Probabilistic Patents

  title={Probabilistic Patents},
  author={Mark A. Lemley and Carl Shapiro},
  journal={Law \& Economics},
Economists often assume that a patent gives its owner a well-defined legal right to exclude others from practicing the invention described in the patent. In practice, however, the rights afforded to patent holders are highly uncertain. Under patent law, a patent is no guarantee of exclusion but more precisely a legal right to try to exclude. Since only 0.1% of all patents are litigated to trial, and since nearly half of fully litigated patents are declared invalid, this distinction is critical… 

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If a litigated patent has previously been licensed to a third party, the courts generally adopt the terms of the prior agreement as the best measure of damages. However, while administratively

Market entrance, patents, and preliminary injunctions: a model of pharmaceutical patent litigation

The Patent Holder wishing to enforce her patent has several ways of doing so. In the world of patent litigation, however, one of the most important remedies is the preliminary injunction (PI),

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In private enforcement systems such as the one for patents, remedies perform the “public” function of determining the optimal amount of protection and deterrence. If every patent were properly

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Inventors and users of technology often enter into cooperative agreements for sharing their intellectual property in order to implement a standard or to avoid costly litigation. Over the past two

Legal Fights for Patent Rights: Are the Judicial Concerns of Small Companies Justified?

  • J. TalvelaT. Kässi
  • Business
    2019 Portland International Conference on Management of Engineering and Technology (PICMET)
  • 2019
Patents and patenting have been extensively studied in recent years. Large firms are considered more advanced in their management of technology and prosecution of patents, while small firms possess a

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Using a sample of patents litigated between 1977 and 1997, I estimate stock market reactions to patent litigation decisions and to patent grants. I find that the resolution of uncertainty over

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This article analyzes patent pools and their effects on litigation incentives, overall royalty rates, and social welfare when patent rights are probabilistic and can be invalidated in court. With

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A substantial number of patents tested in court for validity are invalidated. If a similar portion of all patents was deemed invalid in hypothetical validity tests, then this would indicate a

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Patent litigation is notoriously expensive, but few patents are ever litigated. Among the fraction that are, only a small group dubbed the “most litigated patents” by Allison, Lemley & Walker are



Antitrust Analysis of Patent Settlements between Rivals Is the Settlement Better for Consumers than Ongoing Litigation?

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Rational Ignorance at the Patent Office

It is common to assert that the Patent and Trademark Office does a bad job of examining patents, and that it should spend more time and money weeding out bad patents. In this article, Professor

Foreseeability in Patent Law

In the Festo decision, the Federal Circuit significantly changed the scope of the doctrine of equivalents in patent law. The doctrine of prosecution history estoppel precludes a patent owner from

Antitrust for Patent Pools: A Century of Policy Evolution

This paper reviews the antitrust treatment of patent pooling and cross-licensing arrangements from E. Bement v. National Harrow, decided in 1902, to the Department of Justice business review letters

Patent Pools and Cross-Licensing in the Shadow of Patent Litigation

  • J. Choi
  • Economics
    SSRN Electronic Journal
  • 2003
This paper develops a framework to analyze the incentives to form a patent pool or engage in cross-licensing arrangements in the presence of uncertainty about the validity and coverage of patents

Ending Abuse of Patent Continuations

One of the oddest things to an outsider about the United States patent system is that due to continuation practice it is impossible for the U.S. Patent and Trademark Office (PTO) ever to finally

Incentives to Challenge and Defend Patents: Why Litigation Won't Reliably Fix Patent Office Errors and Why Administrative Patent Review Might Help

Given the limits on Patent Office scrutiny of patent applications, one might hope that ex post litigation can fix at least the important errors. Unfortunately, the often grossly skewed incentives to

As Many as Six Impossible Patents Before Breakfast: Property Rights for Business Concepts and Patent System Reform

In this paper, Professor Merges describes the emergence of patents for business "methods" or concepts, such as Internet airplane ticket pur-chase systems. Professor Merges is agnostic about whether

Anticompetitive Settlement of Intellectual Property Disputes

The overwhelming majority of intellectual property lawsuits settle before trial. These settlements involve agreements between the patentee and the accused infringer, parties who are often competitors

Ending Patent Law's Willfulness Game

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