Cobalt Boats won a $2.7 million verdict in a patent suit against Brunswick Corp. after Brunswick failed to move the suit from Virginia to Tennessee after the U.S. Supreme Court’s TC Heartland decision, according to a verdict form filed Wednesday.
A jury found that Brunswick had infringed one of two claims at issue in Cobalt Boats LLC’s case over its “retractable swim step” technology and concluded the infringement was willful, according to the verdict form, which could prompt the judge overseeing the case to triple the damages awarded by the jury.
The case, over a boat feature that helps swimmers get in and out of the water protected by Cobalt’s U.S. Patent Number 8,375,880, had taken a series of turns in the days before trial as Sea Ray Boats, owned by Brunswick and originally a defendant in the case, tried to shift the case out of Virginia federal court, saying that under the high court’s ruling in TC Heartland limiting where patent suits can be filed, the Eastern District of Virginia was no longer the proper venue for the case.
The high court held that patent suits can only be filed where a defendant is incorporated or where it has committed infringement and has a regular and established place of business. Sea Ray said it has no such ties to the Eastern District of Virginia, so it was “mandatory” for the case to be transferred.
That bid was rejected outright by U.S. District Judge Henry Morgan, who found June 7 that both Brunswick and Sea Ray had missed their chances to contest the venue earlier in the case. The Federal Circuit a few days later agreed in a split decision and declined to grant mandamus relief under the circumstances.
U.S. Circuit Judge Pauline Newman dissented, saying the appeals court must ensure that the TC Heartland decision is properly applied to the facts of the instant case, adding that it’s appropriate to determine the forum before expending the resources involved in a two-week jury trial.
On June 11, the Sunday night before the trial began, the parties agreed to let Sea Ray out of the case, stipulating to its dismissal without prejudice, according to a filing.
The trial began June 12 and lasted eight days as the jury considered three claims of the '880 patent — 2, 4 and 5 — though claim 2 was eventually booted from the case, leaving them only two claims on which to decide.
The jury found Brunswick infringed claim 4 of the patent literally, and that it had infringed both claims under the doctrine of equivalents. That infringement, according to the jury, was willful. It awarded $2.7 million as a “reasonable royalty rate” on the verdict form.
"This was an important victory for Cobalt, well known for its many industry innovations, that sends a strong message to other boat companies that they cannot simply copy Cobalt’s many innovations, like the Swim Step," said Robert Angle of Troutman Sanders LLP, who represents Cobalt in the case. "The jury’s quick and decisive verdict reflected not only the strength of Cobalt’s case, but also the great effort by the Troutman/Stinson team representing Cobalt."
“While disappointed in the outcome, Brunswick Corporation remains confident in its position on this matter, and plans to appeal the recent verdict. Brunswick respects the intellectual property rights of others and designed its step to prevent infringement. Because the matter remains an ongoing subject of litigation, the company will have no further comment,” said Daniel Kubera, director of media relations at Brunswick, in a statement to Boating Industry.
The patent-in-suit is U.S. Patent Number 8,375,880.
Brunswick is represented by David Morris, Jason White, Scott Sherwin, Michael Abernathy, Julie Goldemberg and William R. Peterson of Morgan Lewis & Bockius LLP.
Cobalt is represented by Robert Angle and David Gettings of Troutman Sanders LLP and B. Scott Eidson, Samir Mehta, Penny Slicer and Colin Turner of Stinson Leonard Street LLP.
The district court case is Cobalt Boats LLC v. Sea Ray Boats Inc. et al., case number 2:15-cv-00021, in the U.S. District Court for the Eastern District of Virginia.