Contract analysis

I. EXECUTIVE SUMMARY This memorandum identifies, evaluates, and analyzes comparable patent license agreements to support the proposed reasonable royalty rate of 8.5% of accused-product net sales under the Georgia-Pacific framework. This analysis is prepared to inform and support the expert damages report of Dr. Lawrence Keating of Meridian Economic Consulting Group, LLC, who has been retained as Optiwave Semiconducto

II. LEGAL FRAMEWORK The reasonable-royalty damages analysis in this matter is governed by the Georgia-Pacific framework, which sets forth fifteen factors to be considered in determining the royalty rate that would have resulted from a hypothetical negotiation between a willing licensor and a willing licensee at the time infringement began. Georgia-Pacific Corp. v. U.S. Plywood Corp., 318 F. Supp. 1116 (S.D.N.Y. 1970)

III. METHODOLOGY A. Search and Identification Process The comparable licenses identified in this memorandum were selected through a systematic, multi-step process designed to identify the most relevant and probative agreements. OWS Licensing History. The first and most important step was a comprehensive review of OWS's existing licensing program. OWS's patent licensing activities are managed by FairPoint Licensing Gr

IV. ANALYSIS OF OWS'S OWN LICENSE AGREEMENTS (GEORGIA-PACIFIC FACTOR 1) This section analyzes the three OWS license agreements that involve one or more of the four asserted patents. These agreements are the most probative comparable licenses because they reflect the actual royalty rates that OWS — the patentee in this case — has been able to command for the very patents at issue. Each agreement is analyzed in terms o

1. Summary of Terms The first OWS license agreement is between Optiwave Semiconductor Corp. (as licensor) and Terralink Semiconductor, Inc. (as licensee), with an effective date of March 12, 2020. This agreement is a portfolio license covering eighteen OWS patents, including two of the four asserted patents: U.S. Patent No. 10,234,847 (the '847 Patent, directed to multi-channel silicon photonic waveguide multiplexer

2. Comparability Analysis Technological Comparability: High. The Terralink license covers two of the four asserted patents — the '847 Patent (waveguide multiplexer) and the '562 Patent (thermal management). The licensed products — 100G and 200G silicon-photonics transceiver modules for data-center interconnect — are in the same product category as Lumicore's accused products. While the licensed products are of lower

1. Summary of Terms The second OWS license agreement is between Optiwave Semiconductor Corp. (as licensor) and NovaWave Corp. (as licensee), with an effective date of June 1, 2021. This agreement is a narrower license covering six OWS patents, including three of the four asserted patents: U.S. Patent No. 10,234,847 (the '847 Patent), U.S. Patent No. 10,891,193 (the '193 Patent, directed to coherent optical transceive

2. Comparability Analysis Technological Comparability: Very High. The NovaWave license covers three of the four asserted patents — the '847 Patent, the '193 Patent, and the '562 Patent. The only asserted patent not included is the '015 Patent (polarization-diverse grating coupler). The licensed products — NovaWave's 400G coherent transceiver modules — are directly comparable to Lumicore's accused LumiLink 400G-ZR+ pr

1. Summary of Terms The third OWS license agreement is between Optiwave Semiconductor Corp. (as licensor) and Helix Integrated Photonics, Inc. (as licensee), with an effective date of February 15, 2022. This agreement is a license covering eight OWS patents, including all four of the asserted patents: U.S. Patent Nos. 10,234,847 (the '847 Patent), 10,891,193 (the '193 Patent), 9,678,562 (the '562 Patent), and 11,402,

2. Comparability Analysis Technological Comparability: Highest. This is the strongest technological comparable among the three OWS licenses — indeed, among all five comparables — because it is the only agreement that covers all four of the asserted patents. The licensed patents include the complete set of technologies at issue in this case: waveguide multiplexing ('847 Patent), coherent transceiver integration ('193

V. ANALYSIS OF THIRD-PARTY INDUSTRY-COMPARABLE LICENSES (GEORGIA-PACIFIC FACTOR 2) This section analyzes two third-party license agreements in the silicon-photonics transceiver industry that serve as Factor 2 comparables. While these agreements do not involve OWS or the specific patents-in-suit, they provide valuable market-based data points demonstrating the rates paid for comparable technology in the same industry

1. Summary of Terms This comparable license arises from the settlement of patent infringement litigation between Stratos Photonics, Inc. (as licensor and plaintiff) and ArcLight Systems, Inc. (as licensee and defendant), with an effective date of October 8, 2019. The underlying litigation was filed in the United States District Court for the Northern District of California and involved five Stratos Photonics patents

2. Comparability Analysis Technological Comparability: High. The Stratos Photonics patents cover arrayed-waveguide-grating (AWG) multiplexer technology, which is the same core technology addressed by OWS's '847 Patent ("Multi-Channel Silicon Photonic Waveguide Multiplexer with Low Insertion Loss"). While the specific patent claims differ, the technological domain is identical: both patent sets claim inventions relati

1. Summary of Terms The fifth comparable is a cross-license agreement between Coreline Technologies, Inc. and Prisma Semiconductor Corp., with an effective date of April 22, 2021. This agreement resolved mutual patent disputes between the two companies involving silicon-photonics integrated circuit patents, including patents directed to thermal management and grating-coupler technologies — two of the four technology

2. Comparability Analysis Technological Comparability: High. The Coreline patent portfolio licensed to Prisma includes patents covering thermal management technology for silicon-photonics integrated circuits and grating-coupler technology for optical signal coupling. These are the same core technology areas addressed by OWS's '562 Patent (integrated thermal management system) and '015 Patent (polarization-diverse gra

VI. SYNTHESIS AND RATE DERIVATION A. Summary Table of Comparable Royalty Rates The following table summarizes the key data from all five comparable licenses, including the raw royalty rate and the direction of adjustments needed to align each comparable to the hypothetical OWS–Lumicore negotiation: B. Range Analysis The five comparable licenses establish a raw royalty-rate range of 6.5% to 10.2%. At the low end, the