Earlier this week, the United States District Court for the Eastern District of Virginia (the Court) entered what is believed to be one of the highest damages awards ever issued in a patent case, following a 22-day bench trial in Centripetal Networks, Inc. v. Cisco Systems, Inc. In an opinion authored by Senior U.S. District Judge Henry Coke Morgan, Jr., the Court found that Cisco willfully infringed four out of five of Centripetal’s asserted patents and awarded enhanced damages in an amount of $755,808,545 (enhanced by a factor of 2.5X), and prejudgment interest in an amount of $13,717,925, which resulted in a total past damages award amount of $1,903,239,288. In addition, Judge Morgan ordered Cisco to pay Centripetal a running royalty of 10% on the apportioned sales of the accused products and their successors for a period of three years, followed by a second three-year term wherein the running royalty will be 5% on such sales. The royalties would bring the total to a minimum of $2.65 billion and could make it as high as $3.25 billion.
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