Court sets precedent with damages based on infringer's profits

In Havfisk AS v Remøy Sea Group AS (case number LB-2006-8527), the Borgarting Court of Appeal awarded compensation to the patent owner based on the profits made by the infringer. There is no basis for such an award in the Norwegian Patents Act nor in other written law, although some commentators on the subject have advocated that there ought to be.

The general principle in Norwegian tort law is that only substantiated financial losses are compensated, and that there must be intent or negligence. The Patents Act sets out some specific rules. The patent owner can claim either compensation for the use of the invention by the infringer, or any actual loss or damage in excess of that, but not both. Compensation for the use of the invention is usually calculated as a reasonable licence fee. In the case at hand, the infringer was ordered to pay Nkr12 million, which the court found equalled the profits he had made using the infringing product, a device used on a fishing trawler. The district court had ordered him to pay Nkr1 million, and the patent owner had encountered difficulties substantiating losses in excess of that amount.

The Supreme Court of Norway has refused to grant leave to appeal the case. The Court of Appeal’s judgment is therefore final and binding.