Policy Brief: Conflict Resolution, Public Goods and Patent Thickets

BACKGROUND

  • Over the last three decades, the demand for patents has been steadily growing at patent offices around the world.
  • Strong demand for patent rights combined with errors in patent offices’ examination and grant procedures result in increasing numbers of ‘weak’ and overlapping patent rights.
  • As a result, companies are increasingly confronted with serious challenges when trying to develop and commercialise technology in the presence of patent thickets.
  • Litigation and post-grant validity challenges have been considered as a way of eliminating erroneously granted patent rights.

 METHODOLOGY

  • The authors look at whether individual patents are opposed post-grant. The aim is to identify which factors increase or decrease the incidence of opposition, so as to establish whether post-grant opposition serves applicants patenting different kinds of technology equally well.
  • The analysis draws on a dataset, which includes all patent applications filed with the European Patent Office between 1980 and 2010, with a focus on the characteristics of the patent, the applicant and the technology area.

KEY FINDINGS

  • The authors find that opposition decreases in fields in which many firms would benefit from the revocation of a patent, which creates a public goods problem.
  • In fields with a large number of mutually blocking patents, the incidence of opposition is sharply reduced, particularly among large firms and firms that are caught up directly in patent thickets.

POLICY ISSUES

  • Findings are of high relevance to the users of patent systems and for those concerned with the governance of these systems.
  • Findings indicate that post-grant patent review may not constitute an effective correction device for erroneous patent grants in technologies affected by either patent thickets or highly dispersed patent ownership.
  • The analysis suggests that it will have to be smaller applicants who contribute to ensuring that weak patents are kept off the register or removed from it when first asserted.
  • Collectively, their interests in patent opposition working are much stronger than those of
  • larger firms at the heart of thickets, whose cooperative actions through cross-licensing do not remove weak patents from the patent register.

FOR MORE INFORMATION

The full working paper 13-4 and more information about CCP and its research is available from our website: www.competitionpolicy.ac.uk

ABOUT THE AUTHORS

Dr Dietmar Harhoff is Professor of Business Administration and Director of the Institute for Innovation Research, Technology Management and Entrepreneurship at the Ludwig-Maximilians University Munich

Dr Georg von Graevenitz is Senior Lecturer at Norwich Business School and a member of the ESRC Centre for Competition Policy.

Dr Stefan Wagner is Associate Professor at the European School of Management and Technology.

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