How a Lawyer’s Offhand Attempt at Humor at Trial May Have a $60M Pricetag

On April 8, a federal jury awarded Commil USA LLC of The Woodlands, Texas $63.8M for infringing on U.S. patent 6,430,395.

Issued in 2002, the patent covers a way of maintaining network connections through a series of base stations so a person with a laptop computer, mobile phone or device with a wireless-transmission feature such as Bluetooth doesn’t lose the signal while walking through a building.

A general object of the invention is to provide a technique for allowing mobile units (devices) such as standard cordless telephone handsets and PDA (Personal Digital Assistant), laptop or notebook computers or similar devices that support wireless communication (such as Bluetooth wireless technology) to seamlessly connect to a Wireless Private Branch Exchange (WPBX), or to a standard (wired) PBX or to a LAN or to a cellular telephone network or to a standard wired telephone network, thereby avoiding the use of special (typically expensive) handsets or attachments or software or hardware agents , with the abovementioned mobile devices.

The case is Commil USA LLC v. Cisco Systems Inc., 07cv341, U.S. District Court for the Eastern District of Texas (Marshall). Cisco vows to appeal.

There is an interesting (and expensive) twist to this case.  This verdict came in the 2nd trial, and the damages awarded were over $60M greater than those awarded in the first trial. A Cisco attorney made inappropriate remarks to the jury (of a religious nature) and that forced the retrial.

What happened is best explained in the text analysis as the court explains their reasons for granting a new trial.

Commil bases its motion for new trial on, among other things, inappropriate comments made by Cisco’s counsel during trial. Jonathan David, one of the owners of Commil and its client representative, is Jewish. While cross-examining Mr. David, Cisco’s counsel inquired whether Mr. David had met with Nitzan Arazi, one of the inventors on the ’395 Patent, while in Marshall, Texas for the trial. Mr. David responded affirmatively, explaining that they had had dinner at a barbeque restaurant, to which Cisco’s counsel inexplicably responded: “I bet not pork.” Trial Transcript, May 12, 2010 (morning session), at 146:23. When the court asked Cisco’s counsel to explain the relevance of his comment, Cisco’s counsel admitted that it had no relevance to any issue in the case. Id. at 158:2-6. Thereafter, Cisco’s counsel apologized to the witness, and the court gave a curative instruction.

Though Commil representatives feel the second award more clearly reflects the true value of ‘395, analysts can find little comfort in the $3.7M - $63.8M range created by the two trials. More direct is the price of an ill-thought attempt at humor.