Animating the Hypothetical Negotiation of a Reasonable Royalty in Patent Litigation


Good litigation graphics convey a message quickly and clearly. The example animation in today’s post supports an argument that plaintiff’s claim for a “reasonable royalty” in a patent case was unreasonable because the claim equaled the full value of the defendant company at the time of the “hypothetical negotiation” back in 2008. Here is a short (18-second) version of the animation with audio of how an attorney might argue the point to a jury.

When someone has infringed a patent, how does the jury determine damages? The relevant statute, 35 U.S.C. § 284, provides that the patent holder is entitled to “damages adequate to compensate for the infringement, but in no event less than a reasonable royalty for the use made of the invention by the infringer, ….”

The “Hypothetical Negotiation” in Patent Law

One way to prove damages under the statute is to become a time traveler, somewhat like Ebenezer Scrooge in ”A Christmas Carol.” In the jury’s ”time travel” for patent damages, the jury must imagine going back to a time just before infringement began, and listen in on a hypothetical negotiation for a ”reasonable royalty” between the patent holder and the defendant.

Read more here:

Animation sample - Percentage of value in reasonable royalty


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