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Time Factors of Patent Litigation and Licensing

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Author Info

  • Reiko Aoki
  • Jin-Li Hu

Abstract

This study incorporates the concept of time into an analysis of patent litigation and licensing. We show that increasing imitation or litigation costs with a longer imitation lag or litigation time may have effects on licensing, settlement, and fees other than increasing the pecuniary costs. A higher pecuniary imitation cost always benefits the patentee and hurts the imitator. However, the patentee may prefer faster imitation to induce ex ante licensing, while the imitator may prefer slower imitation to reduce the settlement fee. We also show that both parties may find longer litigation beneficial, unlike higher legal costs.

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Bibliographic Info

Article provided by Mohr Siebeck, Tübingen in its journal Journal of Institutional and Theoretical Economics.

Volume (Year): 159 (2003)
Issue (Month): 2 (June)
Pages: 280-

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Handle: RePEc:mhr:jinste:urn:sici:0932-4569(200306)159:2_280:tfopla_2.0.tx_2-e

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Cited by:
  1. Reiko Aoki & Jin-Li Hu, 1996. "Licensing vs. Litigation: Effect of the Legal System on Incentives to Innovate," Industrial Organization 9612002, EconWPA.

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