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Nutter McClennen & Fish LLP | USA | 22 Mar 2011

Rejection of the 25 rule in the calculation of a reasonable royalty rate

Though the "25 Rule," which presumes that 25 percent of the operating profit from the sale of an infringing good is a reasonable royalty rate, has been frequently relied upon as a starting point in calculating patent infringement damages for more than 40 years, the Federal Circuit recently held that this rule of thumb "is a fundamentally flawed tool.

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