3 minute read | April.07.2014
Big IP verdicts aren’t limited to patent cases. Trade secrets can mean big money, too. Really big. As in multi-, multi-million dollar verdicts. And the trend is up with more than half of the top ten verdicts coming out in just the past two years.
Trials are expensive. They’re also unpredictable. So when a plaintiff seeking damages in a trade secret case decides to take the case all the way through trial, it’s hoping for a jackpot. Otherwise the costs and risks of trial likely wouldn’t make it worth gambling the result on a jury.
For the parties below, the gamble paid off.
Trade Secrets Watch reviewed trade secret misappropriation cases over the past decade and dug up the largest verdicts on record. We also noted any post-verdict information to the extent it was available.
(Editor’s note: The Fourth Circuit has thrown out our second-biggest all-time verdict—a $920 million award to Du Pont for Kolon Industries, Inc.’s alleged theft of trade secrets relating to Kevlar body armor. It’s the latest in a string of large awards that were subsequently reduced or vacated by courts (see the right-hand column, below). Also, a Minnesota state appeals court affirmed a $630 million arbitration award against Western Digital Corp. over allegations of trade secret misappropriation. See Seagate Tech. LLC v. Western Digital Corp., No. A12-1944, Minn. Ct. App. (St. Paul) (July 22, 2013). This would have ranked at No. 3 on our list, had a jury made the award. Regardless, this case confirms that the era of massive trade secret awards has arrived.)
| Rank | Award | Prevailing Party | Case Name | Post-Verdict Result |
|---|---|---|---|---|
| #1 | $2.3 billion | St. Jude Medical | Pacesetter Inc. v. Nervicon Co., BC424443, California Superior Court, Los Angeles County (April 2011) | Reduced to $947 million |
| #2 | $919.9 million | E.I. du Pont de Nemours | E.I. du Pont de Nemours & Co. v. Kolon Industries, Inc., 3:09-cv-00058, U.S. District Court, Eastern District of Virginia (Sept. 2011) | Fourth Circuit vacated the award and remanded for new trial |
| #3 | $465.4 million | Lexar Media | Lexar Media, Inc. v. Toshiba Corp., CV-812458, California Superior Court, Santa Clara County (March 2005) | Trial court ordered new trial on damages; parties later settled for $288 million |
| #4 | $310 million ($88.4 million trade secret award, plus attorneys’ fees and punitive damages) | MGA Entertainment | Bryant v. Mattel, 2:04-cv-09049, U.S. District Court, Central District of California (April 2011) | On re-trial of Bryant v. Mattel (see below); trial judge reduced trade secret award to $85 million but awarded $85 million in punitive damages and $139 million in legal fees; Ninth Circuit vacated $172 million judgment but upheld $137 million in legal fees |
| #5 | $192 million | Sven Peter Mannsfeld | Sven Peter Mannsfeld v. Phenolchemie Inc. et al., CV-2006-001956.00, Alabama Circuit Court, Mobile County (Oct. 2008) | Settled for $40 million |
| #6 | $134 million | USA Power | USA Power LLC v. PacifiCorp, 050903412, Utah Third District Court, Salt Lake County (May 2012) | |
| #7 | $118 million | Bancorp Services | Bancorp Services LLC v. Hartford Life Insurance, 4:00-CV-70, U.S. District Court, Eastern District of Missouri (March 2002) | |
| #8 | $112 million | Brocade Communications Systems | Brocade Communications Systems Inc. v. A10 Networks Inc., 5:10-cv-03428, U.S. District Court, Northern District of California (Aug. 2012) | Trial judge reduced to approximately $62 million and granted A10's motion for a new damages trial; parties later settled for $75 million |
| #9 | $100 million | Mattel | Bryant v. Mattel, 2:04-cv-09049, U.S. District Court, Central District of California (Aug. 2008) | Ninth Circuit vacated the award and judgment; case re-tried (see above) |
| #10 | $94 million | Wellogix | Wellogix Inc. v. BP America Inc. et al., 3:08-cv-00119, U.S. District Court, Southern District of Texas (May 2011) | Trial judge reduced to $44.4 million; Fifth Circuit affirmed |