Valuation of Patents

A corporation is looking to acquire another business. A board of directors wants to understand the value of a patent. A law firm is representing a client who claims their patents were infringed upon by a competing business. All of these circumstances represent situations where a patent valuation is necessary. Understanding the patent’s worth in all three cases helps communicate a company’s overall worth. FASB Accounting Standards Codification ASC 805 (formerly FASB 141) requires disclosure of all patent values during acquisitions. Understanding the valuation of patents, along with the value of other intangible and tangible assets provides an accurate representation of a company’s total worth.

This patent value, whether it is needed by a board of directors or an individual CEO of a privately held company, is an important element in various situations. As technology continues to evolve, more businesses are seeing a competitive advantage to patenting their technology. This highly competitive world has resulted in more patent infringement cases, where patent valuations have become even more important. In order to prove loss of income and the level of infringement, a patent valuation is required.

Not only are patent valuations necessary for corporations, but they are also important for law firms and accounting firms that represent these businesses. No matter a company’s size, their situation, or the industry they are in, Appraisal Economics can provide experienced patent valuation services.

As an internationally recognized leader, Appraisal Economics offers accurate valuations of patents and other independent valuation services using experienced and proven methodologies. Please take a moment to learn more about our business valuation services or feel free to contact us at anytime with any questions you may have.

Assessing Patent Value
With all the factors that could potentially affect the valuation of patents, it’s important to understand the valuation methodology. Appraisal Economics utilizes proven methods gained from years of experience, in order to ensure an accurate, objective patent valuation delivered in a timely manner.

Our approach begins by working closely with a company’s management team to gain a full understanding of the company’s technology and financial projections. Investigating and analyzing the company’s technology allows us to compare it to similar technology within the industry.

During these comparisons we are looking for instances where the technology may have been licensed. Our next step in the patent valuation process is to begin a detailed analysis of the future financial prospects for the technology. Our financial analysis includes development of all assumptions and valuation models necessary to determine the fair market value of the patent. Our experienced professionals rely on a close working relationship with clients when performing a valuation of patents. This relationship is necessary to form an accurate and objective patent valuation report.

Patent Valuation Leaders
Appraisal Economics understands that a patent valuation must be accurate and on time. We meet or exceed relevant industry standards while also adhering to our own internal review process. Clients expect, and we deliver, a high-level of service. That’s why we also provide litigation support. Many of our key team members have been expert witnesses during high pressure litigation proceedings.

Despite the many complexities facing the valuation of patents, Appraisal Economics has experienced professionals capable of handling your patent valuation needs. Please contact us with any of your appraisal needs, and take a moment to view our other available services, including solar power valuation.

Additional Information from Appraisal Economics:

Fairness Opinion

Trademark Appraisal

Equipment Valuation