One of the more challenging aspects of patent licensing is determination of a price, or royalty, for the licensed patent(s) that allows both negotiating parties to benefit under the consummated transaction. The difficulty of successfully arriving at such a price may be complicated by the licensor's anticipation that decisions on pricing patent licenses may impact future licensing and monetization efforts. For example, if royalty structures from licenses become widely known (whether officially or unofficially), they may set a de facto baseline from which future licensees evaluate their opportunities or exposure under the same patent. If the patent becomes the subject of infringement litigation, previously-paid royalties may be presented as evidence of "established royalties" and therefore informative to the trier of fact.
April 19, 2011
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