Banking and Finance Law Commons^™

Court Capture, Jonas Anderson

Articles in Law Reviews & Other Academic Journals

Capture — the notion that a federal agency can become controlled by the industry the agency is supposed to be regulating — is a fundamental concern for administrative law scholars. Surprisingly, however, no thorough treatment of how capture theory applies to the federal judiciary has been done. The few scholars who have attempted to apply the insights of capture theory to federal courts have generally concluded that the federal courts are insulated from capture concerns.

This Article challenges the notion that the federal courts cannot be captured. It makes two primary arguments. As an initial matter, this Article makes the …

The Big Patent Short: Hedge Fund Challenges To Pharmaceutical Patents And The Need For Financial Regulation, Ariel D. Multak

Fordham Journal of Corporate & Financial Law

The enactment of the America Invents Act (AIA) in 2011 ushered in a new system for post-grant patent review. In the interest of enhancing the efficiency of the patent regime by invalidating “bad” patents, certain requirements were relaxed. For example, the AIA created an examination process called inter partes review, which allows a party without legal standing to challenge the validity of a patent in front of the Patent Trial and Appeal Board. In the pharmaceutical patent context, it was expected that inter partes review would be utilized mostly by generic drug makers seeking to invalidate patents without incurring the …

The Patent Litigation Explosion, James Bessen, Michael J. Meurer

Faculty Scholarship

This Article provides the first look at patent litigation hazards for public firms during the 1980s and 1990s. Litigation is more likely when prospective plaintiffs acquire more patents, when firms are larger and technologically close and when prospective defendants spend more on research and development ("R&D"). The latter suggests inadvertent infringement may be more important than piracy. Public firms face dramatically increased hazards of litigation as plaintiffs and even more rapidly increasing hazards as defendants, especially for small public firms. The increase cannot be explained by patenting rates, R&D, firm value or industry composition. Legal changes are the most likely …

The Private Costs Of Patent Litigation, James Bessen, Michael J. Meurer

Faculty Scholarship

This paper estimates the total cost of patent litigation to alleged infringers. We use a large sample of stock market event studies around the date of lawsuit filings for US public firms from 1984-99. We find that the total costs of litigation are much greater than legal fees and costs are large even for lawsuits that settle. Lawsuits cost alleged infringers about $28.7 million ($92) in the mean and $2.9 million in the median. Moreover, infringement risk rose sharply during the late 1990s to over 14% of R&D spending. Small firms have lower risk relative to R&D.

Do Patents Perform Like Property?, Michael J. Meurer, James Bessen

Faculty Scholarship

Do patents provide critical incentives to encourage investment in innovation? Or, instead, do patents impose legal risks and burdens on innovators that discourage innovation, as some critics now claim? This paper reviews empirical economic evidence on how well patents perform as a property system.

An Analysis For The Valuation Of Venture Capital-Funded Startup Firm Patents, John Dubiansky

ExpressO

In an era where forces such as the Bayh Dole act and the rise of the venture capital industry are reshaping the manner in which innovations are brought to market, the role of intellectual property in the financing of new ventures is becoming increasingly important. The investment community requires a better understanding of the risks of patent-based transactions as such deals become more prevalent. This paper addresses that need by explaining an analysis for the valuation of startup firm-held patents. The paper considers the commonly employed methods of patent valuation, and offers an analysis which considers Legal, Technical, and Technology-Market …