Damages for Industrial Property Infringement in France

Grégoire Desrousseaux, Mayeul Ottaviani, and Louis Jabert have published an article titled L’évaluation du prejudice de la contrefaçon devant les juridictions françaises, Propriété Industrielle (“Quantifying infringement harm before the French courts”), Sept. 2025, pp. 15-26.  I highly recommend the article to anyone who wants to understand how the French courts calculate damages for the infringement of patents, trademarks, and designs.  The abstract reads as follows (my translation):

 

The transposition into French law of the damages calculation rules of Directive 2004/48/CE has caused a lot of ink to flow.  The authors have attempted an empirical, cross-sectional approach for the amount and calculation of damages, in compiling the accessible decisions rendered between 2016 and 2025 concerning patents, trademarks, and design and models.  An objective was to analyze, concretely, how the parties and the courts make use of the economic factors (often incomplete) to which they have access, to justify their demands and to guide their decisions.  Another objective was to try to identify—if they exist—the most common methods of calculation.

The article is enlightening.  The authors identified 52 decisions from the relevant time period, decided by courts of first or second instance (juridictions du fond), consisting of 26 patent decisions, 19 trademark decisions, and 7 involving designs and models.  They divide these into two basic categories, paragraph 1 and paragraph 2, reflecting the division set forth in the relevant statutory provisions for patents, trademarks, and designs, which for all three reads the same, to wit (again, my translation):

            For assessing damages and interest, the court takes into account distinctly:  (1) the negative economic consequences of the infringement, including lost profits and the loss sustained by the injured party; (2) the moral prejudice incurred by the latter; and (3) the profits realized by the infringer, including the intellectual, material, and promotional investments which the latter has derived from the infringement.

    

            However, the court may, alternatively and upon request by the injured party, award damages as a lump sum.  This amount is higher than the royalties or fees that would have been due if the infringer had requested authorization for the use of the right infringed.  This sum does not exclude compensation for moral prejudice inflicted upon the injured party.

According to the authors, 45 of the 52 cases (87%) made use of the first paragraph, and only 7 (13%) the second.  Of those falling into the first class, they found 4 that (wrongly, in their view) cumulated (that is, added together, if I understand correctly) lost profits with infringer’s profits.  15 were based on lost profits, 24 on infringers’ profits, and 2 used a mixed methodology (meaning that the amount awarded fell in between lost profits and infringers’ profits).  They describe the formula for lost profits as follows:  (1) the number of infringing products sold by the infringer, (2) multiplied by the price at which the plaintiff would have sold those products, (3) multiplied by the plaintiff’s profit margin, (4) multiplied by the taux de report—a term I find difficult to translate into idiomatic English, but which they define as the percent of the infringing products the plaintiff would have sold but for the infringement—(5) multiplied by the taux de pondération (the percent by which the infringed right contributed to the infringer’s sales).  The formula for calculating the infringer’s profits is:  (1) the number of infringing products sold by the infringer, (2) multiplied by the price at which the infringer sold them, (3) multiplied by the infringer’s profit margin, (4) multiplied by the taux de pondération.   They also find that plaintiffs frequently request and frequently are granted some amount for moral prejudice.  Finally, they remark that courts have a fair amount of discretion in applying the rules; they do not have to follow a strictly mathematical rule, and sometimes the relevant evidence (e.g., of consumer  behavior) have to be estimated qualitatively rather than quantitatively.

2024 US-China Patent Valuation and Damages Workshop

A workshop report titled The 2024 Patent Valuation and Damages Workshop: A US-China Comparative Law Perspective is available on ssrn, and should be of interest to anyone following U.S. and Chinese patent and/or SEP litigation.  I remotely delivered a presentation on compensatory patent damages in the U.S. at the workshop, which was held in May 2024 and included presentations by several other U.S. and Chinese participants.  Here is a link to the report, and here is the abstract:

This report summarizes the proceedings of the 2024 Patent Valuation and Damages Workshop: A U.S.–China Comparative Law Perspective, jointly organized by the Berkeley Asia IP & Competition Law Center (BAIC), Berkeley Center for Law and Technology (BCLT), KoGuan School of Law at Shanghai Jiao Tong University, and the Institute of Intellectual Property and Competition Law. Held in Shanghai on May 28, 2024, the workshop convened leading judges, scholars, practitioners, in-house counsel, and economists from both countries to examine the evolving frameworks for patent damages and valuation. As the inaugural workshop on patent law and practice from a U.S.–China comparative perspective, pioneered by BAIC and BCLT, it explored compensatory damages (lost profits, reasonable royalties, price erosion, apportionment), punitive damages and their deterrence effects, the challenges of valuing and licensing standard-essential patents (SEPs), and the “important but limited” role of judicial rate setting in shaping technology markets. With attention to both theoretical underpinnings and practical case studies, the report highlights key similarities and divergences in practice, as well as the implications for global patent litigation and licensing. By capturing this pioneering comparative dialogue, the report provides valuable insight into the jurisprudential evolution of patent remedies and their broader policy context in the world’s two largest innovation economies.

Recent Articles on Damages in China

Two recent articles in the Queen Mary Journal of Intellectual Property may be of interest to readers who follow developments in Chinese patent/SEP litigation.

1. Zhang Guangliang and Geng Bang have published An Active Exploration of Global Licensing Rate Adjudication Methods for Standard Essential Patents:  The Chinese OPPO v. Nokia Case, 15 Queen Mary J. Intell. Prop. 238 (2025).  Here is the abstract:

The decision rendered by the Chongqing First Intermediate People’s Court in OPPO v Nokia represents a landmark moment in the adjudication of global licensing rates for SEPs within the Chinese judicial system. This ruling not only expedited a resolution between the parties, who had been entangled in over 100 global SEP litigations for two and a half years, but also made significant advancements in the methodologies employed for determining global SEP licensing rates. The case achieved three pivotal breakthroughs in the context of 5G SEPs across global jurisdictions: it established the first ruling on the cumulative industry rate for 5G standards, determined the inaugural generational technical value ratio for multimode devices spanning 2G-5G and rendered the first adjudication of a global licensing rate for 5G multimode devices. This case has substantially enriched the frameworks for adjudicating global fair, reasonable and non-discriminatory (FRAND) licensing rates and has further propelled the evolution of global adjudication rules governing FRAND licensing for SEPs.

2. Renjun Bian has published an article titled Explaining the ‘Low and Unexplainable’ Patent Damages in China:  An Empirical Analysis of 992 Judicial Opinions, 14 Queen Mary J. Intell. Prop. K. 405 (2024).  Here is the abstract:

Patent damages in China are commonly criticized as low and unexplainable, which raises concerns over the overall credibility of China’s patent system. This article describes and reports the results of a large-scale empirical analysis of 992 invention patent infringement lawsuits decided by Chinese courts between 2014 and 2018 with damages awarded. The results show that whether patent damages in China are low depends on the selection of standards. If compared with damages granted by courts in the United States or the expectations of patent holders, patent damages in China are undoubtedly low. However, if considering the patent holder’s actual losses – a more rational standard – the allegation of low patent damages does not stand. In addition, around 64.1% of the variations in patent damages in China can be explained by pre-selected ex ante factors, among which proxies for patent value and scale of infringement play an important role. These findings demonstrate that patent damages in China are not as low and unexplainable as commonly believed. Instead, the rather ‘low’ damages compared to their counterparts in the United States reflect the main body of patent infringement lawsuits between small entities over technology improvements on small widgets and goods in China. 

3. Also of interest, in regard to China and SEPs, is an essay by Michael Franzinger in today’s Law360, titled How WTO’s Anti-Suit Injunction Ruling Affects IP Stakeholders.  For my previous post on the recent ruling by a WTO arbitration panel, finding in favor of the E.U. in its case against China, see here.

Lex Machina Damage Award Litigation Report 2025

I was alerted to the publication of Lex Machina’s Damage Award Litigation Report 2025 by an articlein Law360 earlier this week, and have now had a chance to review the report myself.  (Readers who want a copy should contact Lex Machina.)  “The report primarily compares data spanning the ten-year period from the beginning of 2015 through the end of 2024,” and “focuses on the more than 73,000 federal cases with damage awards in that ten-year span,” including patent, copyright, trademark, trade secret, and antitrust cases, along with several other subject matter areas including products liability.  For present purposes, I thought I would simply highlight a few things relevant to patent damages awards over the past few years.  Most notably, the number of cases awarding patent damages from 2020-24 was 738 (compared with 305 during 2015-19), and the total amount awarded has risen from $3,822,980,219 to $12,667,647,608.  (These amounts are not adjusted for inflation, but clearly outstrip the rate of inflation over that period of time.  I understand that $1 in 2015 would be worth about $1.36 today, and $1 in 2019 would be worth about $1.26.)  The average patent damages award for 2020-24 has increased 200% (to $35,784,315), and the median by 84% (to $1,861,033), compared with 2015-19.  Not surprisingly, average and median jury awards are higher than average and median judge awards, though presumably much of this is attributable to selection effects.  For 2024, the average and median amounts for jury awards in patent cases are $83,693,841 and $24,200,000, compared to $1,254,568, and $603,965 for judge awards.  Average trade secret awards from 2020-24 also have increased compared to 2015-19 (by 105%), while average copyright and trademark awards have decreased (by 48% and 39%, respectively)--though the median trade secret award has increased by only 19%, and the median for copyright and trademark has decreased by 6% and 9%, respectively.  And, as noted above, these numbers are not adjusted for inflation.

Choice of Law and the UPC

Back in March, in a post titled UPC Choice of Law Principles for Damages, I noted a decision of the Mannheim Local Division of the UPC, Hurom Co. v. NUC Electronics Europe GmbH, setting out the following choice of law principles for patent infringement actions filed in the UPC:  "with regard to the determination whether substantive law as laid down in the UPCA or substantive national laws of the UPCA member states applies to acts allegedly infringing traditional European bundle patents, the following applies:

"a) to acts committed after the entry into force of the UPCA, the substantive law as laid down in the UPCA applies;

 

"b) to acts committed before the entry into force of the UPCA, the substantive national laws apply;

 

"c) to ongoing acts started before the entry into force of the UPCA and continued after the entry into force on 1 June 2023, the substantive law as laid down in the UPCA applies."

Furthermore, the court appears to consider damages rules as “substantive,” meaning that national law would apply to damages calculations for acts committed exclusively before the entry into force of the UPCA.

My post neglected to mention, however, a January decision of the UPC Court of Appeal, Fives ECL, SAS v. REEL GmbH, UPC_COA_30/2024 (Jan. 16, 2025), which decided the preliminary issue of whether the UPC has jurisdiction to hear isolated claims for damages, and if so whether this rule applies where the damages were suffered prior to the entry into force of the UPC on June 1, 2023.  The specific setting of this case was that the patent owner had obtained from a German national court a judgment of infringement, prior to June 1, 2023, and a declaration that the defendant would be liable for damages; but it thereafter pursued its damages claim before the UPC.  The UPC Court of Appeal held that the UPC was competent to hear the damages claim (but left open the question of whether national or UPC law would apply to that claim).  The principle established in the Mannheim decision, if correct, would hold that national law applies where the infringing activity occurred prior to June 1, 2023.  

The issues presented in these cases, including an analysis of Fives v. REEL itself, are discussed in a series of article published by Dr. Thomas J. Adam in the journal European Patent Litigation in Practice: “Reach-Back Damages” in the UPC:  Does the UPC have or, indeed, need a long arm to adjudicate on damages caused by patent uses that took place prior to the coming into force of the UPCA?, 3 EPLP 109 (2024); Which Substantive Law Does the UPC Apply as to “Reach-Back Damages”? Some General Thoughts and a Pragmatic Proposal, 3 EPLP 197 (2024); and “We’ll Take It from Here” – Calculation of Damages in the UPC Based on a National Infringement Decision and “Reach-Back” Damages:  Case note to UPC-CoA, 16 January 2025 – UPC_CoA_30/2024.  Dr. Adam’s analysis is consistent with the results reached in the two above-cited cases, if not every aspect of their reasoning.  The second article also discusses the question of what the relevant statute of limitations should be for claims that accrued prior to the entry into force of the UPC.  The UPC itself establishes a five-year statute of limitations (article 72), but Dr. Adam reasons that in these types of cases national law, if different, should apply in order to comport with the parties’ legitimate expectations.  That would mean, for example, that where the claim accrued under German law, the normal statute of limitations would be shorter (three years), except in cases in which the patent owner seeks residual damages under BGB article 252, in which case the statute of limitations is ten years (see, e.g., my previous post on the BGH’s Spannungsversorgungsvorrichtung decision here).     

Update (6-3-2025):  As noted on ip fray, just yesterday a different panel of the UPC Court of Appeal concluded, consistent with the court's January decision in Fives v. REEL, that the UPC has jurisdiction over a case alleging the infringement before and after June 1, 2023 of a non-opted out European Patent.  The new decision is XSYS Germany GmbH v. Esko-Graphics Imaging GmbH, UPC_CoA_156/2025,APL_8790/2025

Upcoming Speaking Engagement at AIPLA Spring Meeting

The American Intellectual Property Law Association (AIPLA) is holding its Spring Meeting in Minneapolis on May 13-15.  Tuesday, May 13 will feature a concurrent session on remedies in IP cases.  The first session (from 10:15—11:00 a.m.) is titled “Crafting Monetary Remedies in Trademark, Copyright and Unfair Competition Cases (Part 1),” and will feature Professor Mark McKenna (moderating) and (Krista Holt, Charlie Eblen, and Jeffrey M. Gould).  The second session (from 11:15-noon) is titled “Attorney Fees Awards in IP Cases & Crafting Remedies in Patent Cases (Part 2),” and will be moderated by Ashe Puri.  Sue Stuckwisch and I will be presenting.  My focus will be on attorneys’ fee awards in IP cases and extraterritorial damages in patent infringement actions.  Maybe I will see some of you there!