SCOTUS Nixes Petitions Challenging CAFC Apportionment Requirements, Claim Preclusion Rulings

Yesterday, the U.S. Supreme Court issued its first major omnibus order list of the October 2026 term, denying petitions for writ of certiorari in a series of intellectual property-related cases. These denials from the nation’s highest court leave in place contested rulings over the application of apportionment principles to damages in patent and trade secret cases. Other cert denials include appeals to IP-related claims barred under res judicata, including one petition arguing for a manifest injustice exception, and yet another challenge to the Section 101 patent-eligibility inquiry developed at the Federal Circuit.

Sunoco Partners Marketing & Terminals v. Powder Springs Logistics

After purchasing a portfolio of patents covering methods of blending butane into gasoline, Sunoco exclusively licensed those patents through the company’s butane supply agreements (BSAs) with distributors. Under those BSAs, Sunoco built blending systems at licensee gasoline terminals and maintained them for a share of the profits from the sale of extra gasoline obtained through the butane blending method. According to Sunoco’s cert petition, although butane and technological services were provided under the BSAs, access to the patented blending systems was the primary reason distributors, many of them Sunoco’s competitors, entered into those agreements.

Sunoco sued Magellan Midstream Partners, predecessor to respondent Powder Springs, after Magellan was selected to provide an automated butane blending system for the Colonial Pipeline. A District of Delaware jury found Sunoco’s patents valid and willfully infringed but only entered a damages award of $12 million based on a rate of two cents per gallon created by the infringing method. The jury was not able to credit testimony from Sunoco’s damages expert, who focused on a profit-sharing methodology based on the BSAs; the district court excluded this testimony as the BSAs covered more than the patented technology. Affirming, the Federal Circuit held that Sunoco’s expert was required to apportion the value of the non-patented services from the BSAs to be awarded lost profits.

Sunoco’s cert petition posed two questions for the Supreme Court: whether the Federal Circuit’s recovery standard for lost profits violates 35 U.S.C. § 284, which provides that courts “shall award the claimant damages adequate to compensate for the infringement;” and whether Federal Rule of Civil Procedure (FRCP) 702 requires courts to exclude expert testimony based upon critical facts contrary to record evidence when every other circuit court has allowed juries to determine whether those facts are true. Sunoco argued that the Federal Circuit’s apportionment requirement conflicted with the plain text of Section 284, and that its view of FRCP 702 improperly invades the province of the jury as factfinder.

Trinseo Europe v. Kellogg Brown & Root

Although an appeal from the Fifth Circuit, the cert petition filed with the Supreme Court by Trinseo Europe also took issue with apportionment requirements for damages awards developed by the Federal Circuit. Trinseo sued Kellogg Brown & Root (KBR) and other defendants in the Southern District of Texas alleging claims under the Defend Trade Secrets Act (DTSA) related to the misappropriation of polycarbonate manufacturing processes originally developed by Dow and sold to Trinseo’s predecessor.

After the jury found four of 10 alleged trade secrets to be valid and all four to be infringed by KBR, the district court vacated a $77 million damages award for Trinseo as speculative and unsupported by evidence. On appeal to the Fifth Circuit, which acknowledged it had not explicitly adopted apportionment principles into the trade secret context, the appellate court found Federal Circuit case law requiring valuation of each alleged secret to be persuasive.

Trinseo’s cert petition asked the Supreme Court whether a jury’s damages award has no legally sufficient basis when the jury finds misappropriation of some, but not all, alleged trade secrets and the trial evidence did not apportion damages per trade secret. Although circuit courts are divided on the issue, Trinseo called the apportionment approach unworkable in the trade secret context as much of the information on a trade secret’s commercial value is kept confidential given the efforts to maintain secrecy required under U.S. trade secret law.

Capital Security Systems v. NCR Voyix

In 2014, Capital Security sued NCR Voyix accusing that company’s automated teller machines of infringing patents covering courtesy amount recognition (CAR) and legal amount recognition (LAR) technologies for automated check reading. During Markman, NCR Voyix allegedly made several intentional misrepresentations regarding CAR and LAR as industry standard check-reading technologies conflicting with statements made by company representatives in Congressional testimony. That lawsuit ended in a default judgment invalidating Capital Security’s patents after the district court granted leave for the patent owner’s counsel to withdraw.

The cert petition recently denied by the Supreme Court followed a separate lawsuit filed by Capital Security in 2022 alleging fraud on the court by NCR Voyix for proffering fraudulent testimony and tampering with the discovery process. The Southern Florida district court found this suit barred by res judicata because the fraud claims could have been raised in a previous action brought in the same district court by Capital Security’s founder, Robin Gustin. Capital Security was added to that pro se complaint, which was dismissed for failure to state a claim because knowledge of the contents of allegedly misclassified discovery materials was imputed to Gustin through her attorney.

Capital Security’s cert petition asked the Supreme Court whether considerations of equity, such as manifest injustice, apply to a federal court’s claim preclusion analysis. Capital Security had argued that the Court should follow the approach of Florida courts, which recognize a manifest injustice exception to the application of both res judicata and collateral estoppel.

Other IP-Related SCOTUS Cert Denials This Week

US Patent No. 7,679,637 LLC v. Google – Petition challenging the Federal Circuit’s rigid application of the Section 101 patentability test, specifically the appellate court’s alleged conflation of the abstract idea identified at Step 1 of Alice/Mayo from the inventive concept analysis at Step 2.

Amron v. 3M Co. – Pro se petition from inventor of Post-it Notes predecessor Press-On Memo challenging the application of claim preclusion to bar a lawsuit alleging violation of confidentiality provisions to a litigation settlement with 3M, arguing that 3M’s representations that only Amron was bound by those provisions to be post-litigation conduct independently supporting a cause of action.

Naicom Corp. v. Dish Network – Petition challenging First Circuit summary affirmance of the District of Puerto Rico’s dismissal of Racketeer Influenced and Corrupt Organizations (RICO) Act, Digital Millennium Copyright Act (DMCA) and other claims related to Dish Network’s alleged manufacture of a piracy paper trail to file a sham piracy complaint with the Federal Bureau of Investigations (FBI).

Deppe v. Sovinski – Pro se petition challenging Eleventh Circuit ruling finding a University of Central Florida (UCF) attorney shielded by qualified immunity from allegations that she committed perjury upon the U.S. Patent and Trademark Office by submitting declarations falsely asserting that UCF had been assigned any and all rights to the petitioner’s laser inventions.

Kabir v. WebMD – Pro se petition raising challenges under the equal protection component of the Fifth Amendment’s Due Process Clause arguing that the systematic denial of Electronic Case Filing (ECF) access to pro se litigants creates a two-tiered system disproportionately impacting small inventors and creating timing asymmetries exploitable by large corporations.