General Motors Corporation v. Devex Corporation

PETITIONER: General Motors Corporation
RESPONDENT: Devex Corporation
LOCATION: Residence of Gates

DOCKET NO.: 81-1661
DECIDED BY: Burger Court (1981-1986)
LOWER COURT: United States Court of Appeals for the Third Circuit

CITATION: 461 US 648 (1983)
ARGUED: Dec 07, 1982
DECIDED: May 24, 1983

ADVOCATES:
George E. Frost - on behalf of the Petitioner
Sidney Bender - on behalf of the Respondents

Facts of the case

Question

Media for General Motors Corporation v. Devex Corporation

Audio Transcription for Oral Argument - December 07, 1982 in General Motors Corporation v. Devex Corporation

Warren E. Burger:

We will hear arguments next in General Motors against Devex Corporation.

Mr. Frost, you may proceed when you are ready.

George E. Frost:

Mr. Chief Justice, and may it please the Court, this is a patent infringement case.

The patent is to a process of making bumpers and other products by cold forming.

The issue is whether the court below properly awarded prejudgment interest.

The case was filed in the Northern District of Illinois in--

Harry A. Blackmun:

There isn't much left of the patent issue, is there?

George E. Frost:

--No, there isn't, Your Honor.

The patent expired more than a decade ago.

The case was filed in 1956 in the Northern District of Illinois.

Twenty-four years later, and after a number of conflicting decisions on both validity and the patent scope, the District Court of Delaware entered judgment on the accounting.

It assessed prejudgment interests of about $11 million against General Motors.

Interest was charged at the commercial bond rates from the dates the infringement was held to have occurred.

The specific question presented on certiorari here is whether the applicable statute, 35 USC 284, requires the award of prejudgment interest on unliquidated damages based on reasonable royalties, where there is a finding that the defendant acted in good faith and not recklessly.

William H. Rehnquist:

Is the question whether it requires it or whether it permits it, or are they the same thing?

George E. Frost:

No.

If the Court please, the first question here is whether it requires it.

We think the court of appeals held that interest was mandatory.

Then we go on to the question of whether the Duplate versus Triplex case is still the law, and finally, to the influence of the Georgia Pacific case, which I will mention in a few moments.

The statute provides that in patent cases, the Court shall award damages adequate to compensate for infringement, but no event less than a reasonable royalty, together with interest and costs as fixed by the court.

It is the direct successor to the 1946 Patent Act.

The Act provided for interest in similar language... the 1946 Act provided for interest in similar language, and it was the first reference to interest in the patent statutes.

The key factor in this case is that the initial form of the 1946 Act explicitly required the award of prejudgment interest.

As proposed, the court would be required to award damages which shall be due compensation for infringement, but not less than a reasonable royalty, together with interest from the time the infringement occurred.

It was in that form that the statute actually passed the House of Representatives, but in the Senate, this language was rejected.

The Senate struck the reference to interest from the time the infringement occurred.

In its place, the Senate substituted the expression,

"interest as may be fixed by the court. "

and it was in this amended form that the Act was passed by both Houses of Congress and signed by the President.

Byron R. White:

Was that the only change that--