The Latest Inappropriate Reasonable Royalty Rule Of Thumb
Law360, New York ( July 28, 2015, 10:10 AM EDT) -- In a July 10 order denying a Daubert motion seeking to exclude the testimony of a patentee's damages expert, the court in Good Technology Corporation v. MobileIron Inc.[1] rejected a fundamental premise of the willing-buyer/willing-seller hypothetical negotiation form of reasonable royalty analysis: that the parties would have negotiated a royalty that allows the suppositious licensee to make a profit on sales of the accused device. Essentially, the court allowed the patentee's expert to present to the jury a hypothetical negotiation in which the suppositious licensee would have agreed to pay the patentee all of the expected incremental profit. In doing so, the court also allowed the patentee to employ a new "rule of thumb" that is just as arbitrary as the "25 percent rule" or the "50 percent rule," which were both recently rejected — let's call this newest version the "100 percent rule."...
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