M International (M) and W Inc. (W, a competitor of M) have been engaged in long-standing litigation over a specific patent infringement matter. Below is a summary timeline of specific events that have taken place related to this matter:

In May 2007, W filed a claim against M for patent infringement.

For the year ended December 31, 2007, management of M determined that a loss for this matter was probable and represented that the estimate of loss was in the range of $15 million to $20 million, with $17 million being the most likely amount of loss within the range.

Required:

For the year-end December 31, 2007, financial statements, what amount should M record as a liability? Cite a FASB guidance standard appropriate for this.