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Trends In Private Patent Costs And Rents For Publicly-Traded United States Firms, James Bessen, Peter Neuhausler, John L. Turner, Jonathan Williams
Trends In Private Patent Costs And Rents For Publicly-Traded United States Firms, James Bessen, Peter Neuhausler, John L. Turner, Jonathan Williams
Faculty Scholarship
We use detailed data to estimate the private costs and private rents of United States patents for publicly-traded firms. In analyzing costs, we first introduce a novel theoretical model to interpret our estimates. We then combine lawsuit data from Derwent Litalert with non-practicing entity (NPE) lawsuits collected by Patent Freedom, and use an event-study approach to estimate losses suffered by alleged infringers during 1984-2009. To estimate rents, we combine patent data from the USPTO and EPO with financial data from COMPUSTAT, and use market-value regressions to estimate the value of patent rents for publicly-traded US firms during 1979-2002. We find …
Deterrence And Aggregate Litigation, Keith N. Hylton
Deterrence And Aggregate Litigation, Keith N. Hylton
Faculty Scholarship
This paper examines the deterrence properties of aggregate litigation and class actions, with an emphasis on positive value claims. In the multiple victim scenario with positive value claims, the probability that an individual victim will bring suit falls toward zero with geometric decay as the number of victims increases. The reason is that the incentive to free ride increases with the number of victims. Deterrence does not collapse but is degraded. Undercompliance is observed, which worsens as the number of victims increases. Compliance is never socially optimal, and the shortfall from optimality increases with the number of victims. These results, …