Three Cases Reshaping Patent Licensing Practice

01 March 2010
By Dr. Elizabeth M. Bailey and Dr. Alan Cox with former NERA economist Dr. Gregory K. Leonard

This article from Managing IP examines three recent US patent infringement cases -- Lucent, i4i, and Cornell. In decisions in these cases, judges of the Court of Appeals for the Federal Circuit set higher standards for calculating reasonable royalties. The authors note that, while the details differ, several common themes emerge on damages methodologies in these three matters. The authors find that the most straightforward implication of these cases is that, when involved in litigation, counsel should ensure that their damages analyses are based on sound economic valuation methodologies that focus on the value of the specific patented technology in the application that is at issue in the case. In addition, litigation counsel should be certain to make the necessary motions that will allow District Courts to perform their gate-keeping role: ensuring that damages methodologies not based on sound economic and business principles are barred from being heard by juries.