Bloomberg News
Published: Saturday, December 15
Callaway Golf Co., the maker of Big Bertha and Steelhead golf clubs, won a jury verdict against Fortune Brands Inc.'s Acushnet unit that three of its golf-ball patents are valid, clearing the way for another trial on damages.
Callaway sued last year in federal court in Delaware contending Acushnet infringed patents for multilayered golf balls.
Before trial, Acushnet agreed its Titleist Pro V1 balls infringed the patents and contended they were not valid.
The jury of four men and four women deliberated about two days following a six-day trial before affirming three of the patents on Friday. They ruled that two claims of another patent also were valid and one claim was invalid.
"We have now established in court that our golf ball patents are valid and that Titleist Pro V1 golf balls infringe those patents," Callaway spokeswoman Michele Szynal said in a statement.
"We will immediately start the process of requesting an appropriate remedy, including injunctive relief and damages."
Acushnet, based in Fairhaven, Mass., sells more than $200 million of the balls a year, according to court papers.
"The jury's mixed decision has created ambiguity," said Joseph Nauman, an Acushnet executive vice-president and legal counsel, in a statement.
"We continue to believe that we will ultimately prevail" based on reviews by the court and the U.S. Patent and Trademark Office, he said.
Acushnet "was facing obsolescence" before using Callaway's patented technology to make a ball that was "monumentally successful," Callaway lawyer Frank Scherkenbach told jurors in the trial, supervised by U.S. District Judge Sue L. Robinson.
The three-layered design, with a core, an inner cover, and a dimpled polyurethane outer cover, was "obvious," and the patent "didn't advance the state of the art," Acushnet lawyer Joseph Lavelle alleged during the trial.
Callaway rose the most in two years on Oct. 18 after its full-year profit forecast increased.
The California-based company has lowered costs by improving manufacturing while sales of high-end drivers and irons have risen.
One of the originally scheduled trial witnesses had been champion U.S. golfer Phil Mickelson, who uses Callaway equipment, according to court papers. Mickelson is the world's No. 2 golfer after Tiger Woods.
Robinson excluded Mickelson, 37, after Acushnet protested Callaway's use of the celebrity, saying Mickelson was invited "for a beauty contest, for his sensational WOW effect."