This paper has attempted a comprehensive investigation of the economic impact of patent holdout by (1) providing a theoretical foundation of patent holdout and its economic implications, (2) operationalizing this theory into several testable economic models, and (3) testing the models with...

When rivals settle a patent dispute, they prefer to preserve the full monopoly profit, even if the patent is very likely invalid. The literature advocates comparing settlement outcomes to the expected result of litigation, but has not identified a comprehensive means of doing this. We show that...

This paper studies the problem of patent holdout. Part I reviews the economic theory of holdout, with a specific emphasis on patents. It shows that the ordinary concept of holdout refers to the non-transacting conduct of a property owner, and that “patent trespass” is a better...

Licensing Intellectual Property rights generates revenue for the owners of such rights. Bundling IP rights in a single license can generate more revenue. Patent rights and trade secret rights are somewhat conflicting IP rights. Combined licenses issued for using both patent rights and trade...

This case study pertains to Intellectual Property Exchange International, Inc. (IPXI), which was formed in 2008 to create a market-based trading exchange for aggregated patent license rights, particularly standards-essential patents (SEPs). IPXI based its model on existing commodities exchanges,...

Over the past several years, there has been a surge in litigation over technical standards, standards-essential patents (SEPs), and the patent policies of standards development organizations (SDOs). While this litigation has fueled a cottage industry of commentary by economists, legal scholars,...

Technical standard setting, though conducted largely through private organizations, possesses many attributes of a public function. By and large, SDO policies operate effectively to enable competitors to collaborate to develop standards that produce network effects and yield significant social...

An extensive literature exists regarding the patent disclosure and licensing commitments made by participants in standards-development organizations (SDOs), and how such commitments affect the assertion of standards-essential patents (SEPs). But this literature largely ignores the acquisition...

Patent licensing contracts commonly prohibit licensees from challenging the validity of the patents at the basis of the contract or penalize such challenges. A considerable debate has emerged as to whether courts should enforce these challenge clauses. We argue that this debate has not gone far...

The US patent system is a foundation of our nation's economy, encouraging innovation and growth. The exclusive right to use and license an invention provides numerous benefits to its inventor and to the broader economy. The patent system is not costless, however, and significant costs stem from...