Courtroom developments and their impact on patent monetisation

When the value of a patent is tied to the ability to enforce it, what happens in the courtroom affects negotiations in the boardroom. Three trends in US litigation continue to have a key impact on monetisation and licensing.

This article first appeared in the IP Monetisation Yearbook 2012, a supplement to Intellectual Asset Management, published by The IP Media Group.  To view the publication in full, please go to www.iam-magazine.com.

Patent law, like the technology underlying it, continues to change at ever-increasing speed. Recent developments in the US courts, particularly at Federal Circuit level, have had a substantial impact on the monetisation of patents. Three developments are especially relevant:

• The courts have increased their scrutiny over damage claims, requiring patent holders to demonstrate the incremental value of a claimed invention over available alternatives. 

• The courts are wrestling with an increasingly common defence strategy which seeks to articulate reasonable royalty damages in terms of a paid-in-full, lumpsum royalty, thus avoiding claims for future royalties. 

• Recent changes regarding venue selection for patent cases have made the International Trade Commission (ITC) an increasingly attractive forum for resolving disputes. However, patent holders should understand that this forum is available only for certain types of dispute.