Patents Used in Patent Office Rejections as Indicators of Value

25 Pages Posted: 13 Nov 2018 Last revised: 23 Oct 2023

Date Written: July 3, 2023

Abstract

This paper introduces a novel approach to measure a patent’s economic value by examining whether the patent’s disclosure leads to rejection of another pending U.S. patent application. This approach considers the use of the patent by the U.S. Patent & Trademark Office in office action rejections on the grounds of novelty or obviousness, as well as its citation as an X or Y reference in a European Patent Office (EPO) search report, which provides analogous information. Unlike conventional citation metrics widely employed by economists, the novel metric is arguably more closely tied to private value, as it is centered on the examiner’s rejection of another patent application based on the patent in question. As this metric is not directly influenced by potential strategic behavior by patent lawyers or patent applicants, it is more directly tied to private value.

This study evaluates how patents used in novelty and obviousness rejections, and comparable EPO information, correspond to common measures of private value—specifically patent renewal, the assertion of a patent in litigation, and the number of patent claims. We examine rejection data from U.S. patent applications pending from 2008 to 2017 and then link value data to rejection citations to patents issued from 1999 to 2007. A similar analysis is also conducted for EPO search reports. Our findings reveal that rejection patents, as well as X and Y EPO search citations, independently exhibit positive correlations with many of the value measurements, exceeding the correlations from forward citations and examiner citations. Moreover, when information from both the USPTO and EPO concerning a given patent is combined, further insights about that patent’s value are obtained. Accordingly, these rejection use metrics provide another independent tool for evaluating a patent’s value.

Keywords: patent, patent citation, patent value, forward citation, patent application, examiner, patent prosecution

JEL Classification: O34, O38

Suggested Citation

Cotropia, Christopher Anthony and Schwartz, David L., Patents Used in Patent Office Rejections as Indicators of Value (July 3, 2023). Available at SSRN: https://ssrn.com/abstract=3274995 or http://dx.doi.org/10.2139/ssrn.3274995

Christopher Anthony Cotropia (Contact Author)

University of Richmond - School of Law ( email )

28 Westhampton Way
Richmond, VA 23173
United States

David L. Schwartz

Northwestern University - Pritzker School of Law ( email )

375 E. Chicago Ave
Chicago, IL 60611
United States

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