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Invalid but infringed? An analysis of the bifurcated patent litigation system

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Listed:
  • Cremers, Katrin
  • Gaessler, Fabian
  • Harhoff, Dietmar
  • Helmers, Christian
  • Lefouili, Yassine

Abstract

In bifurcated patent litigation systems, claims of infringement and validity of a patent are decided independently of each other in separate court proceedings at different courts. In non-bifurcated systems, infringement and validity are decided jointly in the same proceedings at a single court. We build a model that shows the key trade-off between bifurcated and non-bifurcated systems and how it affects the incentives of plaintiffs and defendants in patent infringement cases. Using detailed data on patent litigation cases in Germany (bifurcated) and the U.K. (non-bifurcated), we show that bifurcation creates situations in which a patent is held infringed that is subsequently invalidated. We also show that having to challenge a patent’s validity in separate court proceedings under bifurcation implies that alleged infringers are less likely to do so. We find this to apply in particular to more resource-constrained alleged infringers. Finally, we find parties to be more likely to settle in a bifurcated system.

Suggested Citation

  • Cremers, Katrin & Gaessler, Fabian & Harhoff, Dietmar & Helmers, Christian & Lefouili, Yassine, 2016. "Invalid but infringed? An analysis of the bifurcated patent litigation system," TSE Working Papers 16-698, Toulouse School of Economics (TSE).
  • Handle: RePEc:tse:wpaper:30845
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    References listed on IDEAS

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    1. repec:kap:revind:v:55:y:2019:i:1:d:10.1007_s11151-019-09694-6 is not listed on IDEAS
    2. repec:kap:ejlwec:v:44:y:2017:i:1:d:10.1007_s10657-016-9529-0 is not listed on IDEAS
    3. Gaessler, Fabian & Lefouili, Yassine, 2017. "What to Buy When Forum Shopping? Analyzing Court Selection in Patent Litigation," TSE Working Papers 17-775, Toulouse School of Economics (TSE).
    4. Katrin Cremers & Max Ernicke & Fabian Gaessler & Dietmar Harhoff & Christian Helmers & Luke McDonagh & Paula Schliessler & Nicolas Zeebroeck, 2017. "Patent litigation in Europe," European Journal of Law and Economics, Springer, vol. 44(1), pages 1-44, August.
      • Cremers, Katrin & Ernicke, Max & Gaessler, Fabian & Harhoff, Dietmar & Helmers, Christian & McDonagh, Luke & Schliessler, Paula & Van Zeebroeck, Nicolas, 2013. "Patent litigation in Europe," ZEW Discussion Papers 13-072, ZEW - Leibniz Centre for European Economic Research.
      • Katrin Cremers & Max Ernicke & Fabian Gaessler & Dietmar Harhoff & Christian Helmers & Luke Mc Donagh & Paula Schliessler & Nicolas van Zeebroeck, 2017. "Patent litigation in Europe," ULB Institutional Repository 2013/226239, ULB -- Universite Libre de Bruxelles.
    5. repec:kap:ejlwec:v:48:y:2019:i:2:d:10.1007_s10657-019-09627-4 is not listed on IDEAS

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    Keywords

    Litigation; patents; bifurcation;

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