Side payments, litigation risk and settlement outcomes

Elisabetta Ottoz and Franco Cugno

Information Economics and Policy, 2016, vol. 35, issue C, 76-81

Abstract: We offer a simple model of patent settlement for examining how litigation prospects, patent strength and expected damage awards affect consumer benefits stemming from settlement agreements providing for per-unit royalties and non-negative fixed fees. The result shows that consumers may be harmed if expected damage payments forgone by settlement lead to agreements with high royalty payments that benefit both the patent holder and licensee at the expense of the consumer.

Keywords: Consumers' welfare; Infringement damages; Licensing; Patent settlements (search for similar items in EconPapers)
JEL-codes: K2 O31 O34 (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:iepoli:v:35:y:2016:i:c:p:76-81

DOI: 10.1016/j.infoecopol.2016.02.001

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