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Private Agreements for Coordinating Patent Rights: The Case of Patent Pools

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  • Gallini, Nancy

Abstract

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 infringement litigation. Over the past two decades, U.S. antitrust authorities have viewed pooling arrangements that integrate complementary, valid and essential patents to have “pro-competitive benefits†in reducing prices, transactions costs, and the incidence of costly infringement suits. Since patent pools are cooperative agreements, they also have the potential of suppressing competition if, for example, they harbor weak or invalid patents, dampen incentives to conduct research on innovations that compete with the pooled patents, foreclose competition from downstream product or upstream innovation markets, or raise prices on goods that compete with the pooled patents. In synthesizing the ideas advanced in the economic literature, this paper explores whether these antitrust concerns apply to pools with complementary patents. Special attention is given to the U.S. Department of Justice-Federal Trade Commission Guidelines for the Licensing of Intellectual Property (1995) and its application to recent patent pool cases.

Suggested Citation

  • Gallini, Nancy, 2010. "Private Agreements for Coordinating Patent Rights: The Case of Patent Pools," Economics working papers nancy_gallini-2010-34, Vancouver School of Economics, revised 17 Nov 2010.
  • Handle: RePEc:ubc:bricol:nancy_gallini-2010-34
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Jay Pil Choi & Heiko Gerlach, 2015. "Patent pools, litigation, and innovation," RAND Journal of Economics, RAND Corporation, vol. 46(3), pages 499-523, September.
    2. Josh Lerner & Jean Tirole, 2015. "Standard-Essential Patents," Journal of Political Economy, University of Chicago Press, vol. 123(3), pages 547-586.
    3. Gallini, Nancy, 2014. "Cooperating with competitors: Patent pooling and choice of a new standard," International Journal of Industrial Organization, Elsevier, vol. 36(C), pages 4-21.
    4. Ryan L. Lampe & Petra Moser, 2012. "Do Patent Pools Encourage Innovation? Evidence from 20 U.S. Industries under the New Deal," NBER Working Papers 18316, National Bureau of Economic Research, Inc.
    5. Jensen, Paul H. & Palangkaraya, Alfons & Webster, Elizabeth, 2015. "Trust and the market for technology," Research Policy, Elsevier, vol. 44(2), pages 340-356.
    6. Ralph Siebert, 2013. "Are Ex Ante and Ex Post Licensing Agreements Useful Instruments to Lessen Uncertainty in R&D?," CESifo Working Paper Series 4535, CESifo Group Munich.
    7. Dequiedt, Vianney & Versaevel, Bruno, 2013. "Patent pools and dynamic R&D incentives," International Review of Law and Economics, Elsevier, vol. 36(C), pages 59-69.

    More about this item

    Keywords

    Patent pools; intellectual property; antitrust economics;

    JEL classification:

    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
    • L24 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Contracting Out; Joint Ventures
    • L4 - Industrial Organization - - Antitrust Issues and Policies
    • L44 - Industrial Organization - - Antitrust Issues and Policies - - - Antitrust Policy and Public Enterprise, Nonprofit Institutions, and Professional Organizations
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital

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