Canon Seeks Treble Damages

Color Imaging Inc. and Plastic Industrial Co., Ltd. have been found to have “willfully” infringed a Canon patent. Canon is now requesting the court to “enhance the damages award” fearing the defendants “could flood the market and target Canon’s customers with cheaper, generic versions.”

Back in June, it took a jury only a few hours to find the defendants guilty of willful infringement of Canons Patent No. 7,647,012. Canon was awarded the full measure of damages; however, courts have discretion to increase the damages up to three times the amount found or assessed by a jury in cases of willful of bad-faith infringement.

So Canon is now requesting the US District Court for the Northern District of Georgia (Atlanta) to enhance the damages award by up to three times and has set up an accompanying memorandum that outlines several factors that favor Canon being granted the full extent of enhanced damages allowed under the law.

According to Canon the infringer deliberately copied its design. Canon says it invested substantial resources into developing its toner and the defendant simply copied it. The defendant’s own witnesses testified to ‘reverse engineering’ the toner bottles which were indistinguishable from Canon’s design. Canon added, the infringers’ motivation was to undercut Canon by flooding the market with cheaper, generic versions of Canons toner bottles.

The size of the infringing companies also alludes to enhancement as both Plastic Industrial and Color Imaging are worldwide trading companies and leading manufacturers in their industries that employ many people and turnover a large profit.

Canon also says the lack of investigation by the defendants into any possible patent infringement also favors damages enhancement. After being informed of the infringement, neither defendant investigated the patent or presented any evidence of infringement analysis. Furthermore, the defendants both admitted they became aware of the ‘012 patent and the infringement in January 2010, within a few days of the patent being issued, but didn’t stop selling the toner bottles for years.  Canon’s case was helped by their failure to take any remedial action after learning of the patent and infringement.

The defendant’s litigation behavior included new defenses raised in an untimely manner, shifting theories in an attempt to blindside canon and multiple misleading statements which all weigh in favor of enhancement. Defendants also attempted to conceal the infringement from canon and its own customers. They encouraged other companies to conceal their sales and threatened ‘sever consequences’ if it did not sell its toner bottles. In at least one case, the defendants encouraged customers to conceal the sales “without any high-profile advertising.”