Recent Developments In Estimation Of Patent Infringement Damages

Originally published in IPExperts.com, December 2007.

The 35 USC § 284 statute clearly defines the compensatory nature of patent damages and outlines one form of relief commonly seen in patent infringement damages estimation – reasonable royalty. The other form of patent infringement damage remedy is lost profits.

Reasonable royalty is often estimated using the framework of a hypothetical negotiation between a willing buyer and a willing seller, engaged in an arms length transaction.¹ An economic damages expert relies upon Georgia-Pacific factors and other case-specific factors to determine the bargaining power of each side as they come to the hypothetical negotiation table.^{2, 3}