Patent Litigation When Innovation Is Cumulative

Gerard Llobet

Working Papers from CEMFI

Abstract: This paper studies the effect of litigation as a way to enforce patents when firms hold private information. A structure to the legal system is provided, allowing a better understanding of the settlement and litigation decisions taken by enterpreneurs. The model is broadly consistent with recent empirical evidence. We show that the optimal license consists of a fixed fee and no royalties and that in some cases too much protection might be detrimental to the patentholder. We finally compare different legal systems and their effect on innovation and litigation.

Date: 2001
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Citations: View citations in EconPapers (3)

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Journal Article: Patent litigation when innovation is cumulative (2003)
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