Kirkland Raises the Roof for $125 Million

We have another entry for the category: What doesn’t kill you at the PTAB makes you stronger. This is a big, nine-figure example.

A Kirkland & Ellis team won a $125 million verdict last week, plus an immediate restraining order against the sale of accused products, in a four-year-old dispute over 3D rooftop imaging.

Eagle View Technologies and Xactware compete to provide aerial-view, 3D models of roofs to help insurance adjusters estimate the costs of repairs. Long before the parties went to trial last month in New Jersey federal court, Xactware filed some 13 IPR petitions targeting the Eagle View patents. The PTAB declined to institute proceedings in nine. Of the four that did go to trial, most ended in wins for Eagle View, though the PTAB withheld judgment on some challenged claims, as was its practice pre-SAS Institute.

So when trial rolled around last month, Eagle View, Kirkland and local counsel Walsh Pizzi O’Reilly Falanga argued that Xactware could not use any of the prior art already raised in those proceedings to attack validity. “Having chosen the PTAB as their forum for validity challenges, Defendants simply do not get two bites at the invalidity apple,” they argued in court papers.

Xactware, which was represented by McCarter & English, argued that under a 2016 Federal Circuit ruling, the AIA’s statutory estoppel doesn’t apply to claims in an IPR that the PTAB never ruled on. Eagle View and Kirkland argued that after the Supreme Court’s SAS decision, Xactware had been free to go back to the PTAB and request rulings on those claims but didn’t.

U.S. District Judge Renee Marie Bumb took a middle path. She ruled that Xactware could raise the grounds that the PTAB left hanging, but that Eagle View would be allowed to cross examine about the PTAB history.

“Defendants’ validity expert testified on direct for hours arguing that the patents are invalid, but did not mention the IPRs (which confirmed the opposite),” the Kirkland attorneys said via email. “We revealed what really happened on cross-examination.”

In the end the jury rejected all of Xactware’s invalidity arguments, raised before the PTAB or not.

Jurors also found Xactware and its parent, Verisk, to have infringed willfully, which opens the door to possible enhanced damages. And the day after the verdict issued, Bumb issued a restraining order after Eagle View argued it should not have to wait for a permanent injunction.

Kirkland’s trial team featured partners Adam Alper, Mike De Vries, Gianni Cutri, Brandon Brown and Kristina Hendricks and Walsh Pizzi partner Hector Ruiz.