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Damages for Infringement of Research Tool Patents

The Reasonableness of Reach Through Royalties

By Michael J. Stimson

This paper provides a brief review of the law of patent infringement damages and applies this law to various situations involving infringement of research tool patents, which are patents to materials and methods that can be used to make discoveries. The discussion focuses on the appropriate measure of damages for acts of infringement that result in discoveries profitable for the infringers, and especially on damages awards of royalties on the infringers’ profits from these discoveries, known as reach through royalties. It concludes that in order to satisfy one of the broad goals of the patent system—to encourage innovation—different liabilities should be imposed depending on whether the patented research tools have broad, intermediate, or narrow ranges of use. Thus, while acts of infringement against research tool patents with narrower ranges of use may result in liability including reach through royalties, infringement of research tool patents with broader ranges of use should not. This paper analyzes the effects that reach through royalties awards could have on the licensing and use of research tools, and suggests several ways in which trial courts might avoid creating damages awards precedents that would discourage the use of research tools to advance biomedical technology.

Posted in Articles.

April 11, 2003 Cite: 2003 Stan. Tech. L. Rev. 3