Skip to main content Accessibility help
×
Hostname: page-component-cd9895bd7-jn8rn Total loading time: 0 Render date: 2024-12-21T15:56:29.878Z Has data issue: false hasContentIssue false

1 - Do Patent Law Suits Target Invalid Patents?

Published online by Cambridge University Press:  04 December 2019

Yun-chien Chang
Affiliation:
Academia Sinica, Taipei, Taiwan
Get access

Summary

One objective of the patent litigation system is to screen meritorious from non-meritorious patents and invalidate the latter. While much of this screening may occur at trial, some amount of targeting may take place at the time of the filing of the suit itself. In this chapter, we assess the targeting efficiency of the patent litigation system at this earlier filing stage. Should the system indeed screen at this stage, one would predict a higher likelihood of patent lawsuits among a set of patents with weaker underlying validity relative to a set of patents with stronger underlying validity. In prior work (Frakes and Wasserman, Review of Economics and Statistics, 2017), we found that as examiners were given less time to review applications, they granted patents at higher rates, with the resulting marginal patents exhibiting greater markers of invalidity and attracting more litigation. An implication of these findings is that patents with more questionable validity—due to the leniency of the examiner—are indeed more likely to wind up in litigation, a finding supportive of filing-stage screening of meritorious claims. Our analysis in this book chapter attempts to generalize these prior findings to sources of examiner leniency beyond time constraints. More broadly, we characterize an examiner’s leniency by their overall grant rate, taking advantage of the fact that applications are effectively randomized across examiners. Consistent with our prior findings, we find that lenient examiners are more likely, on average, to issue patents with markers suggestive of weaker underlying validity and that are more likely to attract litigation. Ultimately, our findings suggest that legally invalid patents issued by the U.S. Patent Office are substantially more likely to be the target of litigation relative to legally valid patents.

Type
Chapter
Information
Publisher: Cambridge University Press
Print publication year: 2019

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Allison, John, Lemley, Mark, Moore, Kimberley, and Derek Trunkey, R.. 2004. Valuable Patents. Georgetown Law Journal 92: 435–79.Google Scholar
Allison, John, Lemley, Mark, and Walker, Joshua. 2011. Patent Quality and Settlement among Repeat Patent Litigants. Georgetown Law Review 99: 677712.Google Scholar
Chien, Colleen. 2011. Predicting Patent Litigation. Texas Law Review 90: 283329.Google Scholar
Cockburn, Ian, Korum, Samuel, and Stern, Scott. 2003. Are All Patent Examiners Equal? Examiners, Patent Characteristics, and Litigation Outcomes, in Patents in Knowledge-Based Economy, edited by Cohen, Wesley M. and Merril, Stephen A.. Washington, DC: National Academies Press.Google Scholar
Cotropia, Christopher, Kesan, Jay, and Schwartz, David. 2014. Unpacking Patent Assertion Entities. Minnesota Law Review 99: 649703.Google Scholar
Farre-Mensa, Joan, Hegde, Deepak, and Ljungqvist, Alexander. 2017. What Is a Patent Worth? Evidence from the U.S. Patent “Lottery.” NBER Working Paper 23268.CrossRefGoogle Scholar
Feng, Josh, and Jaravel, Xavier. 2016. Who Feeds the Trolls? Patent Trolls and the Patent Examination Process. Working Paper. Harvard University, Cambridge, MA.CrossRefGoogle Scholar
Ford, Roger Allan. 2013. Patent Invalidity versus Noninfringement. Cornell Law Review 99: 71128.Google Scholar
Frakes, Michael D., and Wasserman, Melissa F.. 2017. Is the Time Allocated to Review Patent Applications Inducing Examiners to Grant Invalid Patents?: Evidence from Micro-Level Application Data. Review of Economics and Statistics 99: 550–63.Google Scholar
Harhoff, Dietmar, and Reitzig, Markus. 2004. Determinants of Opposition against EPO Patent Grants – The Case of Biotechnology and Pharmaceuticals. International Journal of Industrial Organization 22: 443–80.CrossRefGoogle Scholar
Hyman, David, and Silver, Charles. 2006. Medical Malpractice Litigation and Tort Reform: It’s the Incentives, Stupid. Vanderbilt Law Review 59: 1085–136.Google Scholar
Kessler, Daniel, Meites, Thomas, and Miller, Geoffrey. 1996. Explaining Deviations from the Fifty-Percent Rule: A Multimodal Approach to the Selection of Cases for Litigation. Journal of Legal Studies 25: 233–59.Google Scholar
Lanjouw, Jean, and Schankerman, Mark. 2001. Characteristics of Patent Litigation: A Window on Competition. Rand Journal of Economics 32: 129–51.CrossRefGoogle Scholar
Lemley, Mark A. Rational Ignorance at the Patent Office. 2001. Northwestern University Law Review 95: 14951532.Google Scholar
Lemley, Mark A., and Sampat, Bhaven. 2012. Examiner Characteristics and Patent Office Outcomes. Review of Economics and Statistics 94: 817–27.CrossRefGoogle Scholar
Lemley, Mark A., Richardson, Kent, and Oliver, Erik. 2017. The Patent Enforcement Iceberg. Stanford Public Law Working Paper. Stanford, CA.CrossRefGoogle Scholar
Lichtman, Douglas. 2004. Rethinking Prosecution History Estoppel. University of Chicago Law Review 71: 151–82.Google Scholar
Mann, Ronald. 2014. The Idiosyncrasy of Patent Examiners: Effects of Experience and Attrition. Texas Law Review 92: 2149–76.Google Scholar
Melero, Eduardo, Palomeras, Neus, and Wehrheim, David. 2017. The Effect of Patent Protection on Inventor Mobility. Working Paper.Google Scholar
Priest, George L. and Klein, Benjamin. 1984. The Selection of Disputes for Litigation. Journal of Legal Studies 13: 155.Google Scholar
Righi, Cesare, and Simcoe, Timothy. 2017. Patent Examiner Specialization. Working Paper.Google Scholar
Sampat, Bhaven, and Williams, Heidi. 2015. How do patents affect follow-on innovation? Evidence from the human genome. NBER Working Paper 21666.CrossRefGoogle Scholar
Studdert, David, Mello, Michelle, Gawande, Atul, Gandhi, Tejal, Kachalia, Allen, Yoon, Catherine, Puopolo, Ann Louise, and Brennan, Troyen. 2006. Claims, Errors, and Compensation Payments in Medical Malpractice Litigation. The New England Journal of Medicine 354: 2024–33.Google Scholar
Tu, Shine. 2014. Patent Examination and Litigation Outcomes. Stanford Technology Law Review 17: 507–48.Google Scholar
Vishnubhakat, Saurabh, Rai, Arti K., and Kesan, Jay P.. 2016. Strategic Decision Making in Dual PTAB and District Court Proceedings. Berkeley Technology Law Review 31: 45124.Google Scholar

Save book to Kindle

To save this book to your Kindle, first ensure no-reply@cambridge.org is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about saving to your Kindle.

Note you can select to save to either the @free.kindle.com or @kindle.com variations. ‘@free.kindle.com’ emails are free but can only be saved to your device when it is connected to wi-fi. ‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.

Find out more about the Kindle Personal Document Service.

Available formats
×

Save book to Dropbox

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Dropbox.

Available formats
×

Save book to Google Drive

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Google Drive.

Available formats
×