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Patent Purchases and Litigation Outcomes

21 Pages Posted: 5 Dec 2016  

Mark A. Lemley

Stanford Law School

Erik Oliver

Richardson Oliver Law Group LLP

Kent Richardson

Richardson Oliver Law Group

James Yoon

Stanford University, School of Law, Students

Michael Costa

Richardson Oliver Law Group

Date Written: December 2, 2016

Abstract

We test empirically whether purchased patents that are litigated fare better or worse than litigated patents that aren’t purchased. We identified every case filed in 2009 and 2010 that had a definitive winner and had information on the presence or absence of an assignment or other transfer. That left us with 516 decisions. Of those 516 decisions, the patentee won 125, or 24.2%. Of the patents, 280, or just over half, had been transferred before the litigation began.

We find that overall, patentees won 21% of the time with patents that had been sold before litigation began, and 28% of the time with patents they developed in-house. But combining all patent cases may obscure important differences between plaintiffs who buy patents and those who don’t. Dividing our study into entity types produces a surprising result. Operating companies fare better when they assert patents they developed in house. They won 33% of the time when asserting their own patents, but only 23% of the time when asserting purchased patents. By contrast, inventor-owned NPEs -- but not patent assertion entities -- do better with purchased patents. The results also differ by area of technology

Our results have implications for the design of patent markets and for the efficiency of patent licensing transactions.

Suggested Citation

Lemley, Mark A. and Oliver, Erik and Richardson, Kent and Yoon, James and Costa, Michael, Patent Purchases and Litigation Outcomes (December 2, 2016). Stanford Public Law Working Paper No. 2879691. Available at SSRN: https://ssrn.com/abstract=2879691

Mark A. Lemley (Contact Author)

Stanford Law School ( email )

559 Nathan Abbott Way
Stanford, CA 94305-8610
United States

Erik Oliver

Richardson Oliver Law Group LLP ( email )

5150 El Camino Real, B-21
Los Altos, CA California 94022
United States
+1 (650) 967-6555 (Phone)

HOME PAGE: http://www.richardsonoliver.com

Kent Richardson

Richardson Oliver Law Group ( email )

5150 W El Camino Real
Los Altos, CA California 94022
United States

James Yoon

Stanford University, School of Law, Students ( email )

Stanford, CA
United States

Michael Costa

Richardson Oliver Law Group ( email )

5150 W El Camino Real
Los Altos, CA California 94022
United States

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