WEST'S® JURY VERDICTS - NEVADA REPORTS
Patent Holder Awarded $11M Against Infringing Company
Japan Cash Mach. v. MEI
Type of Case:
Intellectual Property - Patent
Specific Liability:
Company allegedly infringed patents for bill validator, bill handling apparatus
General Injury:
Monetary damages, injunction
Jurisdiction:
State: Nevada
Court: United States District Court, D. Nevada.
Related Court Documents:
Plaintiffs' complaint: 2005 WL 6007889
Plaintiffs' opening Markman brief: 2006 WL 6193293
Plaintiffs' trial brief: 2008 WL 5636240
Defendant's trial brief: 2008 WL 5636238
Verdict form: 2009 WL 355713
Case Name:
Japan Cash Machine Co. Ltd., a Japanese corporation, and JCM American Corp., a Nevada corporation, plaintiffs v. MEI Inc. (formerly Mars Electronics International Inc.), a Delaware corporation, defendant; MEI Inc., a Delaware corporation, counter-claimant v. Japan Cash Machine Co. Ltd., a Japanese corporation, and JCM American Corp., a Nevada corporation, counter-defendant
Docket/File Number:
2:05-cv-01433
Verdict:
Plaintiffs, $11,422,960.00
Verdict Date:
Jan. 2, 2009
Judge:
Robert C. Jones
Attorneys:
Plaintiffs: Michael D. Rounds, Watson Rounds PC, Reno, Nev.; David B. Abel, DLA Piper US LLP, Los Angeles, Calif.
Defendant: Edmund R. Bannon, Raymond R. Castello, David Francescani, Lewis Hudnel and Jorge M. Torres, Fish & Richardson, New York, N.Y.; Lori N. Brown, Harmon & Davies, Las Vegas, Nev.
Experts:
Plaintiffs: Dwight Crevelt, electronics and software, Crevelt Computer System Inc., Las Vegas, Nev.; Bruce McFarlane, CPA, damages, LitiNomics, Mountain View, Calif.; Matthew Stein, PE, mechanical engineer, Stein Design, Truckee, Calif.
Defendant: Philip Beutel, PhD, intellectual property, National Economic Research Associates Inc., White Plains, N.Y.; Charles Curley, engineer, Innotek LLC, Cortland, N.Y.; Theodore Grossman, information technology, Babson College, Wellesley, Mass.
Trial Type:
Jury
Breakdown of Award:
$11,422,960.00 to plaintiff for infringement of United States patent number 5,372,361 from the year 2002 to present.
Alternatively, the jury held that if on appeal the court determined that damages could be assessed only after the date of the lawsuit, plaintiff's damages were $7,734,814.00 from Dec. 2, 2005.
Summary of Facts:
Japan Cash Machine Co. Ltd. (“Japan Cash”) and JCM American Corporation (“JCM”) were suppliers of bill validation devises used in gaming machines such as slot machines and video poker. JCM was the exclusive distributor for Japan Cash. Japan Cash and JCM said they pioneered the incorporation of validators in gaming machines and invested heavily in the advancement and development of products and technology for the gaming industry.
Japan Cash held a patent for a bill validator with a bar code detector, patent number 5,420,406. The '406 patent was issued in 1995. The '406 patent is relevant to “ticket-in-ticket-out” gaming machines that include the ability to accept a bar coded ticket. The invention allowed players to redeem their coded tickets for play credits on the gaming machines within a casino instead of redeeming the bar coded ticket at a cashier stand.
Japan Cash also held a patent for a bill handling apparatus, patent number 5,372,361. The '361 patent was issued in 1994. The '361 patent is for a bill handling apparatus for gaming machines with a bill stacker having a removable pusher. The pusher assembly could be easily removed for maintenance or replacement.
According to Japan Cash and JCM, MEI Inc. (“MEI”), formerly Mars Electronics International Inc., infringed both patents '406 and '361 by importing, exporting, manufacturing, distributing, selling, or offering to sell the “MEI Cash Flow SC Series” products.
The MEI product included a bill validator that could accept currency or bar coded documents. The device contained three components: an acceptor module, a chassis and a cassette. The acceptor contained a validator and a transporter, and the cassette contained a stacker module, which consisted of a transporter assembly and a pusher assembly.
Japan Cash and JCM filed a complaint against MEI in United States District Court, District of Nevada in December 2005. The plaintiffs alleged the MEI Cash Flow SC Series validator infringed the '406 patent and the transporter, cassette and stacker module infringed the '361 patent. The plaintiffs sought damages for lost profits, royalties and lost sales; a permanent injunction against MEI; exemplary damages under 35 U.S.C. 285; and attorney fees and costs.
The defendant filed a motion for partial summary judgment, which Judge Robert Jones granted as to the defendant's claim of non-infringement of the '406 patent. The court denied the motion as to the defendant's claim that the '406 patent was invalid, that the plaintiffs lacked standing and were unable to collect damages on behalf of a third party, of non-infringement of the '361 patent, and that the plaintiffs were unable to collect certain lost profits/damages and failed to comply with the Patent Act's marking requirements.
Among other motions, the defendant filed a motion in limine seeking to preclude the plaintiffs' expert, Matthew Stein, from comparing the defendant's allegedly infringing product to the plaintiffs' product at trial. The defense argued that the only appropriate comparison was between the accused product and the claims of the patent-in-suit. The motion was denied.
After a 16-day trial in December 2008 and January 2009, a jury found in favor of the plaintiffs and against the defendant on the plaintiffs' claim of infringement of the '361 patent. The jury also found for JCM on the invalidity defense to the '361 patent. However, the jury found in favor of defendant MEI on the defense of obviousness of the '406 patent and in favor of defendant MEI on the plaintiffs' claim of willful infringement. The parties later conducted a bench trial on the defense of inequitable conduct with respect to the '406 patent. The defendant also argued that the plaintiffs' damages should be limited to damages incurred after the lawsuit was filed because the plaintiffs failed to mark its products pursuant to 35 U.S.C. 287. The court denied the defendant's claim regarding damages as well as inequitable conduct with respect to the '406 patent on Jan. 20, 2009.
Each party filed proposed judgments on the verdict. In their proposed judgment, the plaintiffs sought an award of prejudgment interest and costs related to the litigation and an injunction against further infringement of the '361 patent. In its proposed judgment, the defendant sought its costs related to the litigation of the '406 patent. No judgment had been entered at press time.
Court: United States District Court, D. Nevada.
Westlaw Citation:
2009 WL 427015
West's Jury Verdicts - Nevada Reports Citation:
West’s J.V. Nev. Rep., Vol. 4, Iss. 12, p. 27 (2009)
© 2009 West, a Thomson Reuters business. All rights reserved.
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