The case is Bobst SA v. Heidelberg Postpress Deutschland GmbH, TGI Paris, Sept. 27, 2013, PIBD No. 995, III, at 1585. The patent in suit is the French portion of European Patent 1170228 A2, for (from the English translation, here) a device for controlling the means for feeding sheets into a machine. The German Bundespatentgericht annulled the German portion of the patent in 2011, but the patent remains valid in France.
A little background first on calculating patent damages under French law. As I explain in my book (pp. 264-65, citations omitted):
French courts often begin their damages analysis by calculating the infringing turnover (la masse contrefaisante), which is equal to the number of infringing products for which the defendant is responsible, multiplied by the price at which the defendant sold them. To calculate lost profits, however, the court estimates the number of sales the plaintiff would have made but for the infringement, taking into account such factors as the plaintiff’s capacity, customer preferences, possible noninfringing substitutes, and so on. It then multiplies this number by (a) the price at which the plaintiff would have sold the products and (b) the plaintiff’s profit margin.
In the present case, there were three sales of infringing machines: one in May 2006 to Cartolux; one in July 2007 to TPG; and one to Fellmann that was installed in August 2006, but then returned to the defendant in July 2009. Among the contested issues were which of these sales should be included within the masse contrefaisante.
First, the court noted first that the parties accepted the expert’s conclusion that the sale to TPG had cost Bobst a sale. The court also accepted the expert’s conclusion that the average sales price of a Bobst machine in 2007 was €1,231,000, and that Bobst’s margin over variable costs was 43%. Bobst therefore suffered a lost profit of €529,300 on the sale lost to TPG.
Second, the expert had noted that Bobst had not made an offer to Catolux, and concluded that it wasn’t clear that Bobst would have made this sale absent the infringement; he therefore wound up excluding this sale from the masse contrefaisante. The court concluded, however, that Heidelberg’s aggressive pricing policy had caused Bobst to lose its chance of making an offer that might have interested Cartolux, and that absent Heidelberg’s infringing conduct Cartolux naturally would have turned toward Bobst. As a result, the court estimated that Bobst had a 50% chance of making the sale to Cartolux absent the infringement, and awarded it one-half of the profits it would have earned on sale to Cartolux. Using the average 2006 price as the base, the damages came to €240,000. (Note that this is clearly different from U.S. law, where a 50% chance of making the sale would not, it seems to me, demonstrate by a preponderance of the evidence that the sale would have been made. Therefore, Bobst would have received zero lost profits on this sale under U.S. law, though it would have been entitled to a royalty. On the other hand, with a 51% chance of making the sale, Bobst would prevail by a preponderance of the evidence and get its entire lost profit on that sale.)
Third, as to Fellmann, the court concluded that the masse contrefaisante is determined from the date the infringement began up until the date of judgment, here May 27, 2009. Nevertheless, the defendant argued that the machine sold to Fellmann—which the court characterized as having been provided on a trial basis (à titre d’essai), and which was, after all, returned to the defendant, albeit a couple of months after May 27, 2009—should not be included. The court disagreed, noting that according to the court-appointed expert the plaintiff had made two offers to Fellmann in 2006, which were rejected, but that it had succeeded in selling Fellmann a machine in 2009. The court therefore concluded that Heidelberg’s infringing competition had cost Bobst the ability to make the sale at an earlier period. (Elsewhere in the opinion, the court refers to the defendant’s aggressive pricing policy as a factor in its ability to take away business from the plaintiff.) Bobst concluded a sale with Fellmann in 2009 for €860,897, a discount of €587,043 (40.54%) off the €1,447,940 sticker price. Bobst claimed that it was entitled to recover the discount, on the theory that it wouldn’t have had to offer it if it had the sale three years earlier. The expert concluded, however, that Bobst habitually gave clients discounts, and that only 10% off of the €1,447,940 sticker price, or €144,794, could be allocated to the infringement.
Finally, the court awarded damages for lost sales of complementary goods that would have been sold to TPG and Cartolux, amounting altogether to €205,000 and €93,000, respectively. The court was not convinced that Bobst was entitled to additional damages it claimed to have suffered as a result of granting higher discounts to other customers during the period of Heidelberg’s activity.