Court Accepts Opinion of Invotex Damages Expert Michele M. Riley; Orders Yahoo! Inc. to Pay Post-Verdict Royalty to Creative Internet Advertising Corporation

Baltimore, MD - December 15, 2009

In his December 9, 2009, Memorandum Opinion and Order in re: Creative Internet Advertising Corporation (CIAC) v. Yahoo! Inc., et al., United States Magistrate Judge John D. Love accepts the opinion of CIAC’s damages expert, Invotex® Managing Director Michele Riley, that a 23% post-verdict ongoing royalty rate is reasonable and appropriate to compensate CIAC for Yahoo!’s continuing use of its infringed patent in the Yahoo! Messenger Program with IMVironments.

The dispute over ongoing royalty damages is premised on the theory that since Yahoo! continues to derive revenues from IMVironments post-verdict, CIAC is entitled to continued relief in the form of ongoing monetary damages. A defendant who is found guilty of patent infringement frequently will stop using the patents either voluntarily or through permanent injunction or will negotiate a permanent license with the patentee. Post-verdict damages allow a patentee to receive ongoing monetary damages when injunctive relief is not appropriate and when the parties cannot come to terms on an out-of-court settlement.

At trial in May 2009, the jury accepted Ms. Riley’s opinion that a 20% royalty rate based on Yahoo!’s revenues from IMVironments would be reasonable to compensate CIAC for past damages. According to Judge Love’s opinion,

“The jury accepted Ms. Riley’s pre-verdict application of the Georgia-Pacific factors and the Court similarly accepts her opinion that a 23% ongoing royalty rate is reasonable and appropriate in light of the change in the relationship between the parties post-verdict…. Ms. Riley’s opinion is consistent with the modified Georgia-Pacific approach endorsed by this district, and Ms. Riley specifically considers Yahoo!’s decision not to design around, or otherwise stop infringing.”

The case, Creative Internet Advertising Corporation v. Yahoo, Inc., et al., was filed in the U. S. District Court for the Eastern District of Texas, Tyler Division.

About Invotex Group
Invotex Group provides accounting, financial and economic consulting services to clients including Fortune Global 500 corporations, major law firms, leading research universities and local, state, and federal governments and agencies around the country. The firm’s highly credentialed experts and professional staff conduct economic and financial analyses to provide objective opinions and advice in matters involving complex transactions, disputes, investigations, reorganizations, insurance and valuations. Invotex also offers advisory services for intellectual property owners, including licensing, technology evaluation and license compliance, asset management and enforcement of IP rights. The firm comprises experienced industry leaders, former public company financial executives, former international accounting and consulting firm (“Big 4”) partners and seasoned consultants.

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Contact: Michele Riley, Managing Director, 410-824-0164