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Patent Assertion Entities and Patent Ownership Transparency: Strategic Recording of Patent Transactions at the Uspto
[In Defense of Forum Shopping: A Realistic Look at Selecting a Venue]

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  • Valerio Sterzi

Abstract

Many patent assertion entities (PAEs) hide behind multiple unknown subsidiaries or shell companies with obscure ownership. Meanwhile, the United States Patent and Trademark Office (USPTO), like many other patent offices, does not impose a strict time period for recording the change of ownership of a patent, allowing the holder to gain an advantage by controlling the timing of its ownership disclosure. In this paper, we study to which extent PAEs delay the recording of the U.S. patent reassignments of patents that they will subsequently use in infringement patent lawsuits. On average, PAEs notify the change of ownership more quickly than producing firms, but this is not the case for the patents that they will litigate relatively far in time. In particular, the correlation between the recording lag of the patent transaction and the litigation spell is higher when the patent acquirer is a PAE (than when it is a producing firm) or when the acquirer will litigate the patent in the Eastern District of Texas, famously home to opportunistic litigations. Finally, we find that transactions involving unknown subsidiaries of PAEs are recorded at the USPTO significantly later than those involving PAE parent companies or their known subsidiaries.

Suggested Citation

  • Valerio Sterzi, 2021. "Patent Assertion Entities and Patent Ownership Transparency: Strategic Recording of Patent Transactions at the Uspto [In Defense of Forum Shopping: A Realistic Look at Selecting a Venue]," Journal of Competition Law and Economics, Oxford University Press, vol. 17(4), pages 978-1006.
    • Handle: RePEc:oup:jcomle:v:17:y:2021:i:4:p:978-1006.
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    File URL: http://hdl.handle.net/10.1093/joclec/nhab013
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    References listed on IDEAS

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    1. Luigi Orsenigo & Valerio Sterzi, 2010. "Comparative Study of the Use of Patents in Different Industries," KITeS Working Papers 033, KITeS, Centre for Knowledge, Internationalization and Technology Studies, Universita' Bocconi, Milano, Italy, revised 2010.
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    4. Valerio STERZI & Jean-Paul RAMESHKOUMAR & Johannes VAN DER POL, 2020. "Non-practicing entities and transparency in patent ownership in Europe," Bordeaux Economics Working Papers 2020-10, Bordeaux School of Economics (BSE).
    5. James Bessen & Michael J. Meurer, 2008. "Introduction to Patent Failure: How Judges, Bureaucrats, and Lawyers Put Innovators at Risk," Introductory Chapters, in: Patent Failure: How Judges, Bureaucrats, and Lawyers Put Innovators at Risk, Princeton University Press.
    6. Pénin, Julien, 2012. "Strategic uses of patents in markets for technology: A story of fabless firms, brokers and trolls," Journal of Economic Behavior & Organization, Elsevier, vol. 84(2), pages 633-641.
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    Cited by:

    1. Sterzi, Valerio & Rameshkoumar, Jean-Paul & Van Der Pol, Johannes, 2021. "Non-practicing entities and transparency of patent ownership in Europe: the case of UK dormant companies," Technological Forecasting and Social Change, Elsevier, vol. 172(C).
    2. Adrien HERVOUET & Emmanuel LORENZON & Cesare RIGHI & Valerio STERZI, 2023. "Patent Privateering," Bordeaux Economics Working Papers 2023-10, Bordeaux School of Economics (BSE).
    3. Sterzi, Valerio & Maronero, Cecilia & Orsatti, Gianluca & Vezzulli, Andrea, 2023. "Non-Practicing Entities and their patent acquisition activity in Europe," Department of Economics and Statistics Cognetti de Martiis. Working Papers 202322, University of Turin.
    4. Sterzi, Valerio & Maronero, Cecilia & Orsatti, Gianluca & Vezzulli, Andrea, 2023. "Non-Practicing Entities and their patent acquisition activity in Europe," Department of Economics and Statistics Cognetti de Martiis LEI & BRICK - Laboratory of Economics of Innovation "Franco Momigliano", Bureau of Research in Innovation, Complexity and Knowledge, Collegio 202306, University of Turin.
    5. Valerio STERZI & Cécilia MARONERO & Gianluca ORSATTI & Andrea VEZZULLI, 2021. "Non-Practicing Entities in Europe: an Empirical Analysis of Patent Acquisitions at the European Patent Office," Bordeaux Economics Working Papers 2021-23, Bordeaux School of Economics (BSE).

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    More about this item

    JEL classification:

    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital
    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights

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