that it had given to the primary competitor convatec in order to induce my client hollister to pay thirty five million dollars for the very patent rights that they had secretly released the jury also found that my client hollister had been injured by that fraudulent concealment so the issue in this appeal is whether it was error for the district court to allow the parties which have perpetrated the fraud to escape from any liability for their conduct by awarding no damages to my client the interplay between the florida law in the patent law in this case is unique but in both cases the law prohibits an award of zero on this record and it's a unique case because you have a fraud case you have a florida fraud case in which the law or the case involved patent rights and so you have florida law dealing with  quantification of damages in a fraud case applying and you also have patent law dealing with what is a reasonable royalty in a patent infringement case that is  certainly in tandem and separately would require an award on this record of something other than zero in damages in let's start with florida law florida law as articulated by this court  provides that once you have liability and injury established in a fraud case that a wrong doer cannot escape liability simply because the harm he caused is difficult to quantify and therefore real guidelines that florida law has established and have been recognized by this court the first is that of the proof of the amount of damage is less severe than the burden of proving the fact of damage second point would be that a just and reasonable estimate of the amount of damages is all that is required under florida law third that the determination can be based upon probable as well as inferential proof and doesn't have to be direct and positive proof and then the fourth point being that under florida law for quantification fraud damages mathematical precision is not required so those four guidelines support the overarching principle that a it is unjust in fact unbearable to allow defendants to profit by their own wrongdoing at the expense of the victim which is what has happened in this case now interwoven with this florida law standard on the quantification of fraud damages is the law of patent infringement which requires an award of a reasonable royalty from an infringer and i think we understand what the law is that and that the measure of damages is really measured by the patent because we get to determine what what you had to prove is number one that there was an infringement and then number two what you would have gotten  in the infringement suit if you hadn't been barred by that release let me just tell you what my concern is questions to your opponent primarily but it seems to me probable that the district code has served in a forwarding minimum probative way to that bar at settlement because you r expert didn't know much which was not real good on your part but the fact that he didn't know much does not seem to me to be real significant because we do know that we had precisely the same patents we had a name for enjoying object art which had to be pretty much the same as contacts product because they wanted three in the market and they would do in the same thing and so full the one thing that bothers me in the one thing the district go it said it thirty three and thirty four no twenty nine was that in the bar fact this is the only thing that seems to me to be questionable about the bard is that it did in fact include not only the five eighty three patent which was in friend used that that's what you proved but the six twenty seven patent and foreign patents the district go didn't mention six twenty seven you magine only the foreign patents he called on the foreign counterpart patents so that under the prism case that you probably familiar with in the federal circuit it does say that if they are unrelated patents which are part of the previous license like bart is a previous license to which we are comparing here if unrelated i believe that that is a legitimate argument in if you will mitigation of the position that we took of course it was not argued in the district court to to address the prism standard and i think the court used the i think the important word if the licens included unrelated patents in this case the six twenty seven was in fact the earlier patent and a parent of the the five eighty three the effectively had minor variations in the claim language but dealt with the same technology so the reality being that if you're getting in this case a license on the five eighty three there was really no enhanced value to the recipient for the six twenty seven on the foreign patent rights i believe that the g x g h x data that was put into evidence dealt with domestic sales of the products only but i can't really address the foreign patents beyond that statement because i don't think there's anything else in the record that will allow us to do so where i come back to is where i started judge andersen we have a patent that is clearly comparable patent one that is honestly you don't in pan cases get something this good you just don't usually have to come in with a bunch of third party patents for different it should be for third party licenses for different patents you know in different marketplaces and try to argue by analogy the pretty close here you have dead on comparable patent issued to the only other competitor after dealing with the same products same marketplace at the same time resulting from a litigation started the same day in the same court as the sabotaged convatec legislation so you don't  better than that and could there be an argument that the value that was received by barred is at six point six five million dollars perhaps more than what it would have been if you're only focusing on the five eighty three that may be an arc that may be an argument it was not made it would be one i suppose that could be fielded if you have a remain and which i think the company defendant did not make that argument in the district i've read enough i don't think he made that argument with respect to six twenty seven but i thought he did make argument with respect to the foreign counterparts i know that there was an argument that it was not a comparable licens based on the fact that there were foreign rights involved in the license which is of course as explained by the witness mr jeannette common you settle the whole shooting match you don't you don't push a little bit out here so otherwise no licensee would ever license are with the conundrum any comparable license you're going bring in is going to have that element could they argue that there should be some adjustment they could they did not and in fact all they did was if you will bootstrap on the court observation that there were foreign patent rights involved in the license at issue which the or district code in that footnote i mentioned said something to the effect that in the infringement suit  you would not have been able to collect with respect to foreign infringement of foreign patents but those it would be extra not be held accountable for that it is possible to make make user sales sell is a quarter knows is the standard and if the product was made in the united states or sold from the united states there would be rights  infringed in the united states however for was made overseas sold overseas and used overseas you might have an extra extra territorial issue that you would have to educate in that foreign nation if there were patent rights in that four nation do we know  bard bard got not only the six twenty seven but he also got foreign oil they barred also got foreign counterparts i think didn't correct your honor it  to what you call it whole p c it boat full full world the world peace something we don't see very often i have a different line of inquiry mr jakes i'm going to keep you up there for a few minutes and i'm still give you your full time for a bottle as i understand your claim you're seeking benefit of the bargain damages under florida law as measured by the patent law concept of a reasonable world is that correct i think that's the best way to characterize  florida courts have said that to prove benefit of the bargain damages the plaintiff is required to prove the actual value of the property at the time of the purchase isn't that right i believe that is a correct statement from case the case law that you're looking at where where is the evidence in the record of the actual value of the assets transferred at the time of the transaction the only evidence would be i believe testimonial evidence regarding a quantification for tax purposes of the value of the assets referred to as the houlihan loci calculation so since at the time the asset that was bought were these in co a pending patent applications you could not do anything with them and of course the reality being as we know from the case when we got our pa and sued our competitors we were able to perform you know secure per protection of our rights with bard but not with convatec because of the fraud so my my concern is not about quantification of the damages of it it's about the timing as i understand it your evidence reflects what convatec would have paid for a license in two thousand and ten but that doesn't tell us anything about the value of the property assuming what hollister said was correct the only  he said was correct when the transaction occurred in two thousand and six the only other thing in the record that i could point to your honor to judge prior is the fact that when they gave the concealed release to  it seems to me that's the close isn't tough time good evaluation the five point nine million because it was in october twenty two thousand and five now the settlement they paid three two thousand convatec paid the five point nine million somewhat arguably value of what they had misappropriated to take in mor know right and then when was the purchase in two thousand and six for thirty five million i apologize i believe it was july ish because the release was october two thousand and five so that's just six months i don't know if i'd been trying this case it looks like that point now is a close approximation of what the damages were for not disclosing agreement what they got paid for for the lease agreement has some next to the reasonable royalties why would that not be the best measure of damages your honor we approached the case to answer this but  we approached the case looking at a but for kind of a concert i understand you asked for a lot more authentic i think you got off track well i understand that it was a from about for i was but for the fraud we would have had partly we would have had the patent we would have been able to enforce it it was valid and it would have had that value it isn't reasonable interpretation but for the fraud you were known about the release you still want to gone through with the day all and said we want the point not so that's a possibility that made us and the second answer to the question is in post post judgement proceedings we did make that alternative argument that the five point nine was an that money your honor i'm sure we referenced the five point nine million yeah you say as a result of the material fraudulent misrepresentations paragraph seven hollister has been damaged and i'm out equal to the amount by ruling that the a political law in this case on the damages was patent infringement law to accomplish what the benefit of the bargain would be under either a breach of contract claim  damages or breach a fraud claim or theory of damages and whether or not that law requires some award even when there is evidence lacking in a record or a record lacking evidence that meets the burden of persuasion persuading the jury that the plaintiff in this case has a stablished a reasonable role to the amount of damages and fails to support any intermediate number that may not be the number of vance by the plaintiff but maybe somewhere between zero and what was advanced by the plaintiff your honour's i would submit that the district court got it right on the unique factor will circumstances in this particular case i don't believe that opposing counsel and i disagreed as to what the patent infringement law required the law does indicate s and noted in apple both of us cited to that case if you were to look at the oral argument in the filings that we made on the motion to alter him in the judgment we both pointed to apple as the case to look at opposing counsel pointed to that case arguing that apple teaches that you had to award some amount of  damages that you couldn't award zero damages i pointed out to the district court in our arguments on that that apple does not teach that in every circumstance that there could not be a zero damage award and in fact that there was a footnote indicating bio would have paid at the time of the thirty five million dollars purchase but rather i thought the case was litigated and everybody agreed that the damages would be the infringement release and that the way the case was laid again yes or on that that was the primary focus and least of the damages phase of the trial that i was responsible for was focused more on that second problem you pointed out what would have been the damages proven  argument made by my client in that we raised in cross examination of believe mr jeanette and unfortunately it was not as precise as i wish it would have been had i had a chance to retry this case one of the lines of questioning to mr jeanette  when to whether or not there was ever a suit filed by hollister pursuing claims under the six to seven patent and this played back into that at the time of the asset purchase agreement when hollister purchased these patent applications in two thousand and six it was actually in september outpoint september fifth of two thousand and six the application then issued us the six to seven patent issued as a patent in december of zero six shortly after the purchase that was never sued on and the reason that was never sued on is because comet tech's product did not infringe the claims of the six to seven the six to seven pattern that issued which is in evidence i believe it's either fifty three should be exhibit plaintiff's exhibit fifty three shows that the claims with the in that particular patent required three distinct sections within the rectal catheter those dissing sections also required varying to rahman or hardness now this is something that i attacked in the infringement arguments under the five eighty three as well in the court rejected that approach in that attack saying that the five eighty three which was also a pending patent that at the time of purchase had been amended in altered language had been changed after the purchase and b the stor that broadened the claim language what they did was they took out the requirements of varying the roman hardness and it expanded the scope and coverage of the patent claims in the five eighty three and that's why they pursued that litigation once the five eighty three issued in may of two thousand and ten and could not pursue successfully pursue litigation against convatec at least under the six to seven expert jeanette did testify that the six to sam had been in french a to me just as a matter of common sense that any licensee would want and would not license just the five eight three pat any licensee would insist upon licensing the entire allayed family patents would be your honor i would say that it would appear that way at first glance however a careful analysis of two different stages of these of the i guess the background history will flush out why that's not necessarily the case in this circumstance if you'll take a look at what was going on in zero five when the five point nine settlement was reached between  and the reason that the five point nine is not a reasonable measure is that settlement included two things competent design around and have firsthand view of how saucy was building its b m s saucy approached a cadillac of being masses highly engineered process three distinct sections to serve three distinct value propositions in the market competition designed around that by not having three distinct sections but a simple what one person referred to as a diarrhea tube excuse my language but it was a just a garden hose with a retention cut it was much simpler at the time in zero five when saucy box them into that the agreement if you recall per the record required that they were releasing claims for patent infringement be adjusted and allocated for perhaps the six twenty seven and the foreign counterparts but those don't we have to remain and anyway but adjusted somewhat but obviously they are his damage and once you know it's in france and the low it's very clear that the fact of damage is established and there is a presumption that there will be the federal so on i would respectfully disagree with that being the exact federal circuit law i believe that the federal circuit law provides either of those instances so i would think that my reading up apple in the foot notes in the cases that have cited that were that there are three circumstances in which a court would be justified and allowed to award a zero damages award in all three of these stark circumstances would be rare they would not occur on very frequently and that's the reason we don't have room replete with references in case law to that is because it should be a very rare circumstance one the most rare which would most likely not occur and we're not arguing happened here is that you have a pattern that in essence is infringe has no value to it that's most likely not going to happen because pattern dealing with novel issues right so usually they have some value to them so that's not what we're arguing what happened here the other issues that you would have or two other issues you have a failure in your evidence that you submit by accident or overlooking that evidence and what it's propositions are or you have a strategic decision to present evidence that provides an all or nothing approach and that is what we have here in this particular circumstance there were strategical decisions made by opposing counsel to present a large quantification  it was a simple straightforward this is the mathematical approach for it it may have been geared towards a jury and then we both stipulated to the waiving jury in going forward with the beenz it may have been an oversight in why the board settlement is not a fundamental foundation for your extrapolation a starting point but in any of it is it not true the settlement is very clearly at least a starting point your honor i believe that witnesses which were not witnesses in evidence that my client had in his possession but that plaintiff's counsel and plaintiff had access to their own corporate representatives their own records their parties that dealt with presented of what the board product was there was none to do state trial to reconcile not only the litigation the procedural posture of where it was which was quite different and how they pursued it i did bring it out in my cross examination that there was an aggressive approach towards board board was a later interest to this market had just started had seen a substantial uptick early by undercutting prices and was in a different position than convatec was again board into the market around two thousand and nine been in the market since zero four predating the asset purchase agreement and so there were situational differences in their ability to approach and fight litigation there also counter claims raised by comments that were completely different and subject to exposure to they removed all marking it was a false marking claims that the patents were being practiced on the part on the products by hollister and what that essentially did they had to remove claims within all their marketing they had to remove all patent marketing and recall the prior marked articles now if you're familiar with patent law if you don't mark the article it eliminates your ability to move forward patent infringement claims against any other competitor now that doesn't affect you with comments or barred if those are  the remain but if a third competitor or a fourth competitor comes in the market hollister could not pursue them unless they proactively sent some notice because they had not marked their products any longer with these patents and so what that did was that prevented them from pursuing any other parties for patent infringement claims of these patterns and these products going forward so it wasn't just a two hundred fifty thousand dollars hit it was a huge hit in marketing materials and a huge hit on marking in your ability enforce that against other competitors later on your  n these are all things that are appearing if you look at it on the surface board settlement appears to be a good starting point is seen as identical if you just brush over it but if you get into the detail there were arguments made that the patent said issue there are different the five eighty three the sixty seven are different and i think if you get into my cross examination with mr jeanette you'll see that i referenced a pizza box example i apologize for its elementary nature but i started with three pizza boxes if you want to reconcile the price for slice or value for slice you had to back out domestic the box of pizza that was related to domestic at and then you would have to work through the slices as to what domestic patents where it is you sixty seven five eighty three or any prior or later patents that may have been issue anderson i think i made the correct point the federal circuit has said that when dealing with a reasonable royalty you reverse it if it's outrageously excessive or it's outrageously insufficient and in either case would not be a reasonable estimation of a reasonable royalty zero is by definition outrageously insufficient you don't get a lower number than zero if you look at apple apple actually only talks about one situation that it could think of where maybe hypothetically a zero word would be acceptable and that would be where is it true that this case was litigated on the theory that the damages would be measured by the in friend judgment damages that could would have gotten from but take had it not been s a strategic choice of course it was a strategic choice it doesn't change the governing law of the federal circuit which is even if we do say nothing nothing at all the court is still or the fact finder still obliged to look at the record and determine from that record what reasonable estimate of firing the district though it made reference to a hobson's cellists that he felt like he was was our best case typically in a damage case you get people attacking that and we had no alternative numbers presented even if the court determined that our strategic choice of our best number was not the right number it had as we already know the six point six five without a multiplier for the bard or you have the five point nine for the  alternative benchmarks so the point is and this law is quite clear in the federal circuit most recently in the info hold case which is cited throughout the briefs that it doesn't matter whether somebody deuced the evidence to support their position or that the president is incorrect you still have to find that reasonable royalty it is present in this record in spades there are just too many factual guy points  rely on the discretion of the district killick to give you to let you reopen the evidence the only way you would get additional empty evidence regarding the significance of foreign patent rights or the six twenty seven would be to reopen i don't believe there will be anything in the existing record you could mathematically determine that is that up ground on which we should a farm no in fact it's to the opposite even if the difficulty in getting to the reasonable royalty or the reasonable damages for the fraud is present because of the nature of the fraud you still under the bad law or the federal or the florida law got to get to a reasonable estimate mation reasonable estimation doesn't have to be mathematically precise and so it would be incumbent upon the judge if he keeps a record close to look at the six point six five million and say well what do i attribute to foreign patent rights or sixty seven and make a reasonable estimate based on that and certainly he could reopen as well thank you council will be in recess until nine am tomorrow morning