. LLC v. Motorola, Inc., 732 F. Supp. 2d 634, 639–40 (E.D. Va. 2010)
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`(“[A] patentee is not precluded from collecting damages for a period in which marking was not
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`required even if the requirements of the marking statute were later triggered and the patentee
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`failed to comply.”); Am. Tech. Ceramics Corp. v. Presidio Components, Inc., 14-CV-
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`6544(KAM)(GRB), 2018 WL 1525686, at *5 (E.D.N.Y. Mar. 27, 2018) (§ 287 “does not limit
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`damages for a period during which the marking statute is not triggered, even if it later is
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`triggered and the patentee fails to mark.” (quotation marks omitted)).
`REDACTED0F ORDER RE: IMPINJ’S MOTION TO
`EXCLUDE DAVID A. HAAS AND NXP’S MOTION FOR
`PARTIAL SUMMARY JUDGMENT - 6
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`

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`Case 2:22-md-03034-TGB ECF No. 265-17, PageID.28694 Filed 07/18/24 Page 8 of 29
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`To be sure, Impinj’s position is reasonable. The Federal Circuit construes § 287 strictly
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`to effectuate the policy goal of encouraging marking. See, e.g., Arctic Cat, 950 F.3d at 865
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`(discussing the policy goals of the marking statute). Precluding all pre-suit damages—even
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`those from before a marking obligation attached—would provide additional incentive to mark.
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`And some of the language in Arctic Cat could be read to apply in circumstances like this. See id.
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`(“The statute thus prohibits a patentee from receiving any damages in a subsequent action for
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`infringement after a failure to mark, rather than merely a reduced amount of damages in
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`proportion to the amount of time the patentee was actually practicing the asserted patent.”); id.
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`(“While § 287 describes the conduct of the patentee in the present tense, the consequence of a
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`failure to mark is not so temporally limited.”). But the Court believes the better reading of Arctic
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`Cat and § 287 support NXP’s position: § 287 does not preclude pre-suit damages for a period
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`before an obligation to mark attached.
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`Accordingly, the Court denies Impinj’s motion as to the availability of pre-suit damages
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`for the ’097 Patent.
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`B.
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`Damages for Sales to Customers Outside the United States
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`Impinj argues that Haas may not include in his damages calculations Impinj’s sales to
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`customers outside the United States. Dkt. # 296 at 8–10. Though a very close question, the
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`Court denies Impinj’s motion.
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`“[P]atent laws, like other laws, are to be understood against a background presumption
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`against extraterritorial reach.” Carnegie Mellon Univ. v. Marvell Tech. Grp., Ltd., 807 F.3d
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`1283, 1306 (Fed. Cir. 2015); see also Power Integrations, Inc. v. Fairchild Semiconductor Int’l,
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`Inc., 711 F.3d 1348, 1371 (Fed. Cir. 2013) (“It is axiomatic that patent law does not operate
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`extraterritorially to prohibit infringement abroad.”). Accordingly, an entity commits direct
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`infringement under 35 U.S.C. § 271(a) when it “makes, uses, offers to sell, or sells any patented
`REDACTED0F ORDER RE: IMPINJ’S MOTION TO
`EXCLUDE DAVID A. HAAS AND NXP’S MOTION FOR
`PARTIAL SUMMARY JUDGMENT - 7
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`

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`invention[] within the United States or imports into the United States any patented invention.”
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`35 U.S.C. § 271(a) (emphasis added); see also MEMC Elec. Materials, Inc. v. Mitsubishi
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`Materials Silicon Corp., 420 F.3d 1369, 1375 (Fed. Cir. 2005) (“It is well-established that the
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`reach of section 271(a) is limited to infringing activities that occur within the United States.”).
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`Case law discussing whether a sale is one “within the United States” for purposes of
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`§ 271(a) presents a surprisingly murky picture. The patent statute does not define the term
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`“sale.” See Halo Elecs., Inc. v. Pulse Elecs., Inc., 831 F.3d 1369, 1377 (Fed. Cir. 2016). The
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`Supreme Court has stressed that “[i]t is the general rule under United States patent law that no
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`infringement occurs when a patented product is made and sold in another country.” Microsoft
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`Corp. v. AT & T Corp., 550 U.S. 437, 441 (2007). But according to the Federal Circuit, no
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`“single, universally applicable fact” determines where a “sale” occurs. Carnegie Mellon, 807
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`F.3d at 1308. While the Federal Circuit has not settled on an exact test to determine whether a
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`sale is one “within the United States,” it has explained that relevant locations could include the
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`“place of inking the legal commitment to buy and sell,” the “place of delivery,” and “perhaps
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`also a place where other ‘substantial activities of the sales transactions’ occurred.” Id. (citations
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`omitted).
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`Impinj argues that its sales to foreign customers are not sales “within the United States”
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`for purposes of § 271(a). Dkt. # 296 at 8–10. This is so, Impinj says, because these products are
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`manufactured and shipped abroad to non-U.S. customers, with no evidence that the products
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`eventually enter the United States. Id. at 9. According to Impinj, “Plaintiffs must not only prove
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`that a substantial level of sales activity occurred in the United States, but also that the products
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`sold at some point entered the country.” Dkt. # 349 at 7.
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`NXP responds that a product need not enter the United States to constitute a sale “within
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`the United States” for purposes of § 271(a). See Dkt. # 329 at 10–12. Rather, NXP says that the
`REDACTED0F ORDER RE: IMPINJ’S MOTION TO
`EXCLUDE DAVID A. HAAS AND NXP’S MOTION FOR
`PARTIAL SUMMARY JUDGMENT - 8
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`

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`operative question is whether a “substantial level of sales activity” occurs within the United
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`States, and that this fact-intensive inquiry is reserved for the jury. Id. at 10. NXP cites these
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`facts in support of its position:
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`It is undisputed that Impinj designed all of the accused products in the United
`States. The Impinj sales teams responsible for selling the accused products report
`to Jeff Dossett, Impinj’s Chief Revenue Officer, in Seattle. Impinj divides sales
`efforts related to the accused products across two sales teams, one of which
`reports to a Senior Vice President in Seattle while the other reports to a different
`Senior Vice President based in Idaho. Customers enter into distribution
`agreements with Impinj, Inc., the U.S. company; Impinj’s U.S.-based employees
`negotiate annual pricing agreements with customers, and the agreements are
`executed in Seattle; and Impinj issues all purchase orders for all accused products
`from its Seattle headquarters. Impinj tests the accused products in the United
`States and has a Retail Experience Center located in Seattle where it tests and
`showcases item connectivity applications. Impinj also has U.S.-based systems
`engineers who troubleshoot and coordinate with customers. And Impinj’s
`marketing team, led from its Seattle office, prepares all marketing materials.
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`Dkt. # 412 at 12 (citations omitted) (citing Dkt. # 297-1 at ¶24). Under these facts, NXP says, a
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`reasonable jury could conclude that the disputed sales to customers abroad are sales “within the
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`United States.”
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`The Court tentatively agrees with NXP and concludes that under Federal Circuit
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`precedent, the cited facts raise a triable issue of fact as to whether the accused sales are “within
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`the United States.” The Federal Circuit confronted an analogous set of facts in Carnegie Mellon
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`University v. Marvell Technology Group, Limited, 807 F.3d 1283 (Fed. Cir. 2015). In that case,
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`the plaintiff presented evidence that “with the exception of the chip making [which occurred
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`abroad]. . . all the activities related to designing, simulating, testing, evaluating, qualifying the
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`chips by Marvell as well as by its customers occur[ ] in the United States,” and that each sale was
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`the result of a lengthy domestic sales cycle (also known as a “design win”). Id. at 1309 (citation
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`and quotation marks omitted) (second alteration original). There was also “some evidence
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`suggesting that specific contractual commitments for specific volumes of chips were made in the
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`REDACTED0F ORDER RE: IMPINJ’S MOTION TO
`EXCLUDE DAVID A. HAAS AND NXP’S MOTION FOR
`PARTIAL SUMMARY JUDGMENT - 9
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`

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`United States.” Id. (emphasis added). Based on these facts, the Federal Circuit affirmed the
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`district court’s denial of judgment as a matter of law, concluding that a reasonable jury could
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`find that the cited evidence “suggests a substantial level of sales activity by Marvell within the
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`United States, even for chips manufactured, delivered, and used entirely abroad.” Id. at 1309–
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`10 (emphasis added). The Federal Circuit remanded for a new trial in which the jury would be
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`instructed that it must “find a domestic location of sale as to those chips not made or used in, or
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`imported into, the United States” before including those sales in the damages calculation. Id. at
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`1310.
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`In California Institute of Technology v. Broadcom Limited, 25 F.4th 976 (Fed. Cir. 2022),
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`the Federal Circuit upheld the district court’s jury instruction concerning the “within the United
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`States” requirement. Id. at 992–93. According to the Federal Circuit, the jury instructions
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`appropriately “emphasized the key question of whether there were such substantial activities in
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`the United States.” Id. at 993. The Broadcom court seemingly approved of an instruction that
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`allowed a domestic “sales cycle” to transform a sale into one “within the United States” (though
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`the opinion lacks detail about the nature of each sale). Id.
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`Under the reasoning of Carnegie Mellon and Broadcom, Impinj’s sales to customers
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`abroad might constitute sales within the United States. Impinj’s U.S.-based employees negotiate
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`annual pricing agreements with customers; the Impinj sales team reports to individuals in the
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`United States; purchased orders are “issue[d]” in the United States; and significant testing and
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`marketing activities occur in the United States. See Dkt. # 412 at 12 (citing Dkt. # 297-1 at ¶24).
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`Perhaps most importantly, NXP says that the sale agreements themselves are “executed”
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`in the United States (though neither party explains what this means). Id. (citing Dkt. # 297-1 at
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`¶24). The Federal Circuit seems to place weight on this fact. See Texas Advanced
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`Optoelectronic Sols., Inc. v. Renesas Elecs. Am., Inc., 895 F.3d 1304, 1330 (Fed. Cir. 2018)
`REDACTED0F ORDER RE: IMPINJ’S MOTION TO
`EXCLUDE DAVID A. HAAS AND NXP’S MOTION FOR
`PARTIAL SUMMARY JUDGMENT - 10
`
`

`

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`(distinguishing Carnegie Mellon because in that case, “‘there was some evidence suggesting that
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`specific contractual commitments for [the sale of accused products] were made in the United
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`States.’ [Plaintiff] presented no such specific evidence to the district court here.” (citing
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`Carnegie Mellon, 807 F.3d at 1309)); Carnegie Mellon, 807 F.3d at 1308 (noting that a place of
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`“seeming relevance” is “a place of inking the legal commitment to buy and sell”). But see Halo,
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`831 F.3d at 1378 n.1 (declining to reach the argument that “the place where a contract for sale is
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`legally formed can itself be determinative as to whether a sale has occurred in the United States
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`because we agree with the district court here that the pricing negotiations and contracting
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`activities in the United States to which Halo points did not constitute the final formation of a
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`definitive, binding contract for sale”).
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`To be sure, the Court remains a tad skeptical that this evidence—which relies heavily on
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`the location in which the contracts were “executed”—suffices to transform sales of goods
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`manufactured and shipped abroad to foreign buyers into sales “within the United States.” In
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`Halo Electronics, Inc. v. Pulse Electronics, Inc., 831 F.3d 1369 (Fed. Cir. 2016), for example,
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`the Federal Circuit held that domestic “pricing and contracting negotiations” alone did not create
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`a sale within the United States because the products were made and sold abroad and because the
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`“final formation of a contract for sale” took place outside the United States. Id. at 1378.
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`Depending on what it means for the contracts to have been “executed” in the United States, the
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`sales at issue could more closely resemble the sales in Halo than those in Carnegie Mellon. But
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`the Court concludes that NXP has produced sufficient facts to survive summary judgment.
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`The Court also questions how Federal Circuit case law should be applied in situations
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`like this. As applied to products that are made and shipped abroad to foreign buyers, the
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`approach taken in Carnegie Mellon and Broadcom is arguably in tension with Supreme Court
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`dicta. See Microsoft Corp., 550 U.S. at 441 (“It is the general rule under United States patent
`REDACTED0F ORDER RE: IMPINJ’S MOTION TO
`EXCLUDE DAVID A. HAAS AND NXP’S MOTION FOR
`PARTIAL SUMMARY JUDGMENT - 11
`
`

`

`Case 2:22-md-03034-TGB ECF No. 265-17, PageID.28699 Filed 07/18/24 Page 13 of 29
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`law that no infringement occurs when a patented product is made and sold in another country.”
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`(discussing a different statutory provision)); see also id. at 456 (“If AT & T desires to prevent
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`copying in foreign countries, its remedy today lies in obtaining and enforcing foreign patents.”);
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`cf. Morrison v. Nat’l Australia Bank Ltd., 561 U.S. 247, 266 (2010) (“[T]he presumption against
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`extraterritorial application would be a craven watchdog indeed if it retreated to its kennel
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`whenever some domestic activity is involved in the case.”). Moreover, applying the test in this
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`way could transform nearly any sale by a U.S. company into a sale “within the United States”; it
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`could also incentivize companies to “execute” their agreements abroad. Nevertheless, the Court
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`is bound by Federal Circuit case law, and so denies Impinj’s motion, subject to further objection
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`during trial and in post-trial motions.6
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`C.
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`Standing of NXP USA
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`Typically, “[o]nly a patentee may bring an action for patent infringement.” Textile
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`Prods., Inc., v. Mead Corp., 134 F.3d 1481, 1484 (Fed. Cir. 1998) (citing 35 U.S.C. § 281). But
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`there is a limited exception to this general rule for “exclusive licensees.” Exclusive licensees
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`“may possess sufficient interest in the patent to have standing to sue as a co-plaintiff with the
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`patentee.” Rite-Hite Corp. v. Kelley Co., 56 F.3d 1538, 1552 (Fed. Cir. 1995) (en banc). “To be
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`an exclusive licensee for standing purposes, a party must have received, not only the right to
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`practice the invention within a given territory, but also the patentee’s express or implied promise
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`that others shall be excluded from practicing the invention within that territory as well.” Id.; see
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`6 Impinj also argues that NXP failed to disclose its theory of damages for sales outside the United
`States in a timely manner. Dkt. # 296 at 8–9. Impinj says that Dr. Madisetti admitted that he had not
`opined on foreign sales, and that Haas’s report disclosed “for the first and only time” that such sales
`should be treated as occurring within the United States. Id. at 8. But Dr. Madisetti was not a damages
`expert, and thus did not need to opine on the matter. And Haas filed his report in accordance with the
`Court’s scheduling orders, well before discovery closed.
`REDACTED0F ORDER RE: IMPINJ’S MOTION TO
`EXCLUDE DAVID A. HAAS AND NXP’S MOTION FOR
`PARTIAL SUMMARY JUDGMENT - 12
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`Case 2:22-md-03034-TGB ECF No. 265-17, PageID.28700 Filed 07/18/24 Page 14 of 29
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`also Spine Sols., Inc. v. Medtronic Sofamor Danek USA, Inc., 620 F.3d 1305, 1318 (Fed. Cir.
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`2010), abrogated on other grounds by Halo Elecs., Inc. v. Pulse Elecs., Inc., 579 U.S. 93 (2016).
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`Impinj says that NXP USA lacks standing to recover damages. See Dkt. # 296 at 10–11.
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`NXP B.V. is the patentee of the ’092 and ’097 Patents. Therefore, Impinj says, NXP USA lacks
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`standing to bring a patent infringement action unless it is an exclusive licensee. Id. And Impinj
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`says that NXP USA is at most a “limited non-exclusive” licensee. See, e.g., id. at 11 (citing
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`records stating that NXP USA possesses a “limited, non-exclusive, non-transferable, royalty-free
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`license to use NXP Intellectual Property Rights”). NXP’s response brief does not address this
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`argument or present any contrary evidence. See generally Dkt. # 329.
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`Accordingly, because NXP B.V. is the patentee and NXP USA is not an exclusive
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`licensee, NXP USA lacks standing to collect damages.
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`D.
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`Lost Profits of NXP B.V. through an “Inexorable Flow” Theory
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`“Lost profit” damages represent one method of calculating damages stemming from
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`infringement. “To recover lost profits damages, the patentee must show a reasonable probability
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`that, ‘but for’ the infringement, it would have made the sales that were made by the infringer.”
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`Rite-Hite, 56 F.3d at 1545.
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`Impinj concedes that NXP B.V.—the patentholder—has standing to recover damages.
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`Dkt. # 296 at 11. But Impinj says that NXP B.V. cannot recover lost profit damages because it
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`does not make or sell any products (and thus could not have lost any profits). Id. at 11–15.
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`Impinj says that NXP B.V. is entitled only to a reasonable royalty as damages, if entitled to any
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`damages at all.
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`NXP responds that NXP B.V. can recover lost profits on an “inexorable flow” theory.
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`NXP says that NXP B.V. can recover damages “stemming from sales lost by its wholly owned
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`REDACTED0F ORDER RE: IMPINJ’S MOTION TO
`EXCLUDE DAVID A. HAAS AND NXP’S MOTION FOR
`PARTIAL SUMMARY JUDGMENT - 13
`
`

`

`Case 2:22-md-03034-TGB ECF No. 265-17, PageID.28701 Filed 07/18/24 Page 15 of 29
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`subsidiaries [like NXP USA] to the extent those profits inexorably flowed to NXP B.V.” Dkt.
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`# 329 at 13.
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`In general, “a patentee may not claim, as its own damages, the lost profits of a related
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`company.” Warsaw Orthopedic, Inc. v. NuVasive, Inc., 778 F.3d 1365, 1375 (Fed. Cir. 2015),
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`vacated on other grounds sub. nom Medtronic Sofamor Danek USA, Inc. v. NuVasive, Inc., 577
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`U.S. 1099 (2016); see also Poly–America, L.P. v. GSE Lining Tech., Inc., 383 F.3d 1303, 1311
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`(Fed. Cir. 2004) (explaining that related companies “may not enjoy the advantages of their
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`separate corporate structure and, at the same time, avoid the consequential limitations of that
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`structure—in this case, the inability of the patent holder to claim the lost profits of its non-
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`exclusive licensee”).
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`But several courts have recognized an exception to the general rule: When profits
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`“inexorably flow” from a corporate subsidiary to a corporate parent, then—according to some
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`district courts—the patent-owning parent