A federal district judge yesterday ruled that SCM Corp. cannot collect the $37.3 million in antitrust damages awarded it from Xerox Corp. by a jury last summer.
After a longthy and complicated trial, the jury had ruled that SCM had suffered damages of about $37 million because it was illegally excluded from marketing copying machines using ordinary paper by patets held by Xerox, the machines' developer. The jury had also given SCM almost a quarter-million dollars in other claims involving discounts for customers who ordered a variety of machines.
Yesterday, however, U.S. District Court Judge Jon O. Newman, who presided over the Hartford, Conn., jury trial, said SCM didn't deserve money damages under the law. Newman, who could have trebled the damage awards, said that SCM's key damage claim is a novel one based on Xerox's refusal to grant its rival a license for plain paper copiers.
That didn't by itself entitle the company to trebled antitrust damages, Judge Newman ruled. "Trebled damage awards for a refusal to license would inject major uncertainty into research investment decisions," he wrote in a 102-page decision. He also said that it would be unreasonable under patent law to impose such liability which might threaten future research.
The judge said that because the jury's factural findings had rejected many of SCM's claims for damages, and because the court had concluded that damage liability couldn't validly be based on any of the jury's factual findings in SCM's favor, Xerow was not liable to SCM for any money damages.
SCM, in a strongly worded statement issued after the judge's ruling, said it was "appalled" by the decision and promised an appeal. SCM General Counsel Richard Sexton said the ruling "undercuts the jury system... and leaves an illegal monopolist... free to continue to behave illegally without the slightest risk that such behavior will make it liable for damages."