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Size-of-the-Pile Approach

Describes a method for distributing patent pool royalties to patent pool members that is based on allocating the royalties proportionate to the number of essential patents each pool member has placed in the pool. The approach is usually favored by large companies with big patent portfolios to place in the pool; however, small companies with only one or two important pioneer patents tend to disfavor this approach as they see it as undervaluing their patent contribution. The alternative is to engage in an equitable contribution analysis, which requires weighing the respective merits of each patent in the pool; the problem is that this process that can be difficult and be unattractively subjective.

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