Reasonable Royalty As the Most Common Criterion for Computation of Damages in Patent Infringement Litigations in U.S.A Case Law and the Possibility of Its Applying in Iranian Legal System

One of the most common criteria for the computation of damages in patent infringement litigations in U.S.A Case Law is reasonable royalty. This is because that, it is not possible to properly estimate the lost profits in patent infringement in many cases, and therefore, damage is awarded by calculating reasonable royalty. In U.S.A law, different approaches are applied by courts to determine reasonable royalty-based damages, but the most prominent one has been put forward in Georgia-Pacific Corp. v. U. S. Plywood Corp, which includes 15 factors for determining reasonable royalty-based damages. It has been said that the case law suggested criterion, is a "universally accepted test" for determining reasonable royalty-based damages. While examining this criterion and the place of reasonable royalty in U.S.A law, this study shows that invoking the quantum merit in Iranian patent law could not be a proper method for loss computation. This is for a number of reasons, including statutory prohibition on the application of the quantum merit in compensation for patent infringement, being of patent right as intangible property and confidentiality of the amount of royalty in licenses. Therefore, due to the inconsistency of this Criterion with Iranian legal standards and given the lack of explicit or implicit legal prohibition on using of reasonable royalty as computation method, employing this method by the courts is suggested. To solve the legal ambiguity, it is also suggested that the Iranian legislature introduce reasonable royalty as a criterion for the computation of damages in patent infringement litigations.