IP Law Daily, PATENT—D. Del.: Jury verdict against refined coal credit companies in Midwest Energy's infringement lawsuit upheld, (Nov 21, 2025)

By Saurabh Kashyap, B.A., M.A., LL.B., LL.M.

The court found that the jury instructions were legally sound, the evidence supported the verdict, and no prejudicial error occurred at trial.

The federal district court in Wilmington, Delaware, denied a motion for a new trial filed by CERT Operations entities after a jury found them liable for indirect and willful infringement of two of Midwest Energy Emissions Corp.’s patents concerning mercury emissions control technologies. The court ruled that the jury instructions were proper, the weight of the evidence supported the verdict, and no prejudicial error occurred during trial (Midwest Energy Emissions Corp. v. Arthur J. Gallagher & Co., No. 19-1334-CJB (D. Del. Nov. 20, 2025)).

Background. The plaintiff, Midwest Energy, a developer of patented mercury emission control technologies for coal-fired power plants, brought suit against CERT Operations II, IV, V, and RCB LLC, and several related entities. The defendants collectively operated as refined coal suppliers participating in the Section 45 (26 U.S.C. §45) tax credit program. Although not affiliated with Midwest Energy, the defendants purchased and processed coal using allegedly infringing technology and sold the refined product to power plants that employed further mercury control measures.

The asserted patents included U.S. Patent Nos. 10,343,114 (the ’114 patent) and 10,596,517 (the '517 patent), both of which address chemical treatment methods used to reduce mercury emissions during coal combustion. Specifically, claims 25 and 26 of the '114 patent and claims 1 and 2 of the '517 patent were at issue. These patents claim processes that use halogenated additives and activated carbon injection (ACI) to achieve mercury reduction, a technique essential for compliance with EPA's Mercury and Air Toxics Standards (MATS).

Midwest Energy filed suit in 2019, alleging indirect and willful infringement. A five-day jury trial took place in February 2024. The jury found in favor of Midwest Energy and awarded damages. The court subsequently dismissed co-plaintiff MES Inc. but retained Midwest Energy as the sole plaintiff. CERT moved for judgment as a matter of law and separately for a new trial, contesting the jury's findings on multiple grounds.

Contributory infringement. CERT argued that the jury instructions improperly narrowed the “substantial non-infringing use” analysis by focusing on the refined coal “as sold and delivered” during the damages period. The court rejected this contention, reaffirming its instruction as consistent with Federal Circuit law. It noted that substantial evidence supported the jury’s finding that the refined coal sold by CERT was especially adapted for use in infringing mercury control methods. The court cited Aqua Connect, Inc. v. TeamViewer US, Inc., No. 18-1572, 2023 WL 6387791, at *14 (D. Del. Sept. 29, 2023), and reiterated its earlier decision denying judgment as a matter of law on the same ground.

Induced infringement. CERT contended that the instructions failed to require proof of actual encouragement and causation by CERT. The court, relying on Power Integrations, Inc. v. Fairchild Semiconductor Int’l, Inc., 843 F.3d 1315, 1331 (Fed. Cir. 2016), found the instructions accurate and noted that they tracked the AIPLA Model Jury Instructions. CERT’s position—that it merely sold refined coal without encouraging infringing use—was rejected as inconsistent with the evidentiary record, which showed substantial evidence of conduct by CERT that knowingly caused infringement.

Willful infringement. CERT asserted that there was no evidence of its intent to infringe. The court disagreed, holding that the jury could infer willfulness from circumstantial evidence, including CERT’s indemnity provisions in sales contracts and the financial incentives tied to tax credits. The court cited Eko Brands, LLC v. Adrian Rivera Maynez Enters., Inc., 946 F.3d 1367, 1378 (Fed. Cir. 2020), affirming the jury’s finding that CERT acted with deliberate disregard of Midwest Energy’s patent rights.

Jury instructions. Further, CERT challenged the court’s refusal to instruct the jury to disregard evidence of financial gain from Section 45 tax credits. The court held that any potential prejudice was mitigated by its general instruction to apportion damages solely to the value of the patented invention. Further, the testimony about tax credits was found relevant to show motive and intent, not to compute damages.

Evidentiary rulings. The court rejected CERT’s renewed Daubert challenges to the technical expert, Mr. Philip O’Keefe, and the damages expert, Mr. Philip Green. It found that O’Keefe’s background in coal plant operations and pollution control qualified him to testify on technical issues, and that Green’s reliance on Chem-Mod license agreements was adequately supported and appropriately apportioned. The court also dismissed objections to testimony about indemnity provisions and tax credits as waived or harmless.

Damages. Additionally, CERT challenged the damages verdict as excessive and based on unreliable expert opinion. The court upheld the methodology, noting that Green's reliance on Chem-Mod licenses was supported by O'Keefe's testimony regarding technological comparability.

The Case is No. 19-1334-CJB.

Judge: Burke, C.

Attorneys: James M. Lennon (Devlin Law Firm LLC) for Midwest Energy Emissions Corp. Kenneth L. Dorsney (Morris James LLP) for Arthur J. Gallagher & Co., CERT Operations II LLC, CERT Operations IV LLC, CERT Operations V LLC, CERT Operations RCB LLC, Senescence Energy Products, LLC, Springhill Resources LLC, Buffington Partners LLC, Bascobert (A) Holdings LLC, Larkwood Energy LLC, Cottbus Associates LLC, Marquis Industrial Company, LLC, and Rutledge Products, LLC.

Companies: Midwest Energy Emissions Corp.; Arthur J. Gallagher & Co.; CERT Operations II LLC; CERT Operations IV LLC; CERT Operations V LLC; CERT Operations RCB LLC; Senescence Energy Products, LLC; Springhill Resources LLC; Buffington Partners LLC; Bascobert (A) Holdings LLC; Larkwood Energy LLC; Cottbus Associates LLC; Marquis Industrial Company, LLC; Rutledge Products, LLC

Cases: Patent DelawareNews