(P) Financial Factors: All Pro Sports Camps, Inc. v Walt Disney Company: Analysis of Royalty Issues
Financial Factors Column:
All Pro Sports Camps, Inc. v Walt Disney Company: Analysis of Royalty Issues
The Licensing Journal, January 2001
by Michael Mard
On August 11, 2000, a six-person jury in Orlando, FL, found Walt Disney Company (WDC) guilty of theft of trade secrets, breaking an implied contract, and breaching a confidential relationship. Essentially, the jury ruled that the WDC stole ideas for a sports complex and should pay $240 million in damages. Because the jury concluded that WDC’s conduct was willful and malicious, the trial judge is considering treble damages. WDC plans to appeal. This month’s column reviews the facts of this case and discusses the derivation of the royalty rate as a function of Disney’s theme parks profitability Next month’s column will discuss the derivation of the royalty rate based on market comparisons.
Keywords: Intellectual property, royalty rate, royalty analysis, reasonableness test, effective royalty, profitability
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