CAFC discusses "entire market value rule" in Power Integrations

Power Integrations, Inc. owns U.S. Patent Nos.
6,212,079 (“the ’079 patent”) and 6,538,908 (“the ’908
patent”). Power Integrations sued Fairchild Semiconductor
Corporation and Fairchild (Taiwan) Corporation
(collectively “Fairchild”) for infringement. A jury found
Fairchild literally infringed claims 31, 34, 38, and 42 of
the ’079 patent and infringed claims 26 and 27 of the ’908
patent under the doctrine of equivalents. In a second trial,
a jury awarded damages of roughly $140 million, finding
that the entire market value rule applied in calculating
damages for infringement of the ’079 patent. The district
court denied Fairchild’s motions for judgment as a matter
of law. Fairchild appeals.

We affirm the district court’s judgments of infringement.
We conclude that the entire market value rule
cannot be used here to calculate damages. We vacate the
damages award and remand for further proceedings.