Federal Circuit clarifies entire market value rule for patent damages

Description

Abstract: This article looks at an infringement damages case involving a multicomponent product. The U.S. Court of Appeals for the Federal Circuit clarified the application of the entire market value rule when the smallest salable unit is the entire accused product. The court concluded that, if that unit doesn’t drive demand for the overall product, the royalty must be further apportioned. A sidebar explains why the court also rejected the plaintiff’s expert’s use of the Nash bargaining solution to estimate reasonable royalty damages.