$3.8 Billion Reasonable Royalty Opinion Is Not Inadmissible Despite Similarity To $3.8 Billion Lost Profits Opinion Where Hypothetical Negotiations

"Would Have Produced No Mutually Agreed Upon Price Range In Which The Parties Could Have Negotiated"

The court denied defendants' motion to exclude the testimony of plaintiffs' economist as to his $3.8 billion reasonable royalty calculation. "[Plaintiffs' expert] contends that a reasonable royalty in this case is $3.8 billion, the same amount as his estimate of lost profits. Defendants argue that [the expert's] analysis is improper and should be excluded because he has failed to undertake a separate analysis to calculate a reasonable royalty than he used to calculate lost profits. [The expert] testified before this Court that though he reached the same number, his analyses as to lost profits and reasonable royalty were distinct from one another. . . . [Plaintiffs' expert] testified that based on his review of contemporaneous documents and his analysis of the parties’ expectations, the hypothetical negotiation between Plaintiffs as licensors and Defendants as licensees would have produced no mutually agreed upon price range in which the parties could have negotiated. This is consistent with the holdings of several courts that the 'willing licensor/willing licensee' model is 'an inaccurate, and even absurd, characterization when . . . the patentee does not wish to grant a license.'. . . While Defendants will certainly challenge [plaintiffs' expert's] conclusions on cross-examination and to offer their own experts’ contrary testimony on the issue of a reasonable royalty, they have not set forth a persuasive basis in analytical methodology upon which to exclude [his] testimony."

Warner-Lambert Company, et. al. v. Purepac Pharmaceutical, et. al., 2-00-cv-02931 (NJD April 25, 2011, Order) (Hochberg, J.)