15 Jun Royalty Rate Determination for Valuation of Brands/Patents in Litigation Cases
Royalty Rate Determination for Valuation of Brands/Patents in Litigation Cases
The legendary solicitor, Robert Goldscheider had coined the '25% Rule' for Royalty Rate determination in litigation cases. According to Goldscheider, the 25% Rule can be used by courts as part of the 2-stage process, wherein the defendant & plaintiff (collectively referred to as 'Parties') in the 1st stage determine Royalty as 25% of the operating proﬁt margin (the '25% Threshold'). This is followed up with step 2 of upward/downward adjustments to the 25% Threshold, depending on the bargaining power of each of the litigating Parties.