Explaining a Surge in IPR Filings : Uncertain Design Rights and Learning Their Boundaries in the Finnish Sauna Heater Market

We present a case study of a surge in design right filings in an industry transforming from technology-based to design-based competition. The motives for and outcomes of filing, and how these changed over time are discussed. We go on to explore the events, which offered the agents opportunities to update their beliefs about the scope of design right protection. We find that filing motives change from specific protection goals to freedom to operate over time. We also find that the actors faced several, but sometimes contradictory, learning opportunities. Finally, we argue that uncertain design rights may have fostered entrepreneurial optimism. Policy makers could level the playing field and decrease information asymmetries between experienced and inexperienced players by mandating digital open access to design right databases and existing court cases. However, the expected welfare effects of this libertarian paternalistic policy are contradictory