Royalty” is the compensation paid by users to owners of Intellectual “Property Rights (IPR). Owners of IPR who have, in varying degrees, the “right to exclude” others from practicing the subject matter of those rights, be it patents, copyrights, trademarks or trade-secrets, forego that right in return for the royalty. Theoretically, the licensor may seem to have the unfettered right to dictate the royalty charged to the licensee.1 If only this were true, it would reduce the innumerable hours spent by executives and attorneys at license negotiation tables. Judges required by law to determine “reasonable royalty”2 would not “find it a difficult judicial chore, seeming often to involve more the talents of a conjurer.”3 The proposition that the owner is unlikely to be able to exploit fully his invention all by himself and hence would seek to collaborate with others may seem to suggest that the contribution of the licensee is more decisive. Extended logically, the licensee should have the prerogative to decide the royalty. The fallacy is immediately apparent– the need for licensee’s input in the commercialization process is only secondary to the invention. Said differently, the product 4 is the primary focus of every enterprise and the process by which it is put in the hands of the customer becomes a secondary focus, although both are needed for a commercial success. Moreover, since every licensee’s business does not stop with the product-under-focus alone, his quest in seeking maximized returns in his overall business would involve factors inconsequential to the success of the focal venture.