Competing Value Logics in the Apportionment of SEP Damages

Abstract

This chapter comparatively examines the valuation methodologies put forward and accepted in four initial FRAND cases adjudicated in the US district court system in 2013-15 and finds a qualitative link to the business models (i.e., value logics) employed by the actors and the type of standards involved. Additionally, valuation models based on prior license agreements seem to currently produce higher valuations of SEPs, everything else equal. While the CAFC has clearly stated that apportionment is the governing rule in SEP cases, the variety of valuation methods put forward in similar contexts indicates the calculation of the SEPs still lacks consensus on both legal and economic grounds. However, a number of the most recent SEP rulings in district courts show clear accordance with clarifications from the CAFC in Ericsson and CSIRO. Additionally, the studied cases confirm the lack of empirical evidence of systemic patent holdup and royalty stacking and indicate that the contractual/transactional nature of SEP disputes can well be addressed on a case-by-case basis by the courts.