Although the Federal Circuit has “never described the Georgia–Pacific factors as a talisman for royalty rate calculations, district courts regularly turn to this 15–factor list.” Ericsson v. D-Link. The factors derive from Georgia-Pacific v. U.S. Plywood. The Federal Circuit does “not require that witnesses use any or all of the Georgia–Pacific factors when testifying about damages” in patent infringement cases. Whitserve v. Computer Packages. “If they choose to use them, however, reciting each factor and making a conclusory remark about its impact on the damages calculation before moving on” is not sufficient. Id. “When performing a Georgia–Pacific analysis, damages experts must not only analyze the applicable factors, but also carefully tie those factors to the proposed royalty rate.” Exmark v. Briggs & Stratton.
The fifteen factors are:
- The royalties received by the patentee for the licensing of the patent in suit, proving or tending to prove an established royalty.
- The rates paid by the licensee for the use of other patents comparable to the patent in suit.
- The nature and scope of the license, as exclusive or non-exclusive; or as restricted or non-restricted in terms of territory or with respect to whom the manufactured product may be sold.
- The licensor’s established policy and marketing program to maintain his patent monopoly by not licensing others to use the invention or by granting licenses under special conditions designed to preserve that monopoly.
- The commercial relationship between the licensor and licensee, such as, whether they are competitors in the same territory in the same line of business; or whether they are inventor and promotor.
- The effect of selling the patented specialty in promoting sales of other products of the licensee; the existing value of the invention to the licensor as a generator of sales of his non-patented items; and the extent of such derivative or convoyed sales.
- The duration of the patent and the term of the license.
- The established profitability of the product made under the patent; its commercial success; and its current popularity.
- The utility and advantages of the patent property over the old modes or devices, if any, that had been used for working out similar results.
- The nature of the patented invention; the character of the commercial embodiment of it as owned and produced by the licensor; and the benefits to those who have used the invention.
- The extent to which the infringer has made use of the invention; and any evidence probative of the value of that use.
- The portion of the profit or of the selling price that may be customary in the particular business or in comparable businesses to allow for the use of the invention or analogous inventions.
- The portion of the realizable profit that should be credited to the invention as distinguished from non-patented elements, the manufacturing process, business risks, or significant features or improvements added by the infringer.
- The opinion testimony of qualified experts.
- The amount that a licensor (such as the patentee) and a licensee (such as the infringer) would have agreed upon (at the time the infringement began) if both had been reasonably and voluntarily trying to reach an agreement; that is, the amount which a prudent licensee — who desired, as a business proposition, to obtain a license to manufacture and sell a particular article embodying the patented invention — would have been willing to pay as a royalty and yet be able to make a reasonable profit and which amount would have been acceptable by a prudent patentee who was willing to grant a license.
This post will analyze the eleventh Georgia-Pacific factor.
- The extent to which the infringer has made use of the invention; and any evidence probative of the value of that use.
Case Outcome Notes Hanson v. Alpine Valley Ski Area, Inc., 718 F. 2d 1075 (Fed. Cir. 1983) Reasonable Royalty Affirmed The royalty rate used by the Magistrate Judge was supported by the evidence. The Magistrate determined that plaintiff would have granted licenses only at a uniform rate and not based on actual use. Moreover ,the record contains substantial evidence that actual use of the invention would not have been the basis upon which a willing licensor and licensee would have established the royalty. It would have been extremely difficult to monitor actual use, as apparently no complete or accurate records were kept of the actual use of the machines. Further, a royalty based upon actual use would have been inconsistent with the function of the machines. Plaintiff’s expert likened the machines to an insurance policy. The number of hours a machine is used is irrelevant, as the desire is never to use the machine. Lucent Technologies, Inc. v. Gateway, Inc., 580 F. 3d 1301 (Fed. Cir. 2009) Reasonable Royalty Vacated The extent to which the infringer has made use of the invention does not tend to support the jury award of $358 million. Consideration of evidence of usage after infringement started can, under appropriate circumstances, be helpful to the jury and the court in assessing whether a royalty is reasonable. Usage (or similar) data may provide information that the parties would frequently have estimated during the negotiation. Even though parties to a license negotiation will usually not have precise data about future usage, they often have rough estimates as to the expected frequency of use. This quantitative information, assuming it meets admissibility requirements, ought to be given its proper weight, as determined by the circumstances of each case. Here, the evidence of record is conspicuously devoid of any data about how often consumers use the patented feature. No evidence describes how many users had ever performed the patented method or how many times. Plaintiff had the burden to prove that the extent to which the infringing method has been used supports the lump-sum damages award. i4i Ltd. Partnership v. Microsoft Corp., 598 F. 3d 831 (Fed. Cir. 2010) Admitting Expert Testimony on Damages Plaintiff’s expert opined that factor 11, which looks at the use and value of the patented technology to Defendant, increased the royalty rate. The expert concluded that the patented feature was a critical addition to Defendant’s product. In support of this view, plaintiff presented statements by Defendant employees that the feature was not a “slight addition [but i]t’s more like 90 percent of the value,” was “where the future is, seriously,” and “the glue that holds the [product] ecosystem together.” Defendant points out various weaknesses in the damage calculations by Plaintiff’s expert. Defendant’s disagreements are with the expert’s conclusions, not his methodology. These disagreements go to the weight, not admissibility, of his opinion. Finjan, Inc. v. Secure Computing Corp., 626 F. 3d 1197 (Fed. Cir. 2010) Reasonable Royalty Affirmed The jury’s $9.18 million award was properly supported. Here, the accused direct infringers are Defendants, not their customers. Because Defendants included the patented feature on every accused product, their use encompassed all of their sales, regardless of customer activation. Defendants’ argument that the jury ignored the fact that not all customers enabled the feature confuses “use” under factor 11, which looks to how often a patented invention has been used by infringers. SUMMIT 6, LLC v. Samsung Electronics Co., Ltd., 802 F. 3d 1283 (Fed. Cir. 2015) Affirming Reasonable Royalty Plaintiff’s expert’s damages methodology was based on reliable principles and was sufficiently tied to the facts of the case. The expert first estimated Defendant’s economic benefit from infringement by specifically focusing on the infringing features and by valuing those infringing features based on Defendant’s own data regarding use and on its own financial reports outlining production costs and profits. The expert then envisioned a hypothetical negotiation in which the parties would have bargained for respective shares of the economic benefit, given their respective bargaining positions and alternatives to a negotiated agreement. The district court did not abuse its discretion in determining that the methodology, involving the correlation of use with value, was reliable. In addition, men with the history of life and companies in Italy, Spain, Germany, UK, Japan, France and US. tadalafil 40mg india Visit a doctor purchase levitra is high on the list in order for you to clear your mind of all your stresses and worries. Sildenafil citrate is prescribed to fight against impotency problem as it tadalafil generic helps to recover the problem. cialis on line http://amerikabulteni.com/2012/05/05/barack-obamanin-medyadan-anladigi-ne/ Choose the one whom you idolize.