Enhanced Damages Award for Chinese Client in Texas Federal Court

Following a patent trial victory on behalf of Ningde Amperex Technology Limited (“ATL”) earlier this year against Zhuhai CosMX Battery Co., Ltd. (“CosMX”), Quinn Emanuel secured a rare, enhanced damages award in the Eastern District of Texas in April.  To our knowledge, this marks the first-ever enhanced damages awarded to a Chinese plaintiff in this popular patent venue.

            In February 2024, a team of Quinn Emanuel lawyers across eight offices globally—many fully bilingual in English and Mandarin—convinced a federal jury that a main competitor of ATL willfully infringed three ATL patents directed to key components used in industry-leading lithium-ion batteries—including the electrolyte, the electrodes, and the separator.  It was ATL’s separator patent that carried the day, and presently CosMX has no viable alternatives to ATL’s patented separator technology.  Not long after returning for a second day of deliberation, the jury returned a verdict finding that ATL was entitled to a running royalty of $3.7 million in compensatory damages for two-and-half years of past infringement, leaving open the prospect of the Court awarding ongoing royalties for the remainder of the patent’s 20-year life.

            From the outset, Quinn Emanuel zeroed in on the defendant’s reputation as an imitator rather than an innovator.  Throughout the five-day trial, the team exposed the defendant’s go-to-market strategies as a self-proclaimed low-cost provider, such as hiring-away key ATL engineers, filing copycat patent applications directed to ATL’s inventions, and switching to ATL’s suppliers who knew the secret ingredients of its prized innovation. 

            After the jury found willful infringement, Quinn Emanuel chronicled the defendant’s transgressions in a bid to convince the court to award enhanced damages.  Such motions are fraught with risks, as the court had in previous cases refused to award enhancement or even nullified the jury finding entirely when infringing sales occurred outside of the U.S.  Here, CosMX itself helped tip the scales in favor of enhancement when following the jury’s verdict against CosMX its in-house counsel blamed the court and the jury for purported prejudice on Chinse social media—publishing untrue statements concerning what transpired during the voir dire process that the court and parties engaged in when picking the jury. The absurdity of CosMX’s post-verdict aspersions is of course underscored by the fact that both companies are based in the Peoples Republic of China. On April 26, the court entered final judgment in the case, finding the defendant’s willful infringement warranted a 27% enhancement of the compensatory damages owed.  To date, no other Chinese plaintiff had been successful in seeking enhanced damages in this venue. 

            This win is a testament to the strength and diversity of Quinn Emanuel’s global patent practice.