Court Opinion

ID: 5120669
Source: CourtListenerOpinion
Date Created: 2021-10-22 21:02:00.799325+00
Date Added: 2024-06-11T08:22:18.632087
License: Public Domain

In the United States Court of Federal Claims
                                No. 11-268C
                    (Originally filed: August 31, 2021)1
                       (Re-filed: October 22, 2021)

**********************

SECURITYPOINT HOLDINGS, INC.,
                                                   28 U.S.C. § 1498(a)
Plaintiff,                                         (Jurisdiction Over Patent
                                                   Claims); Post-trial decision;
v.                                                 Infringement; Reasonable
                                                   and entire compensation;
THE UNITED STATES,                                 Implied license; Running
                                                   royalty.
Defendant.

**********************

      Bradley C. Graveline, Rebecca L. Mackin, Chicago, IL, with whom
was Laura M. Burson, Los Angeles, CA, for plaintiff.

       Gary L. Hausken, Director, Commercial Litigation Branch, Civil
Division, United States Department of Justice, Joseph L. Hunt, Assistant
Attorney General, Washington, DC, with whom were Conrad J. DeWitte, Jr.,
Lee Perla, Carrie E. Rosato, Brian N. Gross, and Shahar Harel, for
defendant.

                                 OPINION

BRUGGINK, Judge.

       This is an action for patent infringement brought under 28 U.S.C. §
1498 (a) against the United States, acting through the Transportation Security
Administration (“TSA”). SecurityPoint Holdings, Inc. (“SecurityPoint”) is

1
  This opinion was originally issued under seal to afford the parties an
opportunity to propose redactions of any protected information. Because the
parties did not propose any redactions, the opinion appears in full below.
the plaintiff. It owns a method patent, U.S. Patent No. 6,888,460 (“the ‘460
patent”), which we held valid after a trial in 2016. The parties agreed to two
stipulations regarding infringement. Trial was then held in 2020 to establish
the extent of infringement and compensation owed. Following post-trial
briefing and argument, we conclude that, no later than January 1, 2008, TSA
universally adopted plaintiff’s patented method as its default means for
screening at all Category X and Category I airports and thereby, with certain
exceptions later adopted, infringed plaintiff’s patent. Plaintiff is owed a
royalty, plus interest, through the date of the judgment as compensation for
TSA’s unauthorized use of its method.

                                 BACKGROUND

I. The Patent

       The ‘460 patent concerns a system of recycling trays through security
screening checkpoints by use of movable carts. JX 1 (the ‘460 patent).2 The
‘460 patent’s priority date is July 3, 2002, which is when the inventor, Mr.
Joseph Ambrefe, first filed a provisional patent application at the U.S. Patent
and Trademark Office (“PTO”). As described in the patent, the purpose of
the ‘460 patent is to provide:

       a cost effective way of providing security trays for a security
       checkpoint while at the same time generating revenue from the
       advertising that is contained thereon. Further, the present
       system provides an efficient system for moving the trays for
       use and removal after they are used. Security checkpoints are
       both a time consuming and frustrating part of traveling for
       frequent fliers and people on vacation alike. The present
       invention provides a system of speeding up the process of
       processing people through these checkpoints to decrease the
       likelihood of delays for travelers. The present invention also
       has the advantage of increasing passenger flow through
       checkpoints and increasing traveler satisfaction due to the lack
       of delays.

JX. 1 col. 6 ls. 10-24.

2
  “JX” refers to admitted exhibits offered jointly by both parties. “PX” refers
to admitted exhibits offered by plaintiff. “DX” refers to admitted exhibits
from defendant.
                                      2
       During patent prosecution, the PTO examiner initially rejected the
application as obvious, but that rejection was overcome by the addition of
language to the first claim, which will be set forth below. The ‘460 patent
was issued on May 3, 2005.

       The patent is comprised of one independent claim and 14 dependent
claims. Claim 1 is the independent claim and is exemplary of the method. It
discloses a method comprising:

       a. positioning a first tray cart containing trays at the proximate
       end of a scanning device through which objects may be passed,
       wherein said scanning device comprises a proximate end and a
       distal end,

       b. removing a tray from said first tray cart,

       c. passing said tray through said scanning device from said
       proximate end through to said distal end,

       d. providing a second tray cart at said distal end of said
       scanning device,

       e. receiving said tray passed through said scanning device in
       said second tray cart, and

       f. moving said second tray cart to said proximate end of said
       scanning device so that said trays in said second cart
       be passed through said scanning device at said proximate end.

JX 1 col. 11 ls. 58-59, col. 12 ls. 1-14.

        The final step in the method of claim 1, “moving said tray cart to said
proximate end of said scanning device,” was added at the PTO to overcome
the examiner’s initial obviousness rejection. That final step differentiated
the claimed method from the combination of three prior art references which
disclosed a system to move and/or store trays in a security screening setting.

       Claim 2 teaches that the scanning device is “selected from the group
consisting of a manual inspection station, an x-ray machine, a conveyor belt,
and a particulate matter sensor.” Id at col. 12 ls. 17-19. Claims 3 and 4 add
that the trays are “nestable” and have “exposed sides capable of displaying
advertising.” Id at ls. 21, 23-24. Claim 6 instructs that the “tray carts are
adapted to be rollable.” Id at ls. 28-29. Claim 7 adds that the method of

                                        3
Claim 1 also includes “the step of repositioning said second tray cart from
said distal end to said proximate end.” Id at ls. 31-33. Claims 8 and 9 inform
that a plurality of the trays is “adapted to receive” various items such as a
laptop, camera, purse, coat, wallet, cell phone, and other similar items. Id. at
ls. 34-37, 40-41. Claim 12 adds a third cart to be used in the method described
in Claim 1. Id at ls. 48-49. Claim 13 inserts a step in which the third cart
“containing a plurality of trays” is substituted to replace the first cart. Id at
ls. 50-52. Claim 14 makes the bottoms of the trays adapted to display
advertising on the interior surface of the trays, and Claim 15 teaches that the
trays are adapted to display a tag number. Id. at ls. 53-54, 57.

II. Procedural History

        Plaintiff commenced this action on May 2, 2011, alleging that the
United States, acting by and through the TSA, operates and controls security
screening at security checkpoints at more than four hundred airports
throughout the United Sates and utilizes carts, trays, and scanning devices at
these checkpoints in a manner that infringes one or more of the claims of the
‘460 patent at all or most of the airports under its control. After extensive
discovery and motion practice, the parties filed a joint status report agreeing
that the liability and damages phases of this case should be bifurcated.

        Following the parties’ submission of their joint claim construction
statement, they asked the court to construe eight terms or phrases from claim
1 of the patent. We held a Markman hearing on November 14, 2012, after
which we construed the disputed terms as follows:

 The Patent Term                           The Court’s Construction
 tray                                      a base with upwardly extending
                                           walls
 trays                                     no construction
 tray cart                                 a movable cart capable of holding
                                           one or more trays
 proximate end                             proximal or nearest to; referring to
                                           the end of the scanning device
                                           where an object enters the device
 distal end                                farthest from; referring to the end of
                                           the scanning device where an object
                                           exits the device
 nestable                                  capable of fitting compactly within
                                           one another
 adapted                                   suited

                                       4
 receiving said tray passed through no construction
 said scanning device in said second
 tray cart

SecurityPoint Holdings, Inc. v. United States, 111 Fed. Cl. 1, 11 (2013).

       On November 16, 2012 the parties executed a stipulation regarding
use of plaintiff’s patent at ten airports. ECF No. 45. The November 2012
stipulation was conditional:

       If SecurityPoint establishes infringing use of the ‘460 patent by or for
       the United States, . . . SecurityPoint shall be adjudged to have proved,
       and the United States shall be adjudged liable for, such infringing use
       . . . on a continuous basis at each and every passenger security
       screening checkpoint used at each of the Airports from January 1,
       2008 through the date of SecurityPoint’s judgment on the merits . . . .

Id. ¶ 7 (emphasis added).

      On June 6, 2013 the parties executed a second stipulation. In it,
defendant conceded that it had infringed the ‘460 patent:

       In accordance with the prior stipulation of the parties dated
       November 16, 2012 (Docket No. 45), accepted by the Court on
       November 28, 2012 (Docket No. 46) . . . the parties hereby
       further stipulate . . . that SecurityPoint be adjudged to have
       proved that each method described in and covered by claims 1,
       2, 3, 4, 6, 7, 8, 9, 12, 13, 14, and 15 of the ‘460 Patent has
       been used by the United States . . . pursuant to 28 U.S.C. §
       1498(a).

ECF No. 71 ¶ 5 (emphasis added). In addition to admitting infringement, at
least to some degree, the June 2013 stipulation also defined infringing use of
the ‘460 patent as constituting:

       performance of each step of each such claim . . . on a
       continuous basis. . . where “continuous basis” is defined as
       such use at least once per day that each checkpoint was open.
       . . through the date of this Stipulation, and further as to each
       such patent claim listed in this paragraph through the date of
       any judgment ultimately obtained by SecurityPoint . . . .”

Id. ¶ 5 (emphasis added).

                                      5
        In short, defendant has admitted using the methods of claims 1, 2, 3,
4, 6, 7, 8, 9, 12, 13, 14, and 15 of the ‘460 patent, at least once per day, from
January 1, 2008, to the date on which judgment is entered at the same ten
U.S. airports that were the subject of the prior stipulation, namely, Fort
Lauderdale Hollywood International, Dallas/Fort Worth, Phoenix Sky
Harbor, Philadelphia International, Boston Logan, Washington Dulles,
Portland International, Detroit Metropolitan Wayne County, Baltimore-
Washington International, and Ronald Reagan Washington National.

        The issue of liability remained open, however. Defendant takes the
position that the stipulations merely concede some use, albeit continuously,
but not the extent of use, and only at ten airports. In addition, the government
raised a number of defenses, including anticipation and obviousness. The
latter two defenses were addressed by trial in 2015, following which we held
that the defendant did not meet its burden of proving that a person of ordinary
skill in the art would have combined the prior art references to teach the steps
of plaintiff’s independent claim 1.3 We thus affirmed the validity of the
patent. SecurityPoint Holdings, Inc. v. United States, 129 Fed. Cl. 25 (2016).

        Thereafter, the case entered discovery with respect to the extent of
infringement and damages. During pretrial motion practice, plaintiff asked
the court to impose an adverse inference. In plaintiff’s view, the government
had failed to maintain records of TSA’s use of the ‘460 method, making it
impossible for plaintiff to prove the extent of the government’s use of the
patent. We found that it was premature to draw an adverse inference and
allowed additional time for discovery. During a hearing on November 1,
2017, we noted, however, that plaintiff was not expected to accept at face
value defendant’s argument that “we didn’t use your patent at these airports
for this period of time.” Tr. at 47:11-19 (Transcript from November 1, 2017
hearing, ECF No. 303).

        On March 16, 2020, we granted in part defendant’s motion for
summary judgment regarding the existence of an implied license from
plaintiff to TSA for the use of the ‘460 method at those airports at which
plaintiff had an agreement with the airport operator permitting such use.
SecurityPoint Holdings, Inc. v. United States, 147 Fed. Cl. 499 (2020). We
left open, however, the question of the scope of those licenses in terms of the
relevant dates and number of lanes at the airports implicated by our finding
of an implied license. Id. at 503-04.

3
    Defendant dropped anticipation as a defense prior to trial.
                                        6
        On July 10, 2020, defendant filed a motion in limine to preclude
plaintiff from offering evidence and argument at trial regarding the doctrine
of equivalents. On September 16, 2020, we granted defendant’s motion, but
only in so far as it concerned plaintiff’s case in chief: “If, however,
defendant’s expert, Mr. Tarakemeh’s, testimony is inconsistent with the
court’s prior ruling regarding claim construction, then plaintiff’s expert, Dr.
Jacobson, will be allowed to testify on rebuttal to what is stated in his report
regarding the doctrine of equivalents.” ECF No. 538 at ¶ 1.

III. Trial

        From October 5, 2020 through October 21, 2020, trial was held on the
issues of the extent of infringement at Cat X and Cat I airports4 and damages.
Plaintiff presented ten witnesses, six of whom testified as experts. Defendant
presented five witnesses in its case in chief and one rebuttal witness. Three
of defendant’s witnesses testified as experts. We list the witnesses below
and give a brief summary of their testimony, while discussing the particulars
of their testimony in more detail later.

        Following post-trial briefing, closing argument was heard on April 23,
2021. The parties thereafter filed supplemental briefs related to a study
conducted by the government’s expert, Mr. Amon Tarakemeh, as well as
their respective positions on delay damages.

       A. Plaintiff’s Fact Witnesses

              1. Mr. Joseph Ambrefe

       Mr. Ambrefe is the inventor of the ‘460 patent and the founder and
CEO of SecurityPoint. He testified about the origins of SecurityPoint and
his business plan to sell his patented method to airports and the TSA, which
in some respects had its genesis in the fallout from the attack on the World
Trade Center Towers in New York in 2001. He also testified about the
success of the ‘460 method in early tests and the patent’s eventual
commercial success after the patented method was adopted for use in
airports.

4
  Category X and I are the two largest classifications of commercial airports
in the United States. Airports are classified by TSA primarily according to
the volume of passenger traffic. Category X is the largest. Plaintiff
maintains a claim with respect to the other smaller airports. The parties
agreed to limit this trial to the two largest categories.
                                       7
              2. Mr. Douglas Linehan

        Mr. Linehan is the Vice President of Operations at SecurityPoint. He
testified about efforts to market the method to airports and TSA and the initial
success in commercializing the ‘460 method. He also testified about
plaintiff’s negotiations with TSA, airport operators, and advertising brokers.

              3. Mr. Scot Thaxton

        Mr. Thaxton is TSA’s Deputy Federal Security Director (“FSD”) for
the state of Arizona. He has seventeen years of experience working for the
agency. His responsibilities within the State of Arizona are related to
security screening checkpoints, including oversight of 1,500 employees at
nine commercial airports in Arizona. He was also called to testify by
defendant with respect to the one-cart method, an alternative system to the
‘460 patent that he developed for returning bins at security screening
checkpoints. Plaintiff offered Mr. Thaxton to testify about Federal Aviation
Administration (“FAA”) and TSA airport design and planning guides,
specifically the nature, scope, and timing of efforts to standardize and
optimize the use of tray carts at airport security screening checkpoints.

              4. Ms. Lisa Smithson

       Ms. Smithson is a certified public accountant and SecurityPoint’s
chief financial officer. She testified concerning SecurityPoint’s financial
records.

       B. Plaintiff’s Expert Witnesses

              1. Mr. Marcus Arroyo

       Mr. Arroyo testified in the most recent trial as well as during the
validity trial. He served as the FSD at Newark International Airport from
2001 to 2006. Among other things, Mr. Arroyo was asked to provide expert
opinion and testimony regarding the condition of security checkpoints at
airports before and after 9/11.

        Prior to his time at Newark airport, Mr. Arroyo worked for the FAA,
starting in 1986 as a special agent, and later as a security specialist and
federal air marshal coordinator from September to December of 1986. In

                                       8
January 1987, he was promoted to the interim attorney branch manager,
Eastern Region, Eastern Division. In 1993, Mr. Arroyo was promoted to
Assistant Manager for FAA security for the entire region, as well as Assistant
Manager in Brussels, Belgium. There, he was responsible for Europe, the
Middle East, and Africa from 1993 to 1995. He then returned to the Eastern
Region in 1995 and resumed his position as the division manager of security
for the Eastern Region until July 2002.

       After leaving TSA in 2002, Mr. Arroyo did consulting work for
Aerospace International. While there, he advised on projects such as the
construction of a new airport in the United Arab Emirates. As a result of his
education, work experience and training, he developed a “comprehensive
understanding of the operation of security screening checkpoints.” Tr.
677:22-678:1. At trial, he testified as an expert with respect to airport security
screening checkpoints. He also testified concerning TSA checkpoint design
guides and how they are incorporated into the layout of airport security
designs.

              2. Mr. Erik Bottema

      Mr. Bottema is the vice president of sales and business development
at Adkom, a media company. Mr. Bottema has worked in aviation media
and airport advertising. He was responsible for sales and account
management related to in-airport advertising for airport media
concessionaires JCDecaux and Clear Channel. Currently, he is responsible
for media generation and media sales at Adkom. He testified as an aviation
media-airport advertising expert concerning the value of SecurityPoint’s plan
to market its patented process to advertisers.

              3. Dr. Sheldon Jacobson

       Dr. Jacobson has been a professor of computer science and industrial
engineering in the Department of Statistics at the University of Illinois since
2002. He began work on aviation security issues in 1995, working with the
FAA Office of Civil Aviation Security. His research on multi-level aviation
security passenger screening at airports helped in the design and
implementation of TSA’s PreCheck system. Dr. Jacobson has published in
the field of aviation security, and the court found him to be a person of
ordinary skill in the art (“POSA”) with regard to the ‘460 patent.

      Dr. Jacobson testified as an expert on the extent of use of the patented
method by defendant at checkpoint lanes in Category X (“Cat X”) and

                                        9
Category I (“Cat I”) airports, the value of passenger time savings, TSA’s
executed stipulations of infringement, admissions by TSA employees, TSA
Checkpoint Design Guides, and how the ‘460 patent enhances security,
safety, and efficiency.

              4. Mr. Timothy Hollifield

       Mr. Hollifield is a manufacturing and mechanical engineer who was
involved in security checkpoint operations at the National Safe Skies
Alliance (“NSSA”) in Knoxville, Tennessee from 2001 to 2011. He testified
regarding the testing conducted by the NSSA for TSA of security screening
checkpoint operations after September 11, 2001, the live testing of the ‘460
method at the McGhee Tyson Airport in Knoxville, and increased efficiency
and security at checkpoints brought about by use of plaintiff’s patent.

              5. Mr. Mark Hosfield

        Mr. Hosfield testified concerning the economic indicators that would
be relevant to negotiations with the U.S. government for a license to the ‘460
patent. Mr. Hosfield is the owner of Davis & Hosfield Consulting LLC and
has his bachelor's degree from the University of Illinois and an MBA from
Northwestern. He has 37 years of experience analyzing damages. He
testified as an expert in forensic accounting as it relates to economic
indicators of patent damages. He testified concerning cost savings resulting
from fewer transportation security officer (“TSO”) injuries and from
employing fewer TSOs and the effective royalty rate of the Adason
agreement.5 He also testified about the economic indicators that would be
relevant to a hypothetical negotiation with the U.S. government for a license
to the ‘460 patent.

              6. Mr. James Malackowski

        Mr. Malackowski is the Chairman and Chief Executive Officer of
Ocean Tomo, LLC, an investment banking firm which provides services
related to intellectual property, including financial expert testimony,
valuation, and patent analytics. He has worked extensively in the area of
assessing damages for use of intellectual property. Mr. Malackowski is a
certified public accounting, certified licensing professional, and inventor of
20 patents. He testified as an intellectual property damages expert.

5
 The Adason agreement settled litigation between SecurityPoint and the
Adason Group concerning, inter alia, Adason’s infringement of the patent.

                                     10
       C. Defendant’s Fact Witnesses

              1. Mr. Scot Thaxton

       Mr. Thaxton testified regarding TSA security screening checkpoint
operations in Arizona and the use of a bin return system that he developed as
an alternative to plaintiff’s method, which defendant refers to as the “One-
Cart Method,” and which plaintiff refers to as the “moveable pallet cart”
(“MPC”). Mr. Thaxton testified about the components of the MPC, namely
the dolly cart (a hand truck) and small pallets, as well as how it operated. He
also testified about TSA’s Bin Advertising Program as well as the use of
TSA’s Checkpoint Design Guides (“CDGs”).6

              2. Mr. Dale Mason

       Mr. Mason is a program analyst with the Operational Improvements
Branch of TSA. In 2002, Mr. Mason held a number of positions at TSA
before being promoted to TSA Headquarters, where he is in charge of
drafting and maintaining CDGs. He testified about the CDGs and their
intended use.

              3. Mr. Joseph T. Ambrefe

       Mr. Ambrefe provided testimony as an adverse witness regarding
SecurityPoint’s accounting practices and economic business records, the
Safe Skies demonstration and report, the Knoxville airport demonstration,
and Mr. Ambrefe’s visit to Denver International Airport in August 2019.

       D. Defendant’s Expert Witnesses

              1. Mr. Amon Tarakemeh

       Mr. Tarakemeh is an operations research analyst with a bachelor’s
degree in systems engineering and a master’s degree in operations research.
Mr. Tarakemeh testified regarding his background and work at the Science
Applications International Corporation (“SAIC”). At SAIC, Mr. Tarakemeh
tests procedures and equipment used at airport security checkpoints and
baggage areas to ensure that they meet safety requirements. As part of Mr.

6
  The parties’ positions with respect to whether the MPC or One Cart Pallet
method is infringing is implicit in the two different names. We use plaintiff’s
term simply for ease of reference without addressing here the legal questions
related to infringement.
                                      11
Tarakemeh’s employment at SAIC, he works on contracts for TSA. He
testified as an expert in operations research analysis and the use of the tray
and cart method at security checkpoints.

        The government engaged Mr. Tarakemeh to develop a study that
estimated non-usage of the ‘460 method at airport checkpoints. Mr.
Tarakemeh testified that during the study he visited 36 airports during an
eight-month period in 2018 and 2019 for the purpose of determining the
frequency with which checkpoint operations infringed the ‘460 patent. He
also testified about data he collected related to the movement of passenger
and non-passenger items at checkpoints. Mr. Tarakemeh concluded that
plaintiff’s patented method was only used sporadically.

              2. Dr. Arnold Irvin Barnett

       Dr. Barnett testified as an expert in applied mathematics, including
applied probability and statistics. Dr. Barnett is a professor of Management
Science and Statistics at the Massachusetts Institute of Technology (“MIT”).
He has a degree in physics from Columbia University, a Ph.D. in
mathematics from MIT, and he has taught probability and statistics at MIT
for over 40 years. He testified regarding inferences that can be drawn
regarding the extent of use of the ‘460 patent based upon survey data and
observations of security screening checkpoints by defendant’s expert, Mr.
Tarakemeh.

              3. Mr. Daniel McGavock

       Mr. McGavock has a Bachelor of Science degree in accounting from
Indiana University and currently serves as the Vice President of Charles
River Associates, a consulting firm. He is the firm’s Intellectual Property
Practice leader. He is an expert in accounting and in the valuation and
licensing of intellectual property. Mr. McGavock testified as to the
compensation due to SecurityPoint and responded to plaintiff’s damages
experts.7

7
  Two days into trial, defendant sought to introduce Mr. McGavock’s
supplemental report, which presented a new damages theory. In response,
plaintiff filed a motion to strike (ECF No. 554) those portions of Mr.
McGavock’s supplemental report which concerned the new damages theory.
Acknowledging plaintiff’s motion to strike, on October 20, 2020, defendant
moved to admit Mr. McGavock’s supplemental expert report “minus
paragraphs 8 and 9, figures 2 and 3, and the corresponding schedules which
were the subject of Plaintiff's motion to strike.” Tr. 2833:13-2834:11. We
                                     12
IV. Fact Findings

      A. Security Screening at Airports Prior to Implementation of
         Plaintiff’s Patented Method

       Prior to September 2001, security screening of airline passengers was
beset by inefficiencies and complaints from passengers about long waits at
security checkpoints. Mr. Arroyo explained that trays were generally used
to hold passengers’ belongings during screening, but the lack of
standardization of equipment and hand carrying of trays back and forth led
to the frequent mismanagement of passenger property, clutter, and
disorganization. After the attacks of September 2001, the problem became
more acute as security became a greater concern. Adding space to address
the clutter was not an option at many airports.

        There were also operational concerns at checkpoints. After 9/11, Mr.
Arroyo recalled: “divestiture requirements [at screening checkpoints] were
incrementally ratcheted up to where people were having to take off their
shoes, their belts. It was quite invasive . . . [which] created more of a
workload for the screeners.” Tr. 692:25-693:1-4. Mr. Arroyo explained that,
“It got so chaotic–I can speak for Newark personally because I witnessed it
and experienced it and received many of the complaints–where the queueing
lines were so backed up that they congested the concession stands, the entire
operation.” Tr. 693:17-21. “So, it was really chaotic situation that we had
to address immediately.” Tr. 694:1-2

      When asked his opinion of the state of security screening prior to the
implementation of plaintiff’s method, Mr. Arroyo testified that checkpoints
were:

      chaotic because of trays and all of the divestiture requirements,
      but primarily because of the trays were–were just in a
      disorganized fashion. They were all over the screening
      checkpoint, creating a lot of tripping hazards, creating a lot of
      commotion. They were not readily available for the passengers
      to use the trays to start the divestiture process, which slowed
      down the screening checkpoint operation, caused frustration
      for the screeners . . . caused a lot of anxiety for the passengers
      . . . which ultimately bogged down the entire system . . . .”

agreed to strike the portions of Mr. McGavock’s supplemental report
concerning his newly introduced damages theory and DX 1814 was admitted
into evidence, as amended.
                                     13
Tr. 690:17-691:8.

        The solution was to implement a “process to have some sort of
standardization to meet the expectations of an efficient and steady flow of
bags and passengers through the screening checkpoint.” Tr. 696:22-24.
(Arroyo). Mr. Arroyo was asked at trial, “[d]id TSA do anything to . . .
develop a system to organize trays and move them from the sterile to the non-
sterile side . . . in the time period of–when you first joined TSA [2002]” up
to the time you left? Tr. 700:18-23. He responded that TSA executed a
phased approach and “started to roll out the employment” of screeners,
terminal by terminal at Newark. Tr. 700:24-701:1. Despite TSA’s phased-
approach and “evolving process,” TSA did not have a “uniform system in
place at any point prior to September 1, 2005 [for managing checkpoints].”
Tr. 708:4-6. The lack of uniformity in turn created safety problems “[f]or
the traveling public, when you have trays in a congested area, it creates a
tripping hazard . . . . You have a big crowd trying to get through this funnel,
and anything that could obscure or block the movement is a safety hazard.”
Tr. 709:4-12. TSA expert Gloria Bender also confirmed TSA’s failed efforts
to develop a solution. During the validity trial, Ms. Bender testified that her
company attempted to remedy the checkpoint efficiency problems, but
ultimately did not succeed. Validity Tr. 1037:16-1038:8.

        As a frequent business traveler, Mr. Ambrefe recognized the need for
a uniform system to manage checkpoints. He observed the differences in
security checkpoint layouts from airport to airport, the crowds, delays, long
lines and increasing problems after September 2001. He concluded that what
was needed was greater efficiency and standardization of the screening
process. In 2002, Mr. Ambrefe sketched out what he believed would be a
solution to the problem through the use of standardized trays and carts and
recycling of trays by using carts to move trays from the non-sterile to the
sterile side of checkpoints. He then sought legal advice and filed a patent
application for his invention on July 2, 2003. On May 3, 2005, the ‘460
patent issued.

       Mr. Ambrefe formed SecurityPoint as a corporate means to exploit
the patent and what he viewed to be its potential as a means of introducing
advertising into the screening process. That same year he offered an
unsolicited proposal to TSA to provide the SecurityPoint method along with
standardized trays and carts for security screening in exchange for the
exclusive right to sell advertising on those trays at all 429 federalized

                                      14
airports. TSA would receive the method and equipment at no cost to the
government.8

       TSA was skeptical, however, about introducing new equipment into
security checkpoints out of concern that it would increase congestion and
negatively impact passenger throughput. SecurityPoint nevertheless
persisted in marketing its method to TSA, and in 2005, when plaintiff’s
patent had been issued, TSA agreed to permit a test of the ‘460 method at its
Safe Skies testing facility in Knoxville, Tennessee. The results of the test
were sufficiently favorable that TSA implemented the ‘460 method at the
McGhee Tyson Airport in Knoxville as part of a pilot program. The pilot
program also proved successful. Thereafter, TSA implemented the ‘460
method at Los Angeles International Airport (“LAX”) in another pilot
program.9

       The evidence of the ‘460’s success was highlighted in a TSA
Information Bulletin, dated December 22, 2006, citing an 80 percent increase
in screening efficiency and a 90 percent reduction in injuries after
implementing SecurityPoint’s trays and carts method during a three-month
pilot program at LAX. See PX 84. Those figures were again recited in a
TSA publication several days later. See PX 202 at 3 (TSA Public Affairs
Guidance, December 28, 2006). Further, in a 2007 press release, a TSA
Spokesperson, Mr. Nico Melendez, acknowledged that “the free trays, carts
and tables did help TSA officers work more efficiently. . . . [and] [t]hey
suffered fewer . . . injuries.” PX 1126 (News article from TampaBay.com).

8
  On October 14, 2020, plaintiff moved for judicial notice (ECF No. 555) of:
(1) its assertion that TSA has had the authority since at least May 3, 2005
(issuance of U.S. Patent No. 6,888,460) to grant SecurityPoint sole access to
all category X and I airport checkpoints to implement its patented method;
and (2) its assertion that TSA has had the authority since the issuance of the
‘460 patent to charge a fee to recoup costs for security related expenses,
including costs related to acquiring patented technology via a license.
Plaintiff’s motion is denied as not the proper subject for judicial notice.
9
  On June 30, 2006, TSA and SecurityPoint entered into a Memorandum of
Agreement (“MOA”), in which plaintiff was to provide TSA equipment
(such as tables, bin carriers, and bins) at LAX “in order to assist TSA in
providing more efficient and effective security screening operations at
LAX.” PX 1583 ¶ 3. (TSA/SecurityPoint MOA, dated June 30, 2006).
                                     15
       B. Events Leading to the Lawsuit

        Because of the success of the two pilot programs, SecurityPoint was
expecting TSA to approve its proposal. TSA, however, maintained its
rejection of SecurityPoint’s original offer. Nevertheless, the government
began using the ‘460 method at airports nationwide, starting on September
1, 2005, at Washington Dulles International Airport (“IAD”), while using its
own equipment. It did not execute a contract with plaintiff.

        Seventeen months later, in January of 2007, TSA hosted an Industry
Day event at which TSA solicited proposals from prospective vendors to
furnish equipment, trays, and carts to TSA at security checkpoints. TSA’s
pilot program presentation proposed the following arrangement:

       1) Vendors seeking airport advertisement opportunities will
       contact Airport Operators corresponding to the locations at
       which they wish to advertise;

       2) Vendors then enter into an agreement with the Airport
       Operator;

       3) The Airport Operator submits a proposal to TSA prior to the
       date designated by the Contracting Officer;

       4) TSA evaluates all proposals received by the designated date;
       and

       5) An MOA is executed between the TSA and the Airport
       Operator

PX 1578 (TSA Bin Advertising presentation, January 11, 2007). TSA
specified the technical criteria for the equipment to be furnished, such as the
required dimensions and materials for the bins, carts, and divestiture tables.

        Having exhausted its efforts to market its method on an exclusive
basis to TSA, SecurityPoint elected to compete with other vendors in TSA’s
solicitation. Eventually, SecurityPoint entered into separate agreements or
memoranda of understanding (“MOUs”) with airport operators for the right
to place advertising on the trays, usually in exchange for a portion of that
revenue.10

10
   PX 1415 (Advertising contract chart prepared by Mr. Ambrefe listing the
airports with which SecurityPoint contracted to provide trays and carts).
                                      16
       One of the other companies that submitted a successful bid to an
airport operator in response to TSA’s proposal process was the Adason
Group, LLC. Adason won a contract to provide carts and trays to TSA at
five airports in exchange for advertising access. In March of 2007,
SecurityPoint sued Adason for infringement of the ‘460 patent. The suit
resulted in a settlement in favor of SecurityPoint, with Adason paying a lump
sum of $650,000. Because Adason eventually went bankrupt, plaintiff only
received roughly $300,000.           The suit underscored the difficulties
SecurityPoint faced in competing against other companies that were offering
what it alleged was its own invention.

       Ultimately, plaintiff brought suit against the government in 2011,
alleging that, beginning in 2005, TSA utilized carts, trays, and scanning
devices at airport checkpoints in a manner that infringed the ‘460 patent.
That lead to more roadblocks in SecurityPoint’s efforts to market the ‘460
method to other airport operators because TSA changed its MOU with airport
operators in 2012 to require indemnification in the event of patent
infringement, making it less appealing for airports to enter into agreements
with SecurityPoint. Mr. Linehan testified that TSA’s change to its MOUs
was the “poison pill that stopped airports from signing up with us.” Tr.
489:13-14.

       C. Plaintiff’s Proof of the Extent of Infringement

       Plaintiff relies on four types of evidence to establish the extent of
infringement: the parties’ stipulations regarding infringement; TSA’s use of
Design Guides, which control the setup of security checkpoints; admissions
by TSA employees; and expert testimony.

              1. Stipulations of Infringement

       While the parties disagree about the effect of the stipulations, the
disagreement is ultimately immaterial. Plaintiff is correct that the
stipulations establish use of the ‘460 patent on a continuous basis at each of
the ten initial airports, beginning in January 2008 and continuing to the date
of judgment. Given the improbability that TSA would set up different
methods at the same airports for handling security screening, we find this
concession highly relevant. Defendant is correct, however, that “continuous
basis” merely means “at least once per day,” as stated in the June 2013
stipulation. Defendant also cites to language from a 2011 discovery
scheduling order issued during the liability phase of this action in which the
court recognized that defendant did “not concede that the allegedly infringing

                                     17
activities conducted at these airports are representative to establish
infringement at the nation’s other airports or to calculate damages.” ECF
No. 14 ¶ 2.

        “At least once per day” thus merely provides a starting point for
plaintiff’s obligation to prove the extent of use of the ‘460 patent.
Nevertheless, when viewed in light of the inherent difficulties plaintiff had
in proving use, we treat defendant’s concession as allowing the court to
assume that, in the absence of evidence to the contrary, “once a day” was not
an unusual occurrence. I.e., that the stipulations point to a regular practice.

              2. TSA’s Design Guides

       TSA is responsible for control of the design of airport security
checkpoints. It therefore periodically issues or updates Checkpoint Design
Guides (“CDGs”) which direct the configuration of airport security lanes at
all Cat X and Cat I airports. Plaintiff contends that these guides, which
airport designers are required to use in laying out security screening
checkpoints, are proof that use of plaintiff’s patent is built into the very
structure of virtually all screening lanes.

       Mr. Arroyo had experience with the use of CDGs in the layout of
airport security checkpoints and relied on CDGs when he worked for TSA
because they “laid out the principal parts of a screening checkpoint.” Tr.
711:12-13. CDGs specify checkpoint operations, as well as optimized
checkpoint configurations.

       Mr. Dale Mason, a program analyst with the Operational
Improvements Branch of TSA, testified that, “The primary functions of the
[design] guides are basically for airport architects and program managers to
have some guidance on when they’re building a new checkpoint and for our
system integrators to have some guidance if we are integrating new
equipment into the security checkpoint.” Tr. 2265:25-2266:5. When asked
if CDGs are the “bible” for reconfiguration and construction of processes at
Security Screening Checkpoints (“SSCPs”), Mr. Mason replied, “yes.” Tr.
2261:24-2262:1. He also confirmed that compliance with the CDG is
mandatory.

       TSA published new design guides in 2009, 2014, 2016 and 2020. The
following diagram from the 2014 CDG is illustrative:

                                      18
PX 1543 at 6. Notably, the 2009, 2014, and 2016 CDG’s all contain the
same figure depicted above of a security screening checkpoint with trays and
carts at the proximate and distal ends of lanes. The 2020 CDG also depicts
a similar checkpoint configuration with trays and carts at the proximate and
distal ends of lanes.

        Plaintiff provided a chart comparing claims 1, 2, 3, 4, 6, 7, 8, 9, 12,
13, 14, and 15 of the ‘460 patent to language in the guides, which we find a
fair use of both. An excerpt from the chart highlighting claim 1 appears in
plaintiff’s post-trial brief:

              Claim 1                              Design Guides
 A method comprising:
 positioning a first tray cart          “A fully loaded bin cart should be
 containing trays at the proximate      located at the start of the divest
 end of a scanning device through       tables on the non-sterile side of the
 which objects may be passed,           lane awaiting passenger pick up.”
 wherein said scanning device           (See PX 159 at 26; see also PX 1543
 comprises a proximate end and a        at 24; see also PX 1173 at 36)
 distal end,                            “Bin carts are similar to a hand cart
                                        or dolly to transport a large number
                                        of bins without requiring excessive
                                      19
                                     lifting or carrying by a TSA agent
                                     from the X-ray extension rollers on
                                     the sterile side of the lane to the
                                     divest tables on the non-sterile side
                                     of the lane.” (Id.)
                                     “Each lane requires at least two bin
                                     carts per lane and TSA recommends
                                     maintaining about 60 bins per lane.”
                                     (Id.)
                                     Carry-on bag screening “can be
                                     accomplished by three different
                                     types of x-ray equipment …” (Id.)
                                     Carry-on bag screening includes a
                                     “[s]canning [b]elt.” (Id.)
removing a tray from said first tray “Bins are the gray containers at the
cart,                                front of the checkpoint lane used for
                                     divesting of passenger personal
                                     belongings such as purses, carry-on
                                     bags, backpacks, laptops, shoes,
                                     coats/jackets, etc.” (Id.)

passing said tray through said “Feed the passenger bins to the
scanning    device    from     said scanning belt at the infeed tunnel.”
proximate end through to said distal (Id.)
end,

providing a second tray cart at said “The other bin cart should be
distal end of said scanning device,  positioned at the end of the roller
                                     tables on the sterile side so that the
                                     TSA agent can collect empty bins
                                     after passengers have picked up
                                     their belongings.” (Id.)

receiving said tray passed through “The other bin cart should be
said scanning device in said second positioned at the end of the roller
tray cart, and                      tables on the sterile side so that the
                                    TSA agent can collect empty bins
                                    after passengers have picked up
                                    their belongings.” (Id.)

moving said second cart to said “TSA recommends that bin carts are
proximate end of said scanning pushed upstream against passenger
device so that said trays in said
                                    20
 second cart be passed through said flow through an ADA gate by a
 scanning device at said proximate TSO.” (Id.)
 end                                “In the past, bin cart [sic] transport
                                    by TSOs was a primary cause of on-
                                    the-job injuries. Hand-carrying of
                                    bins is no longer endorsed by TSA.”
                                    (Id.)

Pl.’s Post-Trial Br. at 14-15.

       Dr. Jacobson analyzed the claim limitations of the ‘460 patent in view
of the language found in the CDGs and concluded that every limitation in
claim 1 was met. Similarly, Dr. Jacobson compared the dependent claims of
the ‘460 patent with the design guides and came to the same conclusion that
each limitation of the ‘460 patent was met by the language in the design
guides.

        The 2009 CDG (PX 159) was the first guide to depict trays and carts
in a diagram of a checkpoint.11 Dr. Jacobson “went to the [‘460’s] patent
description to see how the information was in line with it” and concluded that
TSA’s 2009 CDG (PX 159 at 77, Security Checkpoint Diagram) and the ‘460
patent “were exactly in line.”12 Tr. 993:15-23. He explained that the only
method the CDGs provided for moving trays from the sterile side to the non-
sterile side of checkpoints was by tray cart, as called for in the ‘460 patent.

11
  The 2006 guide (PX 158) did not include a diagram, but instead referenced
a tray return system and stated that TSA was considering different options
for processing trays: “At this time, there is no single TSA standard bin return
system to eliminate the need for TSOs to lift and carry bins; two possible
systems which can be considered are a roller/slide system and a non-metallic
bin cart system.” PX 158 at 16 (TSA’s 2006 CDG). From this, Dr. Jacobson
inferred that TSA was debating which type of tray management systems to
employ in 2006.

12
  In describing instructions in the 2009 CDG regarding how bin carts should
be used, Dr. Jacobson testified, “In particular, it recommends the bin carts
are pushed upstream. On gates, passengers flow through the ADA gate by a
TSO. So it shows also the flow of the bin carts and it also explicitly says that
there should be at least two bin carts per lane.” Tr. 993:9-14. Dr. Jacobson
identified where trays and bin carts were located in TSA’s 2009 CDG
showing an optimized security screening checkpoint that was consistent with
the ‘460 patent.

                                      21
He also testified that he was unable to find any deviation permitted from the
trays and carts method in the design guides. Dr. Jacobson’s review of the
2020 CDG showed that the placement of tray carts was the same as shown
in the previous design guides diagrams. Thus, in Dr. Jacobson’s view, the
CDGs called for infringement of the ‘460 patent.

       In post-trial briefing, defendant argues that the CDGs say nothing
about the last step of the patent, namely, moving said second cart to the
proximate end. We disagree. The CDG guidelines state that, “TSA
recommends that the bin cart be pushed upstream through the ADA or access
gate. Upstream is bringing [a bin cart] back out to the non-sterile area at the
beginning of the screening checkpoint process.” Tr. 833:5-8. The 2009
design guide is illustrative:

       In the past, bin cart transport by TSOs was a primary cause of
       on-the-job injuries. Hand-carrying of bins is no longer
       endorsed by TSA. TSA recommends that bin carts are pushed
       upstream against passenger flow through an ADA gate by a
       TSO.

PX 159 at 26 (TSA’s 2009 CDG); see also PX 1173 at 36 (TSA’s 2016
CDG); PX 1543 at 24 (TSA’s 2014 CDG). As Mr. Arroyo explained, there
is no option other than

       to bring [a bin cart] back to the proximate end of the screening
       checkpoint. You are not going to leave it in the metal detector
       or in the ADA lane. You have to push it all the way upstream
       to bring it out to the proximate end of the nonsterile area, where
       the trays will be available and accessible to passengers.

Tr. 833:24-834:5.

        A logical inference is that the reason the carts are “pushed upstream”
is to return the trays to the proximate end of the scanner, thus accomplishing
the last step of Claim 1. We find that the CDGs teach all the steps of the
‘460 method.

         The question remains whether the CDGs actually controlled security
lanes at airports. Mr. Arroyo testified that approval from headquarters was
necessary to deviate from the configurations published in the CDGs:
“[W]hatever we proposed I would submit to headquarters to get approval so
that . . . we could move forward with it.” Tr. 712:13-15. When asked if a
FSD has the discretion to move ancillary equipment, Mr. Mason replied,

                                      22
“No.” Tr. 2296:7. Mr. Mason also testified that he was familiar with TSA’s
2020 guide, confirming TSA employees did not have discretion to vary the
layout of checkpoints. Mr. Mason testified that the only method the CDGs
portrayed for moving trays from the sterile side to the non-sterile side of
checkpoints was by tray cart.13

       Dr. Jacobson explained that the Checkpoint Design Guides:
       gave me the standardized optimized security checkpoint
       configuration . . . [and] made it very clear that if there were any
       deviations from this optimized security checkpoint
       configuration, it would require . . . [an] approval process,
       through the TSA headquarters . . . So there was a process put
       in place for deviations from the design guide.
Tr. 988:10-15, 18-19.14
        In response, defendant argues that “the guides do not govern
operation of the Checkpoints; local TSAs can and do deviate from the
arrangements disclosed in the Guides during operation.” Def. Post-Trial Br.
at 43 (emphasis supplied). Citing TSA’s 2001 CDG, defendant asserts the
CDGs merely are for “planning and design of new or expanded airport
facilities.” PX 1546 at i. Defendant further argues that, once operational,

13
   Mr. Mason replied “no” when asked, “in the course of redesigning a
checkpoint, if a local TSA wants to move ancillary equipment, would they
need to seek TSA approval or headquarters approval?” Tr. 2302:3-7. He
also testified, however, that local TSA personnel do not have discretion to
change the layouts called for by the design guides; we assume that discretion
was limited to accommodating the default design to minor obstructions.
14
   The government moved to exclude Dr. Jacobson’s testimony as it relates
to the CDGs because he was never employed by TSA and had no prior
knowledge of the CDGs before working on this case. We reserved ruling
until after trial. We accepted Dr. Jacobson as an expert and a person of
ordinary skill in the art with regard to the ‘460 patent based on his extensive
experience on aviation security matters. His work with the FAA, research
and writing of 188 published articles on aviation security, as well as his work
in airport baggage screening, which led to the establishment of TSA
precheck, demonstrates his generalized knowledge and skill in the field of
airport security operations. We find that Dr. Jacobson was qualified to opine
on how the instructions for checkpoint design in the CDGs read on the claims
of the patent.

                                       23
airport checkpoints do not necessarily display all elements of a checkpoint
as depicted in the CDGs. It cites Mr. Mason’s testimony:

       [T]here’s 440 airports out there, 2200 and something lanes. If
       I had an optimal space and the airport said, Dale, what do you
       need to make this perfect, I would say do that, but because we
       are often . . . retrofitting checkpoints, we have to deal with
       column issues, expansion joints, ceiling heights . . . So we have
       to make sure that we adjust the hard equipment and the
       ancillary equipment to fit . . . and we do our best with the space
       that we're provided . . . .

Tr. 2273: 2-12.

       At no point did defendant’s witnesses explain how column issues,
ceiling heights, and expansion joints materially affected the design
templates’ function as the default design. Although defendant hints that the
preferred checkpoint configurations might not always be used, it offered not
a single example in which a non-complying design was used; no evidence
was offered of instances in which equipment was relocated in a way that the
patent would not be infringed. We are persuaded that, if there were
deviations in practice, they amount to minor tweaks of the location of trays
or carts, not deviations from the use of the patented method. We find that
the CDGs are strong proof of comprehensive use of the ‘460 patent at all Cat
X and Cat I airports.

              3. Admissions by TSA Employees

        Plaintiff also relies on statements from TSA employees and one
defense expert to confirm comprehensive use of its patent.15 Scot Thaxton,
Deputy FSD for Arizona, has seventeen years of experience working for
TSA. He testified that, after the LAX test in 2006, TSA headquarters agreed
to allow FSDs from individual airports to use the ‘460 method under a
Memorandum of Understanding (“MOU”): “headquarters made the decision
at that point that if other [airport] locations wanted to advance it under the
MOU, it would be up to the FS[D].” Tr. 532:11-13. He also affirmed that
he personally recommended that TSA headquarters use SecurityPoint’s
method. Mr. Thaxton also testified about why he supported using the ‘460

15
  The expert statement relied on was from Mr. McGavock. We agree with
defendant, however, that plaintiff took the statement out of context. It was
merely an assumption made for purposes of valuing the hypothetical license
and not an independent opinion on infringement.
                                      24
method. “My recommendation . . . I saw Doug and Joe as small business
owners advancing, they could reduce the cost for the taxpayers of not having
to buy tables and carts and replenish bins, and I thought it was viable.” Tr.
533:2-7.

        Plaintiff also cites Ben Sears’ deposition, accepted in lieu of live
testimony at trial. Mr. Sears is a TSA program manager with TSA’s
Innovative Task Force, where he manages demonstrations of new
technologies. Mr. Sears testified as a Rule 30(b)(6) deponent that he was
unaware of a single Cat X or Cat I airport that did not infringe the ‘460’s
claimed methods. Mr. Sears stated that TSA continued to use the ‘460
method at the conclusion of the LAX pilot program. While defendant
attempts to minimize the import of his testimony by suggesting that it was
beyond the scope of his Rule 30(b)(6) designation, we disagree. He was
testifying as to his knowledge of facts, and those facts related to his proffered
area of testimony—the benefits conferred on TSA by use of the carts and
trays methodology.

       Plaintiff also relies on a TSA slide presentation produced by its
Arizona’s senior leadership. In it, Ms. Sulynn Shepherd, a TSA Safety and
Occupational Health Specialist in Arizona, explains why Phoenix Sky
Harbor Airport was implementing a new system for managing trays and carts
at security screening checkpoint and how the new system would work. PX
1554 at 00:34-00:40 (TSA slide presentation titled “Phoenix Sky Harbor
Hand Truck with Mini Pallet,” dated April 16, 2018). Ms. Shepherd states:

       The change is going to be the process and the vehicle in which
       bins are replenished to the passenger divestment area. The
       question may be asked ‘why are we changing this process?’
       Currently, TSA is infringing on a utility patent. We will
       institute a new process that assures we will no longer infringe
       on that patent. Phoenix senior leadership volunteered to lead
       the field to help break the infringement.

PX 1554 at 00:25-00:51.

        In other words, the reason Phoenix Sky Harbor began using the
moveable pallet cart was concern about infringing the ‘460 patent. We count
it highly unlikely that a “once a day” use would trigger a wholesale change
of operation. Mr. Sears’ testimony that he was not able to identify even one
instance of an airport that did not use the patented method is a strong
indication that the method was used universally. The statement was made in
the context of Mr. Sears’ testimony as a TSA representative that TSA

                                       25
continued to use the ’460 method after the conclusion of the pilot program.
Likewise, Mr. Thaxton’s testimony suggests that, at least in his experience,
there was wide-spread infringement of plaintiff’s patented method.

              4. Expert Testimony

       At trial, plaintiff called Dr. Jacobson to opine on the extent of TSA’s
unauthorized use of the ‘460 patent. Dr. Jacobson works in the Department
of Statistics at the University of Illinois as a professor of computer science
and industrial engineering. He began work on aviation security issues in
1995, advising the FAA on aviation security through 2016. The court
accepted him as an expert in the operation of security screening checkpoints.
Based on TSA Checkpoint Design Guides, the parties’ stipulations of
infringement, and the deposition testimony of Mr. Mason, he concluded that,
“there is widespread universal infringement of the ‘460 patented method by
the TSA.” Tr. 964:9-11. He also found that the ‘460 patent is:

       practiced by the Transportation Security Administration, and
       by practicing this method, passengers . . . benefit from this
       because ultimately every decision that the TSA makes at a
       checkpoint is designed to enhance the safety, security and
       efficiency of the operation . . . So ultimately what I found is
       that there was tremendous benefit to practicing the method in
       safety, security, as well as efficiency.

Tr. 987:14-24.
       At trial, in response to a question about the existence of “any evidence
that TSA has not practiced the method of claim 1 of the ‘460 patent at any
time from January 1, 2008 through the present,” he replied, “I found no
evidence to refute that belief.” Tr. 1070:5-8. As it relates to the asserted
dependent claims, “which are claims 2, 3, 4, 6, 7, 8, 9, 12, 13, 11 14, and 15,
did you form any opinions as to the extent of TSA’s infringement of the
asserted dependent claims of the ‘460 patent?” Dr. Jacobson replied that,
“these are once again supported by the design guides and there is no evidence
to suggest that they would not be practiced.” Tr. 1070:10-18.

        At trial, Dr. Jacobson was also asked about his understanding of the
parties’ executed stipulation regarding proof of liability under 28 U.S.C.
§1498. As it relates to the parties’ November 2012 stipulation, Dr. Jacobson
testified:

                                      26
       As I reviewed the ‘460 patent, as I said before, I was trying to
       establish infringement and the extent of the infringement, and
       what this informed me is that when the TSA chose to practice
       the ‘460 method, that was a decision that they had to make, and
       they committed to that decision ultimately by putting it in the
       security -- in the design guides. In these design guides, it
       provides an optimized security checkpoint . . . but by adding
       the stipulation in, the agreement is that a continuous basis
       means once the commitment is made, it is applied uniformly,
       continuously and universally to the airports which are
       designated here as stated[, relating to 10 airports.]

Tr. 1029:3-15.

       Dr. Jacobson was asked if he was “aware that at some point in time
the court expanded the inquiry of the present case [from 10 airports] to other
Cat X and Cat I airports” and if he had “look[ed] for any evidence to see
whether TSA follows different procedures at the 10 airports that are the
subject of PX 811, the stipulation, and the other Cat X and Cat I airports.”
Tr. 1029:19-21; 1029:24-1030:2. He replied, “[t]here is perfect consistency
based on the design,” indicating that TSA’s CDGs provided support to infer
that the same infringement which occurred at the 10 airports listed in the
stipulation was occurring at other Cat X and Cat I airports. Tr. 1030:3-4. Dr.
Jacobson concluded that, based on Checkpoint Design Guides, there is no
reason why the infringement that TSA admitted to at 10 Cat X airports should
not also apply to the other Cat X and Cat I airports.

       Overall, Dr. Jacobson found that, based on the evidence provided in
the design guides, Mr. Mason’s testimony, and the parties’ stipulations,
TSA’s infringement of claim 1 of the ‘460 patent is “widespread and
universal based on all the information and documentation that I had available
to me.” Tr. 1070:2-4.

       Rather than countering Dr. Jacobson’s testimony with expert
testimony of its own, defendant objects to Dr. Jacobson’s testimony on the
basis of his qualifications concerning the design guides:

       The only support for its contention besides the guides
       themselves is the testimony from Dr. Jacobson who has never
       worked for TSA and had never seen a Design Guide before this
       litigation.

Def.’s Post-Trial Br. at 9-10.

                                     27
        As we explained above, Dr. Jacobson has extensive experience with
airport security and we view him as competent to interpret the design guides
and apply them to the method of the patent. In addition, while his testimony
is in some respects merely a recitation of the three items of proof addressed
above, we find his testimony persuasive in terms of whether any other
methods than the patented one has been used during the relevant period at
TSA-controlled airports.

              5. Summary of Plaintiff’s Proof of the Extent of Infringement

        We find that plaintiff has carried its burden of proving that, with
certain exceptions we lay out below, its patent was universally used as the
default method for all lanes at all Cat X and Cat I airports. While this finding
is warranted based on the stipulations, CDG Guidelines, admissions, and
expert testimony, it is particularly appropriate in light of the virtually
impossible task plaintiff had of quantifying use. Unlike plaintiff, defendant
had the advantage of virtually unrestricted access to TSA lanes and was the
party best able to preserve the relevant metrics. This was particularly the
case after plaintiff put TSA on notice as early as 2005 of its claims of
infringement. In retrospect, defendant’s resistance and ultimately inability
to comprehensively and in detail provide responses to plaintiff’s discovery
requests may have been understandable due to the complexity and cost
involved. As we will see below, defendant itself undertook a small-scale
effort at determining usage of the patented method, and, in our judgment
failed, in part because the study was limited to a brief period of time and a
limited number of airports. Even though we reject, below, the methods
employed in the survey, it serves to illustrate as well that plaintiff would
never have been able to offer proof of past usage comparable to the detail of
Mr. Tarakemeh’s data.

        It is worth clarifying, in view of one of defendant’s arguments with
respect to damages, that we find defendant infringed the method of the patent.
It did not use the tables, trays and carts which plaintiff offered at no cost as
part of its unsuccessful solicitation. Although it could have obtained them
for free if it had contracted with plaintiff, TSA purchased those itself while
infringing the patent.

       In sum, we find that plaintiff has carried its burden of proving that its
patented method became the default means used by TSA for screening
passengers at security checkpoints at all Cat X and Cat I airports. It becomes
defendant’s obligation to prove that use was not universal.

                                      28
       D. Potential Exceptions to Use of the Patented Method

        Defendant made little attempt to challenge plaintiff’s evidence as to
comprehensive widespread use of the ‘460 patent. Instead it argues that
plaintiff’s evidence camouflages non-use as use by indiscriminately treating
all passenger throughput as if it were use of the patent. Defendant contends
that proof of use requires distinguishing between the movement of
passengers through a checkpoint and their belongings to determine whether
a given passenger is exclusively utilizing trays for divestiture and whether
those trays return to their point of origin. Only if a passenger exclusively
divests his or her items onto trays obtained from the proximate end, as
defined by defendant, and then that tray of items is scanned without
interruption, and the passenger reassembles his or her belongings and places
the tray onto a cart that returns to the point of origin is that viewed by
defendant as evidence of infringement. Any break in this chain, for example
if a passenger obtains a tray from another lane, or places an item directly on
the scanning belt, or if a TSA screener removes a tray for closer inspection,
or if a cart is returned to another lane, would, according to defendant, mean
the patent is not being used.

       In order to establish these examples of non-use, defendant offered the
testimony of Mr. Tarakemeh, who has been an operations research analyst at
SAIC since 2014. Mr. Tarakemeh was engaged to conduct a study of what
he viewed as use, or not, of the patent at airport checkpoints. During the
study, Mr. Tarakemeh visited 36 airports in 2018 and 2019 for the purpose
of determining the extent to which all the steps of the ‘460 patent were
actually used. As we explain in more detail below, Mr. Tarakemeh was not
merely counting the number of passengers going through a checkpoint.
Instead, he broke the various elements of the movement of passengers and
their belongings into a number of events mimicking the steps of the patent.
If a passenger used three trays, for example, he kept track of the number of
trays and items going into the trays. He also attempted to trace the source
and destination of trays and bin carts. For example, he observed that carts
sometimes were shared between adjacent lanes and that sometimes trays
were removed for additional screening. He viewed each of these events as
potential “attrition points” because, in his view, they broke the chain of use
of the patented method. He employed a team of surveyors to monitor and
quantify all these events.

       He concluded that the patented method was actually used by less than
20% of passengers in normal lanes, and less than 1% of the time in lanes
designated as “PreCheck lanes.” From this, defendant concludes that the
court cannot accept universal comprehensive infringement as an established

                                     29
fact. In addition, even if the court finds the government liable for
infringement, defendant argues that the Tarakemeh study demonstrates that
plaintiff’s preferred damages metric—passengers—is inappropriate.

              1. Mr. Tarakemeh’s Airport Study

       Mr. Tarakemeh has a bachelor’s degree in systems engineering and a
master’s degree in operations research.16 He has worked on a TSA contract
since beginning his work at SAIC in 2014. Mr. Tarakemeh tests procedures
and equipment used at airport security checkpoints and baggage areas to
ensure that they meet safety requirements. He testified as an expert in
operations research analysis and the use of the tray and cart method in
security checkpoints. Dr. Barnett, another of defendant’s experts, then used
Mr. Tarakemeh’s raw data from the 36 sampled airports for the eight-month
period and extrapolated an overall usage rate for the additional Category X
and Category I airports and for previous years.

        Mr. Tarakemeh identified four phases in a passenger’s progress
through a security screening checkpoint (“SSCP”): 1) the divest phase, where
passengers are able to place their items in trays or directly on the scanner
belt; 2) the scanner phase, from which trays can be diverted for additional
screening; 3) the recompose phase, where passengers retrieve their items and
dispose of trays; and 4) the cart phase, at which bin carts are recirculated to
the beginning of a lane.

       Essential to Mr. Tarakemeh’s analysis is the assumption that the
patent calls for a “closed loop” in the circulation of trays and carts, i.e.,
staying within a single lane. If either trays or carts, or both, cycle through a
different lane, then the patent was not being used.

       At the divest phase, non-use could occur in a number of ways. If a
passenger did not use a tray at all, that became a “zero” use. If, as was
sometimes the case, TSA placed a bin cart between two lanes so that trays
could be retrieved from two directions (something Mr. Tarakemeh referred
to as a “bin island”), that also constituted zero use at the divest phase.

16
   On December 23, 2019, plaintiff filed a motion in limine to exclude Mr.
Tarakemeh’s opinions. ECF No. 433. On February 20, 2020, we denied
plaintiff’s motion. We did not reach plaintiff’s substantive criticisms, as
none of plaintiff’s contentions would disqualify him from testifying. The
objections went to the weight afforded his opinions and the sufficiency of the
data, but not his qualifications.

                                      30
Similarly, if there was one tray cart per lane, but the cart was placed more
than five feet away from the proximate end of the divesting table, he viewed
that as non-use. As he explained it, if a passenger had to take a “pivot step”
to retrieve a tray, that meant the tray was not at the “proximate end” of the
lane, as contemplated by his view of the patent. Because Mr. Tarakemeh
also tracked the number of items divested, if a passenger simply placed an
item on the conveyer belt without using a tray, that became an instance of
non-use, although he expressed that as a percentage for that phase, reflecting
the total number of items divested.

       At the scanner phase, SAIC data collectors tracked whether trays or
items were removed from the scanner belt by TSA inspectors and taken to a
separate secondary screening. Even if the item or tray was returned to the
belt for retrieval by the passenger, Mr. Tarakemeh’s data collectors were
instructed to treat that as an instance of non-use of the patent. In his view,
this was an additional step that broke the link in patent infringement.

        At the recompose phase, if a passenger picked up a tray and went into
an overflow area to recompose, but the tray did not end up in the cart at the
distal end of that same lane, that was counted as non-use. In other words, the
tray was not returned to the cart at the distal end to be returned to the
proximate end. He also applied the same five foot “pivot step” inquiry at the
distal end.

       Finally, at the cart phase, Mr. Tarakemeh tracked whether TSOs
returned carts to the proximate end of the same lane. If the second cart was
returned to the proximate end of a different lane through a crisscross
movement, that was counted as non-use because the patent envisioned a
closed loop within one lane.

       Mr. Tarakemeh defined the overall observed usage rate as the ratio of
the total number of trays observed moving in accordance with the ‘460
method to the total number of items scanned by the scanner machine. Table
V-1 presents the overall observed usage rate broken down by lane type.

DX 1683 at 5.

                                     31
        The overall observed usage rate above is obtained by multiplying the
usage rates observed at the four phases. At mixed lanes (a standard
checkpoint lane) the overall observed rate was 19.2 percent. At Pre-Check
lanes, the rate was 0.2 percent. As the court understands his analysis, in the
results for “mixed” lanes above, one could not assume a minimum of 38.4%
infringement based solely on the divest phase results, because using a tray at
the divest phase in a way that infringed the patent might end up with the same
tray, for example, being sent to the wrong lane, resulting in non-
infringement.

       The most basic critique plaintiff lodges against the Tarakemeh study
is that it is designed to capture the steps of the patent used by a single
passenger, and it is not, as it should be, focused on TSA’s creation of security
lanes which are set up with the purpose of using the steps of the patent. In
other words, TSA has established a security screening process which, in
normal operation, continually violates the patent, even if a particular
passenger does not, for example, make use of trays. Everyone who passes
through a security check point benefits from increased efficiency, and
therefore focusing on a complicated means of isolating specific instances of
non-use of trays is pointless. According to plaintiff, simply operating the
lane itself, irrespective of how any one passenger chooses to use trays,
constitutes the infringement.

      Defendant replies that the ‘460 patent relates to a system for the
movement of items, not people: “a tray and a system that can be used . . . to
provide efficient movement of loose items . . . from a starting point to an
ending point.” JX 1 at col. 5 ls 27-30. Because the patent mentions items,
defendant argues, items are the proper metric of infringement.

       This disagreement illustrates why the court asked for additional
briefing on how the parties expect the court to use the Tarakemeh study.
After briefing, it became apparent that defendant did indeed seek to call into
question plaintiff’s assertion of comprehensive infringement, but defendant’s
alternative, and in some respects more important point, was that Mr.
Tarakemeh’s work shows why plaintiff’s royalty calculations, which rely on
passenger volume, are artificially inflated. In other words, even if the court
has reservations about the precision of the Tarakemeh study, defendant
argues that Mr. Tarakemeh was correct to shift the court’s focus to screening
items, and not people. We will reserve for the discussion below the
resolution of how to use his study, assuming it is otherwise relevant and
reliable.

                                      32
        Plaintiff has three other objections to the study which are of a type:
they all amount to contentions that Mr. Tarakemeh has misconstrued the
patent by adding steps in some way. The first concerns the exclusion of
instances of passengers taking a “pivot step” in either picking up a tray or
disposing of a tray. Collectors were told to estimate when the bin carts were
positioned more than five feet away from the divesting table or more than
five feet away from the end of the recomposing table. Plaintiff contends that
not only is the term “pivot step” not found in the ‘460 patent or the court’s
claim construction, but that the term lacked precision; there was no way for
data collectors objectively to assess whether a passenger took a “pivot step.”

       For reasons set out in the discussion below, we agree with plaintiff
that the limitation of not making a “pivot step” is not present in the patent,
hence this deduction point is invalid. Even if it were, we think the metric is
too subjective to be taken into account.

        Plaintiff also argues that exclusion of lanes making use of bin islands
was improper. Here, however, we agree with defendant’s assumption that
this forms a relevant inquiry. As Mr. Tarakemeh’s study revealed, there were
occasions during his eight-month study in which lanes shared bin carts. As
we explain below, whether at the proximate or distal end of a lane, use of
such bin islands constitutes a different method than the one covered by the
‘460 patent because the trays circulate across lanes. While plaintiff points
out that there is no evidence that bin islands were in use before 2018, that
merely factors into how the court will calculate damages. We note, however,
that defendant gave us no readily measurable way to extract instances of bin
island use or crossovers.17

        The third attrition point to which plaintiff objects is that related to
secondary screening. Mr. Tarakemeh’s data gatherers were instructed to
record instances of trays being removed for secondary screening as non-use
at the scanning phase, unless they saw the tray returned to the recompose
table. Mr. Tarakemeh instructed his observers to count those instances of
secondary screening as non-use, which resulted in approximately 3% non-
infringement at that point. While Mr. Tarakemeh testified that he attempted
to account for trays that returned to the lane after being pulled for secondary
screening, he also testified that trays were not tracked from start to finish.
We are unpersuaded by this methodology because, without knowing whether
a tray departed the lane, the trackers would not know whether the method

17
  While at the distal end it appears that the only reductions relate to cross-
over or bin islands, the same is not true at the proximate end.

                                      33
was practiced as it regards a particular tray, even assuming that was a relevant
metric to count infringement.

        Plaintiff’s remaining critiques concern the mathematics of the study.
For example, plaintiff argues that items being tracked at the four phases are
different from each other, leading to an incoherence when the results are
combined. At phase one, two, and three, the study tracks trays and items. At
phase four, only carts and trays are tracked. Plaintiff also argues that the
SAIC study artificially amplifies the instances of non-use because a
passenger’s use of single tray can result in multiple instances of non-use. If
a bin cart was located six feet away from either the distal or proximate end
of a screening lane, each tray could be an instance of non-use at the divesting
and recompose phase. If the passenger put a knapsack on the conveyor belt
in addition to the tray, that became another partial non-use at the divesting
phase. If a tray was removed for additional screening, that became an
instance of non-use during the scanner phase. Tracking individual non-uses
thus creates the potential that a single passenger can account for multiple
instances of non-infringement.

       Disagreement between the parties’ experts as to whether the SAIC
calculations are a meaningful way to measure use of the patented method
generated a lively debate. If we understand Dr. Barnett’s explanation
correctly, these phenomena do not skew the results because the calculations
are done independently for each phase. The results for any one phase, based
on thousands of data points, are accurate and meaningful, in his view.
Plaintiff’s expert, Dr. Jacobson claims that, because of the study’s faulty
design, it cannot be corrected, and thus it is completely unreliable. The court
also had its own concerns, which we believe were not satisfactorily explained
by Dr. Barnett as to the multiplier effect of “zero” usage at any given phase.

        In the final analysis, however, we believe it is unnecessary to attempt
to harmonize the expert’s views on the reliability of measuring non-
infringement in the way that Mr. Tarakemeh and Dr. Barnett attempted.
Once we remove those asserted instances of non-infringement that Mr.
Tarakemeh improperly applied, the results as a whole are compromised. We
recognize, however, that the use of bin islands or tray cart crossovers is some
evidence that plaintiff’s method was not utilized at all times at all screening
points.

       What is also true is that Dr. Barnett’s data was gathered from 36
airports representing only 60 percent of air traffic and extrapolated to the
remaining airports. More important, he extrapolated from an eight-month
period from 2018 to 2019 backward across a thirteen-year period, assuming

                                      34
the same conditions. That is particularly problematic given the recent
introduction of bin islands.

              2. TSA PreCheck Lanes

        A related but separate instance of non-infringement which defendant
offers concerns the use of PreCheck lanes. Beginning in 2011, TSA began
offering expedited screening lanes at some airports. The purpose of
PreCheck is to expedite the screening process for passengers who have
successfully completed TSA’s background investigation.18 TSA PreCheck
lanes allow passengers to “experience a smoother screening process—no
need to remove shoes, belts . . . laptops, or light jackets” versus TSA’s
standard security screening lanes which require removing coats, shoes,
laptops, and other items before proceeding through security.19 Instead,
personal items may be placed directly on the scanning belt, without a tray, as
is the case in the instance of not removing a laptop from its carrying case or
passengers keeping their shoes and jackets on. In other words, when
passengers use TSA PreCheck lanes, they do not divest as many items into
trays on the scanning belt as they would in standard security lanes.

        Defendant argues that PreCheck lanes do not infringe the ‘460
method. Defendant reasons that passengers in a PreCheck lane do not need
to use a tray for their belongings because passengers are required to remove
fewer garments and are able to leave items in carrying cases. As a result,
fewer items pass through the scanning device in trays as taught by the claims
of the ‘460 patent. It relies on the Tarakemeh study to quantify the extent of
infringement at PreCheck lanes. By “use,” Mr. Tarakemeh means that a
given passenger places all divested items on a tray that cycles through the
security lane. If a passenger placed any items directly on the belt, even
though using a tray for some items, he treated that as non-use. From this he
concludes that the method is used less than 1% of the time in PreCheck lanes.

       Plaintiff takes the position that, even though passengers often may not
use trays in PreCheck lanes, the relevant fact is that TSA has set up all lanes,
including those employing PreCheck, to use the patented method. It is not
the passenger that violates the patent; it is TSA that infringes by positioning
carts at both ends of the scanning devices and using them to recycle trays.

18
   TSA’s website concerning TSA PreCheck, https://www.tsa.gov/precheck
(last visited Aug. 3, 2021).
19
     Id.

                                      35
As we discuss below, we agree with plaintiff that the relevant fact is that the
lane is set up and operated in a way that infringes the patent. The fact that
few passengers make use of trays we view as relevant not to infringement
but to calculation of a royalty.

              3. Automatic Screening Lanes

        It is undisputed that in 2016, TSA implemented, on a limited basis, a
completely new means of returning trays called “Automated Screening
Lanes” or “ASLs.” These involve lanes in which carts are not used at all,
and trays are automatically returned on a conveyor belt. They involve over-
sized trays which are labeled for tracking purposes within the scanner. There
is no question that they do not employ the ‘460 method. Atlanta is the only
airport with ASLs in every lane. Plaintiff’s damages expert estimates that
over 100,000,000 passengers have been screened using such lanes and that
implementing ASLs universally would cost hundreds of millions of dollars.

       E. Findings Related to Damages

       Plaintiff argues for use of a running royalty based on passenger
throughput. Plaintiff’s evidence that 7,660,935,659 passengers went through
screening lanes at Cat I and Cat X airports between 2008 and 2018 is
unrebutted.

        Another relevant factor in calculating damages is the extent to which
plaintiff granted an implied license to TSA to use its patent at certain airports
covering specific periods of time. In the discussion section below, we
consider the parties’ competing evidence and argument concerning the scope
of that implied license.

         Also discussed below, defendant argues that, assuming liability,
damages should be determined based on a lump sum royalty. The key factor
it relies on in advocating for a lump sum is its allegation that there existed an
acceptable, non-infringing alternative to plaintiff’s patented method at the
time the parties would have conducted a hypothetical negotiation—the one-
cart method or moveable pallet cart system (MPC) adopted in Arizona. The
availability of such a non-infringing alternative would have limited the
amount that TSA was willing to pay at the hypothetical negotiating table.

       Mr. Thaxton, a seventeen-year TSA veteran and a Deputy FSD,
designed the MPC system and implemented it in Phoenix Skyharbor Airport
in 2018 as a way to avoid using plaintiff’s patent. TSA first started using the
MPC system in March 2018. Instead of using two movable tray carts that

                                       36
function both to store and move trays, the MPC used a modified tray to
become a “mini-pallet”20 that functions as a “base unit” in which other trays
are nested and stored. A single two-wheeled dolly is then used to pick up the
mini-pallet and accumulated trays from the distal end of the screening lane
and move them to the proximate end. The mini-pallet does not have wheels.
While it can be picked up or slid, as a practical matter, it is not designed to
move independently of the dolly. The dolly, in effect, serves a purpose not
unlike the plaintiff’s tray carts, although the MPC uses only one dolly per
security screening lane. In contrast, the patent requires two carts.

        Mr. Thaxton testified that in 2018 he assembled the various elements
of the MPC from local hardware stores. He explained that the “Dolly Pal”
component is currently a “stock item” that is “off-the-shelf,” Tr. 2167:16-
17; although he also testified that it was not commercially available in 2005.
“I don’t think they produced it until 2010.” Tr. 2168:15-16. Mr. Thaxton
testified that it took him only a short time to assemble the one cart system.
As he said, “it was kind of a no-brainer.” Tr. 591:5-6.

        Defendant’s damages expert, Mr. McGavock, testified that he was
able to determine what was commercially available in 2005 to put together
the MPC system.21 He opined that, although the “Dolly Pal” component
currently used in the one-cart method was not on sale until 2010, all of the
components—the trays, the dollies, and mini-pallets—were either
commercially available or there were similar components, including custom
pallets, that were on the market at the time of the hypothetical negotiation.

      Mr. McGavock went on to determine what it would have cost in 2005
to implement the MPC at all Category X and Category I airports. He
concluded it would have cost between $5,922,399 and $9,917,101.22

20
   Sometime after 2010, instead of using a tray to create a mini-pallet, Mr.
Thaxton located a commercially available Dolly Pal and bolted a tray onto it
to form the base unit. Mr. Thaxton testified the Dolly Pal was not available
until 2010.
21
   He testified that he used “the Wayback machine to look at the internet as
it existed in 2005” to find ads selling the various components of what he
considered to be the moveable pallet cart. Tr. 2896:23-24.
22
  Plaintiff’s experts calculate a much higher number due to their assertion
that the inefficiencies of the MPC would dictate hiring many more security
officers.

                                      37
Defendant later uses this calculus to ground its numbers to limit plaintiff’s
damages.

       The MPC was used at nine commercial airports in Arizona and in
some lanes at the Denver Airport.23 Mr. Thaxton testified that he evaluated
metrics such as throughput and personnel usage before and after the MPC
was implemented and concluded that the metrics were the same as when
using the ‘460 method.

       Plaintiff’s expert, Tim Hollifield, was a checkpoint team manager
involved in the testing of SecurityPoint’s system during the SafeSkies study.
Mr. Hollifield identified several inadequacies of the MPC that would, in his
view, have rendered the MPC system unacceptable for widespread use by
TSA in 2005:

       The goal for TSA was to calm the checkpoint down, and an
       aluminum hand truck going through a metal detector caused
       significant distractions. When you push that through, they’re
       going to stop the lane, you’re going to create distractions for
       the screening process, and also you’re going to increase
       anxiety for passengers.

Tr. 1726:12-18.
       Mr. Arroyo also noted that the MPC requires TSOs to ask their
colleagues for assistance when returning the MPC through the disabled
passenger gate. Mr. McGavock admitted that MPCs caused damage to gates
and access gate panels, which required TSO time to repair, and negatively
impacted TSOs by taking them away from performing security-related
functions. According to Mr. McGavock, MPCs have a thin, protruding nose
plate which posed a risk of strikes to passengers. In contrast, the ‘460 patent
showed no ankle strikes when the method was tested. Additionally,
SecurityPoint’s carts could hold up to 60 bins per cart, whereas the MPC
system could only hold 28 bins per cart, resulting in 1.28 more minutes per
hour spent on returning bins.

       We have no reason to question Mr. Thaxton’s testimony concerning
the availability in 2018 of the component parts from which he assembled the
proto-type MPC, or for that matter, Mr. McGavock’s evidence that similar

23
   Mr. Thaxton testified, “[the MPC] went to the nine airports, commercial
airports, in Arizona.” Tr. 589:4-5; Mr. Ambrefe also testified that he saw the
MPC in use in Denver.
                                      38
components were available in 2005. What the court finds more telling,
however, is the fact that the one cart system was not developed in the sixteen
years following 9/11. We find speculative and counter factual Mr.
McGavock’s testimony that, in the hypothetical negotiation, the size of the
patent holder’s demand for compensation would have prompted TSA to
implement the MPC system in 2005. The best evidence of what TSA would
have done is what it did—adopt plaintiff’s patented method on a massive
scale, despite the asserted availability of a “no brainer,” low-cost alternative.

       Mr. Arroyo explained that several alternatives were introduced by
TSA between 2001 and 2006 in an effort to expedite screening. In addition,
Mr. Malackowski testified that experiments were undertaken at various
airports, all of which failed (such as a bin runner system, side slide, and
mechanical conveyor belt). As he explained, “for an extended period of time,
the government was continually looking for alternative solutions . . . and the
[MPC system] was not . . . identified for [13 years].” Tr. 1925:7-11. At the
validity trail, Mr. Arroyo also testified that, prior to adopting plaintiff’s
method, TSA thought the introduction of carts, including a dolly cart, would
be a hazard and decrease efficiency. Validity Trial Tr. 1593-94. Moreover,
as we discussed above, Ms. Gloria Bender was hired from 2003 to 2005 to
develop a solution to remedy efficiency problems at SSCPs, but never
suggested a cart-and-tray management system as claimed in the ‘460 patent
or use of a dolly and pallet system. We find that the MPC was not an available
and acceptable method at the time of the hypothetical negotiation.

                                    DISCUSSION

I. Infringement

       We found above that plaintiff put on sufficient evidence to confirm
universal and continuous infringement of its patent at all Cat X and Cat I
airports. The only potential exceptions we reserved from our examination of
the Tarakameh study were with respect to TSA’s use of bin islands,
crisscrossing carts, and PreCheck and ASL lanes. We turn then to the import
of the Tarakemeh study.

       A. The Parties’ Opposing Conclusions on Mr. Tarakemeh’s Study

       We agree with plaintiff that the Tarakemeh study is fundamentally
flawed and that his overall conclusions are irrelevant. The reason is that he
improperly assumed that TSA infringed only if a particular passenger
actually divested items onto at least one tray taken from a tray cart which

                                       39
was no more than five feet away from the proximate end of a screening lane
and if there was no secondary screening.

       We disagree with this operating assumption. We hold that TSA
infringed the patent when it operated screening lanes which, in their normal
operation, invited passengers to take a tray from a first tray cart at the
proximate end of a particular screening lane and then, after scanning, to then
return that tray to a second tray cart at the distal end of the same lane, after
which the second tray cart was returned, with trays, to the proximate end of
the same lane by TSA. That was clearly established to be the routine process
by which TSA screened passengers. Once TSA opened up a lane for use
employing these steps, the infringement was continuous, and it was
infringement by TSA, not the passenger. We view it as legally immaterial
whether a particular passenger declined the use of a tray, or placed items
directly on the scanning belt. Therefore, recording how many trays a
passenger took, how many items were divested into trays, or how many items
were placed on the scanning belt directly was a useless exercise. It
demonstrated nothing about whether the patent was being infringed.

        We recognize, however, that Mr. Tarakemeh also recorded some other
“attrition points,” which, as we suggested above and we discuss below, we
do find relevant. What we reject, however, is his overall conclusion that
there was no more than 19.2% infringement in normal lanes and less than 1%
infringement in PreCheck lanes. This conclusion can be ignored because the
study was not designed to capture infringement. And it can be ignored
without reliance on the enfilade of more detailed criticism from plaintiff’s
experts. We turn now to the particular attrition points he identified.

              1. Pivot Step

        Mr. Tarakemeh excluded from the infringement tally instances in
which passengers took a “pivot step” of five feet or more, either in picking
up or disposing of a tray. We need not address plaintiff’s criticisms directed
at the imprecision and subjectivity of this metric. The term “pivot step” is
not present in the patent. It is Mr. Tarakemeh’s interpretation of the patent,
and it is one that is not justified by the court’s claim construction. Claim one,
step one of the ‘460 patent requires positioning a first tray cart containing
trays at the proximate end of a scanning device through which objects may
be passed, wherein said scanning device comprises a proximate end and a
distal end.

      In our construction of the terms “proximate” and “distal” we held that
proximate meant “proximal or nearest to; referring to the end of the scanning

                                       40
device where an object enters the device.” SecurityPoint Holdings, Inc. v.
United States, 111 Fed. Cl. 1, 9 (2013). We described distal end as “farthest
from; referring to the end of the scanning device where an object exits the
device.” Id. We gave no further specificity to location or distance from the
scanning device. In fact, we specifically rejected defendant’s efforts to add
more precision to location:

       Defendant views its definition of an “end” to be a precise point
       as compared to a more general area at the extent or boundary
       of something. We do not share defendant’s understanding of
       its construction; it implies a level of precision that we find
       generally lacking in the 460 patent. The patent describes a
       method for cycling trays through a scanning device at a
       security check point. It is not dependent upon a great deal of
       precision in the location of the instrumentalities involved.
       Perhaps if “proximate end” and “distal end” were used to
       describe the actual physical entry and exit point of the
       screening device itself, defendant’s understanding would be
       natural. Here, however, the claims use the terms to describe the
       location of tray carts external to the device. As it is, “proximate
       end” means “proximal or nearest to; referring to the end of the
       scanning device where an object enters the device.” “Distal
       end” means “farthest from; referring to the end of the scanning
       device where an object exits the device.” Nothing further is
       implied by those definitions.

Id. at 8-9.

        A tray cart six feet away from the screening belt therefore literally
infringes. Even if it did not, however, this is precisely the type of additional
limitation which would trigger the court’s ruling that, if Mr. Tarakemeh’s
presentation relied on a new limitation, and one inconsistent with the court’s
prior claim construction, plaintiff would be able to resuscitate its argument
of infringement under the doctrine of equivalents. In that event, the
testimony of Dr. Jacobson is clear that positioning a first tray cart containing
trays six feet away from the proximate end of a scanning device amounted to
performing the same function in the same way to produce the same result.
The same would be true of trays at the distal end.

              2. Secondary Screening

       Similarly, plaintiff objects to Mr. Tarakemeh’s secondary screening
as a point of attrition. Secondary screening occurs when a tray is selected

                                       41
for additional screening and taken away from the general area of the scanning
device. Apparently the reason for treating this as an attrition point is not that
this amounted to an additional step, but because Mr. Tarakemeh assumed
that, unless it was clear that a tray returned to the revesting table, it must have
gone to a different lane, thus triggering concerns about “criss-cross”
movement between lanes. He testified that his observers attempted to
account for trays that returned to the lane after being pulled for secondary
screening, but he also testified that trays were not tracked from start to finish.
Under these circumstances we are unwilling to assume that secondary
screening should be treated as non-infringement.

               3. Bin Islands and Tray Crossovers

       Finally, plaintiff argues that the exclusion of lanes making use of bin
islands and tray crossovers was improper. Here, however, we agree with
defendant’s assumption that the existence of bin islands and instances of the
crisscross scenario, in which bins from the distal end of one lane are returned
to the proximate end of another lane, are relevant because these constitute
non-use of the patent.

        As an initial matter, we find that making exceptions for bin islands
and instances of tray cart crisscross does not trigger the doctrine of
equivalents. These are not new claim constructions; rather, the existence of
bin islands or the crisscross scenario were merely observations of where tray
carts were situated and how they moved at the airports Mr. Tarakemeh
surveyed. As we observed above, there were occasions during Tarakemeh’s
eight-month study in which lanes shared bin carts, and we concluded that use
of such bin islands constitutes a different method than the one covered by the
‘460 patent because the trays circulate across lanes rather than in a closed-
loop fashion as contemplated by the patent. Mr. Tarakemeh was applying
the court’s construction of the patent. We further note, however, that
defendant gave us no readily measurable way to extract instances of bin
island use or crossovers. In fact, concerning the quantum of damages, the
government concedes that it does not rely on Mr. Tarakemeh’s study. Rather,
defendant uses the study to illustrate what it views as plaintiff’s unreasonable
eight cent per-passenger royalty.

       Concerning the issue of bin islands and tray cart crossovers, those
instances thus do provide some evidence that the ‘460 patent was not used at
all times, at all lanes, at all airports. According to Mr. Tarakemeh’s data, at
the cart phase, reported in Table V-1 above, use of plaintiff’s method was
70.8%. Non-use due to bin island and tray cart crisscross instances would be
29.2 %, assuming all non-use at the cart phase related to whether or not a cart

                                        42
was returned from the distal end to the proximate end of the same lane. This
number cannot be directly applied to the infringement calculus, however.
The study was only conducted at 36 airports over an eight-month period from
2018 to 2019. There is no evidence that bin islands were in use before 2018.
Accordingly, non-use as it relates to bin island and crossover instances, will
be considered for the limited purpose of determining a royalty rate.

        In sum, Mr. Tarakemeh’s study does not rebut plaintiff’s claim
concerning TSA’s universal infringement of the ‘460 method. We agree with
plaintiff that inferring that the ‘460 patent was rarely used at all in Cat X and
Cat I airports from 2005 to 2018 based solely on a survey conducted from
2018 and 2019 at 36 airports is unreasonable due to the lack of historical data
and questionable mathematical calculations, and more importantly, because
the survey was not designed to capture use of the patent. We conclude that
TSA made the patented method the default at all Cat X and Cat I airports,
with the exception of those using the MPC and ASL systems. Moreover,
because the government has not indicated how the SAIC study should be
applied to the damages calculation other than to argue that the study shows
the unreasonableness of plaintiff’s damages calculation, we find that the
study does not convey meaningful data related to damages, with the
exception of the finding that there was some use of bin islands and tray cart
crossovers.

II. Damages

       A. A Running Royalty Versus a Lump Sum Payment

        Having found liability, plaintiff is entitled to recover “reasonable and
entire compensation” for the government’s acquisition of a compulsory non-
exclusive patent license. 28 U.S.C. § 1498(a). Both parties agree that
damages should be determined by constructing a hypothetical negotiation
between a willing licensor and licensee using factors spelled out in Georgia-
Pacific Corp. v. U.S. Plywood Corp., 318 F. Supp. 1116, 1120 (S.D.N.Y.
1970), modified and aff’d, 446 F.2d 295 (2d Cir. 1971); see also Rite-Hite
Corp. v. Kelley Co., 56 F.3d 1538, 1544 (Fed. Cir. 1995) (en banc) (citing
Hanson v. Alpine Valley Ski Area, Inc., 718 F.2d 1075, 1078 (Fed. Cir.
1983)). Plaintiff bears the burden of proof.

       One means of measuring compensation, particularly when profits are
not a relevant measure, is to require the defendant to pay a running royalty
for a license as well as damages for its delay in paying the royalty. See
Standard Mfg. Co. v. United States, 42 Fed. Cl. 748, 758 (1999), abrogated
in other respects by Uniloc USA, Inc. v. Microsoft Corp., 632 F.3d 1292 (Fed.

                                       43
Cir. 2011); see also Wright v. United States, 53 Fed. Cl. 466, 469 (2002). An
alternative calculus involves a lump sum payment. See Lucent Techs., Inc.
v. Gateway, Inc., 580 F.3d 1301, 1326 (Fed. Cir. 2009).

        Plaintiff advocates for a running royalty, which it argues should
consist of $0.08 per-passenger going back to at least 2008.24 That would lead
to damages of $618,505,375 million.25 Plaintiff claims that, “This amount is
inclusive of delay damages, but it will need to be trued up as of the date of
judgment to reflect additional passenger throughput and additional delay
damages.” Pl.’s Post-Trial Br. at 65.

       Defendant asks the court to adopt a lump sum royalty, which it
contends should be no more than a maximum of $12,637,499, an amount
representing the cost to implement the MPC system at all airports.26

       The most basic issue to resolve, therefore, is whether to adopt a
running royalty rate as opposed to a lump sum. There are generic
considerations involved. For example, as defendant points out, for both
contracting parties, the lump-sum license generally avoids ongoing
administrative burdens of monitoring usage of the invention. Plaintiff
counters that the lump sum royalty runs the risk of an unanticipated windfall
to either party due to unforeseen circumstances or miscalculation of the
patent’s value or anticipated use. A per-passenger royalty would have
provided both parties with the flexibility of ending the arrangement.

24
   Although the parties agree to an earlier date of first infringement,
plaintiff’s damages calculations begin in 2008.
25
   Plaintiff’s expert, Mr. Malackowski, testified that “$618 million . . . takes
into account deductions for the implied license at about 21 percent,
deductions for ASLs and a 10-year bond delay payment rate.” Tr. 1948:25-
1949:3.
26
   Mr. McGavock’s opines that the cost of implementing the MPC method at
all Category X and Category I airports would be between $5,922,399 and
$9,917,101, plus delay damages. His figure for the total reasonable and
entire compensation was $12,637,499. Mr. Malackowski criticized that
figure for not including increased labor hours that would have been necessary
had TSA used the MPC instead of the ‘460 method nationwide.

                                      44
        Mr. Malakckowski testified that the remaining term of the license,
approximately 17 years, also would motivate the parties to agree to a running
royalty versus a lump sum. He reasoned that, since the hypothetical
negotiation would have taken place in 2005, the parties to the negotiation
would need to assess what might happen over the next 17 years to account
for future innovation. Because of the length of the remaining term, we agree
that TSA would have been motivated not to lock itself into a lump sum, in
the hope that it could minimize future payments by engineering a way around
the patented method. Instead, we believe that TSA would have been
motivated to try to reach agreement on a de minimis running royalty as a way
to avoid a large lump sum that might turn out to have been unnecessary.

        Plaintiff also argues that a running royalty based on passenger
throughput would have logically suggested itself to hypothetical negotiators.
First, because, as Mr. Malackowski testified, “the passenger is essentially the
engine of commerce that results in the benefits of the ‘460 Patent.” Tr.
1819:16-18. In addition, as Dr. Jacobson testified, one of the primary
benefits of the patented method is reduced passenger wait time. No other
metric for use with a royalty was offered by defendant and none appears to
the court. Personal belongings do not flow through the screening points
unless they are directly associated with a passenger, and the use of trays and
carts would, in any event, be considerably more difficult to track. The most
relevant and simplest metric—passengers—was also readily available. TSA
already tracks passenger throughput in order to measure performance of its
operations, and it already charges usage fees on a per-passenger basis for
enhanced security. In addition, SecurityPoint’s business model was already
based on passenger throughput.

       Defendant offers a number of particularized reasons why the parties
to the hypothetical negotiation would have agreed to a lump-sum royalty,
versus a running royalty, and why, if a running royalty had been adopted, it
would not be based on passenger throughput. It argues that it is not feasible
to track precise usage of the patented method, that usage of the claimed
method is sporadic, and that plaintiff’s concentration on passenger
throughput overestimates usage of the claimed method and encompasses
instances of infringement and non-infringement. We find none of the
arguments persuasive.

       The simple answer to these critiques we have already explained. The
reason the government contends it would be difficult to apply a running
royalty is that it accepts Mr. Tarakemeh’s flawed view of how to measure
use of the patent. TSA, however, infringes by the way in which it sets up
and operates lanes. The assumed complexity disappears when it becomes

                                      45
obvious that it is unnecessary to track trays, individual items divested, and
carts. For the same reason, there was no “sporadic use.” The only thing
which made it appear sporadic was Mr. Tarakemeh’s focus on items, trays
and divestments.

         Defendant’s strongest argument in favor of a lump sum amount is that
there was available an acceptable, non-infringing alternative that would have
given TSA great leverage in the hypothetical 2005 negotiations, namely the
MPC. The Federal Circuit has recognized that non-infringing alternatives
will necessarily limit the amount a party would be willing to pay to use the
patented technology at the hypothetical negotiation. AstraZeneca AB v.
Apotex Corp., 782 F.3d 1324, 1334 (Fed. Cir. 2015) (“There is little incentive
. . . for the infringer to take a license rather than side-step the patent with a
simple change in its technology.”); Riles v. Shell Expl. & Prod. Co., 298 F.3d
1302, 1312 (Fed. Cir. 2002) (“The economic relationship between the
patented method and non-infringing alternative methods, of necessity, would
limit the hypothetical negotiation.”). The question, therefore, is whether the
MPC system infringes the patent, was an acceptable alternative, and was
available.

              1. Does the MPC Infringe the ‘460 Patent?

        The ‘460 method cycles trays through a checkpoint using two carts.
In contrast, the MPC uses only one cart. The addition of the second cart was
critical to the patentability of the method. It is thus a decisive difference.
Defendant alleges that SecurityPoint ignores the requirement that a “tray
cart” be an actual cart. Instead, defendant claims that plaintiff relies on
conclusory statements of Mr. Arroyo and Dr. Jacobson, that a “tray cart” does
not require wheels.

       We are unpersuaded by the creative argument from plaintiff’s experts
that one, or even two mini-pallets at either end of the checkpoint are
theoretically movable and thus constitute the two carts required. Clearly the
mini-pallets are platforms intended to receive trays and are then moved with
the dolly. While there may have been some sighting of agents sliding pallets
on Velcro skids across the floor, that is not a meaningful equivalent to two
moveable tray carts.

              2. Were MPCs an Acceptable Alternative?

      To be deemed acceptable, the alleged non-infringing substitute must
not “possess characteristics significantly different from the patented
product.” Kaufman Co. v. Lantech, Inc., 926 F.2d 1136, 1142 (Fed. Cir.

                                       46
1991). Mr. Thaxton testified that he evaluated certain metrics such as
throughput and personnel usage before and after the MPC was implemented
and that the throughput metrics were the same as when using the ‘460
method. Defendant also argues that the acceptability of the method is proved
by the fact that it was used in nine commercial airports in Arizona and for a
period in some lanes at Denver International Airport.27

        Plaintiff notes that use of the MPCs did not begin until 2018, long
after the theoretical 2005 negotiations. In addition, it argues that the MPC
system was severely deficient when compared to the ‘460 method, thus
rendering it unacceptable as an alternative. Plaintiff’s expert, Mr. Hollifield,
was a checkpoint team manager involved in the testing of SecurityPoint’s
system during the SafeSkies study. He saw the benefits of the ‘460 patent
firsthand when it was first tested and identified certain ways in which the
MPC system would have been less desirable, including triggering metal
detectors and causing increasing stoppages.

        Mr. Arroyo explained that the MPC requires TSOs to ask their
colleagues for assistance when returning the dolly through the ADA gate,
which, according to Mr. McGavock, occasionally resulted in damage to ADA
gates and access gate panels. The MPC dolly carts have a thin, protruding
nose plate which posed a risk of strikes to passengers. The ‘460 method cart
could hold up to 60 bins per cart, whereas the MPC system could only hold
28 bins per pallet. Mr. Arroyo also testified that the MPC system required
significant energy to operate, and it is less stable, because it operated with
the two wheels versus the ‘460’s four-wheeled tray cart.

       As defendant points out, however, an alternative need not provide the
same level of benefits or quality if the relevant consumer would have
accepted it. See Brunswick Corp. v. United States, 36 Fed. Cl. 204, 217
(1996). In this respect although we agree with the government that the
asserted deficiencies of the MPC smack of exaggeration, we believe that, if
given a choice, TSA would have preferred to use the patented method, so
long as it came with no legal liabilities. The patented method was more
efficient and less likely to cause minor damage or injury. The latter half of
the inquiry—whether the relevant consumer would have accepted the
alternative—is much more telling. We agree with plaintiff that the strongest
evidence that the MPC was not an acceptable alternative was that TSA used

27
  The parties offer competing evidence regarding whether MPCs continue to
be used at the Denver airport today. It is unnecessary to resolve that dispute,
however, because our holding that the alternative method was neither
acceptable nor available is unconcerned with where it is used today.
                                      47
the MPC only at Arizona airports and some lanes at Denver International
Airport, and it did not begin doing so until 2018, when it became apparent
that there was a serious patent infringement problem. In short, development
of the MPC itself smacks of contrivance because it was implemented, not in
response to a felt physical need, but to minimize damages from patent
infringement after many years of unauthorized use.

        It is also telling that, despite the pendency of this lawsuit since 2011,
and the concerted efforts of TSA to design around the patented method,
plaintiff’s method has been adopted wholesale around the country. Contrast
that with the spotty use of the MPC and the very late development of ASLs.
We conclude that the MPC was not sufficiently attractive to dissuade TSA
negotiators from considering paying for a more attractive alternative. In
addition, for the reasons explained below, we are persuaded that it was not
available in 2005, albeit for some of the same reasons that it was not an
attractive alternative.

              3. Was the MPC Method Available?

       Defendant argues that even if the one-cart method was not used until
March 2018, that does not mean it was unavailable in 2005. Defendant
contends that an alternative does not need to be actually in use to be
“available” to the hypothetical licensee so long as the licensee possessed “all
of the necessary equipment, know-how, and experience” at the time of the
hypothetical negotiation. Micro Chem., Inc. v. Lextron, Inc., 318 F.3d 1119,
1123 (Fed. Cir. 2003) (quoting Grain Processing Corp. v. Am. Maize-
Products Co., 185 F.3d 1341, 1354 (Fed. Cir. 1999)). Rather a hypothetical
licensee would look to alternatives that were “in the wings.” Zygo Corp. v.
Wyko Corp., 79 F.3d 1563, 1571–72 (Fed. Cir. 1996) (discussing reasonable
royalty).

       Mr. Thaxton testified that he obtained the materials he used to create
a fixed receptacle for trays, as well as a dolly, from commercially available
sources in 2018. When he first attempted to design around the ’460 patent,
he managed to come up with the one-cart method in a relatively short period
of time. To create a fixed base for holding trays at both ends of the screening
lane, he modified a single tray and labeled it to discourage passengers from
trying to pick it up. He later switched to a premanufactured “Dolly Pal,”
which he conceded was not available in 2005. Mr. McGavock confirmed,
however, that all of the components or component substitutes, such as
customized pallets, were available at the time of the hypothetical negotiation.

                                       48
       We conclude that the constituent components or their equivalents
were probably commercially available in 2005, and it would take minimal
engineering skills to build from a tray or tray platform an elevated pallet to
hold trays. Mr. Thaxton or someone else from TSA probably could have
cobbled together in 2005 the same or similar pieces of equipment into an
MPC.

       This does not amount to proof of availability, however. TSA expert
Gloria Bender testified at the validity trial that her company was engaged by
TSA at several airports to improve checkpoint efficiency but was unable to
develop a satisfactory solution to the problems solved by the methods
claimed in the ‘460 patent. She, along with TSA expert, Robert Cammarato,
also testified that even though it was their responsibility to solve efficiency
problems in SSCPs and establish standard operating procedures for TSA
screeners from 2003 to 2005, they never suggested a cart-and-tray
management system as claimed in the ‘460 patent.

       Mr. Arroyo also explained that several alternatives were explored by
TSA between 2001 and 2006 at various airports, such as a bin runner system,
side slide, and mechanical conveyor belt, all of which failed. Mr.
Malackowski added that “for an extended period of time, the government
was continually looking for alternative solutions . . . and the [MPC system]
was not one of them that was identified for that first decade plus.”28 Tr.
1925:7-11. And, as noted earlier, we have Mr. Arroyo’s 2015 testimony that
the use of carts was considered counterintuitive at checkpoints at the time
when the hypothetical negotiation would have taken place. This further
suggests to us that TSA would not have come up with the MPC method back
in 2005.

        Two things are clear. First, what was not available was a
commercially offered method or “system” of a pallet and dolly for moving
trays, nor did TSA have an internally developed system that was waiting in
the wings. See State Industries, Inc. v. Mor-Flo Industries, Inc., 883 F.2d
1573, 1579 (Fed. Cir. 1989). There was not available a single product that
performed like the tray and cart system.

      More importantly, however, the know-how, experience, and
motivation necessary to assemble the parts into the combined tray holder and

28
   Mr. Malackowski explained: “And so there is no basis to believe that
sitting down in 2005, the negotiators would have thought of, developed, the
movable pallet cart. It was not obvious at the time, just as the simple elegant
invention of SecurityPoint was not obvious at that time.” Tr. 1925:12-16.
                                      49
dolly system was also clearly missing at the time of the hypothetical
negotiation. Cf. Grain Processing, 185 F.3d at 1354. If it had been present,
it would not have taken thirteen years and repeated, targeted, and TSA-
financed efforts by engineers to come up with a solution to a problem that
was obviously not a “no brainer.” We find that the one-cart method or MPC
would not have occurred to the hypothetical negotiators and was therefore
not available to influence the negotiations.

        This is not to say that the apparent simplicity of plaintiff’s method
would not have occurred to the government. As Mr. Malacowski observed,
in the event TSA developed a new technology (such as automated screening
lanes), TSA could have stopped paying royalties on passengers passing
through lanes that used the new technology. This offered TSA an incentive
to use a minimal running royalty to buy time to develop an alternative.

       Plaintiff has established that the parties would have elected to use a
running royalty, and not a lump sum payment. Defendant has not proved
that the MPC was an available, acceptable alternative. What follows is
consideration of the amount of that royalty.

       B. Other Factors Influencing the Negotiation

        Reasonable royalty damages are determined based on what the parties
would have agreed to in a hypothetical negotiation just prior to the date of
first infringement. In this case, that would be September 2005. The Federal
Circuit has held that the hypothetical negotiations model produces the result
“more of the character of a forced settlement where neither party gets all it
would wish.” Rite–Hite Corp., 56 F.3d at 1556.

       In analyzing the hypothetical negotiation, the court applies the factors
from Georgia–Pacific, which provides a “list of evidentiary facts relevant, in
general, to the determination of the amount of a reasonable royalty for a
patent license.” Ga.-Pac. Corp., 318 F. Supp. at 1120 (outlining the factors
relevant to the determination of a reasonable royalty). The parties are not
required to address all the factors because “there is no formula by which these
factors can be rated precisely in the order of their relative importance or by
which their economic significance can be automatically transduced into their
pecuniary equivalent.” Id. at 1120–21. Thus, in the court’s construction of
the hypothetical negotiation, some “factors may be of minimal or no
relevance to a particular case and other factors may have to be molded by the
Court to fit the facts of the case at hand.” Proctor & Gamble Co. v. Paragon
Trade Brands, Inc., 989 F. Supp. 547, 607 (D. Del. 2001). The court is not
“constrained” by the Georgia-Pacific factors and need not consider factors

                                      50
that are “inapposite or inconclusive.” Brunswick Corp., 36 Fed. Cl. at 212
(citing Ga.-Pac. Corp., 318 F. Supp. at 1120).

       Although there are fifteen Georgia-Pacific factors, the only ones
either or both parties discussed are the following:

       (1) The current, established royalty rates under the patent at issue.

       (2) The royalty rates for comparable technology.

       (7) The duration of patent and license terms.

       (8) The profitability and commercial success of the invention.

       (9) The utility and advantages of the invention over prior art.

       (10) The nature, character, and benefits of use.

       (11) The extent and value of infringing use.

       (13) The portion of realizable profits creditable to the invention alone.

       (14) Expert testimony on royalty rates.

       (15) The totality of other intangibles impacting a hypothetical
       negotiation between a willing licensor and licensee.

       In considering how these factors should influence the hypothetical
negotiation, the court may consider facts that post-date the time of the
negotiation. Sinclair Refining Co. v. Jenkins Petroleum Process Co., 289
U.S. 689, 698 (1933). The Supreme Court termed these facts “the book of
wisdom” and cautioned that courts should not ignore them. Id. These relieve
some of the artificiality inherent in the exercise by tethering what is
otherwise a pure hypothetical to reality.

        In considering these factors, we are mindful that the benefits claimed
must be attributable to the patented method, which is to say that we must be
able to differentiate between the specific improvement of the claimed method
and other non-patented features that may otherwise also contributed to the
benefits ascribed to the patent. FastShip, LLC v. United States, 131 Fed. Cl.
592, 625 (2017), aff’d as modified, 892 F.3d 1298 (Fed. Cir. 2018)
(“Damages are apportioned based on the ‘smallest salable patent-practicing

                                      51
unit’ within the infringing article, meaning those features within the scope of
the claimed invention.”) (citing LaserDynamics, Inc. v. Quanta Computer,
Inc., 694 F.3d 51, 67 (Fed. Cir. 2012)). While this is less of a concern here
because we are confronted with a method patent rather than an improvement
to a complicated piece of existing technology, it is nevertheless the case that
some of the enthusiasm expressed about the ‘460 method was attributable to
non-patented changes to screening lanes. That caution is particularly
applicable to Georgia Pacific factors 10 and 13.
               1. Factors 1 and 2: Established Royalty and Comparable
                License Rates

        The place to begin is any evidence of what the licensor agreed to in
the real world. The Georgia Pacific court captured this inquiry in its first
two, related, factors. The first is “[t]he royalties received by the patentee for
the licensing of the patent in suit, proving or tending to prove an established
royalty.” Ga.-Pac. Corp., 318 F. Supp. at 1120. The second is “[t]he rates
paid by the licensee for the use of other patents comparable to the patent in
suit.” Id. “This factor examines whether the licenses relied on by the
patentee in proving damages are sufficiently comparable to the hypothetical
license at issue in suit.” Lucent Techs., Inc., 580 F.3d at 1325.

       Here, the only reference offered is plaintiff’s agreement with the
Adason Group to settle SecurityPoint’s infringement suit. Defendant objects,
arguing that the Adason agreement is not analogous because it was neither a
license agreement nor was it a commercial transaction in the normal sense.
Although not perfectly analogous, we find that the Adason agreement
provides a starting point.

        As mentioned earlier, Adason responded to TSA’s Bin Advertising
Program solicitation and was successful in participating in that program at
five airports in 2007. After SecurityPoint sued Adason,29 the parties entered
into a settlement in September 2007, whereby Adason agreed to pay
SecurityPoint $650,000, and agreed to market SecurityPoint’s system for
advertising as, in essence, a broker for plaintiff. That plan was not ultimately
followed, however, because Adason went out of business. It paid roughly
half of the settlement amount before going under. Although there was no
running royalty adopted for future use, Mr. Hosfield calculated what he
believed was an equivalent royalty rate of $0.063 per-passenger by dividing

29
  The suit was not limited to patent infringement. Plaintiff alleged five
counts, including false advertising and violations of the Lanham Act.

                                       52
Adason’s total settlement of $650,000 by the 10.3 million passengers
screened at those five airports during the period of the Adason agreement.30

        According to plaintiff, during a hypothetical negotiation (using the
“book of wisdom” to account for the Adason negotiations fourteen months
later), the parties would have taken into account the $0.063 per-passenger
royalty rate of the Adason agreement because it is the only comparable
license. Plaintiff reasons that TSA would have agreed to pay more than
Adason paid because TSA received more benefits from the ‘460 patent than
Adason. Adason was a private advertising company which only benefitted
from placing ads on the trays, and not from improved security, increased
passenger throughput, reduced TSO injuries, and reduced staffing.
Moreover, Adason was in financial distress, and could not have paid more
than $0.063 per passenger. Plaintiff thus argues that Adason’s royalty rate
should be a floor.

        Defendant, on the other hand, believes the Adason example to be
inapposite because it was not a running royalty license, was entered into to
end litigation that included claims other than patent infringement, was
between competitors in the market—unlike TSA and SecurityPoint—and set
the terms for a future business relationship. The government also believes
Mr. Malackowski’s reverse engineering of the rate to be flawed because it
did not take into account any infringement that Adason undertook prior to
2007.

       We disagree with the government’s complete rejection of the
relevance of the Adason payment. Adason, like TSA, infringed the ‘460
patent. Both would have been incentivized to enter into negotiations to deal
with assertions of infringement. The fact that Adason was only able to pay
$300,000 before declaring bankruptcy, we view as not undercutting the
legitimacy of the use of the $650,000 figure, which, barring evidence of
deceit (none was offered), represents the result of arms-length negotiations.

       Moreover, any higher royalty would have jeopardized Adason’s
solvency. This factor would have put a downward pressure on a settlement
figure. As Mr. Hosfield testified:

30
  The Adason agreement was not just a payment for past infringement. The
parties agreed to an ongoing business relationship. While the terms of that
deal became irrelevant due to Adason’s insolvency, the intent to enter a
mutually beneficial arrangement for the future lends credence to plaintiff’s
position that it would have pushed for a running royalty.
                                     53
       What they agreed to pay and, in fact . . . as I recall, what they
       told SecurityPoint was this is what we can pay; anything above
       that would force us into bankruptcy. So that’s the amount that
       they agreed to. What that tells us . . . is that if Adason’s
       financial condition were better, SecurityPoint might not have
       agreed to such a low number; however, that’s the agreement
       they made, and that’s what they agreed to accept, and that’s
       what I determined.

Tr. 1657:3-13. (emphasis added).

       Mr. Malackowski agreed with Mr. Hosfield’s assessment:

       I believe the Adason agreement is lower than an agreement
       with the TSA, all else being equal, because, first, there’s the
       financial duress that we’ve talked about that drove it down, but
       second, Adason was receiving no benefit to this invention
       except the ability to sell advertising, which is valuable, but the
       TSA receives significantly greater benefits related to the
       passenger throughput and all of the labor savings and reduced
       injuries and other economics that exceed anything that Adason
       would have ever been able to achieve.

Tr. 1854:8-18. (emphasis added).

       We reject as well, however, plaintiff’s argument that the Adason
figure becomes a floor. While an equivalent royalty rate can be derived from
a lump sum payment, nevertheless, the parties used a lump sum payment and
not a running royalty. We agree with the government that the dynamics of a
decision to foreclose future use of a patent and close out litigation is different
than opening the door to ongoing payments over potentially a 17-year period.
Constructing an artificial equivalent royalty under those circumstances
strikes us as camouflaging the independent incentives to end the
infringement and the litigation. We do not know what the parties would have
agreed to by way of a running royalty and we do not know whether releasing
non-patent infringement claims had any financial weight for Adason. We
also cannot ignore the fact that Adason had been infringing for the purpose
of making money. Plaintiff’s demand would have sought to capture some of
those advertising receipts, something of no interest to TSA.

       In sum, as the only evidence of anything that looks like a payment for
infringement, the Adason settlement is certainly relevant. However, we

                                       54
decline to treat the constructed royalty as a floor. We use it as a factor in
constructing the appropriate royalty.

              2. Factor 7: Patent Duration/License Term

       The duration of the hypothetic license is also relevant to the parties’
bargaining positions. This is the seventh Georgia–Pacific factor. 318 F.
Supp. at 1120. The term of the license is assumed to be the remaining life of
the patent. Plaintiff’s expert, Mr. Malackowski recognized that this factor
operates in the government’s favor:

       Once we determine that it’s going to be a running royalty,
       because it’s such a long period of time, the TSA is going to
       push hard to say that we have to make it very reasonable, . . .
       lower rather than higher. And so I give them the benefit of the
       doubt . . . . [Y]es, I believe the term of the license -- in
       particular, 18 years -- matched to this industry and the
       uncertainty of future innovation would result in a running
       royalty to account for anything like ASLs, and it would teach
       away from a lump sum.

Tr. 1868:11-1869:8.

       We agree that the long remaining life of the patent would push the
negotiation toward a running royalty, and a lower one. TSA would have
opted for a running royalty in the hope of a coming up with an alternative
method in the future, but concern that, if it was unsuccessful, it would end
up paying a royalty for all 17 years remaining on the patent would give it a
strong incentive to agree to only a small royalty.

              3. Factor 8: Profitability, Commercial Success, and Popularity

        The eighth Georgia–Pacific factor is “[t]he established profitability
of the product made under the patent, its commercial success; and its current
popularity.” 318 F. Supp. at 1120. The focus here is on the success of the
patented methodology from the patent holder’s perspective. On the one
hand, there is no question that SecurityPoint developed a successful business
model for turning access to security lanes into advertising revenue. It is also
true, on the other, that it obtained that access by offering, not just a method
to improve efficiency and safety at screening lanes, but free equipment.
From 2008 through 2017, it realized a total of $45.93 million in ad revenue
from more than 40 airports throughout the United States. TSA’s imposition
of a requirement that airport operators sign an MOU indemnifying TSA for

                                      55
possible patent violations, along with its opening up to plaintiff’s competitors
the opportunity to offer the same system, put substantial constraints on
plaintiff’s ability to capitalize on its method.

        Insofar as this factor can be separated from the parties’ relevant
bargaining positions, we agree with the government that this factor is neutral
in calculating a royalty. TSA is not an advertising broker. The success of
plaintiff’s endeavors to date is not tied strictly to the patent’s method.
Further, the hypothetical running royalty is not an effort to calculate profits
lost to plaintiff.31 The fact that plaintiff could have made even more money
with unfettered access to airports is irrelevant to what the parties would have
negotiated for use of the method only, which would not necessarily have
resulted in ad revenues to plaintiff and which required TSA to furnish its own
equipment. We find plaintiff’s business success not directly relevant to the
circumstances assumed in a hypothetical negotiation.

              4. Factors 9 and 10: Advantages of the Invention and the
              Nature, Commercialization, and Benefits of the Claimed
              Invention

       The next two interrelated inquiries consider the benefits provided by
the patent, especially over what was known in the field prior to the invention,
and “the character of the commercial embodiment of it as owned and
produced by the licensor.” Ga.-Pac. Corp., 318 F. Supp. at 1120. These are
the ninth and tenth Georgia Pacific factors, which are often considered in
tandem.

       Plaintiff offers four areas of benefit to the government provided by its
method: 1) enhanced security; 2) passenger time savings; 3) reduced TSO
injuries; and 4) that the patent enabled TSA to employ fewer TSOs. The
common denominator in asserted benefits 1, 2, and 4 is that the patented
method involves less clutter and is more efficient in terms of cart movement
and accelerated passenger throughput, an assertion we accept as proved. This
efficiency also meant less effort expended on moving trays, resulting in
fewer repetitive stress injuries for TSOs.

31
  Taxpayers can only scratch their heads over TSA’s unwillingness to take
up plaintiff’s offer in 2005 to furnish, not only the patented method, but trays
and carts at no cost. Plaintiff could have implemented its model and the
government would not have to pay damages for infringement.

                                      56
       Defendant, on the other hand, asserts that factors 9 and 10, are less
relevant to a § 1498 inquiry because consideration of the alleged benefits of
the patent are disfavored, citing Dow Chemical Co., which held that “[t]he
proper measure [of damages] is what the [patent] owner has lost, not what
the taker has gained. Dow Chem. Co. United States, 226 F.3d 1334, 1348
(Fed. Cir. 2000) (alterations in original). This appears to be based on a
concern that § 1498 actions amount to an uncompensated Fifth Amendment
taking, in which the value of what is taken is relevant, not the benefit to the
government. While we appreciate that as a theoretical constraint, we do not
view Dow as a bar to evaluating the motivations to the government in a
theoretical negotiation, so long as the benefits are not speculative.

        The benefits offered by the invention are thus relevant to the
hypothetical negotiation, but only in so far as they are established
improvements over TSA’s prior modes of managing trays and carts. The
focus here is on TSA’s incentives to pay to be able to use the patent because
of the benefits it obtained. We must therefore apportion the benefits between
those provided by the patent’s method and any that were the result of non-
patented elements or other unrelated events. In the context of an invention
that is a smaller part that is then used in a larger system, as in FastShip, LLC
v. United States, 131 Fed. Cl. 592 (2017), aff’d as modified, 892 F.3d 1298
(Fed. Cir. 2018), “[d]amages are apportioned based on the ‘smallest salable
patent-practicing unit’ within the infringing article, meaning those features
within the scope of the claimed invention.” Id. at 625 (citing LaserDynamics,
Inc. v. Quanta Computer, Inc., 694 F.3d 51, 67 (Fed. Cir. 2012)); see also
Ericsson, Inc. v. D-Link Sys., Inc., 773 F.3d 1201, 1226 (Fed. Cir. 2014)
(“[T]he governing rule is that the ultimate combination of royalty base and
royalty rate must reflect the value attributable to the infringing features of
the product, and no more.”).

       Here, however, we are looking at a method patent which offers a novel
but complete and integrated set of steps. Each step is necessary. The fact
that none of the equipment used was novel should not detract from the
novelty of the method as a whole. We are aware of the need for
apportionment—the same consideration comes up in dealing with factor
13—but we view it as having limited application here, except with respect to
scrutinizing the benefits highlighted by plaintiff.

                     a. Enhanced Security

      There is no question that airport and passenger security is TSA’s
mission. Nor is there any question that the ‘460 patent relates to this mission

                                      57
by increasing efficiency at checkpoints.32 Mr. Hosfield testified that the
patented method “reduce[s] the distractions caused by the need for screening
officers to perform job duties amidst the stress and strain of congested and
disorganized checkpoints.” Tr. 1298:16-19. This sentiment was echoed
publicly by TSA spokesperson Nico Melendez, who said that the ‘460
methods “allows us to do our jobs more effectively and provide more
security.” PX 1125 (Washington Post Article on ads being tested in LAX
airport security trays). This is accomplished primarily, as explained by Mr.
Hosfield, by reducing the time spent by TSOs returning trays to the non-
sterile side of SSCPs. Thus, the TSOs can spend more time on security-
related tasks.

        In addition, Dr. Jacobson testified that improving throughput at
security checkpoints, something discussed in more detail below, reduces
passenger wait times, resulting in shorter queues and smaller crowds on the
non-sterile side of the airport check-in area. He explained that crowding at
checkpoints creates security risks. This was supported by testimony of TSA
Administrator Peter Neffenger at a Senate Committee on Homeland Security
and Governmental Affairs hearing. Mr. Neffenger stated that delays at
airport security screening checkpoints are “unacceptable, primarily because
the convergence of large crowds in public spaces can create a security risk .
. . . TSA has worked diligently to address passenger volume growth, and the
delays . . . at checkpoints.” PX 539 at 24 (Malackowski report) (quoting
“Written testimony of TSA Administrator Peter Neffenger for a Senate
Committee on Homeland Security and Governmental Affairs hearing titled
‘Frustrated Travelers: Rethinking TSA Operations to Improve Passenger
Screening and Address Threats to Aviation’,” U.S. Department of Homeland
Security, June 7, 2016.).

       We are persuaded that the patented method contributed substantially
to improved security. How much, however, is a consideration we reserve
until dealing with defendant’s contention that plaintiff failed to apportion
damages to distinguish improvements tied to the ‘460 patent versus non-
patented features.

32
  The USPTO, in its determination to make special, stated that the ‘460
Patent “directly contributes to the countering of terrorism.” PX 9 at 1 (PTO
Decision on plaintiff’s Petition to Make Special the ‘460 Patent).

                                     58
                    b. Passenger Time Savings

       Several TSA documents state that passenger experience and wait
times are important to TSA. TSA’s staffing model is “designed to calculate
the necessary level of TSOs to ensure security and minimize wait times.” PX
1175 at 5 (GAO Aviation Security: TSA’s Staffing Allocation Model, GAO-
07-299). The CDGs, moreover, state that SSCPs should be optimized to
“increas[e] throughput” and “improv[e] passenger customer service.” E.g.,
PX 1371 at 8 (TSA 2014 CDG).

      Reducing wait times was a priority for TSA, as Mr. Arroyo attested,
having witnessed the disorganized checkpoint lines prior to the ‘460’s
implementation:

      It got so chaotic -- I can speak for Newark personally because
      I witnessed it and experienced it and received many of the
      complaints -- where the queueing lines were so backed up that
      they congested the concession stands, the entire operation. The
      lines were and people with their carry-on items were blocking
      the escalators that ramped up to the point where escalators had
      an emergency stop because people were -- there was no place
      to go, and they were falling on each other. So it was a really
      chaotic situation that we had to address immediately.

Tr. 693:17-694:2.

       Much of plaintiff’s proof of the efficiencies gained by its method
comes from TSA’s description of the success of the test run at LAX. Mr.
Melendez, a TSA spokesperson, attributed, at least in-part, a 90-second
reduction in passenger wait times at LAX during the test period to the ‘460
patent, resulting in a 16% reduction in wait times. PX 1123 (“Ad Pitches
Target Captive Audience,” by Jeff Thomas, Mercury News, January 10,
2007). A September 5, 2006 letter from Lawrence Fetters, FSD at LAX,
concluded that the patented method “helped streamline the screening process
and increase throughput.” PX 754 at 1 (Lawrence Fetters’ letter to Lydia
Kennard, dated September 5, 2006). According to Ronald Shields, former
Program Analyst for TSA, the patented method also helped streamline the
screening process and increase throughput. PX 1209 at 187 (Shields Dep.).

       In order to capture these time savings and express their value in
dollars, plaintiff offered the testimony of Dr. Jacobson. He put together an
elaborate presentation, heavily dependent on the 90-second savings figure
from the LAX test. He melded that with figures obtained from a 2013 report

                                    59
of The National Academies of Science, Engineering, and Medicine, a third-
party, government-supported source, which attempted to calculate the value
to passengers of wait times in different areas at airports. That report
concluded that passengers valued check-in and security time at $32/hour
($37.20/hour for business travelers and $28.45/hour for leisure travelers). PX
1239 at 7 (Passenger Value of Time Vol. 1, Transportation Research Board
of the National Academies of Science, Engineering, and Medicine).
Applying those hourly figures to the 90-second savings touted from the LAX
pilot program results in a calculus of that savings’ value.

        Recognizing that the 90-second figure was from one airport and
reflected heightened savings due to the holiday period, Dr. Jacobson
attempted to come up with comparable figures for other airports at other
times. He proposed a range of $0.10 to $0.50 per passenger. It is
unnecessary to examine his methodology in detail. We agree with defendant
that the exercise creates a false sense of accuracy.

       We have fundamental concerns about the constituent elements of Dr.
Jacobson’s calculus. First, the 90-second figure is drawn from one airport
and represents a brief period of time. Even Dr. Jacobson conceded that,
because the testing was done at the peak 2005 Thanksgiving season, he had
to make an adjustment to the figures, but his 10 to 50 cent per passenger
range appears more like a guess than the product of considered analysis. In
addition, we agree with defendant that a dose of skepticism about TSA’s
reaction is warranted in view of the predictable enthusiasm that would be
associated with receipt of free equipment.

      In fact, Mr. Melendez qualified his statement concerning the “90-
second” reduction:

       The longest checkpoint wait times for last holiday season
       dropped by 90 seconds to seven minutes from a year earlier,
       said spokesman Nico Melendez, though he acknowledged any
       number of variables could have cut the time.

PX 1126 at 1 (News article from TampaBay.com) (emphasis added). The
reference to “any number of variables” probably refers to other efficiencies
employed at SSCPs around that time, including ergonomically correct
equipment and a $15 million dollar remodel of the LAX checkpoints. See
PX 84 at 2 (TSA Information Bulletin) (“The new checkpoint configurations
at LAX have resulted in significantly longer divestiture and re-composure
space for the traveling public. Furthermore, divesting tables are installed to

                                     60
x-ray height . . . These improvements have had a positive impact on reducing
wait times at LAX.”).

       As defendant’s expert, Mr. McGavock, correctly observed, “longer
divestiture and recomposure space and x-ray height tables are not elements
of the SecureTray® System that are covered by the claims of the patent-in-
suit.” DX 1664 ¶ 157 (McGavock Report). Even plaintiff’s expert Mr.
Malackowski acknowledged that the “SecureTray® System” provided to
LAX included custom-fitted, stainless steel “ergonomically designed
divesture and recomposing tables” which improved efficiencies at the
checkpoint. PX 538 at 10; see also PX 159 at 27 (TSA’s 2009 CDG)
(“Implementation of these tables will increase sequencing efficiency through
the checkpoint.”). Mr. Arroyo also conceded that improvements to divesting
tables was expected to increase checkpoint throughput.

       Defendant also points out that some of the lane configurations at LAX
changed during this time to use one scanner for two lanes. This had the effect
of minimizing wasted passenger wait time. Mr. Thaxton memorialized these
efforts in a spring 2006 report. DX 1778 (Trip report from a visit to Los
Angeles in 2006). He testified that the optimization changes “drove down
some of the wait time conditions.”33 Tr. 2123:20.

       In short, the 90-second savings figure, which serves as the backbone
of Jacobson’s monetary calculus, is highly problematic. It does not account
for the non-patented changes at LAX and elsewhere. In addition, we view
the report of The National Academies of Science, Engineering, and Medicine
with respect to how passengers value their time in checkout lanes as
inherently subjective. Further, Dr. Jacobson’s reliance on those numbers
assumes a one-to-one correspondence between how passengers value their
time and how TSA would have valued time savings. While TSA has every
incentive to keep passengers happy, we decline to simply apply these
numbers as if they had objective weight.

       We have no doubt that TSA’s use of the patent triggered an important
consequence—reduced passenger wait times and increased throughput—
which had an associated advantage in improving security. We also believe
that TSA would have been willing to pay to achieve increased security,
efficiency, and happier passengers. We are not, however, persuaded by Dr.

33
  Similar efficiency results were achieved in Dallas (DFW) in 2005 unrelated
to the patent. See DX 1543 at 17 (Tiger Team 2005 Security Checkpoints
Report).

                                     61
Jacobson’s per-passenger time saving model that this phenomenon should be
valued at $0.10 to $0.50 per passenger.

                     c. Reduced TSO Injuries

        Before implementing the claimed methods of the ‘460 patent, the
standard practice of moving bins was hand-carrying and lifting by TSOs. In
2003, TSA had the highest injury and illness rate among federal agencies at
19.4%, while the average injury and illness rate for all federal workers was
5.5%. PX 1218 (AP article, March 3, 2004). That TSA recognized the
correlation between hand-carrying bins and TSO injuries is apparent from
the 2006 Design Guide, which states: “Lifting and carrying of bins by TSOs
is known to be a significant injury risk and should be eliminated if possible.”
PX 1193 at 16. A February 2007 GAO Report on TSA Staffing Models
states that “TSO injuries were a significant drain [on TSA] workforce.” PX
1175 at 56. Mr. Malackowski also opined that lack of standardization added
to injury levels.

      In response to on-the-job injuries, TSA stated that it no longer
endorsed hand-carrying of bins by TSOs:

       Bin carts are similar to a hand cart or dolly to transport a large
       number of bins without requiring excessive lifting or carrying
       by a TSA agent . . . In the past, bin cart transport by TSOs was
       a primary cause of on-the-job injuries. Hand-carrying of bins
       is no longer endorsed by TSA.

PX 1172 at 26 (TSA 2009 CDG). The ‘460 system, by eliminating the hand
carrying of trays, would have had a beneficial impact on reducing TSO
injuries. This is confirmed by a TSA press release, which reported that injury
rates were reduced by 90% following implementation of the ‘460 method
during the pilot program at LAX. PX 84 at 2. A June 12, 2007 TSA e-mail
provided similar support: “Since LAX has optimized the checkpoints
including the transition to using the bin carts, we have reduced our [workers’
compensation claims] by at least 65%.” PX 1191 at 1.

       Mr. Hosfield analyzed data related to fewer TSO injuries in order to
calculate a per-passenger cost savings to TSA. He concluded that TSA
avoided 6,855 lost time events through use of the ‘460 patent from 2008
through 2018. After subtracting Air Marshal injury cases, he also came up
with an average workers’ compensation cost per TSA injury for each year.
Using those numbers, he calculated a per passenger savings attributed to
reduced injuries. He concludes that the cost savings from fewer TSO injuries

                                      62
from the ‘460 method results in another positive economic indicator of
$0.007 per passenger.

       Mr. McGavock, defendant’s expert, conceded Mr. Hosfield’s overall
point, agreeing that injury reduction is a solid economic indicator: “I think
the injury rate statistic is probably the most solid in terms of the difference
between hand carrying and the two-cart method in terms of quantifying [a
royalty].” Tr. 3081:10-13. He went on, however, to criticize Mr. Hosfield’s
numbers. Mr. McGavock testified that, “what I tried to do is apportion using
actual data and empirical data before and after use of the patented method to
apportion down to bin-related injuries, which would be closer to the value
associated with the patented invention.” Tr. 2984:24-2985:3. He determined
that, when the injury reduction value is corrected to specifically analyze bin-
related injuries as opposed to any type of injury at checkpoints, the value
would be reduced from $0.007 per passenger to $0.001:

       I did the same type of math that Mr. Hosfield did to determine
       a but-for lost time cases, subtract actual time cases, to get what
       the implied savings were in terms of reduced injuries. So it’s
       interesting, when you look at just bin-related injuries, there’s a
       58 percent adjustment, but bin injuries are only a small percent
       of total checkpoint injuries, whereas [Hosfield] just applied
       this whole percent to total checkpoint injuries. So that’s a long
       way of saying what I tried to do is apportion using actual data
       and empirical data . . .”

Tr. 2985:15-25 (emphasis added). In other words, Mr. McGavock did a
similar calculus but limited his inputs to those injuries attributed to bins,
which would have been the injuries most likely to have been reduced by the
use of plaintiff’s method. We find that reduced injuries is a relevant factor in
determining a royalty, as both parties acknowledge, although we find
defendant’s argument as to the valuation of that factor more persuasive.

                     d. Reduction in TSO Staffing

       SecurityPoint contends that TSA was able to hire fewer TSOs after it
implemented the ‘460 patent. Mr. Hosfield was the expert responsible for
calculating these savings. He relied on the following inputs: the number of
hours worked annually by TSOs, the average cost per hour to maintain a
TSO, and total passenger throughput. Against these, he applied a percentage
reduction in the number of TSO hours which he attributes to use of the
patented method.

                                      63
        That percentage, of course, is critical. He derives the number from
two reports. The first is the December 2006 TSA Information Bulletin
summarizing the SecurityPoint pilot at LAX: “bin return carts reduce the
frequency of moving bins from the sterile to non-sterile side by 80%.” PX
84 at 2. Secondary support for this number comes from The Safe Skies study,
which showed that there was an 84-90% reduction in tray movements using
the ‘460 patent. See PX 1149 at 14. It also comes from an internal TSA
memorandum which states: “Preliminary results of the pilot indicate
favorable results due to the consistent and unlimited equipment supplies for
each lane. This includes reduction of time for current screener (manual) bin
return . . . [B]in reruns have been reduced drastically.” PX 607 at 2. Mr.
Shields also testified that the use of carts allowed TSOs to move more trays
at a time, and he agreed that it “reduced drastically” tray reruns and led to a
“reduction of time for current screener.” PX 1209 at 60 (Shields Dep.).

       The second critical piece in deriving a percentage savings was drawn
from the 2005 Cambria study, prepared for TSA, which analyzed the benefits
of potentially using an automated conveyor system. As part of that study, it
was determined that a TSO stationed at the recompose area of the checkpoint
(an “exit floater”) spent 34-35% of his time on tray management. PX 1122
at 6. Mr. Hosfield then applied these two percentages—80% fewer TSO
movements and 34% of an exit floater’s time—to come up with a 27.2%
reduction in TSO hours due to use of the patent. He then converted that into
a .41 Full-Time Equivalent (employee) savings per lane, resulting in a total
of 532 to 696 TSOs fewer per year for a total cost savings to TSA of
$510,774,633, which converts to a $0.075 cost savings per passenger.

        We agree that the overall point is well taken. There no doubt were far
fewer trips back and forth for TSOs, and that had value for TSA in terms of
less work pressure and fewer distractions for TSOs and perhaps fewer hires.
What we cannot accept at face value are Mr. Hosfield’s numbers. It assumes
a frictionless conversion of fewer motions into fewer employees. As Mr.
Hosfield conceded, the best evidence of his hypothesis would have been an
actual decline in TSOs employed. In that regard, Mr. Hosfield’s export
report indicates a reduction in TSOs with job titles related to checkpoint
security from 2008 to 2017 but also recognizes that total TSOs employed
increased during the period.34

34
  He also claimed that, regardless of the actual number of persons employed,
TSA reaped the benefit of having more time available to TSOs for security-
related functions as a result of the patented method.
                                      64
       In summary, we view factors 9 and 10 as very important to the
negotiations. Even after discounting for the effect of other changes that
improved efficiency, we are persuaded that the switch from hand carrying
trays to the two-cart system significantly improved the flow of passengers
through checkpoints. That certainly had the effect of making checkpoints
safer by increasing passenger throughput and decluttering. It decreased the
number of injuries to TSOs, and it took pressure off both the individual TSO
in doing his or her job and on the agency in deciding how many officers to
hire and where to place them. We believe TSA was willing to pay for these
benefits.
              5. Factor 11: Extent of Use of Claimed Invention

        The eleventh Georgia–Pacific factor is “[t]he extent to which the
infringer has made use of the invention; and any evidence probative of the
value of that use.” 318 F. Supp. at 1120. While both parties discuss this
factor, we find it adds nothing useful to calculation of a royalty rate here.
The first component, extent of use, is accommodated by our findings on
infringement. This was a contested issue but now it has been resolved.
Applying any appropriate royalty based on use will incorporate this factor.
The second component, value of that use, was addressed in our discussion of
factor 10.

              6. Factor 13: Apportionment Between Patented and
              Unpatented Elements

        As cautioned earlier, in valuing damages, plaintiff must be careful to
seeks only the value provided by the patented elements. Ga.-Pac. Corp., 318
F. Supp. at 1120. To the extent that this consideration is relevant to a
government entity, we believe we have taken it into account in assessing
factors 9 and 10, by limiting benefits to those traceable to the patent.35 There
is value in the screening lane attributable to equipment not unique to the
patent, such as tables and scanners. It is also true that trays were used before
the patented method. Each of those items pre-existed the patented method,
although they are utilized in the patented method. But we do not believe it
to be appropriate to use them to discount the improvements unique to
plaintiff’s patent. The proper comparison is between screening lanes which
do not use the patented method and those which do. Our earlier comparison

35
  We also note that this consideration is most apt in a lost profits case, a
remedy not sought here.

                                      65
isolates the benefit of the patented method by asking what value was added
by the insight of using two carts to cycle trays through a screening lane.36

              7. Factor 14: Expert Opinions

       The thirteenth Georgia–Pacific factor is “[t]he opinion testimony of
qualified experts.” 318 F. Supp. at 1120. As the parties note, this factor is
subsumed in the court’s consideration of other factors. It does not warrant
separate treatment.

              8. Factor 15: Bargaining Position of Parties at Hypothetical
              Negotiation

       Finally, in constructing the hypothetical negotiation scenario, the
court should consider the relative strengths of the parties’ bargaining
positions. “The fifteenth factor sets forth the ‘willing buyer/willing seller’
hypothetical negotiation through which the other fourteen factors are to be
considered.” Proctor & Gamble Corp., 989 F. Supp. at 613.

         Mr. Malackowski concluded that SecurityPoint would have the upper
hand due to the benefits provided to TSA: TSO cost savings, passenger time
savings, and the high cost of employing alternatives to the ‘460 method.
Plaintiff also points to its history with Adason as an example of success in
asserting its intellectual property rights. We agree that these facts generally
support plaintiff’s bargaining position. There is no question that TSA faced
a serious problem, and plaintiff’s invention provided a solution. We know
that it struggled to avoid using the method and failed until at least 2018. And
even then, the government only uses the alternative MPC method at a handful
of airports. Further, the Adason settlement suggests that the method had real
commercial value.

        Nevertheless, TSA was plaintiff’s only customer for its patented
method, as opposed to advertising space. This gave significant leverage, in
our view, to TSA in the hypothetical negotiations. For all practical purposes,
SecurityPoint operated at the sufferance of TSA because TSA has a
monopoly on access to security lanes. In pursuing its business model,
plaintiff could not access advertising revenues unless it could get cooperation
from the government, as became apparent when TSA adopted the MOU

36
  This is in distinction to the exercise we engaged in earlier scrutinizing the
data plaintiff’s experts relied on in calculating time savings per passenger.
That data was clouded by features unrelated to the patented method, such as
improved equipment and use of one scanner for two lanes.
                                      66
directed at obtaining indemnification assurances from airport operators. The
MOU illustrates both that TSA had strong concerns that it was violating the
patent and that it wanted access to the patent, but it also illustrates how fragile
was plaintiff’s ability to exploit its patent.

        The compensation we award does not assume that plaintiff would
benefit from advertising access—compensation has to be measured simply
in terms of what the parties would agree to in giving TSA access to plaintiff’s
patent. Nevertheless, because plaintiff had the most to lose in failed
negotiations, we believe the parties’ unique relationship favors the
government. Although we have to assume the parties wanted to reach a
compromise, we recognize that TSA wanted, but did not absolutely need
plaintiff’s patent; whereas plaintiff only had TSA as a potential customer.

       C. The Royalty Rate

       All of the above considered, we find a reasonable royalty rate of two
cents per passenger to be appropriate. We believe the parties would have
found themselves in something like the following positions in 2005. Plaintiff
owned a very useful method for significantly improving passenger
throughput at security lanes, which TSA recognized would solve a long-
standing efficiency problem and improve security in the process. TSA badly
wanted to use the method, but was unwilling to pay for it, hoping either that
the patent would turn out to be invalid, or could be designed around.

        Plaintiff badly wanted to exploit its patent, but without access to
security lanes, the patent was basically useless. The parties thus had every
incentive to reach an agreement, but one which recognized the length of the
term of the patent. Unlike a commercial license agreement, whereby both
parties hope to profit, TSA would not have been able to recoup any of the
royalty on the backend.37 Although TSA wanted to use the patent and would
have been willing to pay a running royalty, we believe that the specter of
paying a royalty for a very high number of passengers over a very long period
would have made it only willing to consider a running royalty if it were
relatively small.

37
  We do not agree with plaintiff’s position that TSA would have, in essence,
passed the buck to airline passengers viz-a-viz air travel safety fees tacked
on to airfare. There was no evidence introduced nor legal argument made
that these funds were available to TSA outside of the normal appropriation
process controlled by Congress.

                                        67
        Plaintiff’s eight cent figure failed to meaningfully account for the
government’s non-patent contributions and for the relatively long life that
this agreement would have had.38 The Adason agreement provides a starting
point, but it does not represent the minimum that plaintiff would have been
able to insist on. Adason was faced with the threat of bankruptcy if it did not
settle with SecurityPoint. It had no recourse or option other than to pay and
enter into a new arrangement with plaintiff going forward. TSA, on the other
hand, would not have been threatened, other than by a suit for damages, in
the same as was a private party. Further, Adason and SecurityPoint were
competitors in the travel advertising space. They were both interested in
capturing advertising clients. In the hypothetical negotiation, TSA would
have been uninterested in the benefits of advertising. These are reasons to
lower the rate derived from the Adason settlement.

        We begin with the Adason rate but reduce it to two cents per passenger
to account for the differences in the positions of TSA and Adason, TSA’s
non-patent-attributable contributions, the fact of the long duration and large
base involved, and, in addition, in the absence of any better way to measure
it, to account for reduction in the base to account for leakage due to use of
bin islands, crossovers, and PreCheck lanes. We also believe that two cents
per passenger more likely reflects the actual savings to TSA from reduced
injuries and reduced manhours, especially given our finding discounting Dr.
Jacobson’s work quantifying those benefits, and it accounts for the more
intangible benefit to TSA’s primary mission, aviation security. The rate set,
we calculate the base to come up with the license payment before interest.

       D. The Base

        Between January 1, 2008 and April 30, 2020, 7,660,935,659
passengers passed through Cat X and Cat I airports.39 That forms the base
for the royalty, although two deductions are appropriate.

38
  Although Mr. Malackowski contends that in calculating the $0.08 royalty
he gave TSA the benefit of its contributions to the security process, such as
TSA’s TSO training and equipment improvements, we see no apportionment
in his per passenger royalty other than his conclusory statement.
39
  PX 1202. This number will need to be trued up to reflect the actual TSA
passenger throughput as of the date of judgment.

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               1. ASL Lanes

       ASL lanes, or “Automated Screening Lanes,” are lanes in which carts
are not used and trays are automatically returned. There is no question that
they do not employ the ‘460 patent. Atlanta is the only airport with ASLs in
every lane and was the only airport deducted from Mr. Tarakemeh’s and Dr.
Barnett’s airport usage study. Plaintiff deducted passengers who passed
through ASL lanes from its base, leaving a total of 5,937,271,709 passengers
who passed through checkpoints where there were no implied licenses or
ASLs (using its figures for implied licenses).

       The government did not provide its own numbers on ASL throughput.
We thus apply the TSA-generated numbers used by plaintiff in calculating
an ASL deduction to the passenger throughput base, which will also have to
be adjusted to reflect usage after the date of trial and before judgment.

               2. Implied Licenses

        We found that TSA held an implied license to use the ‘460 method at
certain airports but left the issue of the scope of the license for trial.
SecurityPoint Holdings, Inc. v. United States, 147 Fed. Cl. 499, 503-04
(2020). Plaintiff requests reconsideration of our prior ruling. It argues that
an implied license does not exist at all because SecurityPoint’s placement of
its system at airports was done under economic duress because it was forced
to choose between negotiating with TSA or losing the opportunity to
continue installation of SecurityPoint’s equipment at airports. Mr. Ambrefe
testified that, “If I did not sign the document, I would not have been able to
continue installation [of equipment].” Tr. 173:2-3.

       We previously rejected plaintiff’s argument of economic duress,
finding that “Plaintiff offers not a scintilla of evidence that it was in any way
coerced to sell advertising in exchange for providing trays and carts.”
SecurityPoint, 147 Fed. Cl. at 503. A review of the evidence during the
infringement and damages trial does not warrant a different outcome. As we
previously held, “[i]t was plaintiff, in fact, that approached the government,
prior to TSA’s use of the patented method, with an unsolicited proposal to
begin supplying its system and materials to the government in exchange for
the right to place advertising.” Id.

        In the alternative, plaintiff argues that, if an implied license does exist,
the license should only apply to instances in which SecurityPoint received
consideration in the form of advertising revenue. To support its argument,
plaintiff cites Fuji Photo Film Co. v. Int’l Trade Comm’n, 474 F.3d 1281,

                                        69
1294 (Fed. Cir. 2007), which held that, “An accused infringer does not
acquire an implied license unless it has actually paid full compensation.” Mr.
Ambrefe prepared a document that provided the timeframes during which
advertising contracts were in place with SecurityPoint, distinguishing
instances in which SecurityPoint did not receive consideration. He explained
that that there were gaps in the chart during which SecurityPoint continued
to provide its equipment to airports but it did not have advertising contracts
in place. Mr. Malackowski then prepared his calculation:

       The deduction for the implied license . . . should occur at any
       time that SecurityPoint had an agreement with an airport that
       provided them with compensation for use of the invention . . .
       So in order to know when SecurityPoint was actually
       compensated for use of their technology, I requested, through
       counsel, for Mr. Ambrefe to prepare an analysis or a summary
       [PX 1415] of the business records showing each and every
       contract in place for each and every airport.

Tr. 1908:23-1909:9. His 21.2 percent deduction for implied licenses reflects
only those periods and airports in which SecurityPoint had active advertising
contracts.

       In contrast, Mr. McGavock based his implied license deduction of 31
percent on any period during which SecurityPoint had a contract for access
with an airport. Defendant argues that this was appropriate because
SecurityPoint received the benefit of access to TSA checkpoints and the
opportunity to receive revenue, not the revenue itself, by installing its
equipment at checkpoints. This is also consistent with plaintiff’s counsel’s
statement during the claim construction hearing that “TSA has entered into .
. . a memorandum of understanding with about 40 airports where the
SecurityPoint system is in place, and again we’re not claiming infringement
for any of those situations because it’s under an implied license.” ECF No.
48 at 57:6-11.

       We agree with defendant that whether SecurityPoint was able to
commercialize its opportunity has no bearing on the existence of the license.
The proper approach to determine the scope of the implied license is to count
each instance in which SecurityPoint had an agreement with an airport to
provide trays and carts to implement its method, not just periods during
which SecurityPoint had advertising contracts. By deploying its equipment
at TSA screening checkpoints, SecurityPoint gained access, which conferred
the benefit of an opportunity to sell advertising in its trays, regardless of
whether an advertising contract was in place. Compensation therefore should

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be reduced by 31 percent reflecting passenger throughput from 2008 to 2018
at airports affected by the implied license.

       E. Damages Calculation

       If we were to assess the royalty as of the date of this opinion, it would
come to $103,685,510, derived as follows: 1) a royalty base of 7,660,935,659
passengers at Cat X and I airports from January 1, 2008 to April 30, 2020; 2)
less 2,374,890,054 (31%) to account for TSA’s implied license; 3) less
101,770,092 (ASL passenger throughput); and 4) applying the per passenger
royalty of two cents per passenger:

     1) Category X and I
                                Passenger Throughput
     Passenger Throughput                                   7,660,935,659
                               31% Implied License
     2) Implied License                                                   31%
                               Deduction
     Deduction

     Passenger Throughput
     covered by Implied                                        2,374,890,054
     License

     Remaining Passenger
                               Remaining PAX (after
     Throughput After
                               31% deduct)                     5,286,045,605
     Deduction for Implied
     License

                               Passenger throughput
                               related to ASL
                               screening lanes that do
                               not practice the
     3) ASL Passengers
                               patented methods and       101,770,092
                               excludes overlapping
                               passengers already
                               deducted from the
                               implied license
                                Calculated as
                               Passenger Throughput
     Royalty Base              Reduced by: 1)
                                                               5,184,275,513
                               Implied License; and
                               2) ASL Throughput
     4) Royalty Rate            Royalty Rate                            $0.02

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       Royalty Rate
       multiplied by the         Total Damages                   $103,685,510
       Royalty Base

       This calculation, however, is based on a passenger throughput figure
as of April 30, 2020. Plaintiff is correct that this number should be updated
through the date of judgment, including appropriate reductions for implied
licenses and ASL lanes.40 The same is true with respect to the application of
interest, set out below. Accordingly, we leave to the parties the correct total
judgment.

         F. Delay Damages

       The parties agree that delay damages should reflect the 10-year
Treasury rate. We agree that this is a reasonable instrument, given the length
of time of uncompensated infringement. Where the parties disagree is
whether to apply over the entire 16-year period the 4.02% rate prevailing in
September 2005 when the hypothetical negotiation took place, or whether to
apply the rate prevailing when annual royalty payments would have been
made.

       The overarching principle is to make the patent holder whole. Gen.
Motors Corp. v. Devex Corp., 461 U.S. 648, 655-56 (1983). While the “rate
of prejudgment interest and whether it should be compounded or
uncompounded are matters left largely to the discretion of the court,” Boeing
Co. v. United States, 86 Fed. Cl. 303, 322 (2009), plaintiff is correct that
“[g]enerally, the interest rate should be fixed as of the date of infringement,
with interest then being awarded from that date to the date of judgment.” Id.
(citing Nickson Indus., Inc. v. Roi Mfg. Co., 847 F.2d 795, 800 (Fed. Cir.
1988)). And a fixed rate has been applied in recent decisions of this court.
See Davidson v. United States, No. 13-942C, 2018 WL 4087269 (Fed. Cl.
Aug. 27, 2018); FastShip, LLC v. United States, 131 Fed. Cl. 592, 627
(2017).

       It is important to note, however, that in FastShip, a single award was
made; the case did not involve a running royalty. While Boeing Co. involved
damages based on periodic royalty payments, our reading of the case
suggests that the court did not rely on a single fixed interest rate. 86 Fed. Cl.
at 322-25. In Davidson, while the court did apply a single rate over multiple
payments, the court noted that the periodic payments would have been
heavily weighted to the front.

40
     Damages beyond the date of judgment are not available in this litigation.
                                       72
        We agree with defendant that the appropriate approach here is to
assess interest at the ten-year rate as it fluctuated annually over the seventeen-
year period, on an annually compound basis. We believe this best captures
the intent of the Court in General Motors:

              An award of interest from the time that the royalty
       payments would have been received merely serves to make the
       patent owner whole, since his damages consist not only of the
       value of the royalty payments but also of the forgone use of the
       money between the time of infringement and the date of the
       judgment.

General Motors Corp., 461 U.S. at 655–56. Plaintiff was not deprived of the
entire amount of principal compensation from January 2008. Rather, it
would have received royalty payments on an annual basis. As defendant
correctly argues, ignoring this fact makes damages look more like a lump
sum approach was taken and would result in overcompensation in light of
the fact that interest rates have declined over the intervening 13 years.
Accord Brunswick Corp. v. United States, 36 Fed. Cl. 204, 218–219 (1996)
(The purpose of delay compensation is to “place [plaintiff] in the economic
position it would have held had royalties been timely paid and prudently
invested to produce return and preserve the principal.”).

                                CONCLUSION

        For the reasons set out above, we conclude that plaintiff has
established comprehensive infringement of its patent at all Cat X and Cat I
airports beginning in January 2008 and running through the date of entry of
judgment, with the exceptions set out. Plaintiff has established entitlement
to a running royalty based on $0.02 per passenger. Delay damages are fixed
as set out herein. The precise quantum of damages, including interest, is left
to the parties’ calculation.

       Pending motions ECF No. 554 and 555 are dealt with in the opinion:
we grant plaintiff’s motion to strike (ECF No. 554) portions of Mr.
McGavock’s supplemental expert report (DX 1814), and deny plaintiff’s
motion for judicial notice (ECF No. 555) as both moot and not warranted.
Other pending motions are denied as moot: ECF No. 524, 525, 540-546, 551,
and 553.

       The parties are directed to consult regarding damages through the date
of judgment as directed in this opinion, including the quantum of interest,

                                       73
and file a joint status report on or before October 1, 2021, informing the court
of an agreed-upon amount or their respective positions as to that figure.
Entry of judgment will be deferred until that status report.

                                           s/ Eric G. Bruggink
                                           ERIC G. BRUGGINK
                                           Senior Judge

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