HopefullyInLawSchool
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LSDefine
Simple English definitions for legal terms
overriding royalty
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A quick definition of overriding royalty:
An overriding royalty is a payment made to someone who has the right to receive a portion of the profits from the sale of a product or service. This payment is usually made to an author or inventor for each copy of their work or article sold under a copyright or patent. If there is no established royalty, a court will determine a remedy for infringement based on what a reasonable royalty would have been. A reasonable royalty is a payment that a licensee would be willing to pay the holder of the intellectual-property rights while still making a reasonable profit from its use. This standard often serves as the measure of damages in a claim of patent, copyright, or trademark infringement, or for misappropriation of trade secrets.
A more thorough explanation:
An overriding royalty is a type of royalty payment made to an author or inventor for each copy of their work or article sold under a copyright or patent. It is similar to a regular royalty, but it is paid on top of any other royalties that may be owed.
For example, if an author has a contract with a publisher that includes a 10% royalty on book sales, and then later signs a separate agreement for an overriding royalty of 2% with a different company, they would receive a total of 12% on each book sold.
Overriding royalties are often used in the oil and gas industry, where a landowner may receive a percentage of the profits from any oil or gas extracted from their property, in addition to any lease payments or other royalties they may receive.
In summary, an overriding royalty is an extra payment made to an author or inventor on top of any other royalties they may receive for their work or invention.