Patent Law

In the recent case of ClearPlay v. Max Abecassis and Nissim Corp (Fed. Cir. 2010), the patent holder (Nissim) struggled to collect its royalty payments even after the parties signed an agreement that settled their patent infringement dispute.

Nissim's situation is not unusual. A recent report by the Invotex found that 86% of licensees underpay royalties. Most of the under-payment comes from (1) questionable license interpretations and (2) unreported sales of covered goods & services.

Although the report may be somewhat biased (Invotex makes its money by finding non-compliance) it does make clear patentees should plan to work as hard collecting royalties as they did winning the infringement lawsuit. This type of study may also be helpful for patentees seeking injunctive relief -- especially if they can show that the defendant-in-question has underpaid royalties in the past.

Read the Report

Intangible Economy Blog