Reasonable royalty is the minimum damages measure guaranteed by 35 U.S.C. § 284: even where a patentee cannot prove lost profits, it can still recover a reasonable royalty for the infringing use. Courts frame the inquiry as a hypothetical negotiation, asking what royalty a willing licensor and willing licensee would have agreed to just before infringement began, assuming both knew the patent was valid and infringed.

Experts typically anchor that hypothetical negotiation to the Georgia-Pacific factors and to comparable real-world licenses. The royalty base, meaning the revenue or unit count the rate is applied to, is generally limited to the smallest salable patent-practicing unit under the entire market value rule, unless the patentee can show the patented feature actually drives demand for the whole product.

As a simulation input, the reasonable royalty figure decomposes into two tunable dials, the royalty base and the royalty rate, letting a user see how expected damages in the expected-value-of-a-lawsuit calculation move as each assumption changes independently.

Reasonable royalty is the default damages theory whenever lost profits cannot be proven, whether because the patentee does not practice the invention or the market-reconstruction proof is too speculative. Damages experts build a hypothetical negotiation narrative supported by the Georgia-Pacific factors and comparable license agreements, and that narrative is frequently the most contested part of a patent damages trial.