The U.S. Supreme Court on Tuesday ruled against Cisco Systems Inc(CSCO.O) over a $64 million patent infringement verdict the tech giant is fighting.
On a 6-2 vote, with Justice Stephen Breyer recused, the court threw out a ruling by the U.S. Court of Appeals for the Federal Circuit in favor of Cisco. The case will now return to the appeals court for further proceedings.
The case concerns a patent held by Commil USA LLC on a way to improve the implementation of a wireless network where multiple access points are needed. Commil sued Cisco for patent infringement and induced patent infringement based on the network equipment maker's use of similar technology.
In April 2011, a jury awarded Commil almost $63.8 million in damages. A judge subsequently added $10.3 million in interest.
In June 2013, the appeals court ordered a retrial, concluding that Cisco should be allowed to mount the "good faith" defense.
The high court ruled in an opinion by Justice Anthony Kennedy that Cisco's belief that the patent was valid was not a legitimate defense.
Justice Antonin Scalia wrote a dissenting opinion in which he was joined by Chief Justice John Roberts.
In a brief filed at the invitation of the high court, the U.S. government had warned that companies accused of inducing patent infringement were likely to raise the "good faith" defense in most cases, if not all of them.
The case was closely watched by Silicon Valley and biotechnology firms alike to see whether such a defense would be endorsed by the high court.
The case is Commil v. Cisco, U.S. Supreme Court, No. 13-896.
(Published by Reuters – May 26, 2015)