Just last week, a federal jury in Marshall, Texas, decided a patent infringement case between two of the three top automated key duplicating machines vendors. It all began back in June 2021, when Hy-Ko accused The Hillman Group’s duplication machines, KeyKrafter and PKOR, of infringing its patented technologies. Consequently, they filed a patent infringement lawsuit against The Hillman Group company in the Eastern District of Texas. In the complaint, Hy-Ko shows that the key duplication across the U.S. generates over $600 million yearly. They allege that the patent infringement is an attempt to maintain and expand the control of the key duplication business and sought $115 million in damages.

On the other hand, The Hillman Group responded initially by trying to invalidate the key duplication patents through four inter partes reviews filed on November 9-10, 2021 (IPR2022-00169, IPR2022-00168, IPR2022-00175, IPR2022-00174). However, attorneys Bryan J. Jaketic and Michael P. Gonzalez of Squire Patton Boggs represented Hy-Ko in these cases and managed to get a denied institution decision in all four IPRs on May 9, 2022.

In the district court case, the defense attorneys argued that the differences between two companies’ sales recently have to do with product quality rather than the patents involved in the case. Hy-Ko’s lead attorney, Joseph A. Meckes, called as witnesses William Much, a co-inventor of the patented technology, Michael Bass, CEO and president of Hy-Ko, and Steven DeVries. They managed to convince the jury to award a one-time reasonable royalty of $16 million for past and future sales.

What do you think about this decision? How are damages calculated in patent infringement cases?