Finding “ Lost ” Pro fi ts : An Equilibrium Analysis of Patent Infringement Damages

  title={Finding “ Lost ” Pro fi ts : An Equilibrium Analysis of Patent Infringement Damages},
  author={James J. Anton and D. Angelo R. Agossou Yao},
We examine the impact of patent infringement damages in an equilibrium oligopoly model of process innovation where the choice to infringe is endogenous and affects market choices. Under the lost profits measure of damages normally employed by U.S. courts, we find that infringement always occurs in equilibrium with the infringing firm making market choices that manipulate the resulting market profit of the patentholder. In equilibrium, infringement takes one of two forms: a “passive” form in… CONTINUE READING


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