Intellectual Property
Valuation, Exploitation, and Infringement Damages 2015 Cumulative Supplement
11th Edition
Published on 19. October 2015
Book
Paperback/Softback
420 pages
978-1-118-92842-4 (ISBN)
Description
An updated, comprehensive guide to monetizing intellectual property assets
Intellectual Property, Valuation, Exploration, and Infringement Damages removes complexity and provides solutions to the challenge of placing a dollar amount on intellectual property. This revised and updated cumulative supplement for 2015 provides insight that reflects the latest regulations and best practices, and the most up to date practical tools for evaluating the investment aspects of licensing and joint venture decisions. The discussion includes procedures for accounting, tax, and legalities, and examines the business economics of strategies involving intellectual property, and analytical models are provided to help you determine reasonable royalty rates for licensing and fair equity splits in joint venture arrangements. With detailed explanations and expert insight into the realities surrounding these assets, you'll have everything you need to exploit your product to the fullest extent.
Companies are increasingly looking to their intellectual property as a profit center. Patents, trademarks, formulas, copyrights, and brand names can easily become the cornerstone of a corporation, and its most important asset, all while remaining difficult to quantifiably value. This supplement simplifies the challenge by providing the tools, precedent, and expert advice you need to approach these assets with clarity and understanding.
* Overcome valuation challenges and avoid common errors
* Understand the associated legal, tax, and accounting practices
* Study analytical models for fair licensing and equity splits
* Review precedent for determining infringement damages
Intellectual property can cost hundreds of millions of dollars to create, and is often irreplaceable with no substitute or alternative available. These assets need protection, and companies need recourse in case of infringement. Intellectual Property, Valuation, Exploration, and Infringement Damages clarifies the legal, financial, and investment issues to give you a deeper understanding of how best to handle these valuable assets.
Intellectual Property, Valuation, Exploration, and Infringement Damages removes complexity and provides solutions to the challenge of placing a dollar amount on intellectual property. This revised and updated cumulative supplement for 2015 provides insight that reflects the latest regulations and best practices, and the most up to date practical tools for evaluating the investment aspects of licensing and joint venture decisions. The discussion includes procedures for accounting, tax, and legalities, and examines the business economics of strategies involving intellectual property, and analytical models are provided to help you determine reasonable royalty rates for licensing and fair equity splits in joint venture arrangements. With detailed explanations and expert insight into the realities surrounding these assets, you'll have everything you need to exploit your product to the fullest extent.
Companies are increasingly looking to their intellectual property as a profit center. Patents, trademarks, formulas, copyrights, and brand names can easily become the cornerstone of a corporation, and its most important asset, all while remaining difficult to quantifiably value. This supplement simplifies the challenge by providing the tools, precedent, and expert advice you need to approach these assets with clarity and understanding.
* Overcome valuation challenges and avoid common errors
* Understand the associated legal, tax, and accounting practices
* Study analytical models for fair licensing and equity splits
* Review precedent for determining infringement damages
Intellectual property can cost hundreds of millions of dollars to create, and is often irreplaceable with no substitute or alternative available. These assets need protection, and companies need recourse in case of infringement. Intellectual Property, Valuation, Exploration, and Infringement Damages clarifies the legal, financial, and investment issues to give you a deeper understanding of how best to handle these valuable assets.
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Other editions
New editions
Russell L. Parr | Gordon V. Smith
Intellectual Property
Valuation, Exploitation, and Infringement Damages, 2016 Cumulative Supplement
Book
04/2016
12th Edition
Wiley
€209.00
Article is exhausted; no reprint
Persons
Russell L. Parr, CFA, ASA is President of Intellectual Property Research Associates (www.ipresearch.com). He is an expert in determining the value of intellectual property. Mr. Parr's books about intellectual property value and management are published in Japanese, Korean, Italian and English. He is dedicated to the development of comprehensive methods for accurately defining the value of intellectual property.
Content
PREFACE xvii
PART I VALUATION 1
CHAPTER 1A INTELLECTUAL PROPERTY LANDSCAPE (NEW) 3
1A.1 80% of Corporate Value Is Intellectual Property and Intangible Assets 4
1A.2 Over Seven Million Patents 6
1A.3 Corporations Own the Most Patents 7
1A.4 All Industries Are Patenting Inventions 8
1A.5 Trademarks 10
1A.6 Trademarks Are Supported with Huge Ad Spending 11
1A.7 Copyrights 12
1A.8 Trade Secrets 12
1A.9 Business of Licensing 15
CHAPTER 1B U.S. CONGRESS FLIRTS WITH DISASTER (NEW) 25
1B.1 Patent Litigation Venue 27
1B.2 Patent Infringement Damages 27
1B.3 Injunctions for Only Competitors 29
1B.4 Harming Our Only Economic Advantage 31
CHAPTER 12A RISK-ADJUSTED CASH FLOWS (NEW) 32
12A.1 Required Rates of Return 33
12A.2 Capital Asset Pricing Model 36
12A.3 Build-Up Method 41
12A.4 Venture Capital Rates of Return 42
12A.5 Probability of Success 45
12A.6 Conclusion 49
CHAPTER 12B DEALING WITH RISK AND UNCERTAINTY IN INTELLECTUAL PROPERTY VALUATION AND EXPLOITATION (NEW) 51
12B.1 Risk versus Uncertainty 53
12B.2 Decision Analysis and Decision Trees 55
12B.3 Decision Tree Components and Conventions 56
12B.4 Monte Carlo Techniques 63
12B.5 Markov Chains 66
12B.6 Obtaining Information from Indirect Observation: Shadow Pricing 70
12B.7 Bayesian Analysis 72
12B.8 Option Pricing Models 75
12B.9 Limitations on Rationality in Decision Making: The Effects of Perception and Biases on Decision Making 78
12B.10 Conclusion 79
CHAPTER 14A RIGHTS OF PRIVACY, PUBLICITY, AND CELEBRITY PERSONA (NEW) 81
14A.1 Introduction 81
14A.2 Legal Underpinnings 84
14A.3 Trademark Rights 87
14A.4 Copyright 88
14A.5 Legal Uncertainties and Solutions 90
14A.6 A Photography Issue 91
14A.7 Conclusion 93
CHAPTER 14B INTELLECTUAL PROPERTY AND INTANGIBLE ASSET VOLATILITY (NEW) 95
PART II LICENSING 101
CHAPTER 27A ROYALTY RATES AND LICENSE FEES FOR TECHNOLOGY (NEW) 103
27A.1 Royalty Rates 104
27A.2 Per Unit Royalties 107
27A.3 Royalties Based on Profitability 108
27A.4 License Fees 109
27A.5 Medical Device Industry Royalty Rates 111
27A.6 Medical Device Industry License Fee Distribution 112
27A.7 Conclusion 114
CHAPTER 27B LICENSE FEES AND ROYALTY RATE FREQUENCY FOR TECHNOLOGY (NEW) 115
27B.1 Real Deal Royalty Rates 116
27B.2 Per Unit Royalties 118
27B.3 License Fees 119
27B.4 Conclusion 120
CHAPTER 27C ROYALTY RATES AND LICENSE FEES FOR PHARMACEUTICALS AND BIOTECHNOLOGY (NEW) 121
27C.1 The Parties--Licensing between Corporations Dominates 122
27C.2 Royalty Rates 122
27C.3 License Fees 124
27C.4 Key Technologies 125
27C.5 Developmental Stages of Technology 126
27C.6 Conclusion 128
CHAPTER 33A THE MAGNITUDE AND MEANING OF ROYALTY MISREPORTING (NEW) 129
33A.1 Introduction 129
33A.2 "Why?" versus "How?" 130
33A.3 Math Errors: 5% Error Rate 133
33A.4 Royalty Rate Errors: 4% Error Rate 134
33A.5 Transfer Prices: 4% Error Rate 136
33A.6 Unreported Benchmarks and Milestones: 5% Error Rate 137
33A.7 Unreported Sales: 16% Error Rate 138
33A.8 Disallowed Deductions: 9% Error Rate 138
33A.9 Unreported Sublicenses: 17% Error Rate 139
33A.10 Questionable License Interpretation: 40% Error Rate 139
33A.11 Conclusion 140
CHAPTER 33B INTELLECTUAL PROPERTY AUDIT AND MANAGEMENT (NEW) 141
33B.1 Introduction 142
33B.2 Intellectual Property Is Important 142
33B.3 But Intellectual Property Is Frequently Mismanaged 143
33B.4 Why the Intellectual Property Dichotomy? 143
33B.5 The First Step: An Intellectual Property Audit 144
33B.6 From IP Audit to IP Management 146
33B.7 Insuffi cient Approaches 147
33B.8 A New Intellectual Property Management Paradigm 148
33B.9 Available Tools 148
33B.10 Benefi ts of Intellectual Property Management 149
33B.11 When to Do an Intellectual Property Audit 150
33B.12 How to Do an Intellectual Property Audit 152
33B.13 Software Solutions to Make the Job Easier 155
33B.14 Conclusion 158
CHAPTER 35A QUANTIFYING REASONABLE ROYALTIES: THE ENTIRE MARKET VALUE RULE (NEW) 163
CHAPTER 45 NEW MEASURE OF INFRINGEMENT DAMAGES--FUTURE DAMAGES (NEW) 175
45.1 Royalty Rate for Future Damages 177
45.2 What About Future Lost Profi ts? 188
CHAPTER 45A CONTINUALLY EVOLVING PATENT DAMAGES (NEW) 189
45A.1 Post-Verdict Royalty Rates 190
45A.2 Optimize Your Patented Technology or Lose It 195
45A.3 Litigation-Based Licenses 198
CHAPTER 45B THE 25% RULE IS DEAD (NEW) 203
APPENDIX G MORE SAMPLE ROYALTY RATE INFORMATION (NEW) 207
APPENDIX H TRADEMARK ROYALTY RATES (NEW) 235
APPENDIX H-A MORE TRADEMARK AND COPYRIGHT ROYALTY RATES (NEW) 253
APPENDIX I PHARMACEUTICAL AND BIOTECHNOLOGY ROYALTY RATES (NEW) 291
APPENDIX J TELECOMMUNICATIONS ROYALTY RATES (NEW) 315
APPENDIX K ELECTRICAL AND ENERGY ROYALTY RATES (NEW) 351
INDEX 385
PART I VALUATION 1
CHAPTER 1A INTELLECTUAL PROPERTY LANDSCAPE (NEW) 3
1A.1 80% of Corporate Value Is Intellectual Property and Intangible Assets 4
1A.2 Over Seven Million Patents 6
1A.3 Corporations Own the Most Patents 7
1A.4 All Industries Are Patenting Inventions 8
1A.5 Trademarks 10
1A.6 Trademarks Are Supported with Huge Ad Spending 11
1A.7 Copyrights 12
1A.8 Trade Secrets 12
1A.9 Business of Licensing 15
CHAPTER 1B U.S. CONGRESS FLIRTS WITH DISASTER (NEW) 25
1B.1 Patent Litigation Venue 27
1B.2 Patent Infringement Damages 27
1B.3 Injunctions for Only Competitors 29
1B.4 Harming Our Only Economic Advantage 31
CHAPTER 12A RISK-ADJUSTED CASH FLOWS (NEW) 32
12A.1 Required Rates of Return 33
12A.2 Capital Asset Pricing Model 36
12A.3 Build-Up Method 41
12A.4 Venture Capital Rates of Return 42
12A.5 Probability of Success 45
12A.6 Conclusion 49
CHAPTER 12B DEALING WITH RISK AND UNCERTAINTY IN INTELLECTUAL PROPERTY VALUATION AND EXPLOITATION (NEW) 51
12B.1 Risk versus Uncertainty 53
12B.2 Decision Analysis and Decision Trees 55
12B.3 Decision Tree Components and Conventions 56
12B.4 Monte Carlo Techniques 63
12B.5 Markov Chains 66
12B.6 Obtaining Information from Indirect Observation: Shadow Pricing 70
12B.7 Bayesian Analysis 72
12B.8 Option Pricing Models 75
12B.9 Limitations on Rationality in Decision Making: The Effects of Perception and Biases on Decision Making 78
12B.10 Conclusion 79
CHAPTER 14A RIGHTS OF PRIVACY, PUBLICITY, AND CELEBRITY PERSONA (NEW) 81
14A.1 Introduction 81
14A.2 Legal Underpinnings 84
14A.3 Trademark Rights 87
14A.4 Copyright 88
14A.5 Legal Uncertainties and Solutions 90
14A.6 A Photography Issue 91
14A.7 Conclusion 93
CHAPTER 14B INTELLECTUAL PROPERTY AND INTANGIBLE ASSET VOLATILITY (NEW) 95
PART II LICENSING 101
CHAPTER 27A ROYALTY RATES AND LICENSE FEES FOR TECHNOLOGY (NEW) 103
27A.1 Royalty Rates 104
27A.2 Per Unit Royalties 107
27A.3 Royalties Based on Profitability 108
27A.4 License Fees 109
27A.5 Medical Device Industry Royalty Rates 111
27A.6 Medical Device Industry License Fee Distribution 112
27A.7 Conclusion 114
CHAPTER 27B LICENSE FEES AND ROYALTY RATE FREQUENCY FOR TECHNOLOGY (NEW) 115
27B.1 Real Deal Royalty Rates 116
27B.2 Per Unit Royalties 118
27B.3 License Fees 119
27B.4 Conclusion 120
CHAPTER 27C ROYALTY RATES AND LICENSE FEES FOR PHARMACEUTICALS AND BIOTECHNOLOGY (NEW) 121
27C.1 The Parties--Licensing between Corporations Dominates 122
27C.2 Royalty Rates 122
27C.3 License Fees 124
27C.4 Key Technologies 125
27C.5 Developmental Stages of Technology 126
27C.6 Conclusion 128
CHAPTER 33A THE MAGNITUDE AND MEANING OF ROYALTY MISREPORTING (NEW) 129
33A.1 Introduction 129
33A.2 "Why?" versus "How?" 130
33A.3 Math Errors: 5% Error Rate 133
33A.4 Royalty Rate Errors: 4% Error Rate 134
33A.5 Transfer Prices: 4% Error Rate 136
33A.6 Unreported Benchmarks and Milestones: 5% Error Rate 137
33A.7 Unreported Sales: 16% Error Rate 138
33A.8 Disallowed Deductions: 9% Error Rate 138
33A.9 Unreported Sublicenses: 17% Error Rate 139
33A.10 Questionable License Interpretation: 40% Error Rate 139
33A.11 Conclusion 140
CHAPTER 33B INTELLECTUAL PROPERTY AUDIT AND MANAGEMENT (NEW) 141
33B.1 Introduction 142
33B.2 Intellectual Property Is Important 142
33B.3 But Intellectual Property Is Frequently Mismanaged 143
33B.4 Why the Intellectual Property Dichotomy? 143
33B.5 The First Step: An Intellectual Property Audit 144
33B.6 From IP Audit to IP Management 146
33B.7 Insuffi cient Approaches 147
33B.8 A New Intellectual Property Management Paradigm 148
33B.9 Available Tools 148
33B.10 Benefi ts of Intellectual Property Management 149
33B.11 When to Do an Intellectual Property Audit 150
33B.12 How to Do an Intellectual Property Audit 152
33B.13 Software Solutions to Make the Job Easier 155
33B.14 Conclusion 158
CHAPTER 35A QUANTIFYING REASONABLE ROYALTIES: THE ENTIRE MARKET VALUE RULE (NEW) 163
CHAPTER 45 NEW MEASURE OF INFRINGEMENT DAMAGES--FUTURE DAMAGES (NEW) 175
45.1 Royalty Rate for Future Damages 177
45.2 What About Future Lost Profi ts? 188
CHAPTER 45A CONTINUALLY EVOLVING PATENT DAMAGES (NEW) 189
45A.1 Post-Verdict Royalty Rates 190
45A.2 Optimize Your Patented Technology or Lose It 195
45A.3 Litigation-Based Licenses 198
CHAPTER 45B THE 25% RULE IS DEAD (NEW) 203
APPENDIX G MORE SAMPLE ROYALTY RATE INFORMATION (NEW) 207
APPENDIX H TRADEMARK ROYALTY RATES (NEW) 235
APPENDIX H-A MORE TRADEMARK AND COPYRIGHT ROYALTY RATES (NEW) 253
APPENDIX I PHARMACEUTICAL AND BIOTECHNOLOGY ROYALTY RATES (NEW) 291
APPENDIX J TELECOMMUNICATIONS ROYALTY RATES (NEW) 315
APPENDIX K ELECTRICAL AND ENERGY ROYALTY RATES (NEW) 351
INDEX 385