Rex Medical v. Intuitive Surgical: When a Verdict Becomes Nominal

Rex Medical, L.P. v. Intuitive Surgical, Inc., No. 24-1072 (Fed. Cir. Oct. 2, 2025), affirmed a district-court JMOL that reduced a $10 million jury verdict to $1 in nominal damages. The reduction did not turn on infringement or validity. It turned on apportionment. The damages expert had relied on a portfolio license that covered far more than the asserted patents, and the expert had not done the work to separate the value of the asserted patents from the value of the rest. The district court excluded the testimony before trial, the jury still returned $10 million on a different damages theory, and the district court entered judgment as a matter of law at $1. The Federal Circuit affirmed.

The decision is the second major Federal Circuit damages reset of 2025, following EcoFactor v. Google (Fed. Cir. 2025) (en banc), and it tightens the screws on comparable-license analysis in the same direction.

The verdict and the appeal

The jury returned $10 million in reasonable-royalty damages. The patentee's damages expert had built his analysis around a portfolio license between Rex Medical and a third party. The portfolio license covered a bundle of patents and other intellectual property, of which the asserted '650 patent in the Intuitive Surgical case was a subset.

Before trial, the district court granted Intuitive Surgical's Daubert motion and excluded the expert's apportionment-based testimony. Rex Medical went to trial on a different damages theory; the jury still returned $10 million. Intuitive Surgical moved for JMOL on damages, the district court granted it, and entered $1 in nominal damages.

On appeal, the Federal Circuit affirmed both the Daubert exclusion and the JMOL. The infringement finding stood. The asserted patents were not invalidated. The dollar value of the win, after the apportionment failure, was $1.

What the expert's analysis did and did not do

The expert identified the portfolio license. He presented the royalty rate from that license. He treated the rate as a reasonable proxy for the value of the asserted patents.

What he did not do, in the district court's reading affirmed on appeal, was the apportionment math. The portfolio contained patents and other rights beyond the asserted '650 patent. A reasonable royalty for the asserted patents alone is, in the typical case, a fraction of the rate the licensor and licensee agreed to for the full portfolio. The expert needed to show the connecting steps: which patents were in the portfolio, what fraction of the portfolio's value was attributable to the asserted patents, and how that fraction translated into a royalty rate for the case at hand.

Those steps were not in the report at the rigor Rule 702 requires. The district court excluded the testimony under Daubert. The Federal Circuit affirmed.

The Federal Circuit's reasoning

The reasoning followed the same apportionment line drawn in Apple v. Wi-LAN and Jiaxing Super Lighting v. Lights of America. A comparable license is admissible as a reasonable-royalty input only if the expert has tied the license to the asserted patents with sufficient analytical work. The work cannot be conclusory. The expert cannot wave at the comparable and assert the rate. The expert has to show why the comparable maps to the patents in suit and what adjustments are required to make it map.

The portfolio-license problem is a recurring fact pattern. A patentee with a portfolio of related patents often licenses the portfolio rather than individual patents. The portfolio rate is the cleanest number available, and damages experts gravitate to it. But the portfolio rate is not the asserted-patent rate, and Rex Medical confirms that treating them as the same will not survive Daubert or appellate review.

The court did not announce a new rule. It applied longstanding apportionment doctrine and reinforced the en banc holding in EcoFactor. The two decisions together are a clear signal that damages methodology will be tested with rigor at the gatekeeping stage and again on appeal.

How this fits with EcoFactor and the post-amendment environment

EcoFactor addressed comparable-license selection and the analytical chain between the cited licenses and the royalty rate the expert proposed. Rex Medical addresses portfolio-to-individual-patent apportionment, which is a related but distinct issue. Together they cover the two most common failure modes in patent damages analysis.

The post-amendment environment has been characterized by tighter Daubert gatekeeping at the partial-exclusion margin. Rex Medical extends that tightening to the appellate stage. A damages opinion that is excluded at trial and not salvaged on appeal is now a live risk, and the cost of that risk is the difference between $10 million and $1.

Practical implications for damages experts

The implication for damages experts is concrete. Portfolio licenses can still be used as comparables. The expert just has to do the apportionment. That means identifying the patents in the portfolio, identifying the value drivers across those patents, allocating a defensible share of the portfolio's value to the asserted patents, and explaining the allocation in terms a reviewing court can evaluate.

The work is harder than citing the portfolio rate and stopping there. It involves patent-by-patent analysis of the licensed bundle, technology mapping, sometimes claim-by-claim economic analysis. It produces a longer expert report, with more exhibits and more cross-examination surface area. That is the trade-off the post-Rex Medical environment imposes.

For retaining counsel, the implication is that damages experts who take shortcuts on apportionment are now an exclusion risk at trial and an affirmance risk on appeal. The $10-million-to-$1 outcome is the data point that should drive damages-expert retention decisions going forward.