Download This PaperPatent Hold-Out and Licensing Frictions: Evidence from Litigation of Standard Essential Patents
53 Pages Posted: 27 Oct 2021 Last revised: 22 Jan 2024
Date Written: June 7, 2023
Abstract
The theory of patent “hold-out” posits that frictions in the market for licensing standard-essential patents (SEPs) provide incentives for prospective licensees to opportunistically delay taking licenses with the goal of avoiding or reducing royalty payments. We construct measures of pre- and in-litigation hold-out from information disclosed in U.S. cases filed 2010-2019. Relying on both SEP and a matched control set of non-SEP disputes, we explore whether frictions in the market for licensing are associated with hold-out. We find some evidence of an association between hold-out and both SEP portfolio size and enforcement uncertainty; however, we find no evidence associating pre- or in-litigation hold-out with the international breadth of SEP rights.
Keywords: Litigation, standards, patents, hold-out, U.S.
JEL Classification: K41, L96, O34
Suggested Citation: Suggested Citation
Brian J. Love (Contact Author)
Santa Clara University - School of Law ( email )
500 El Camino Real
Santa Clara, CA 95053
United States