The Full Federal Court in Australia has made it clear that, in
an action for unjustified threats, a party is entitled only to
damage sustained as a result of the unjustified threats under
section 128 of the Patents Act 1990 (the Act),
and not damage sustained as a result of
infringement proceedings subsequently commenced (Australian Mud
Company Pty Ltd v Coretell Pty Ltd [2017] FCAFC 44). This
decision overturned an award for substantial damages of just over
$1.5 million. It is a timely reminder of the precision required in
undertaking a damages analysis, both in terms of the application of
the correct legal test and the evidence required to meet that
test.
Background
Australian Mud Company (AMC) was the owner of
an innovation patent relating to core sampling. AMC's lawyers
sent three letters between November 2006 and February 2007 to
Mincrest Holdings Pty Ltd (Mincrest) and Coretell
Pty Ltd (Coretell) alleging infringement of
AMC's patent by reason of the
