7 April 2026, The Supreme Court of Delaware ruled in the patent licensing dispute between LG Electronics and Intellectual Ventures (hereinafter referred to as IV), overturning the lower court’s decision to substantially reduce the jury-awarded damages to approximately US$4.9 million (equivalent to approximately RMB 33.47 million). The court instead awarded LG US$12.8 million (equivalent to approximately RMB 87.43 million) in damages, along with pre-judgment interest and legal costs.

The case stems from a patent licensing agreement signed in 2019 between LG Electronics and several entities under IV. LG agreed to pay US$12.8 million in licence fees to ensure that LG and its customers would be protected from infringement litigation when using the relevant technology. The parties agreed that damages for breach of contract would be limited to the licence fees paid by LG. However, IV subsequently sued LG’s customers, General Motors and Toyota Motor Corporation, in a US federal court in Texas, resulting in LG facing claims totalling approximately US$17.2 million. LG consequently filed a lawsuit in the Delaware Superior Court in November 2022, alleging that IV had breached the contract.

In October 2024, a jury ruled in favour of LG, awarding damages of $17.2 million. Whilst the trial judge upheld the verdict, he accepted IV’s argument that, based on the contractual cap on damages, the award should be reduced to the amount of licence fees actually received by IV’s entities, approximately $4.9 million. Both parties appealed the trial court’s decision.

On 7 April 2026, a panel of the Delaware Supreme Court issued its opinion, noting that whilst the contractual cap on damages was indeed linked to LG’s licence fees, the new interpretation put forward by IV’s affiliated entities—arguing that liability should be limited to $4.9 million—had been raised at the very last moment prior to the trial. The court held that this last-minute change created an unfair prejudice, depriving LG of a sufficient opportunity to gather evidence or adjust its strategy; consequently, it was inappropriate for the trial judge to adopt the reduced cap following the jury’s verdict.

At the same time, the court dismissed IV’s appeal. The court noted that LG’s products fell within the scope of the licence agreement and that LG did indeed bear a substantive obligation to compensate its customers. The jury reasonably relied on correspondence and testimony, which indicated that LG should pay General Motors approximately $14.9 million and Toyota approximately $2.3 million, totalling $17.2 million. Based on the liability cap set out in the relevant licence agreement (namely $12.8 million), the Court of Appeals accordingly ruled that IV’s liability was capped at $12.8 million.

The court also clarified the provisions of Delaware law regarding pre-judgment interest, ruling that such interest should be awarded as a matter of right, rather than at the judge’s discretion. The lower court should not have refused to award interest on the grounds that LG had not yet actually paid its customers. Furthermore, as the prevailing party, LG is entitled to recover litigation costs, which are not precluded by the liability limitation clause in the contract.

The Court of Appeals remanded the case to the Delaware Supreme Court, directing it to enter a judgment for $12.8 million and to award LG pre-judgment interest and legal costs. LG declined to comment on the case, and representatives of the other parties did not immediately respond to requests for comment. IP Finance will continue to monitor further developments.

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