The Value of Legal Protection of Novel Product Designs: Evidence from Egyptian Goddess v. Swisa

49 Pages Posted: 5 May 2020 Last revised: 16 Jun 2021

See all articles by Tian Heong Chan

Tian Heong Chan

Emory University - Goizueta Business School

Po-Hsuan Hsu

National Tsing Hua University - Department of Quantitative Finance

Kevin Tseng

National Taiwan University - Department of Finance; National Taiwan University - Center for Research in Econometric Theory and Applications

Date Written: June 15, 2020

Abstract

An unexpected decision of the Federal Circuit Court of Appeals (CAFC) on Egyptian Goddess v. Swisa in 2008 greatly enhanced the legal protection for novel product designs , especially those with many features (i.e., product designs that are more intricate). That decision helped reduce imitations of more intricate product designs. Such strengthened legal protection has value implications, as stock markets reacted more favorably thereafter to intricate product designs compared to simpler product designs. Such positive reactions are more pronounced among firms facing fiercer product market competition and among firms previously involved in design-related litigation.

Keywords: design innovation, patent system, market performance, firm strategy, organization and behavior

JEL Classification: G18, K11, L51, O34

Suggested Citation

Chan, Tian Heong and Hsu, Po-Hsuan and Tseng, Kevin, The Value of Legal Protection of Novel Product Designs: Evidence from Egyptian Goddess v. Swisa (June 15, 2020). Available at SSRN: https://ssrn.com/abstract=3574702 or http://dx.doi.org/10.2139/ssrn.3574702

Tian Heong Chan

Emory University - Goizueta Business School ( email )

1300 Clifton Road
Atlanta, GA 30322-2722
United States

Po-Hsuan Hsu

National Tsing Hua University - Department of Quantitative Finance ( email )

101, Section 2, Kuang-Fu Road
Hsinchu, Taiwan 300
China

Kevin Tseng (Contact Author)

National Taiwan University - Department of Finance ( email )

1, Sec. 4, Roosevelt Road
Taipei, 106
Taiwan

National Taiwan University - Center for Research in Econometric Theory and Applications ( email )

1 Sec. 4, Roosevelt Road
Taipei 106, 106
Taiwan

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