How the Timing of Hypothetical Negotiation Can Lead to a Higher Premium for Exclusivity

• Pages: 45-48
• Date: 01 December 2026
• Published date: 01 December 2026
• Author: Amy Fulton,Omar Robles,Ryan P. O'Quinn
• Subject Matter: Derecho Constitucional

Published in Landslide, Volume 18, Number 2, 2026. © 2026 by the American Bar Association. Reproduced with permission. All rights

reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or stored in an

electronic database or retrieval system without the express written consent of the American Bar Association.

LANDSLIDE December/January 2026

45

How the Timing of Hypothetical Negotiation Can Lead to a

Higher Premium for Exclusivity

Amy Fulton, Omar Robles, and Ryan P. O’Quinn

The assessment of damages as compensation for patent infringement and trade secret misappropriation is a com-

plex process. Damages can often take the form of a reasonable royalty—which 35 U.S.C. § 284 sets as the oor

for compensation for the tort of patent infringement. Many courts and damages experts often look to what are

referred to as the Georgia-Pacic factors when determining the reasonable royalty. Among the many factors consid-

ered, the nature and scope of the license with regard to exclusivity can have a sizable impact on the reasonable royalty

award. This article examines how the timing of the hypothetical negotiation may raise the premium for exclusivity

under certain circumstances.

General Framework for Determining a Reasonable Royalty Rate

Section 284 provides that, where patent infringement is found, “the court shall award . . . damages adequate to

compensate for the infringement, but in no event less than a reasonable royalty for the use made of the invention by

the infringer.”1 In the case of damages relating to a misappropriated trade secret, both the Uniform Trade Secrets Act

and the Defend Trade Secrets Act also allow for reasonable royalty damages.2

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