Adam R. Alper

Alper, with co-counsel Michael De Vries, scored a major win last year related to standard essential patents and RAND licensing.

Owners of standard essential patents, which are key to industry standards, are generally required to license them based on reasonable and nondiscriminatory terms - commonly called RAND - when they participate in the standards development process.

Innovatio IP Ventures LLC had sued both large corporations and small businesses for allegedly infringing certain standard essential patents related to wireless technology. The company sought more than a billion dollars in damages.

"Innovatio sent thousands of demand letters out to users of Wi-Fi devices," Alper said. "They were not the suppliers of computer chips or laptops, but the people who buy them and use them."

In total, there were 23 patents asserted and dozens of defendants throughout the country involved, including Cisco Systems Inc., Motorola Solutions Inc., and Netgear Inc. In re Innovatio IP Ventures LLC Patent Litigation, 13-09308 (N.D. Illinois, filed Oct. 3, 2013).

Early on, Alper and his team "felt that paying attention to the damages issues in a proactive manner would drive a resolution, " he said. Ultimately, the court agreed to put off considering the liability and infringement matters, among others, and proceed to have two trials on damages issues.

The key to the casewas determining the RAND royalty rate for the patents at issue.

Innovatio originally demanded $2,300 per location using Wi-Fi.

But the court found that the plaintiff's analysis supporting its demand lacked credible methodology, Alper said, and also suffered from a failure of proof.

Whittling down the sum demanded by Innovatio, the court held that the maximum royalty rate was 9.56 cents per Wi-Fi chip.

"This order is unique in that it provides a specific, quantitative method for calculating a RAND royalty rate," Alper said. "This is also the first court to look closely at the requirements for a claim to be subject to RAND obligations."

- Pat Broderick