Question
HOTco, a domestic corporation, invents a control panel to make residential fur- naces heat up faster. HOTco sells these control panels exclusively in the
HOTco, a domestic corporation, invents a control panel to make residential fur- naces heat up faster. HOTco sells these control panels exclusively in the United States. HOTco does not wish to operate abroad. Therefore, HOTco licenses its control panel know-how to FORco, an unrelated foreign corporation, for commer- cial exploitation abroad. Under this license, FORco manufactures control panels in Belgium for sale throughout Europe. FORco pays HOTco a royalty on each foreign sale made. What is the source of the royalty from FORco to HOTco?
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