  United States Court of Appeals
     for the Federal Circuit
                ______________________

   ENPLAS DISPLAY DEVICE CORPORATION,
              Plaintiff-Appellant

    ENPLAS TECH SOLUTIONS, INC., ENPLAS
               (U.S.A.), INC.,
                  Plaintiffs

                           v.

   SEOUL SEMICONDUCTOR COMPANY, LTD.,
              Defendant-Appellee
            ______________________

                      2016-2599
                ______________________

   Appeal from the United States District Court for the
Northern District of California in No. 3:13-cv-05038-NC,
Magistrate Judge Nathanael M. Cousins.
                ______________________

              Decided: November 19, 2018
                ______________________

    JOHN C. ROZENDAAL, Sterne Kessler Goldstein & Fox,
PLLC, Washington, DC, argued for plaintiff-appellant.
Also represented by MICHAEL E. JOFFRE.

    LAWRENCE J. GOTTS, Latham & Watkins LLP, Wash-
ington, DC, argued for defendant-appellee. Also repre-
sented by GABRIEL BELL; CHARLES SANDERS, Boston, MA;
RYAN OWENS, Costa Mesa, CA.
2 ENPLAS DISPLAY DEVICE CORP. v. SEOUL SEMICONDUCTOR CO.



                  ______________________

    Before NEWMAN, HUGHES, and STOLL, Circuit Judges.
      Opinion for the court filed by Circuit Judge STOLL.
    Opinion concurring in part, dissenting in part filed by
                Circuit Judge NEWMAN.
STOLL, Circuit Judge.
     Enplas Display Device Corporation appeals the dis-
trict court’s summary judgment that claim 20 of Seoul
Semiconductor Company, Ltd.’s (“SSC”) U.S. Patent
No. 6,007,209 is not anticipated. Following a jury trial on
the remaining infringement and invalidity issues, Enplas
also appeals the district court’s denial of judgment as a
matter of law (“JMOL”) that SSC’s U.S. Patent
No. 6,473,554 is anticipated; denial of JMOL of no in-
duced infringement; and denial of JMOL that the jury’s
damages award is excessive and not supported by the
trial evidence.
     For the reasons below, we affirm the district court’s
judgment that claim 20 of the ’209 patent and the assert-
ed ’554 patent claims are not anticipated. Although a
close question, we also affirm the district court’s denial of
JMOL of no inducement. We hold, however, that the
district court erred when it denied JMOL that the damag-
es award was not supported by substantial evidence. We
therefore vacate the jury’s damages award, and remand
for further proceedings.
                        BACKGROUND
    The asserted ’209 and ’554 patents are directed to
methods of backlighting display panels, particularly LED
displays used in televisions, laptop computers, and other
electronics. In such displays, the ’209 patent teaches,
“uniform illumination is difficult to achieve, and prior art
devices frequently fail[ed] to provide a sufficiently uni-
ENPLAS DISPLAY DEVICE CORP.   v. SEOUL SEMICONDUCTOR CO. 3



form source of illumination for LCD displays.” ’209 pa-
tent col. 1 ll. 36–38. The invention claimed in the
’209 patent purports to solve this problem by providing a
light source that uniformly backlights the rear surface of
the display panel. Id. at col. 1 ll. 45–48. The light source
includes “a housing having a cavity formed by diffusely
reflective bottom and side interior surfaces.” Id. at col. 1
ll. 46–48. “Illumination is provided by [LEDs] that are
shielded by shielding elements.” Id. at col. 1 ll. 50–51.
The LEDs and shielding elements are “positioned such
that the emitted light is substantially uniformly distrib-
uted throughout the cavity, thereby eliminating bright
spots (i.e., ‘hot spots’) in the display panel.” Id. at col. 1
ll. 52–55.
        Claim 20 of the ’209 patent recites:
       20. A method of backlighting a display panel,
    comprising:
        producing illumination from a substantially
    lambertian light source comprising a cavity with
    internal side walls, an internal bottom wall, and
    an aperture, said step of producing illumination
    comprising the step of directing light rays emitted
    by plural light sources mounted on said internal
    bottom wall and around the perimeter of the aper-
    ture into the cavity such that the light exiting the
    aperture is substantially uniform in intensity and
    color;
        using a diffuser to diffuse light from said sub-
    stantially lambertian light source;
        using a brightness enhancing film to concen-
    trate the diffused light into a predetermined an-
    gular range without significantly reducing the
    uniformity of the diffused light; and
        directing the concentrated, diffused light onto
    said display panel.
4 ENPLAS DISPLAY DEVICE CORP. v. SEOUL SEMICONDUCTOR CO.



Id. at col. 9 l. 18–col. 10 l. 8 (emphasis added).
     The ’554 patent, however, purports to solve the illu-
mination uniformity problem in a different way. The
patent discloses a lighting apparatus using a “waveguide
coupled to a light source for injecting light into the wave-
guide.” ’554 patent, Abstract. Embedded within the
waveguide is “an illumination coupler.” Id. at col. 3
ll. 18–20. The illumination coupler “comprises a refrac-
tive index interface configured to capture light rays
propagating along a line that forms less than the critical
angle of total internal reflection with respect to at least
one of the top and bottom surfaces, such that the captured
light rays are injected therebetween for propagation
outside of the interior region.” Id. at col. 3 ll. 23–29. The
illumination coupling element has two curved surfaces in
its top surface that form the total internal reflection
(“TIR”) region above the LED and a bottom surface above
the LED. Id. at col. 16 ll. 14–24. The bottom surface
works with the TIR region to distribute light within the
waveguide. Id. at col. 16 ll. 27–48.
     Through TIR, the ’554 patent solves the bright spot
problem by preventing light from shining directly from
the light source through the display. The curved portions
of the TIR region, however, also create a “dark spot” by
completely redirecting light above the LED. Id. at col. 14
ll. 58–61. To counter this problem, the ’554 patent dis-
closes a rounded bottom TIR surface that is configured to
allow a small amount of light to “leak” through its top
surface to ensure uniformity in the display. Id. at col. 14
l. 61–col. 15 l. 3. This is known as “leaky TIR.” Id.
at col. 15 ll. 1–3.
    Claims 1, 6, 30, and 33–35 of the ’554 patent are re-
produced below:
        1. An illumination device, comprising:
ENPLAS DISPLAY DEVICE CORP.   v. SEOUL SEMICONDUCTOR CO. 5



       a waveguide having an illumination coupler
   embedded in an interior region of said waveguide,
   said illumination coupler adapted to receive light
   from a point source within said interior region,
   and to direct light between generally parallel top
   and bottom surfaces outside said interior region,
   said illumination coupler comprising a refractive
   index interface which is inclined relative to at
   least one of said top and bottom surfaces said in-
   terface being configured to reflect light rays emit-
   ted by the point source which propagate along a
   line that forms less than the critical angle of total
   internal reflection with respect to a line lying in
   one of said top and bottom surfaces, such that
   light rays which would otherwise pass out of said
   waveguide are captured for propagation between
   said top and bottom surfaces.
       ....
       6. The illumination device of claim 1, wherein
   the waveguide and illumination coupler are inte-
   grally formed from a single piece of material.
       ....
       30. An optical apparatus, comprising:
       a light emitting diode (LED);
       an optical element having top and bottom op-
   posing sides and an edge extending between the
   top and bottom opposing sides, said LED mounted
   at a predetermined location beneath a central por-
   tion of said optical element such that light from
   the LED enters the optical element, said optical
   element including a TIR surface spaced from said
   bottom side and extending from a point above the
   LED outwardly towards said edges, said TIR sur-
   face positioned to receive light emitted by the
   LED, said TIR surface curving towards the LED
6 ENPLAS DISPLAY DEVICE CORP. v. SEOUL SEMICONDUCTOR CO.



    so as to form a cusp above the LED, the curving
    TIR surface totally internally reflecting light rays
    such that reflected light rays propagate from the
    TIR surface towards the edge of the optical ele-
    ment.
        ....
        33. The optical apparatus of claim 30, wherein
    said TIR surface is leaky such that some light
    emitted by the LED is transmitted therethrough.
        34. The optical apparatus of claim 33, wherein
    said cusp is contoured to permit leakage of light
    through said TIR surface.
        35. The optical apparatus of claim 34, wherein
    said cusp is rounded to permit leakage of light
    through said TIR surface.
Id. at col. 19 ll. 2–17, col. 19 ll. 31–33, col. 21 ll. 8–23,
col. 21 ll. 28–36 (emphases added).
    Enplas is a Japanese manufacturer of plastic lenses
used in “light bars,” which are used for backlighting
displays in flat-screen televisions. SSC is a Korean
company that manufactures and sells LEDs, which are
also used in light bars for backlighting flat-screen televi-
sions, as well as automotive, smartphone, and lighting
applications. From November 2010 to June 2011, SSC
and Enplas collaborated to manufacture lenses for SSC’s
light bars, which are covered by SSC’s ’209 and ’554
patents. SSC presented testimony that, during this joint
development period, SSC employees informed Enplas that
the end product, including SSC’s LEDs and Enplas’s
lenses, would be covered by SSC’s patents. SSC also
presented testimony that it had understood that it would
have an exclusive relationship with Enplas for sales of the
lenses.
ENPLAS DISPLAY DEVICE CORP.   v. SEOUL SEMICONDUCTOR CO. 7



    In 2012, however, SSC suspected that Enplas had
provided the lenses to SSC’s competitors who sold light
bar products in the United States. SSC believed that
those products infringed the ’209 and ’554 patents. To
confirm its suspicion, SSC purchased several televisions
from various retailers in the United States and took them
apart for analysis. In particular, SSC purchased a Sam-
sung Display LCD television, which used a lens supplied
to Lumens Co., Ltd., and an LG Electronics LED televi-
sion, which used lenses supplied to LG Innotek. SSC
analyzed the televisions and determined that they con-
tained infringing light bars with Enplas’s lenses. As a
result, SSC sent Enplas a letter alleging that Enplas was
inducing and contributing to the infringement of the ’209
and ’554 patents in the United States.
    In response, Enplas filed the present declaratory
judgment action against SSC, seeking a declaration that
the ’209 and ’554 patents were invalid and not infringed.
SSC counterclaimed, asserting infringement and seeking
damages. SSC alleged that Enplas induced its direct and
indirect customers to import, use, sell or offer for sale
products infringing SSC’s patents.
    Before trial, Enplas moved for summary judgment
that claim 20 of the ’209 patent is anticipated by U.S.
Patent No. 5,684,354 to Gleckman (“Gleckman”). The
district court denied Enplas’s motion but converted SSC’s
opposition into a cross-motion for summary judgment.
The district court granted SSC’s cross-motion, concluding
that no reasonable juror could find that Gleckman antici-
pates claim 20 of the ’209 patent.
    The case proceeded to a jury trial on anticipation of
the asserted claims of the ’554 patent, induced infringe-
ment of the ’209 and ’554 patents, willfulness, and dam-
ages. The jury found that Enplas induced infringement of
the ’209 and ’554 patents and that none of the asserted
claims of the ’554 patent were anticipated by U.S. Patent
8 ENPLAS DISPLAY DEVICE CORP. v. SEOUL SEMICONDUCTOR CO.



No. 3,774,021 to Johnson (“Johnson”) or Japanese Patent
Application Publication No. S63-127161 (“JP-161”).
Based on SSC’s damages expert testimony, the jury
awarded $4 million in damages for a one-time freedom-to-
operate payment for the ’554 patent and $70,000 for the
’209 patent. The jury verdict form specifically indicated
that the one-time freedom to operate payment was for “all
[Enplas] products,” including lenses that had not been
accused of infringement. J.A. 119, 121. The district court
denied Enplas’s pre-trial motions to exclude SSC’s dam-
ages expert evidence on the basis that it improperly
considered products not alleged or shown to infringe the
’554 and ’209 patents. The district court also denied
Enplas’s post-trial motions for JMOL of anticipation of
the ’554 patent, no inducement, and excessive damages.
   Enplas appeals the district court’s summary judgment
and denial of its post-trial motions. We have jurisdiction
pursuant to 28 U.S.C. § 1295(a)(1).
                       DISCUSSION
                            I.
                      ANTICIPATION
     Enplas appeals the district court’s summary judgment
that claim 20 of the ’209 patent is not anticipated by
Gleckman and the district court’s denial of JMOL that the
’554 patent is anticipated by Johnson and JP-161. We
affirm both judgments.
                           A.
    First, Enplas asserts that the district court erred by
granting summary judgment that claim 20 of the ’209
patent is not anticipated by Gleckman. We review the
district court’s grant of summary judgment under region-
al circuit law. MAG Aerospace Indus., Inc. v. B/E Aero-
space, Inc., 816 F.3d 1374, 1376 (Fed. Cir. 2016). The
Ninth Circuit reviews a grant of summary judgment de
ENPLAS DISPLAY DEVICE CORP.   v. SEOUL SEMICONDUCTOR CO. 9



novo. Id. (citing Greater Yellowstone Coal. v. Lewis,
628 F.3d 1143, 1148 (9th Cir. 2010)). Summary judgment
is appropriate “if the movant shows that there is no
genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law.” Fed. R. Civ. P.
56(a).
    Gleckman discloses a method of backlighting a display
panel comprising LEDs disposed around the periphery of
a cavity having reflective walls and an aperture. The
question before us is whether Gleckman discloses the
“emitted by plural light sources mounted on said internal
bottom wall” limitation of claim 20. Although Gleckman
does not disclose mounting light sources on the bottom
wall as required by the claim, Enplas nonetheless argues
that a genuine issue of material fact exists regarding
whether Gleckman teaches light sources mounted on the
bottom wall. This is so, according to Enplas, because the
inventor of the ’209 patent, Dr. Pelka, testified that
Gleckman “doesn’t exclude the mounting on the perimeter
being on the bottom wall as long as it’s on the perime-
ter.” J.A. 3413 at 59:12–14. We disagree.
    At most, Dr. Pelka’s testimony suggests that Gleck-
man could have been modified to include light sources on
the bottom wall. This is not enough, however, for antici-
pation. Anticipation requires that a single reference
disclose each and every element of the claimed inven-
tion. In re Smith Int’l, Inc., 871 F.3d 1375, 1381 (Fed. Cir.
2017) (“A patent claim is anticipated ‘only if each and
every element is found within a single prior art reference,
arranged as claimed.’” (quoting Summit 6, LLC v. Sam-
sung Elecs. Co., 802 F.3d 1283, 1294 (Fed. Cir.
2015))). Prior art that must be modified to meet the
disputed claim limitation does not anticipate the claim.
See, e.g., In re Chudik, 851 F.3d 1365, 1374 (Fed. Cir.
2017) (“Prior art that ‘must be distorted from its obvious
design’ does not anticipate a new invention.” (quoting In
re Wells, 53 F.2d 537, 539 (CCPA 1931))). We therefore
10 ENPLAS DISPLAY DEVICE CORP. v. SEOUL SEMICONDUCTOR CO.



affirm the district court’s summary judgment of no antici-
pation of claim 20 of the ’209 patent.
                             B.
     Second, Enplas asserts that the district court erred by
denying JMOL that Johnson anticipates the asserted
claims of the ’554 patent. We review the district court’s
denial of JMOL de novo under the law of the Ninth Cir-
cuit. ActiveVideo Networks, Inc. v. Verizon Commc'ns,
Inc., 694 F.3d 1312, 1319 (Fed. Cir. 2012); Hangarter v.
Provident Life & Accident Ins. Co., 373 F.3d 998, 1005
(9th Cir. 2004). A motion for JMOL is properly granted
“if the evidence, construed in the light most favorable to
the nonmoving party, permits only one reasonable conclu-
sion, and that conclusion is contrary to the jury’s verdict.”
Escriba v. Foster Poultry Farms, Inc., 743 F.3d 1236, 1242
(9th Cir. 2014) (quoting Pavao v. Pagay, 307 F.3d 915, 918
(9th Cir. 2002)). Whether a claim is anticipated is a
question of fact. MPHJ Tech. Invs., LLC v. Ricoh Ams.
Corp., 847 F.3d 1363, 1378 (Fed. Cir. 2017). As a factual
question, the “jury’s verdict must be upheld if it is sup-
ported by substantial evidence that is adequate to support
the jury’s findings, even if contrary findings are also
possible.” Escriba, 743 F.3d at 1242 (citation omitted).
    Johnson generally discloses an LED module that cou-
ples light into a planar light guide, e.g., a telephone
faceplate, such that discrete remote regions of the face-
plate can be illuminated. The issues at trial included
whether Johnson discloses (1) the “illumination coupler”
required by claims 1 and 6; (2) an “LED mounted at a
predetermined location beneath a central portion of said
optical element” required by claims 30 and 33–35; and (3)
a “TIR surface” that is leaky such that some light emitted
by the LED is transmitted through, as required by claims
33–35.
    The jury heard testimony from SSC’s expert,
Dr. Moore, who explained that the illumination coupler of
ENPLAS DISPLAY DEVICE CORP.   v. SEOUL SEMICONDUCTOR CO. 11



claim 1 of the ’554 patent comprises a top and bottom
surface that work in conjunction to direct light from the
LED. Dr. Moore explained that the illumination coupler
is physically separated from the LED and that this was
distinguished from Johnson, which discloses a fully en-
capsulated LED, not an illumination coupler. Dr. Moore
testified that because the LEDs in Johnson are encapsu-
lated, there is no bottom surface of an illumination cou-
pler as required by the ’554 patent. Dr. Moore also
testified that the LED in Johnson is positioned in the
middle of the optical element, not beneath the central
portion of the optical element as required by claims 30
and 33–35. Further, Dr. Moore testified that the system
disclosed in Johnson was designed to distribute light left
and right and that there was no reason in Johnson to
allow light to escape from the top surface.         Thus,
Dr. Moore opined that Johnson does not disclose the
“leaky TIR” limitation as required by claims 33–35.
    Although Enplas presented conflicting expert testi-
mony, “when there is conflicting testimony at trial, and
the evidence overall does not make only one finding on the
point reasonable, the jury is permitted to make credibility
determinations and believe the witness it considers more
trustworthy.” MobileMedia Ideas LLC v. Apple Inc.,
780 F.3d 1159, 1168 (Fed. Cir. 2015). We must presume
that the jury credited the testimony of Dr. Moore in
finding that Johnson does not anticipate the ’554 patent.
Because the jury’s finding is supported by Dr. Moore’s
testimony, as well as the Johnson reference itself, we
agree with the district court that the jury’s verdict that
Johnson fails to anticipate the ’554 patent is supported by
substantial evidence.
    Finally, Enplas argues that the district court erred by
denying JMOL that the asserted claims of the ’554 patent
are anticipated by JP-161. JP-161 discloses a device that
“relates to a light source that distributes the light from a
light-emitting diode over [a] large-area surface emitting
12 ENPLAS DISPLAY DEVICE CORP. v. SEOUL SEMICONDUCTOR CO.



light.” J.A. 22516. The device “provide[s] a distributing
type surface light source using a light-emitting diode . . .
wherein the emitted light from [the] light-emitting diodes
is efficiently and uniformly distributed to a light-emitting
surface and a large area luminescent device using a small
number of light-emitting diodes.” J.A. 22517. The device
also comprises reflective back and side surfaces that cover
the translucent main surface of the display. At trial,
Enplas asserted that JP-161 discloses the “illumination
coupler” and capturing of light rays “for propagation
between said top and bottom surfaces” required in claim 1
of the ’554 patent. J.A. 15893–94.
    SSC, however, also presented competing testimony
from Dr. Moore. Dr. Moore explained that JP-161 does
not disclose the illumination coupler because there is no
“refracting surface at the bottom which allows the light to
be refracted at that surface.” J.A. 16056 at 1238:11–14.
He further testified that the claimed illumination coupler
is physically separated with an air gap to cause refraction
into the illumination coupler and that JP-161 is “missing
the air gap in the refracting surface.” Id. at 1238:15–21.
Dr. Moore also testified that the interface in JP-161 does
not show “capturing” by total internal reflection, but
rather shows “Fresnel refraction,” which allows light to
pass out of the waveguide on its second reflection rather
than being totally internally reflected. J.A. 16057–58
at 1239:3–1240:11. Here again, we must presume the
jury credited Dr. Moore in finding that JP-161 does not
anticipate the asserted claims of the ’554 patent. Because
the jury’s verdict is supported by Dr. Moore’s testimony,
we agree with the district court that the verdict is sup-
ported by substantial evidence and affirm its denial of
JMOL of no anticipation.
ENPLAS DISPLAY DEVICE CORP.   v. SEOUL SEMICONDUCTOR CO. 13



                              II.
                 INDUCED INFRINGEMENT
    Enplas argues the district court erred by denying
JMOL of no induced infringement because the trial evi-
dence did not support a finding that it had specific intent
to induce infringement in the United States. We review
the district court’s denial of JMOL de novo under the law
of the Ninth Circuit. ActiveVideo, 694 F.3d at 1319;
Hangarter, 373 F.3d at 1005. Questions of knowledge and
intent are factual questions for the jury. Ericsson, Inc. v.
D-Link Sys., Inc., 773 F.3d 1201, 1222 (Fed. Cir. 2014); see
Warsaw Orthopedic, Inc. v. NuVasive, Inc., 824 F.3d 1344,
1348 (Fed. Cir. 2016). On appeal, therefore, the sole
question is whether substantial evidence supported the
verdict. Substantial evidence is “such relevant evidence
as a reasonable mind might accept as adequate to support
a conclusion.” Consol. Edison Co. of N.Y. v. NLRB,
305 U.S. 197, 229 (1938).
    “Whoever actively induces infringement of a patent
shall be liable as an infringer.” 35 U.S.C. § 271(b). “In
order to succeed on a claim of inducement, the patentee
must show, first that there has been direct infringement,
and second that the alleged infringer knowingly induced
infringement and possessed specific intent to encourage
another’s infringement.” Minn. Mining & Mfg. Co. v.
Chemque, Inc., 303 F.3d 1294, 1304–05 (Fed. Cir. 2002)
(internal citations omitted). Mere knowledge of infringe-
ment is insufficient. Liability for inducement “can only
attach if the defendant knew of the patent and knew as
well that ‘the induced acts constitute patent infringe-
ment.’” Commil USA, LLC v. Cisco Sys., Inc., 135 S. Ct.
1920, 1926 (2015) (quoting Global-Tech Appliances, Inc. v.
SEB S.A., 563 U.S. 754, 766 (2011)); see also DSU Med.
Corp. v. JMS Co., 471 F.3d 1293, 1305 (Fed. Cir. 2006).
“Although the text of § 271(b) makes no mention of intent,
we infer that at least some intent is required.” Global-
14 ENPLAS DISPLAY DEVICE CORP. v. SEOUL SEMICONDUCTOR CO.



Tech, 563 U.S. at 760. Thus, “specific intent and action to
induce infringement must be proven.” DSU Med. Corp.,
471 F.3d at 1305 (quoting Warner-Lambert Co. v. Apotex
Corp., 316 F.3d 1348, 1364 (Fed. Cir. 2003)). Unlike
direct infringement under 35 U.S.C. § 271(a), which must
occur in the United States, liability for induced infringe-
ment under § 271(b) can be imposed based on extraterri-
torial acts, provided that the patentee proves the
defendant possessed the requisite knowledge and specific
intent to induce direct infringement in the United States.
See Merial Ltd. v. Cipla Ltd., 681 F.3d 1283, 1302–03
(Fed. Cir. 2012).
    Although we recognize that this is a close case, we
conclude that the trial record demonstrates that the jury
received substantial evidence whereby both Enplas’s
knowledge and intent to induce infringement could be
reasonably found. At trial, Enplas did not dispute that it
knew of the ’209 and ’554 patents. Enplas also did not
dispute that it was informed that the product it manufac-
tured, co-developed, and sold to SSC was covered by SSC’s
patents. Nor did Enplas dispute that it had a 50% world-
wide market share and that Enplas’s customers sold
televisions in the United States among other countries.
     The jury also received evidence of Enplas and SSC’s
prior business relationship, including that Enplas had
initially manufactured the lenses specifically for SSC’s
light bars, but then sold them to others. SSC also pre-
sented testimony that, during the joint development
project, SSC employees informed Enplas that the end
product, including SSC’s LEDs and Enplas’s lenses, was
covered by SSC’s patents. The jury heard testimony that
SSC purchased several televisions from various retailers
in the United States and determined that they contained
infringing light bars with Enplas’s lenses. SSC presented
evidence showing that SSC had sent Enplas a pre-suit
letter, informing it that SSC had found infringing lenses
in televisions sold in the United States and including part
ENPLAS DISPLAY DEVICE CORP.   v. SEOUL SEMICONDUCTOR CO. 15



numbers of the light bars having Enplas’s lenses. The
jury also heard evidence that SSC discussed the letter
and its infringement position with Enplas.
     SSC also presented evidence that Enplas knew of its
50% worldwide market share, supporting an inference
that Enplas knew of the likelihood that its lenses would
end up in the United States. In addition, SSC presented
evidence that Enplas provided its customers with product
specifications that recommended infringing configurations
for its accused lenses. As we have recognized, “[p]roviding
instructions to use a product in an infringing manner is
evidence of the required mental state for inducing in-
fringement.” Microsoft Corp. v. DataTern, Inc., 755 F.3d
899, 905 (Fed. Cir. 2014).
     Enplas argues that this evidence does not establish
that it knew its lenses would be incorporated in U.S.
televisions and that in any event mere knowledge is not
enough to establish specific intent. We agree that mere
knowledge of possible infringement is not enough. See
DSU Med. Corp., 471 F.3d at 1305. We conclude, howev-
er, that the evidence in this case, while not overwhelming,
provides at least circumstantial evidence that would allow
a jury to reasonably find that Enplas had knowledge of
the patents and of its customers’ infringing activity and
that it intended to induce their infringement. See Water
Techs. Corp. v. Calco, Ltd., 850 F.2d 660, 668 (Fed. Cir.
1988) (“While proof of intent is necessary, direct evidence
is not required; rather, circumstantial evidence may
suffice.”); see also Lucent Techs., Inc. v. Gateway, Inc.,
580 F.3d 1301, 1322 (Fed. Cir. 2009) (“A plaintiff may . . .
prove the intent element [of induced infringement]
through circumstantial evidence, just as with direct
infringement. . . .”). Accordingly, we affirm the district
court’s denial of JMOL.
16 ENPLAS DISPLAY DEVICE CORP. v. SEOUL SEMICONDUCTOR CO.



                           III.
                        DAMAGES
     Finally, Enplas challenges the district court’s denial
of JMOL that the jury’s $4 million damages award for the
’554 patent was excessive and not supported by substan-
tial evidence. “When reviewing damages in patent cases,
we apply regional circuit law to procedural issues and
Federal Circuit law to substantive and procedural issues
pertaining to patent law.” Whitserve, LLC v. Comput.
Packages, Inc., 694 F.3d 10, 26 (Fed. Cir. 2012) (quoting
Wordtech Sys., Inc. v. Integrated Networks Sols., Inc.,
609 F.3d 1308, 1318 (Fed. Cir. 2010)). The Ninth Circuit
reviews the denial of JMOL de novo. Hangarter, 373 F.3d
at 1005.
    Enplas argues that the district court erred when it
denied JMOL that the damages award was not supported
by substantial evidence. Specifically, it contends that the
only evidence supporting the $4 million award was testi-
mony from SSC’s damages expert that explicitly and
improperly included non-infringing devices in the royalty
calculation. Before trial, Enplas filed a Daubert motion to
exclude this testimony. The district court deferred full
consideration of that motion, stating that it was more
appropriate for a motion in limine. Enplas filed a motion
in limine, seeking to exclude SSC’s damages expert’s
testimony regarding “other lenses” not at issue in this
case. The district court denied that motion, holding:
       Consistent with this Court’s prior rulings,
   [SSC’s expert] cannot assume that infringement
   can be proven for the lenses not in this case.
   However, [SSC’s expert] may present evidence
   that under a lump-sum royalty negotiation, [En-
   plas] would seek to cover all of its potentially in-
   fringing products. As long as [the] ultimate
   damages determination is adequately adjusted to
ENPLAS DISPLAY DEVICE CORP.   v. SEOUL SEMICONDUCTOR CO. 17



    only recover for those lenses in the case, [the] tes-
    timony is permitted.
J.A. 13144 (emphasis added). Thus, the district court’s
order limited SSC’s expert to a damages theory based on
infringing and “potentially infringing products.” Id. It
did not allow a damages theory based on sales of non-
accused products.
    At trial, SSC’s expert opined that Enplas would have
agreed to a lump sum royalty in a hypothetical negotia-
tion for the ’554 and ’209 patents. She testified that “[i]f
the license [were] limited only to the accused lenses . . .
the reasonable royalty for the ’554 Patent [would be]
$500,000, and for the ’209 Patent $70,000.” J.A. 15539 at
722:3–5. She explained that “the $570,000 covers the[]
five products” accused of infringement in this case.
J.A. 15534 at 717:1–3. SSC’s expert did not stop there,
however. She went on to testify that Enplas and SSC
would not have limited the license to just the accused
products “if there [were] a risk of infringing the patent by
manufacturing other products that are similar in nature.”
J.A. 15534 at 717:11–13 (emphasis added). The “more
pragmatic approach,” explained SSC’s expert, would have
been for the parties to agree to a premium “freedom to
operate” license to avoid the need to test and negotiate
licenses for additional or future potentially infringing
lenses that Enplas might sell. J.A. 15534–35 at 717:22–
718:3.
    To determine the premium that Enplas would pay,
SSC’s expert assessed the volume of sales of all non-
accused lenses made by Enplas. Because none of this
information had been produced during discovery, SSC’s
expert found “some publicly-available information from
the Enplas website” and used that to “determine what
that volume of sales would be.” J.A. 15535 at 718:17–25.
SSC’s expert testified that “the volume of sales” for En-
plas’s unit that sells lenses “is eight to ten times the sales
18 ENPLAS DISPLAY DEVICE CORP. v. SEOUL SEMICONDUCTOR CO.



of the specific products that we’re here to talk about
today”—i.e., the accused infringing products. J.A. 15537
at 720:3–7.
    Based on this information and theory, SSC’s expert
testified that Enplas and SSC would have agreed to pay
$2 to 4 million depending on the ultimate “volume of sales
of potentially infringing products beyond the ones in this
case.” J.A. 15538 at 721:2–5 (emphases added).       SSC’s
expert did not present any explanation or evidence what-
soever to show how the past revenue from Enplas’s nonin-
fringing lenses could reasonably estimate the future
revenue from Enplas’s infringing or potentially infringing
lenses. To the contrary, she admitted that her theory was
based on limited information:
       Q. And why is it that your range is 2-to $4
   million?
       A. The range depends upon what you ulti-
   mately decide is the volume of sales of potentially
   infringing products beyond the ones in this case.
   And I don’t have any better information on that.
       If it were all the products, it would be the up-
   per end of that range, the $4 million. If it were
   only half of the products, it would be the lower
   end of the range.
J.A.15538 at 721:1–8 (emphasis added).
    Enplas again objected to SSC’s expert’s methodology
during her direct examination. The district court over-
ruled the objection, holding that its opinion had not
changed from its prior rulings on this testimony and that
Enplas’s objection went to the weight of the testimony,
not admissibility.
     Following the close of evidence, the district court
instructed the jury on damages, in relevant part, as
follows:
ENPLAS DISPLAY DEVICE CORP.   v. SEOUL SEMICONDUCTOR CO. 19



       If you find that [Enplas] induced infringement
   of any valid claim of the ’554 and/or the ’209 pa-
   tent, you must then determine the amount of
   money damages to be awarded to SSC to compen-
   sate it for the infringement.
       ....
        SSC seeks a reasonable royalty in the form of
   a one-time lump sum for all past and future in-
   fringement of its patents. If you find that SSC has
   established induced infringement, SSC is entitled
   to at least a reasonable royalty to compensate it
   for that infringement.
       ....
       One way to calculate a royalty, as SSC has in-
   tended is appropriate here, is to determine a one-
   time lump sum payment that the infringer would
   have paid at the time of the hypothetical negotia-
   tion for a license covering all sales of a licensed
   product both past and future. When a one-time
   lump sum is paid, the infringer pays a single price
   for a license covering both past and future infring-
   ing sales.
        Trial Tr. at 1295:6–1296:4, 1296:22–1297:3,
   Enplas Display Device Corp. v. Seoul Semiconduc-
   tor Co., No. 13-cv-05038 (N.D. Cal. Mar. 25, 2016)
   (Dkt. No. 454) (emphases added). Thus, the dis-
   trict court correctly instructed the jury to award
   damages adequate to compensate SSC for past
   and future infringing sales if the jury found that
   Enplas induced infringement. The court also in-
   structed the jury that it could award a lump sum
   for past and future infringement.
   The jury awarded $4 million in damages for a one-
time freedom-to-operate payment for the ’554 patent and
$70,000 for the ’209 patent. Enplas moved for JMOL,
20 ENPLAS DISPLAY DEVICE CORP. v. SEOUL SEMICONDUCTOR CO.



renewing its objection to SSC’s damages theory, which the
district court again denied. In doing so, the court held
that SSC’s expert’s testimony regarding a lump sum
freedom-to-operate license complied with its earlier
rulings that SSC could present evidence regarding En-
plas’s potentially infringing products in a hypothetical
lump-sum royalty negotiation. The district court also
noted that Enplas did not present a damages expert or
present evidence to rebut SSC’s expert’s opinion. 1
    On appeal, Enplas contends that the jury’s $4 million
damages award should be overturned because the only
evidence supporting the jury’s award was based, in part,
on non-infringing sales of non-accused Enplas lenses. 2



    1   To the extent the district court relied on the fail-
ure of Enplas to produce a rebuttal witness to deny
JMOL, the district court erred. The burden to prove
damages remains with the patentee, and Enplas was not
required to produce a witness to rebut SSC’s damages
theory. Lucent, 580 F.3d at 1324.
    2   The dissent contends that Enplas’s argument is
contrary to our holding in Versata Software, Inc. v. SAP
America, Inc., 717 F.3d 1255, 1264 (Fed. Cir. 2013). In
Versata, we held that it is improper to raise “questions of
admissibility of . . . expert testimony” “[u]nder the guise of
sufficiency of evidence.” Id. But this case is distinguish-
able from Versata. There, the appellant’s “briefs and
statements at oral argument confirm[ed] that its argu-
ments should have been resolved under the framework of
Daubert and the Federal Rules of Evidence” even though
the appellant had “not appealed a Daubert ruling.” Id.
For example, the appellant argued in its briefs that “the
expert’s testimony should have been excluded from evi-
dence, the jury ‘should have never heard any lost profits
theory,’ that ‘the district court should not have permitted
ENPLAS DISPLAY DEVICE CORP.   v. SEOUL SEMICONDUCTOR CO. 21



We agree. As we have held, a reasonable royalty “cannot
include activities that do not constitute patent infringe-
ment, as patent damages are limited to those ‘adequate to
compensate for the infringement.’” AstraZeneca AB v.
Apotex Corp., 782 F.3d 1324, 1343 (Fed. Cir. 2015) (quot-
ing § 284).
    Our decision in AstraZeneca is instructive. There, the
district court awarded damages that included a royalty on
sales made after the asserted patents had expired but
during a “pediatric exclusivity period.” Id. at 1341. This
period barred the FDA from approving competing drug
manufacturers’ Abbreviated New Drug Applications for
six months beyond the patents’ expiration date. Id. The
district court reasoned that “the effect of the pediatric
exclusivity period, like that of the patent term, is to bar
the sale of a generic product until after the expiration of
the exclusivity period.” Id. Thus, the district court con-
cluded, any license would have included the right to sell
the licensed drug during the patent term as well as the
pediatric exclusivity period. Id. at 1341–42.
    We rejected that theory, however, because “[t]he roy-
alty base for reasonable royalty damages cannot include
activities that do not constitute patent infringement, as


Versata’s expert to present his lost profits theory,’ and
that his analysis is ‘legally defective.’” Id. In contrast,
here, Enplas does not argue that the district court should
not have admitted SSC’s expert testimony on damages;
rather, it contends that the jury’s verdict is not supported
by substantial evidence because SSC’s expert testimony
on damages—the only evidence that supports the $4
million damages award—was calculated based, in part, on
non-infringing sales. Appellant Br. at 62–63. Thus,
Enplas does not improperly raise a question of admissibil-
ity under the guise of sufficiency of evidence.
22 ENPLAS DISPLAY DEVICE CORP. v. SEOUL SEMICONDUCTOR CO.



patent damages are limited to those ‘adequate to compen-
sate for the infringement.’” Id. at 1343 (quoting 35 U.S.C.
§ 284). We also cited our decision in Gjerlov v. Schuyler
Laboratories, Inc., 131 F.3d 1016, 1024 (Fed. Cir. 1997),
explaining that “it [is] improper to award a reasonable
royalty damages for the defendant’s sale of the prohibited
non-infringing products, because acts that do not consti-
tute patent infringement cannot provide a proper basis for
recovery of damages under section 284.” Id. at 1344.
    Here, SSC’s expert opined that Enplas and SSC would
have agreed to a $2 to 4 million royalty based on a royalty
base comprising sales of non-accused lenses. J.A. 15538
at 721:2–5. This testimony cannot support the jury’s
damages award, for § 284 and our precedent proscribe
awarding damages for non-infringing activity. Thus, the
jury’s $4 million award for infringement of the ’554 patent
cannot stand.
    We do not find SSC’s attempts to distinguish Astra-
Zeneca and Gjerlov persuasive. SSC asserts that, unlike
this case, “the district court improperly awarded damages
for non-infringing activities” in AstraZeneca and Gjer-
lov. Appellee Br. at 67. But that is precisely what oc-
curred here. The only evidence presented at trial to
support a damages award above $570,000 was SSC’s
expert’s damages theory applying a royalty to lenses that
were neither accused of infringement nor shown to in-
fringe. SSC presented no other evidence or damages
theory to support an award above $570,000. Nor did
SSC’s expert provide any explanation of how past sales
revenue for non-accused lenses could predict the future
sales revenue of infringing or even potentially infringing
lenses. Without such an explanation, her conclusion is
wholly inconsistent with our precedent. The expert’s
testimony that she arrived at a $2 million to $4 million
range of possible damages due to the lack of information
from which to calculate future infringing sales—as well as
ENPLAS DISPLAY DEVICE CORP.   v. SEOUL SEMICONDUCTOR CO. 23



the 100% difference between these upper and lower
limits—bolsters this conclusion.
    SSC makes much of its expert’s testimony that she
was not saying that Enplas would pay damages on non-
accused lenses. According to SSC, because its expert
characterized her use of the volume of sales of non-
accused lenses as a “paid-up, lump sum royalty” to ease
an “administrative burden,” her application of a royalty to
non-accused lenses was acceptable. Appellee Br. at 65.
We disagree. Regardless of the characterization by SSC’s
expert, damages calculated by applying a royalty to sales
of non-accused lenses cannot support a jury’s verdict on
damages. 3 To be sure, we have held that a jury may
award a lump-sum, paid-in-full royalty in lieu of a run-
ning royalty on future sales. See Lucent, 580 F.3d
at 1325. But that lump-sum must be based on an esti-
mate of the extent of future sales of accused products, not
on past sales of non-accused products.
    We therefore vacate the $4 million damages award for
infringement of the ’554 patent and remand for further
proceedings on damages. We do not disturb the jury’s
award of $70,000 for infringement of the ’209 patent.




   3    We acknowledge that patentees may sometimes
recover damages for “convoyed sales,” where an unpatent-
ed product is sold with the patented product and the two
are “analogous to components of a single assembly or [are]
parts of a complete machine, or they must constitute a
functional unit.” Rite-Hite Corp. v. Kelley Co., 56 F.3d
1538, 1550 (Fed. Cir. 1995) (en banc). We note that the
convoyed sales doctrine does not apply here, nor does SSC
rely on it.
24 ENPLAS DISPLAY DEVICE CORP. v. SEOUL SEMICONDUCTOR CO.



                       CONCLUSION
    For the foregoing reasons, the district court’s sum-
mary judgment that claim 20 of the ’209 patent is not
anticipated is affirmed. We also affirm the district court’s
denial of JMOL that the asserted claims of the ’554 patent
are anticipated and affirm its denial of JMOL of no in-
duced infringement. We conclude, however, that the
district court erred in denying JMOL that the damages
award was not supported by substantial evidence. Ac-
cordingly, we vacate and remand the jury’s damages
award for further proceedings on damages consistent with
this opinion.
  AFFIRMED-IN-PART, VACATED-IN-PART, AND
                REMANDED
                          COSTS
   No costs.
  United States Court of Appeals
      for the Federal Circuit
                 ______________________

    ENPLAS DISPLAY DEVICE CORPORATION,
               Plaintiff-Appellant

    ENPLAS TECH SOLUTIONS, INC., ENPLAS
               (U.S.A.), INC.,
                  Plaintiffs

                            v.

   SEOUL SEMICONDUCTOR COMPANY, LTD.,
              Defendant-Appellee
            ______________________

                       2016-2599
                 ______________________

   Appeal from the United States District Court for the
Northern District of California in No. 3:13-cv-05038-NC,
Magistrate Judge Nathanael M. Cousins.
                ______________________

NEWMAN, Circuit Judge, concurring-in-part and dissent-
ing-in-part.
    I concur in the court’s decision sustaining the validity
of the Seoul Semiconductor Company (“SSC”) patents in
dispute and affirming the judgment of induced infringe-
ment. The jury verdicts were reached on correct instruc-
tions of law, and are supported by substantial evidence. I
must, however, dissent from the reversal of the jury’s
damages verdict. On the unrebutted testimony presented
2 ENPLAS DISPLAY DEVICE CORP. v. SEOUL SEMICONDUCTOR CO.



to the jury, the verdict is supported by substantial evi-
dence and requires affirmance.
    A jury’s damages verdict receives substantial defer-
ence. See Los Angeles Mem’l Coliseum Comm’n v. Nat’l
Football League, 791 F.2d 1356, 1365 (9th Cir. 1986)
(“[W]e undertake only limited review of jury damages
awards, in order to avoid encroaching upon the jury’s
proper function under the Constitution.”); Handgards,
Inc. v. Ethicon, Inc., 743 F.2d 1282, 1297 (9th Cir. 1984)
(“A jury’s finding of the amount of damages must be
upheld unless the amount is grossly excessive or mon-
strous, clearly not supported by the evidence, or only
based on speculation or guesswork.” (internal quotation
marks omitted) (quoting Blanton v. Mobil Oil Corp., 721
F.2d 1207, 1216 (9th Cir. 1983)). On procedures not
unique to patent law, we apply the procedural law of the
regional circuit. The standard of review of the jury’s
damages verdict is the standard of the Ninth Circuit, the
forum of the jury trial. The court today departs from
these procedural principles, although these principles
constitute binding precedent.
   The District Court Correctly Denied JMOL
   On the Damages Verdict
    This court agrees that the district court correctly in-
structed the jury on damages. See Maj. Op. at 20. The
instruction included: “One way to calculate a royalty, as
SSC has intended is appropriate here, is to determine a
one-time lump-sum payment that the infringer would
have paid at the time of a hypothetical negotiation for a
license covering all sales of a licensed product both past
and future.” Maj. Op. at 19. My colleagues focus on the
uncontroverted expert testimony pertaining to a hypothet-
ical negotiation that would have licensed Enplas under
SSC patents for all infringing and potentially infringing
products—past, present, and future—rather than a li-
cense limited to the accused product. Enplas at trial
ENPLAS DISPLAY DEVICE CORP.   v. SEOUL SEMICONDUCTOR CO. 3



presented no challenge to this testimony, which was a
realistic focus on the value of business certainty. None-
theless, my colleagues conduct a de novo hypothetical
negotiation on appeal—contrary to the strictures of prece-
dent and practice. See Slaven v. Am. Trading Transp.
Co., 146 F.3d 1066, 1069 (9th Cir. 1998), as amended on
denial of reh’g and reh’g en banc (Aug. 18, 1998) (“It is
well-established that an appellate court will not consider
issues that were not properly raised before the district
court. It follows that if a party fails to raise an objection
to an issue before judgment, he or she waives the right to
challenge the issue on appeal.”) (internal citations omit-
ted).
    The Patent Act’s damages provision, 35 U.S.C. § 284,
states that “the court shall award the claimant damages
adequate to compensate for the infringement, but in no
event less than a reasonable royalty for the use made of
the invention by the infringer, together with interest and
costs as fixed by the court.” Id. As explained in Rite-Hite
Corp. v. Kelley Co., 56 F.3d 1538, 1544 (Fed. Cir. 1995) (en
banc), “the language of [35 U.S.C. § 284] is expansive
rather than limiting. It affirmatively states that damages
must be adequate, while providing only a lower limit and
no other limitation.” Id.
     Neither side argues that the jury’s damages award
was not adequate to compensate for the infringement. No
argument is presented that the jury awarded less than a
reasonable royalty for the use made of the invention.
Nonetheless, Enplas argues on appeal that an improper
theory was presented by SSC’s damages expert and, thus,
the jury verdict is fatally flawed. Enplas is mistaken, in
law and in reality, as well as in contravention of standard
litigation procedures. See In re Oracle Corp. Sec. Litig.,
627 F.3d 376, 386 (9th Cir. 2010) (“[F]ail[ure] to respond
to Defendants’ [contentions], and to then challenge the
district court’s evidentiary rulings on appeal, is to invite
4 ENPLAS DISPLAY DEVICE CORP. v. SEOUL SEMICONDUCTOR CO.



the district court to err and then complain of that very
error. We cannot countenance such a tactic on appeal.”).
    Enplas has not appealed the district court’s Daubert
ruling, see Daubert v. Merrell Dow Pharm., Inc., 509 U.S.
579 (1993) (the court is the gatekeeper on the admissibil-
ity and appropriateness in law and fact of expert testimo-
ny). Likewise, Enplas has not appealed the district
court’s ruling on the motion in limine:
   Consistent with this Court’s prior rulings, [SSC’s
   expert] cannot assume that infringement can be
   proven for the lenses not in this case. However,
   [SSC’s expert] may present evidence that under a
   lump-sum royalty negotiation, [Enplas] would
   seek to cover all of its potentially infringing prod-
   ucts. As long as [the expert’s] ultimate damages
   determination is adequately adjusted to only re-
   cover for those lenses in the case, [the expert’s]
   testimony is permitted.
J.A. 13144 (“Order on Motion in Limine”). The evidence
at trial comported with these evidentiary rulings. Enplas
does not argue on appeal that it presented any evidence,
expert or otherwise, contradicting this damages theory as
applied in any hypothetical negotiation.
    On appeal, Enplas asks the question: “Whether the
district court erred in denying judgment as a matter of
law that the damages award was not supported by the
evidence, where the damages expert explicitly included
non-infringing devices in her royalty calculation.” Appel-
lant Br. 2. This is a grossly inaccurate description of the
expert’s testimony, for non-infringing devices were not
“explicitly included” by the expert. To the contrary, the
expert estimated sales of “potentially infringing products
ENPLAS DISPLAY DEVICE CORP.   v. SEOUL SEMICONDUCTOR CO. 5



beyond the ones in this case,” J.A. 15538, 1 and testified
that
    if [Enplas] wanted [] a freedom-to-operate license,
    and they were pragmatic about it, they would be
    willing to pay 2- to $4 million in order to ensure
    that they’d never have to worry about testing
    these products and negotiating other licenses for
    those products in the future. . . . The range de-
    pends upon what you ultimately decide is the vol-
    ume of sales of potentially infringing products
    beyond the ones in this case.
J.A. 15537–38 (Trial Tr. at 718:20–721:4). The lump-sum
reflects a reasonable royalty that the infringer would have
been willing to pay on hypothetical negotiation under the
circumstances that existed.
    On appeal, review of the district court’s action on a
motion for judgment as a matter of law is governed by the
standards of the regional circuit. See InTouch Techs.,
Inc., v. VGO Commc’ns, Inc., 751 F.3d 1327, 1338 (Fed.
Cir. 2014). “[I]n entertaining a motion for judgment as a
matter of law, the court should review all of the evidence
in the record.” Reeves v. Sanderson Plumbing Prods.,
Inc., 530 U.S. 133, 150 (2000); see Escriba v. Foster Poul-
try Farms, Inc., 743 F.3d 1236, 1242 (9th Cir. 2014)
(“Reviewing a renewed motion for JMOL requires scruti-
ny of the entire evidentiary record . . . .”). Thus, on appeal
from the denial of JMOL, review is based on all the evi-
dence before the jury, drawing all reasonable inferences in
favor of the non-moving party, whereby we decide wheth-



    1  Transcript of Proceedings 721:3–4, Enplas Display
Device Corp. v. Seoul Semiconductor Co., No. 3:13-cv-
05038-NC (N.D. Cal. Mar. 25, 2016), (No. 452) (“Trial
Tr.”).
6 ENPLAS DISPLAY DEVICE CORP. v. SEOUL SEMICONDUCTOR CO.



er such evidence constituted substantial evidence in
support of the verdict. See Josephs v. Pac. Bell, 443 F.3d
1050, 1062 (9th Cir. 2006).
     The Ninth Circuit has explained that judgment as a
matter of law is proper when “the evidence, construed in
the light most favorable to the nonmoving party, permits
only one reasonable conclusion, and that conclusion is
contrary to the jury’s verdict.” Pavao v. Pagay, 307 F.3d
915, 918 (9th Cir. 2002). “A jury’s verdict must be upheld
if it is supported by substantial evidence, which is evi-
dence adequate to support the jury’s conclusion, even if it
is also possible to draw a contrary conclusion.” Id. Fur-
ther, “we cannot reverse [the jury’s] findings merely
because our reading of the evidence might have been
different, especially where the district court concluded
that the evidence at trial was sufficient to support the
verdict . . . .” Passantino v. Johnson & Johnson Consumer
Prod., Inc., 212 F.3d 493, 513 (9th Cir. 2000) (internal
quotation marks omitted).
    Here, the district court ruled that the testimony re-
garding the freedom-to-operate royalty negotiation was
admissible. This testimony was the only evidence pre-
sented to the jury on the hypothetical negotiation. It is
not reasonable to draw a contrary conclusion from the
record before the jury. See Pavao, 370 F.3d at 918 (JMOL
is proper when “the evidence, construed in the light most
favorable to the nonmoving party, permits only one rea-
sonable conclusion, and that conclusion is contrary to the
jury’s verdict.”); Perkin-Elmer Corp. v. Computervision
Corp., 732 F.2d 888, 893 (Fed. Cir. 1984) (“In sum, only
when the court is convinced upon the record before the
jury that reasonable persons could not have reached a
verdict for the non-mover, should it grant the motion for
JNOV.”). On this basis, the uncontradicted expert testi-
mony constitutes substantial evidence supporting the jury
verdict.
ENPLAS DISPLAY DEVICE CORP.   v. SEOUL SEMICONDUCTOR CO. 7



    The district court did not depart from the law of dam-
ages and the rules for review of jury verdicts. In Versata
Software, Inc. v. SAP Am., Inc., 717 F.3d 1255 (Fed. Cir.
2013), this court admonished the appellant for attacking
the admissibility of expert testimony in the same manner
as have Enplas and now the panel majority:
    According to SAP, the jury’s lost profits award
    should be set aside for four reasons. The first two
    reasons relate to the methodology used by Versa-
    ta’s expert. SAP avers that Versata’s “but for”
    model is “inconsistent with sound economic prin-
    ciples,” and thus “[the expert’s] opinion should
    have been excluded from evidence.” Appellant’s
    Br. 46. Similarly, SAP claims Versata’s expert did
    not adhere to the Panduit framework because he
    used multiple markets thereby rendering his
    analysis “legally defective.” Id. at 50.
    The court rejects these two arguments as improp-
    erly raised. Under the guise of sufficiency of the
    evidence, SAP questions the admissibility of Ver-
    sata’s expert testimony and whether his damages
    model is properly tied to the facts of the case.
    Such questions should be resolved under the
    framework of the Federal Rules of Evidence and
    through a challenge under Daubert v. Merrell Dow
    Pharm., Inc., 509 U.S. 579 (1993).
Id. at 1264.
    Enplas appeals the district court’s JMOL denial, and
argues that SSC’s expert testimony regarding a hypothet-
ical negotiation for a freedom-to-operate license was
insufficient to support the jury’s damages assessment.
Such questions should be resolved under the framework of
the Federal Rules of Evidence and through a Daubert
challenge. Nonetheless, Enplas and now my colleagues
challenge admissibility under the guise of substantial
evidence. Precedent is directly on point:
8 ENPLAS DISPLAY DEVICE CORP. v. SEOUL SEMICONDUCTOR CO.



    Whether evidence is inadmissible is a question
    clearly within the scope of the rules of evidence
    and Daubert. However, SAP has not appealed a
    Daubert ruling. Instead, it argues that the jury
    could have not had sufficient evidence to award
    lost profits because the expert’s testimony was fa-
    tally flawed and should not have been admitted.
    This is the improper context for deciding ques-
    tions that, by SAP’s own admissions, boil down to
    the admissibility of evidence.
Versata, 717 F.3d at 1264.
    In direct analogy, the district court herein properly al-
lowed SSC’s damages expert to testify concerning a hypo-
thetical negotiation for a freedom-to-operate license.
Deference is owed to the district court’s evidentiary
ruling, which comports with precedent. See Harper v.
City of Los Angeles, 533 F.3d 1010, 1030 (9th Cir. 2008)
(“We afford broad discretion to a district court’s eviden-
tiary rulings.”); see also Zhang v. Am. Gem Seafoods, Inc.,
339 F.3d 1020, 1038 (9th Cir. 2003) (“We must accept any
reasonable interpretation of the jury’s actions, reconciling
the jury’s findings by exegesis if necessary . . . ; a search
for one possible view of the case which will make the
jury’s finding inconsistent results in a collision with the
Seventh Amendment.”) (internal citations omitted). The
majority’s view produces such a collision.
    Substantial Evidence Supports the Jury’s
    Verdict Based on a Lump-Sum Freedom-to-
    Operate License
    This court explained in Lucent Technologies, Inc. v.
Gateway, Inc., “[t]he hypothetical negotiation tries, as
best as possible, to recreate the ex ante licensing negotia-
tion scenario and to describe the resulting agreement.”
580 F.3d 1301, 1325 (Fed. Cir. 2009). The goal is to
“accurately reflect[] the real-world bargaining that occurs,
particularly in licensing.” Exmark Mfg. Co. v. Briggs &
ENPLAS DISPLAY DEVICE CORP.   v. SEOUL SEMICONDUCTOR CO. 9



Stratton Power Prods. Grp., LLC, 879 F.3d 1332, 1349
(Fed. Cir. 2018). We have observed that “[a] key inquiry
in the analysis is what it would have been worth to the
defendant, as it saw things at the time, to obtain the
authority to use the patented technology . . . .” Carnegie
Mellon Univ. v. Marvell Tech. Grp., Ltd., 807 F.3d 1283,
1304 (Fed. Cir. 2015).
     At trial, the only damages expert opined that Enplas,
in a hypothetical negotiation, would have agreed to pay $2
-to 4 million for a freedom-to-operate license, thereby
avoiding the burdens and uncertainties associated with
monitoring, testing, and complying with a license of
limited scope that would have been only applicable to a
single product. The expert discussed the benefits, to both
parties, of a freedom-to-operate patent license—
elimination of uncertainty and pragmatic administration.
A license is intended to alleviate business uncertainty; no
precedent limits the hypothetical negotiation to consider-
ation of a single product. This testimony was correctly
held admissible, for the cost and disruption of separate
litigation over every existing and future product within
the possible scope of the patent is a reasonable considera-
tion in license negotiations. See Rude v. Westcott, 130
U.S. 152, 164 (1889) (“The avoidance of the risk and
expense of litigation will always be a potential motive for
a settlement.”).
    The district court was correct in allowing the jury to
hear testimony to this effect. “Questions about what facts
are most relevant or reliable to calculating a reasonable
royalty are for the jury.” i4i Ltd. P’ship v. Microsoft
Corp., 598 F.3d 831, 856 (Fed. Cir. 2010), aff’d, 564 U.S.
91 (2011). SSC’s damages expert testified to a legally
permissible theory for a hypothetical negotiation. The
expert explained the methodology to the jury, testifying at
trial:
10 ENPLAS DISPLAY DEVICE CORP. v. SEOUL SEMICONDUCTOR CO.



      Q. So in the real world, how would this license
   have been negotiated in your opinion?
       A. The more pragmatic approach would be for
   the parties to decide that the royalty -- some pre-
   mium should be paid in order for the right to
   avoid this ongoing hassle of testing and licensing
   additional products. So that the freedom to oper-
   ate in other words, peace of mind that you no
   longer have to negotiate for every future product
   that you might sell.
       Q. And earlier today you said that you were
   assuming that the products at issue infringed the
   Patents-in-Suit; Correct?
       A. Yes.
       Q. And are you now assuming that other
   products infringe the Patents-in-Suit?
       A. No.
   Q. And are you seeking -- are you saying that
   EDD [Enplas Display Device Corp.] would pay for
   damages on products that aren’t said to infringe
   the Patents-in-Suit?
   A. No. I’m simply saying that they would be will-
   ing to pay a premium to avoid the complications of
   going through this negotiation process for every
   other product they might choose to sell. So it’s an
   insurance policy.
   Q. And did you determine this premium that EDD
   would pay?
   A. Yes.
   Q. And how did you go about doing that?
   A. What I did was look at the best information I
   had available on the volume of sales of other
ENPLAS DISPLAY DEVICE CORP.   v. SEOUL SEMICONDUCTOR CO. 11



   lenses by EDD. And while EDD did not provide
   any of that information in this case, there is some
   publicly-available information from the Enplas
   web site that I relied upon to determine what that
   volume of sales would be.
   ...
   Q. Do you recognize this document?
   A. I do.
   Q. And what is this?
   A. This is another page from my report that re-
   flects the revenue and gross margin for the Enplas
   plastic optical. The plastic optical business, ac-
   cording to the Enplas web site and the documents
   on it, later became EDD.
   ...
   Q. So the revenue on the top line, is that what you
   were looking at?
   A. Yes. The sources for this are shown at the bot-
   tom of the page. But I obtained this information
   directly from the Enplas Corporation business
   plans that were on the Enplas web site, because
   that’s the only information I have. So I captured
   the revenue number on top as well as the gross
   margin down below. The revenue number is stat-
   ed in Japanese Yen. Once you convert that to
   U.S. dollars, what you learn is that the volume of
   sales for the entire business that sells the lenses
   is eight to ten times the sales of the specific prod-
   ucts that we’re here to talk about today.
J.A. 15534–37 (Trial Tr. 717:20–720:7). The expert fur-
ther testified:
       Q. And why is it that your range is 2- to $4
   million?
12 ENPLAS DISPLAY DEVICE CORP. v. SEOUL SEMICONDUCTOR CO.



         A. The range depends upon what you ulti-
    mately decide is the volume of sales of potentially
    infringing products beyond the ones in this case.
    And I don’t have any better information on that.
    If it were all the products, it would be the upper
    end of that range, the $4 million. If it were only
    half of the products, it would be the lower end of
    the range. Or you may determine if EDD ulti-
    mately provides you better information, that some
    other factor is appropriate.
J.A. 15538 (Trial Tr. 721:1–10).
    No challenge to this testimony was raised during
cross-examination at trial, and no contrary damages
theory or estimate was presented. Enplas did not ques-
tion the methodology or the underlying data for the
freedom-to-operate     damages     theory;    the    cross-
examination was focused on prior license agreements and
figures underlying the expert’s other theory for a hypo-
thetical negotiation, a theory the expert characterized as
“an endless stream of serial negotiations. And [] not
something that’s done in the real world.” J.A. 15534
(Trial Tr. 717:18–19). “This court has recognized that
estimating a reasonable royalty is not an exact science.
The record may support a range of reasonable royalties,
rather than a single value. Likewise, there may be more
than one reliable method for estimating a reasonable
royalty.” Summit 6, LLC v. Samsung Elecs. Co., 802 F.3d
1283, 1296 (Fed. Cir. 2015).
    My colleagues state that “Enplas was not required to
produce a witness to rebut SSC’s damages theory.” Maj.
Op. at 20 n.1. While this is correct in the abstract, it does
not atone for Enplas’ litigation decision to leave the
damages theory unrebutted.               “Vigorous cross-
examination, presentation of contrary evidence, and
careful instruction on the burden of proof are the tradi-
tional and appropriate means of attacking shaky but
ENPLAS DISPLAY DEVICE CORP.   v. SEOUL SEMICONDUCTOR CO. 13



admissible evidence.” Daubert, 509 U.S. at 596. The
failure to provide contrary evidence, or even challenge the
evidence SSC presented, may well have affected the jury’s
verdict.
    Here, the damages testimony was clearly relevant,
the jury was correctly instructed, and the verdict was in
conformity with the evidence. There is no basis to over-
turn the denial of JMOL, for substantial and unrebutted
evidence supported the jury verdict. See Cataphote Corp.
v. De Soto Chem. Coatings, Inc., 356 F.2d 24, 26 (9th Cir.),
opinion modified on denial of reh’g, 358 F.2d 732 (9th Cir.
1966) (“It is not [the Appellate Court’s] function to reeval-
uate the evidence presented below. We cannot substitute
our judgment for the first-hand evaluation made by the
trier of fact. Pursuant to Rule 52(a) of the Federal Rules
of Civil Procedure our obligation is to determine if the
findings below were ‘clearly erroneous.’ This statutorily
imposed standard does not vests us with power to reweigh
the evidence presented at trial in an attempt to assess
which items should and which should not have been
accorded credibility.”). It is not the appellate judge’s role
to provide the evidence that a party declined to provide at
trial.
    The Appellant Misapplies AstraZeneca
    Enplas also offers an unsupportable interpretation of
AstraZeneca AB v. Apotex Corp., 782 F.3d 1324 (Fed. Cir.
2015), now accepted in the majority’s opinion. See Maj.
Op. at 21–22. This court stated in AstraZeneca that “a
reasonable royalty cannot include activities that do not
constitute patent infringement, as patent damages are
limited to those adequate to compensate for the infringe-
ment,” AstraZeneca, 782 F.3d at 1343 (internal quotation
marks omitted), responding to the question of: whether
damages may include a post-expiration pediatric exclusiv-
ity period. See id. at 1342. The court stated that “it is
clear that Apotex did not infringe Astra’s patents during
14 ENPLAS DISPLAY DEVICE CORP. v. SEOUL SEMICONDUCTOR CO.



the exclusivity period, since those patents had expired.”
Id. at 1343.
    Unlike AstraZeneca, which held that an expired pa-
tent could not be infringed, the hypothetical negotiation
in the present case assumes that SSC’s patent is valid
and infringed. Cf. Lucent Techs., 580 F.3d at 1325 (“The
hypothetical negotiation also assumes that the asserted
patent claims are valid and infringed.”).
    Here, the issue of a hypothetical freedom-to-operate
negotiation is, whether a potential infringer would rea-
sonably include all potentially infringing products in a
paid-up license, in order to avoid the uncertainty of possi-
ble infringement and further litigation. The panel majori-
ty misstates the record, in stating that “SSC’s damages
expert [] explicitly and improperly included non-infringing
devices in the royalty calculation.” Maj. Op. at 16. As
quoted ante, the damages expert answered “No” when
asked: “[A]re you saying that EDD would pay for damages
on products that aren’t said to infringe the Patents-in-
Suit?” J.A. 15535 (Trial Tr. 718:10–12).
    Throughout the trial, it was emphasized that the pro-
posed measure of damages was freedom to operate under
SSC patents. The expert testified, and Enplas did not
dispute, that the cost and disruption of litigation and
disagreements favor such business considerations. No
rule excludes reasonable business considerations from a
hypothetical negotiation. Rather than look only at units
of infringement, SSC’s damages expert testified as to
what would have been reasonable compensation for a
freedom-to-operate patent license. And the expert ex-
plained why such a license would have been beneficial to
the parties. This testimony aligns with AstraZeneca and
was unopposed by Enplas, and is substantial evidence in
support of the jury’s verdict.
ENPLAS DISPLAY DEVICE CORP.   v. SEOUL SEMICONDUCTOR CO. 15



                        SUMMARY
    The Court has cogently stated: “Few bodies of law
would be more difficult to reduce to a short and simple
formula than that which determines the measure of
damage recoverable for actionable wrongs.” F. W. Wool-
worth Co. v. Contemporary Arts Inc., 344 U.S. 228, 232
(1952). Until today, “we have never laid down any rigid
requirement that damages in all circumstances be limited
to specific instances of infringement proven with direct
evidence.” Lucent Techs., 580 F.3d at 1334. Faced with
unopposed expert testimony describing a hypothetical
negotiation for a freedom-to-operate license, my col-
leagues “create a hypothetical negotiation far-removed
from what parties regularly do during real-world licensing
negotiations.” Id.
    The damages verdict was the product of correct jury
instructions, and testimony on examination and cross-
examination before the jury. The lump-sum verdict was
for “all past and future infringement,” Maj. Op. at 19, as
the jury was instructed. My colleagues’ insistence that
the payment was for non-infringing products was not
presented at trial, and has no support in the record. The
jury verdict is supported by substantial evidence, and
should be affirmed. I respectfully dissent from the court’s
contrary ruling.
