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Do firms profit from patent litigation? The contingent roles of diversification and intangible assets

Do firms profit from patent litigation? The contingent roles of diversification and intangible assets
Do firms profit from patent litigation? The contingent roles of diversification and intangible assets
Prior research suggests that firms’ ability to benefit from their technologies is determined by the strength of intellectual property (IP) laws and the inimitability of their technologies. We complement this explanation by suggesting that the generation of profits from technology is also driven by how effectively firms engage in patent infringement litigation (i.e., take legal action against their rivals) to create isolating mechanisms and protect their technologies. We contend that patent infringement litigation is characterized by industry and geographic specificity that affect (disproportionately) revenue generation and costs and, therefore, its net effect on firm profitability. By identifying contingencies that influence the economic returns from patent litigation, the analysis helps us understand why firms experience different profitability outcomes even when they operate in similar IP regimes and possess similar portfolios of technologies.
0048-7333
Kafouros, Mario
deadca5d-8181-40bb-a61c-cc6776677493
Aliyev, Murod
b3150e1c-c16a-4dba-bcca-502fc6cb1c6b
Krammer, Sorin M.S.
24ce872e-5044-4846-bb35-88e12c74c854
Kafouros, Mario
deadca5d-8181-40bb-a61c-cc6776677493
Aliyev, Murod
b3150e1c-c16a-4dba-bcca-502fc6cb1c6b
Krammer, Sorin M.S.
24ce872e-5044-4846-bb35-88e12c74c854

Kafouros, Mario, Aliyev, Murod and Krammer, Sorin M.S. (2021) Do firms profit from patent litigation? The contingent roles of diversification and intangible assets. Research Policy, 50 (6), [104263]. (doi:10.1016/j.respol.2021.104263).

Record type: Article

Abstract

Prior research suggests that firms’ ability to benefit from their technologies is determined by the strength of intellectual property (IP) laws and the inimitability of their technologies. We complement this explanation by suggesting that the generation of profits from technology is also driven by how effectively firms engage in patent infringement litigation (i.e., take legal action against their rivals) to create isolating mechanisms and protect their technologies. We contend that patent infringement litigation is characterized by industry and geographic specificity that affect (disproportionately) revenue generation and costs and, therefore, its net effect on firm profitability. By identifying contingencies that influence the economic returns from patent litigation, the analysis helps us understand why firms experience different profitability outcomes even when they operate in similar IP regimes and possess similar portfolios of technologies.

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SK-Paper-Litigation-ResPol-final - Accepted Manuscript
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Accepted/In Press date: 3 April 2021
e-pub ahead of print date: 12 April 2021
Published date: 12 April 2021

Identifiers

Local EPrints ID: 497792
URI: http://eprints.soton.ac.uk/id/eprint/497792
ISSN: 0048-7333
PURE UUID: 29b223b1-9e17-419e-9481-2629127c8826
ORCID for Sorin M.S. Krammer: ORCID iD orcid.org/0000-0002-5773-9514

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Date deposited: 31 Jan 2025 17:41
Last modified: 23 Aug 2025 04:01

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Contributors

Author: Mario Kafouros
Author: Murod Aliyev
Author: Sorin M.S. Krammer ORCID iD

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