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Do Standard-Essential Patent Owners Behave Opportunistically? Evidence from U.S. District Court Dockets

Author

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  • Brian Love

    (TSE-R - Toulouse School of Economics - UT Capitole - Université Toulouse Capitole - UT - Université de Toulouse - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement)

  • Yassine Lefouili

    (TSE-R - Toulouse School of Economics - UT Capitole - Université Toulouse Capitole - UT - Université de Toulouse - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement)

  • Christian Helmers

    (TSE-R - Toulouse School of Economics - UT Capitole - Université Toulouse Capitole - UT - Université de Toulouse - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement)

Abstract

To what extent and with what effect do owners of standard-essential patents (SEPs) "hold-up" companies that produce standard-compliant products? To explore this question, we construct measures of opportunistic patent licensing behaviors using detailed information collected from the dockets of U.S. patent cases filed (2010-2019) to enforce SEPs and a matched sample of non-SEPs. Overall, we find evidence of opportunistic behavior by the patent enforcer in approximately 77% of SEP and 65% of non-SEP assertions in court. The figures mask important heterogeneity. There is significantly more opportunistic conduct aimed at increasing a potential licensee's loss if the patent enforcer prevails in court: 35% of SEP assertions vs. 10% of non-SEP assertions. In contrast, conduct that increases a potential licensee's litigation costs is less common and the difference between SEP assertions (8%) and non-SEP assertions (6%) is small. We also show that opportunistic behavior is associated with case outcomes, with the effect on settlement depending on the type of opportunistic behavior. Behavior that increases a potential licensee's litigation costs is associated with an increase in the probability of settlement, while behavior that increases a potential licensee's loss if the patent enforcer prevails in court is negatively associated with settlement.

Suggested Citation

  • Brian Love & Yassine Lefouili & Christian Helmers, 2023. "Do Standard-Essential Patent Owners Behave Opportunistically? Evidence from U.S. District Court Dockets," Post-Print hal-04547832, HAL.
  • Handle: RePEc:hal:journl:hal-04547832
    DOI: 10.1093/aler/ahad010
    Note: View the original document on HAL open archive server: https://hal.science/hal-04547832
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    References listed on IDEAS

    as
    1. Alexander Galetovic & Stephen Haber & Ross Levine, 2015. "An Empirical Examination Of Patent Holdup," Journal of Competition Law and Economics, Oxford University Press, vol. 11(3), pages 549-578.
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    More about this item

    Keywords

    Litigation; Standards; Patents; Holdup; U.S;
    All these keywords.

    JEL classification:

    • K41 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Litigation Process
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General

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