>Lets say this is 25% of the sale price. That is, society says that at most 25% of the sale, not profit, price is allowed to cover IP costs. In your fictional e

>Lets say this is 25% of the sale price. That is, society says that at most 25% of the sale, not profit, price is allowed to cover IP costs. In your fictional example of 5 different involved patents the legal framework incentivizes the 5 patent holders and those who desire their patents to negotiate a split. I'm not sure I'm following the story here. So we have compulsory licenses, which are to be set as no more than 25% of the licensee's sale price. Let's assume that the licensee accurately knows all of the patented ideas they plan to rely on. The prospective licensee needs to set aside 25 cents of every dollar to be paid to patent holders. So far, so good (although I don't think you'll be able to find a number that's satisfactory; see below). Now what do they actually do with those 25 cents? They can't unilaterally send it to any of the patent holders, because apportionment needs to happen. You can't require that they pre-negotiate a split among the patent holders, because that would defeat the point of a compulsory license by allowing one or more patent holders to drag out negotiations. You could set up a third-party entity (i.e. a government agency) whose job it is to hold all the payments in escrow and manage the negotiations among the patent holders, but that would require said entity to either bear the risks of dealing with bad-faith negotiators or be willing to make unilateral judgments based on the merits of an individual case - and given how well the USPTO does with bad-faith actors now, I don't think I trust them to take on an expanded role that would require dramatically more technical expertise and judgment. re: 25% - I know you didn't mean to put any weight behind that particular number, but I also don't think there is any such number that would be universally reasonable. Again, I don't think many commercial products consist solely of the implementation of a single idea. Even if you're only basing your product on one patent, presumably you're also adding your own thought to make it marketable, and the amount that that new thought contributes is variable per product. If you set the license fee ratio very high, then patent holders of small ideas can unduly enrich themselves by demanding most of the revenue for something to which they contributed only a small part. (That degenerates to the current situation - you can think of the current situation as having a "compulsory license" with a price that's often somewhere above 100% of sale price, since you can always proceed without a license, at the cost of a lawsuit that would recover the price plus punitive damages.) On the other hand, if you set it too low, then you open the door to blatant copying. And note that this isn't just a matter of picking something "in the middle" - no matter where you put the line, bad-faith actors will change their behavior to exploit it in one direction or another, or both.