{"title":"Methods of Intellectual Property Valuation","authors":"Susan J. Chaplinsky, G. Payne","doi":"10.2139/ssrn.909734","DOIUrl":"https://doi.org/10.2139/ssrn.909734","url":null,"abstract":"This note addresses the methods used in valuing intellectual property, with a particular focus on patents. The note defines intellectual property and explains its growing importance. It also describes income methods, market approaches, discounted-cash-flow methods, and option-valuation methods.","PeriodicalId":337989,"journal":{"name":"IRPN: Innovation & Patent Law & Policy (Sub-Topic)","volume":"84 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2008-10-21","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"130337015","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Are Patents Discouraging Innovation?","authors":"Soma Dey","doi":"10.2139/ssrn.1014531","DOIUrl":"https://doi.org/10.2139/ssrn.1014531","url":null,"abstract":"The strengthening of the U.S. patent regime in the early eighties was followed by a sharp increase in patenting but did not change the R&D expenditure significantly in some industries in the U.S. This “patent paradox†is prominently observed in complex industries, like the semiconductor industry. In this paper I develop a model of invention and product development to examine the effects of a patent regime change on the patenting and R&D decisions of firms in complex industries. Firms in these industries have a greater need to access a large number of ideas to successfully develop an end product. I consider two different environment — one without licensing and one with licensing. While a stronger patent regime leads to higher patenting and R&D activities in both environments, the strategic complementarity between patenting and R&D is relatively weaker in the presence of licensing. A stronger patent regime change that creates incentives for firms to increase patenting activity, therefore, may not lead to a similar increase in R&D activity.","PeriodicalId":337989,"journal":{"name":"IRPN: Innovation & Patent Law & Policy (Sub-Topic)","volume":"114 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2007-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"123380977","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Patents Pending: Patent Reform for the Innovation Economy","authors":"Julie A. Hedlund","doi":"10.2139/SSRN.1004512","DOIUrl":"https://doi.org/10.2139/SSRN.1004512","url":null,"abstract":"Congress is in the midst of the patent reform debate. Recently introduced legislation \"The Patent Reform Act of 2007\" (S. 1145 and H.R. 1908), would provide significant needed reforms to the system. A new ITIF paper examines the issue of patent reform and discusses recommendations. The paper focuses on three areas of reform. The first is patent delay. With over 700,000 pending patent applications in the U.S. Patent and Trademark Office (PTO) it can take 4 years to get a patent. Second, the paper looks at patent quality and the reasons why the PTO issues too many questionable patents. Finally, the paper examines a third problem: the dramatic increase in patent litigation and awards, which impose a significant tax on the U.S. innovation system.","PeriodicalId":337989,"journal":{"name":"IRPN: Innovation & Patent Law & Policy (Sub-Topic)","volume":"33 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2007-05-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"122722650","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Valuing Patents for Licensing: A Practical Survey of the Literature","authors":"A. Layne-Farrar, J. Lerner","doi":"10.2139/ssrn.1440292","DOIUrl":"https://doi.org/10.2139/ssrn.1440292","url":null,"abstract":"A number of methods exist for valuing a patent in order to license it to an external party. Several of these methods are well accepted in academic circles, others are merely tolerated as expedient. None of the existing methods, however, appears poised to easily accommodate software patent valuation in the face of open source software. Open source software distributors do not earn revenues directly from licensing source code. Even forprofit open source enterprises, such as Red Hat, provide software as part of a service bundle, not as an individually priced product. The problem of linking a patent to a stream of revenue generated by a bundle of goods holds for many service-oriented businesses, with open source as an extreme case. The increasing prevalence of service-based business models suggests that new thinking about how to put a price on patented innovations may be required. In addition to the basic problem of placing a dollar value on an innovation, new thinking on the incentives at play in license negotiations may also be necessary. In other words, do any unique principal-agent problems between patent holder and licensee surface as a result of the open source business model‘ Do any other licensing structure issues need to be worked through in order for existing theory to fit an open source environment. Before any of this 'new thinking' can begin (or is even warranted), though, an assessment of the current state of art is in order. This paper reviews the academic literature on valuing patent licenses.","PeriodicalId":337989,"journal":{"name":"IRPN: Innovation & Patent Law & Policy (Sub-Topic)","volume":"19 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2006-03-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"132293456","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"The Value of Certainty in Intellectual Property Rights: Stock Market Reactions to Patent Litigation.","authors":"Alan C. Marco","doi":"10.2139/ssrn.945009","DOIUrl":"https://doi.org/10.2139/ssrn.945009","url":null,"abstract":"Using a sample of patents litigated between 1977 and 1997, I estimate stock market reactions to patent litigation decisions and to patent grants. I find that the resolution of uncertainty over validity and infringement is worth as much to the firm as the initial patent right. Each is worth about 1 to 1.5% excess returns. Additionally, I find that there are significant differences pre and post-1982 with the establishment of the Court of Appeals for the Federal Circuit. I also find that there are significant differences in reactions for plaintiff patent-holders and defendant patent-holders. Interestingly, there is no similar effect for appellate court decisions relative to the district court. To my knowledge, this is the first study that measures the stock market reactions to legal outcomes of patent cases.","PeriodicalId":337989,"journal":{"name":"IRPN: Innovation & Patent Law & Policy (Sub-Topic)","volume":"1 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2005-11-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"122674194","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Are All Patent Examiners Equal? The Impact of Examiner Characteristics","authors":"I. Cockburn, Samuel Kortum, Scott Stern","doi":"10.3386/W8980","DOIUrl":"https://doi.org/10.3386/W8980","url":null,"abstract":"Building on insights gained from interviewing administrators and patent examiners at the United States Patent and Trademark Office (USPTO), we collect and analyze a novel dataset on patent examiners and patent outcomes. This dataset is based on 182 patents for which the Court of Appeals for the Federal Circuit (CAFC) ruled on validity between 1997 and 2000. For each patent, we identify a USPTO primary examiner, and collect historical statistics derived from their entire patent examination history. These data are used to explore a number of hypotheses about the connection between the patent examination process and the strength of ensuing patent rights. Our main findings are as follows. (i) Patent examiners and the patent examination process are not homogeneous. There is substantial variation in observable characteristics of patent examiners, such as their tenure at the USPTO, the number of patents they have examined and the degree to which the patents that they examine are later cited by other patents. (ii) There is no evidence that examiner experience or workload at the time a patent is issued affects the probability that the CAFC finds a patent invalid. (iii) Examiners whose patents tend to be more frequently cited tend to have a higher probability of a CAFC invalidity ruling. The results suggest that all patent examiners are not equal, and that one of the roles of the CAFC is to review the exercise of discretion in the patent examination process.","PeriodicalId":337989,"journal":{"name":"IRPN: Innovation & Patent Law & Policy (Sub-Topic)","volume":"31 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2002-06-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"130782599","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"International Patenting and Technology Diffusion","authors":"J. Eaton, Samuel Kortum","doi":"10.3386/W4931","DOIUrl":"https://doi.org/10.3386/W4931","url":null,"abstract":"We model the invention of new technologies and their diffusion across countries. Our model predicts that, eventually, all countries will grow at the same rate, with each country's productivity ranking determined by how rapidly it adopts inventions. The common growth rate depends on research efforts in all countries, while research effort is determined by how much inventions earn at home and abroad. Patents affect the return to invention. We relate the decision to patent an invention internationally to the cost of patenting in a country and to the expected value of patent protection in that country. We can thus infer the direction and magnitude of the international diffusion of technology from data on international patenting, productivity, and research. We fit the model to data from the five leading research economies. The parameters indicate how much technology flows between these countries and how much each country earns from its inventions domestically and elsewhere. Our results imply that foreign countries are important sources of technology even though countries earn most of their return to innovation at home. For example, about half of U.S. productivity growth derives from foreign technology yet U.S. investors earn 98 per cent of the revenue from their inventions domestically.","PeriodicalId":337989,"journal":{"name":"IRPN: Innovation & Patent Law & Policy (Sub-Topic)","volume":"29 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1994-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"123321024","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Economic Consequences of a Changing Litigation Environment: The Case of Patents","authors":"J. Lanjouw","doi":"10.3386/W4835","DOIUrl":"https://doi.org/10.3386/W4835","url":null,"abstract":"A model of patent infringement is developed to analyze the relationship between litigation and aspects of the legal environment such as the probability that the patent is found valid, the size of legal fees and their allocation across agents. Potential challengers first decide whether to infringe and then the patentee decides whether or not to prosecute. The outcome of this game has a fundamental impact on the value of patent protection to a patentee. This model is then linked to a patent renewal model which explicitly incorporates the legal parameters of interest from the litigation game. Estimates of the renewal model allow the empirical estimation of the private value of a patent protection. Simulations are presented for Germany which show the quantitative impact of changes in the legal environment on the value generated by the patent system and hence the incentives created for innovation.","PeriodicalId":337989,"journal":{"name":"IRPN: Innovation & Patent Law & Policy (Sub-Topic)","volume":"24 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1994-08-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"121189280","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Inequitable Conduct and Walker Process Claims After Therasense and the America Invents Act","authors":"Gideon Mark, T. L. Anenson","doi":"10.2139/ssrn.3623312","DOIUrl":"https://doi.org/10.2139/ssrn.3623312","url":null,"abstract":"This Article examines the dramatic constriction of the inequitable conduct defense to patent infringement accomplished in 2011 by the issuance of the Federal Circuit’s decision in Therasense, Inc. v. Becton, Dickinson & Co. and the enactment of the America Invents Act (AIA). The Article argues that Therasense and the AIA have unduly narrowed the inequitable conduct defense and thus undermined core goals of United States patent law. The Article concludes that Therasense and specific features of the AIA, particularly its adoption of new post-issuance review proceedings and a new best mode amendment, will operate in tandem to sharply curtail the availability of the inequitable conduct defense and impair the operation of the U.S. patent system. Simultaneously, Therasense will operate to overly constrict the opportunity for parties to assert Walker Process antitrust claims. In short, the cure has been worse than the plague on the patent system that critics have commonly attributed to the inequitable conduct doctrine.","PeriodicalId":337989,"journal":{"name":"IRPN: Innovation & Patent Law & Policy (Sub-Topic)","volume":"118 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"120956405","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}