Principal Robert L. Vigil and Associate Xiao Zhang Summarize Their Research on Patent Portfolio Valuation Methodologies in NACVA’s Financial Forensics Newsletter

July 27, 2022

Patent infringement litigation often requires determining the value of an individual patent or a small subset of patents that have been bundled together with dozens, or even hundreds, of other patents in a portfolio license or sale agreement. While the price paid for the entire portfolio may be known, how much of that price is attributable to individual patents in the portfolio is not. When only a small subset of patents are at issue, how can we estimate their worth?

In the article “Determining the Price for One When All You Have Is the Price for Many,” Analysis Group Principal Robert L. Vigil and Associate Xiao Zhang provide insight into how value can be adduced using information about patent value distributions obtained from data on patent renewals, surveys, stock price movements, and patent citations. Their article was published in QuickRead, the digital newsletter of the National Association of Certified Valuators and Analysts (NACVA).

The authors’ review of the academic literature suggests that, in certain circumstances, the results from other patent value distribution studies can be combined with information about the unique characteristics of the patent being valued to determine what proportion of the total portfolio price may be attributable to the patent of interest. 

This article originally appeared in the June edition of Analysis Group’s Forum publication. A longer and more detailed article, titled “Apportioning Value In Patent Portfolio License And Sale Agreements,” was previously published in the Licensing Executives Society International journal les Nouvelles.

Read the article in NACVA QuickRead