[Ip-health] US compulsory license in DirectTV patent case - Finisar Corp. v. DirecTV Group, Inc.

[James Love]

Definitely not a public health emergency, but a case involving access
to satellite television, which shows that some countries know how to
use the TRIPS flexibilities. Jamie

 From the decision:

"For the reasons stated at the July 6, 2006 hearing, the Court denied
Plaintiff=92s motion for injunctive relief and granted a compulsory
license. Defendants are hereby ORDERED, for the remaining life of the
` 505 patent, to pay Plaintiff an ongoing royalty of $1.60 per
Integrated Receiver Decoder, commonly referred to as a set top box,
activated by or on behalf of or for any of the named Defendants or
their present or future affiliates or subsidiaries after June 16,2006."

http://www.fr.com/news/articledetail.cfm?articleid=3D605

Here is the Fish and Richardson analysis of: Finisar Corp. v. DirecTV
Group, Inc.

Judge Ron Clark denied Finisar Corp.'s motion for entry of a
permanent injunction against DirecTV, following a jury's finding that
DirecTV infringed Finisar's information transmission system
technology, and that the infringement was willful. The Court analyzed
the case under the four-factors set forth by the Supreme Court in
eBay: irreparable harm, adequacy of remedies available at law,
balance of hardships, and public interest. The Court found that there
was no irreparable harm because Finisar never sold the rights to the
patent or made an attempt to practice the patented technology. The
Court held that a compulsory license would adequately compensate
Finisar for DirecTV's future use of the patent. Looking at the
balance of hardships and the public interest, the Court noted that
the satellite television market is a two-competitor market. An
injunction could have put DirecTV out of business and created a
monopoly. Furthermore, the Court noted that an injunction would
negatively affect thousands of DirecTV employees, and 15 million
DirecTV subscribers could lose their television service. These facts
lead the Court to conclude that the balance of the hardships favored
DirecTV and the public would be best served by not granting an
injunction.

(For more commentary, see: http://www.patentlyo.com/patent/2006/08/
injunction_deni.html)


Case 1:05-cv-00264-RHC Document 333 Filed 07/07/2006 Page 1 of 2

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF TEXAS
BEAUMONT DIVISION

Civil Action No. 1:05-CV-264 , JUDGE RON CLARK

FINISAR CORP., Plaintiff,
v.
THE DIRECTV GROUP, INC., ET AL., Defendants.

FINAL JUDGMENT

Pursuant to Rule 58 of the Federal Rules of Civil Procedure and in
accordance with the jury verdict delivered on June 23, 2006 and the
Court=92s oral findings and conclusions entered on the record July 6,
2006, the Court hereby enters judgment for Plaintiff Finisar Corp.
and against Defendants The DirecTV Group, Inc., DirecTV Holdings,
LLC, DirecTV Enterprises, LLC, DirecTV Operations, LLC, DirecTV,
Inc., and Hughes Network Systems, Inc. for infringement of U.S.
Patent No. 5,404,505, claims 16, 17, 22, 24, 26, 39, and 44. IT IS
THEREFORE ORDERED that Plaintiff Finisar Corp. shall have and recover
from Defendants The DirecTV Group, Inc., DirecTV Holdings, LLC,
DirecTV Enterprises, LLC, DirecTV Operations, LLC, DirecTV, Inc., and
Hughes Network Systems, Inc., jointly and severally, the total sum of
$103,920,250.25, plus prejudgment interest at the agreed rate of 6%,
calculated as stated on the record at the July 6, 2006 hearing, on
the damages found by the jury, said prejudgment interest totaling
$13,359,276.00, together with post judgment interest on the entire
sum calculated pursuant to 28 U.S.C. =A7 1961.

For the reasons stated at the July 6, 2006 hearing, the Court denied
Plaintiff=92s motion for injunctive relief and granted a compulsory
license. Defendants are hereby ORDERED, for the


Case 1:05-cv-00264-RHC Document 333 Filed 07/07/2006 Page 2 of 2

remaining life of the ` 505 patent, to pay Plaintiff an ongoing
royalty of $1.60 per Integrated Receiver Decoder, commonly referred
to as a set top box, activated by or on behalf of or for any of the
named Defendants or their present or future affiliates or
subsidiaries after June 16,2006. Royalties shall be paid quarterly
accompanied by a statement in accordance with the provisions of
paragraph 3.8 of the MPEG-2 Patent Portfolio License, dated February
22, 2001, granted to Hughes Network Systems, Inc. Payments shall
begin three months after the date of signing of this judgment and
shall be made quarterly thereafter. Payments not made within 14 days
of the date due shall accrue interest at the rate of 10% , compounded
monthly. Finisar shall have the right to request audits in accordance
with the provisions of paragraph 3.9 of said MPEG-2 Patent Portfolio
License. It is anticipated that, as sophisticated entities with
experience in licensing agreements, the parties may wish to agree to
more comprehensive or convenient terms. The parties shall promptly
notify the court of any such agreement. The court maintains
jurisdiction to enforce this portion of the Final Judgment.

Costs are taxed against Defendants The DirecTV Group, Inc., DirecTV
Holdings, LLC, DirecTV Enterprises, LLC, DirecTV Operations, LLC,
DirecTV, Inc., and Hughes Network Systems, Inc. jointly and
severally. All relief not specifically granted herein is denied. All
pending motions not previously ruled on are denied. This is a Final
Judgment and is appealable.

So Ordered and Signed this 7 day of July, 2006

Signed
Ron Clark, United States District Judge

---------------------------------
James Love, CPTech / www.cptech.org / mailto:james.love@cptech.org /
tel. +1.202.332.2670 / mobile +1.202.361.3040

"If everyone thinks the same: No one thinks."  Bill Walton"