Optimal Standards of Proof in Patent Litigation: Infringement and Non-Obviousness

29 Pages Posted: 4 Oct 2019

See all articles by Ezra Friedman

Ezra Friedman

Northwestern University - Pritzker School of Law

Abraham L. Wickelgren

University of Texas at Austin - School of Law; University of Texas at Austin - Center for Law, Business, and Economics

Date Written: October 3, 2019

Abstract

We build a model of innovation and patent adjudication under two forms of uncertainty; uncertainty regarding whether the original invention merits protection (non-obviousness), and uncertainty as to whether a particular competitor's product should be barred (infringement). We find that when it is practical to increase the rewards from innovation by extending patent length, the standards of proof for non-obviousness should be high. The intuition for this is that patent length should be set so that the increase in innovation from extending patent length is balanced by the increase in deadweight loss from extending monopoly pricing. In this situation, the ex-ante cost of failing to protect a good patent is minimal, but there is substantial deadweight loss from protecting a bad patent. In contrast, if non-infringing competing inventions substantially decrease the original inventor's profits, it might be desirable to have a very low standard of proof for infringement, since the deadweight loss from an incorrect finding of infringement is mostly balanced out by the increased ex-ante incentive to invent.

Keywords: Patent Law, Standards of Proof, Breadth, Non-Obviousness

JEL Classification: K10, K30

Suggested Citation

Friedman, Ezra and Wickelgren, Abraham L., Optimal Standards of Proof in Patent Litigation: Infringement and Non-Obviousness (October 3, 2019). Northwestern Law & Econ Research Paper No. 19-07. Available at SSRN: https://ssrn.com/abstract=3463873 or http://dx.doi.org/10.2139/ssrn.3463873

Ezra Friedman (Contact Author)

Northwestern University - Pritzker School of Law ( email )

375 E. Chicago Ave
Chicago, IL 60611
United States

Abraham L. Wickelgren

University of Texas at Austin - School of Law ( email )

727 East Dean Keeton Street
Austin, TX 78705
United States

University of Texas at Austin - Center for Law, Business, and Economics

Austin, TX 78712
United States

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