Broadcom damages against Qualcomm may be cut

The hit on Qualcomm from a patent suit it lost to rival Broadcom may be slashed because of an unrelated ruling that came down in August.

In May, a jury in the U.S. District Court for the Southern District of California found that Qualcomm infringed three Broadcom patents and awarded Broadcom $19.6 million. The judge in that case, James Selna, said he would double the damages to more than $39 million because the jury found the infringement was wilful. The damage award isn’t final because other issues in the case are still pending.

On Monday, Selna tentatively overturned the double award because of a new standard for proving wilful infringement, said Broadcom attorney David Rosmann. Broadcom can either accept the $19.6 million in direct damages or pursue a new trial in which it would try to prove Qualcomm acted deliberately, he said. Judge Selna ruled any new trial would look at the whole case over again, he said.

Broadcom hasn’t decided which path to take, but its priority in the case is getting an injunction to stop Qualcomm from making, using or selling the chips, Rosmann said.

“The issue of the injunction is far more important to Broadcom than the damages,” Rosmann said. “We’re hoping to move forward on the injunction as quickly as possible.”

In August, the U.S. Court of Appeals for the Federal Circuit upped the ante for patent owners that want to earn higher damages — they can be as much as tripled — by proving someone knew they were infringing a patent and did so anyway, according to patent attorney Smith Brittingham of Finnegan, Henderson, Farabow, Garrett & Dunner.

“You have to show more comprehension of the situation than you would have had to in the past,” Brittingham said. The Federal Circuit ruling, on a suit against hard-drive vendor Seagate Technology, automatically changed the standard in all federal courts, he said. The ruling could change other pending cases, he said.

The new standard probably won’t discourage patent suits among competitors like the Broadcom-Qualcomm dispute, but it may make litigation less attractive for patent-holding companies in the business of suing, Brittingham said.

“It’s consistent with the view that … maybe patent infringement cases have gotten too easy to win and have created an unnecessary drag on business,” he said.

Judge Selna asked Broadcom for a decision by the end of this week, Rosmann said. Qualcomm declined to comment on the substance of the case.

The suit is one of several between Qualcomm and Broadcom, who are battling over the market for mobile-phone chips.