An Empirical Investigation into Patent Enforcement in Australian Courts

Abstract

The effectiveness of patent protection depends not only on the existence of patent laws on the books, but also on the ability to enforce the rights granted by those laws. In recent years, there has been concern expressed in Australia that courts are providing inadequate protection for patent owners: that they are anti-patent. We argue that there are two fundamental problems with this line of argument. The first is that although it is essentially an empirical issue, the debate has largely been based on anecdotal evidence provided by vested interest groups. Second, many existing studies are critical of the observed low levels of success in patent litigation disputes without properly recognizing that a patent does not provide any guarantee of validity if challenged in a court of law. Given the selection bias, only those cases where validity is highly questionable may actually make it to court. To incorporate these issues into the debate, we have created and analysed a database of all patent enforcement decisions (on both validity and infringement) of Australian courts for the period 1997-2003. We report descriptive statistics on patent litigation including detailed information on the duration of such litigation. Our analysis indicates that, in line with theoretical predictions, patent owners are more likely to have at least some of their claims upheld in both validity and infringement determinations than they are to lose all of their claims.