How Recent Patent Damages Precedent May Increase Reasonable Royalty Awards

In the last few years, developments in U.S. patent damages law have emerged that may have an upward effect on the magnitude of reasonable royalty awards. This article addresses two developments that have begun to take hold in the U.S. district courts after significant precedential rulings from the U.S. Court of Appeals for the Federal Circuit:

1. Reasonable royalty damages may incorporate the value of foreign economic activity caused by domestic direct infringement under 35 U.S.C. § 271(a), based on Brumfield v. IBG LLC, 97 F.4th 976 (Fed. Cir. 2024); and
2. Reasonable royalty damages for a component supplier may incorporate the value of the invention in markets for downstream products, like finished consumer goods, based on Cal. Inst. of Tech. v. Broadcom Ltd., 25 F.4th 976 (Fed. Cir. 2022).

Each of these concepts, standing alone, can increase the magnitude of a damages award. In combination, they may have a multiplicative effect in certain cases.