The defendants moved to exclude the expert report of Mr. Ratliff, asserting that he made critical errors in his expert report on damages. The defendants specifically alleged that Mr. Ratliff committed basic math and reasoning errors in adjusting the royalty rate in an exclusive license from 1% to 4% for the non-exclusive hypothetical license.
The defendants first asserted that Mr. Ratliff made three math errors in adjusting a license agreement to derive the reasonable royalty rate for the hypothetical license. After reviewing the expert report, the district court found the approach sufficiently reliable to be admissible under the Federal Rules of Evidence and Daubert. “Why Cree and BU lowered the original 2% running royalty to 1% in the amended agreement, and whether additional payments from Cree and the sublicensees make the licensing scheme the economic equivalent of a 3% running royalty, are factual questions that go to the weight of his testimony.”
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