Different Rules of Legal-Cost Allocation and Patent Hold-Up

Elisabetta Ottoz and Cugno Franco ()
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Cugno Franco: University of Turin, http://www.est.unito.it/

Department of Economics and Statistics Cognetti de Martiis. Working Papers from University of Turin

Abstract: We study how different rules of legal-cost allocation impact on negotiated royalties in an environment where patent hold-up is possible. The model assumes that the courts routinely grant stays of permanent injunctions to allow the infringers to redesign their products or deny injunctive reliefs outright. In these scenarios we consider the American system, where each party bear s its own costs, the British system, where the loser incurs all costs, and the system favoring the defendant, where the defendant pays its own costs if it loses and nothing otherwise. Our main conclusions are that when stayed injunctions are granted the system favoring the defendant provides the best results, while under denied injunctions the American system is preferable

Pages: 17 pages
Date: 2012-10
New Economics Papers: this item is included in nep-ino, nep-ipr and nep-pr~
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Related works:
Chapter: Different Rules of Legal-Cost Allocation and Patent Holdup (2015)
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