Changes

===Papers with reviews in progress===

@article{bessen2003patent,

}

thicket_stance={},

thicket_stance_extract={},

thicket_def_extract={Although the term “patent thicket” seems to have originated in litigation in the 1970s regarding Xerox’s dominance of a portion of the photocopier industry,1 economist Carl Shapiro reintroduced the term in academic discourse in 2000. Shapiro defines a patent thicket more broadly to encompass the intellectual property portfolios of several companies that form “a dense web of overlapping intellectual property rights that a company must hack its way through in order to actually commercialize new technology,” and he points out that “with cumulative innovation and multiple blocking patents, … patent rights can have the perverse effect of stifling, not encouraging, innovation”... While the existence of a patent thicket is a necessary but insufficient condition for demonstrating that a given collection of patents is a pro-competitive solution to a particular patent thicket problem, the antitrust regime has never had an objective method of verifying the existence of a patent thicket in a given section of patent space... Patent thickets are not a new phenomenon, and when the total number of owners of the conflicting intellectual property rights is small, the response to the patent thicket problem has often been to cross-license (Grindley & Teece 1997; Teece 1998; Teece 2000). When more than two parties are involved, however, the transaction costs of cross-licensing between all of the parties can be prohibitive, and additional economic barriers exist such as hold-ups and double marginalization... Particularly in the biopharmaceutical industry, patent thickets threaten the process of cumulative innovation because they act “as barriers to entry [that prevent new entrants] from using the technologies protected by such patent thickets”... The standard taxonomy categorizes the economic relationship between individual patents as blocking, complementary, independent, or substitute (Andewelt 1984; Newberg 2000), or “BCIS.” The elimination of substitutes is also a necessary but insufficient condition for a pro-competitive pooling solution to a patent thicket... Given that Shapiro defines a patent thicket as “a dense web of overlapping intellectual property rights that a company must hack its way through in order to actually commercialize new technology” (2000, pg. 120), measuring density is a logical direction of inquiry. Building upon his premise that a patent pool is a natural market-clearing mechanism that forms within a patent thicket, it should be possible to verify that the density of patents within known pools is higher than the surrounding patent space. If the density measures of established pools are significantly higher than the density of their surrounding patent space, that finding will contribute a new dimension to the definition of patent thickets},

tags={},

thicket_stance={},

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thicket_def_extract={When organizations in technology industries attempt to advance their innovative activities, they may encounter patent thickets, or dense webs of overlapping intellectual property rights owned by different companies that must be hacked through in order to commercialize new technology... Using Shapiro’s definition of a patent thicket as the starting point, two conditions must be satisfied in order for a collection of patents to be a patent thicket: the collection of patents must be both “dense” and “overlapping”(2000, pg. 120).},

tags={},

thicket_stance={},

thicket_stance_extract={},

thicket_def_extract={...for the formation of patent thickets. These dense webs of overlapping intellectual property rights owned by different companies (Shapiro 2000) can present a significant barrier that must be hacked through in order to commercialize new technology. In other industries characterized by cumulative innovations and multiple blocking patents, the existence of such densely concentrated patent rights can have the perverse effect of stifling innovation rather than encouraging it. Such patent thickets are already problematic in other convergent technology areas such as biotechnology (Heller and Eisenberg 1998; Clark et al. 2000; Horn 2003) and information technology (Clarkson 2004)... When multiple organizations each own individual patents that are collectively necessary for a particular technology, however, their competing intellectual property rights form a “patent thicket”},

tags={},

thicket_stance_extract={},

thicket_def={References Shapiro, Diversely-Held, Transaction Costs, Unspecified Blocking Mechanism},

tags={},

filename={[[Cockburn MacGarvie (2006) - Entry And Patenting In The Software Industry]].pdf}

thicket_stance={},

thicket_stance_extract={},

thicket_def_extract={As all industry participants have responded to increased incentives to obtain patents, the “thicket” in these markets has grown dramatically, imposing greater and greater transactions costs on all firms.... As discussed above, it may not be just the absolute number of patents in an area that can deter entry, but also the total cost to an entrant of licensing its way through the thicket. One salient feature of patent thickets is the potential for higher costs associated with negotiating with many parties. To the extent that there are fixed costs of conducting a negotiation, having to deal with more parties will drive up costs of obtaining licenses. There may also be transactions costs associated with bargaining and coordinating negotiations with multiple licensors... But transactions costs associated with thickets may have interesting dynamic effects: while incumbents enjoy increased protection for current innovations, larger thickets will also raise their costs of introducing future generations of innovations.},

tags={},

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thicket_def_extract={With more than 100,000 software patents issued in the US since 1990, and ever-greater complexity and scale of software products, industry participants face an increasingly forbidding “thicket” of IP. With even quite modest products containing millions of lines of code and thousands or tens of thousand of inter-related component modules, any of which could potentially infringe one or more patents, the cost of “clearing” new products for potential infringement can be very large. Allegedly poor standards of patent examination in this area in the past may also have generated large numbers of patents with inadequate disclosure, and excessively broad claims, raising the costs of determining the scope of existing IP, and increasing uncertainty about possible future litigation from competitors and non-competitors alike... a patent “thicket”—i.e. a “a dense web of overlapping intellectual property rights that a company must hack its way through in order to actually commercialize new technology”... Following Hall and Ziedonis (2003) and Ziedonis (2005), we hypothesize that start-up companies with patents will be able to use them in cross-licensing negotiations to defend themselves against litigation. These patents may then act to reduce the transaction costs associated with operating in a “thicketed” market... However, it may not be just the absolute number of patents in an area that can deter entry, but also the extent to which those patents form a “thicket” in the sense of generating transactions costs above and beyond simple blocking power. As Shapiro (2001) puts it, “a patent thicket is a dense web of overlapping intellectual property rights that a company must hack its way through in order to actually commercialize new technology. With cumulative innovation and multiple blocking patents, stronger patent rights can thus have the perverse effect of stifling, not encouraging, innovation.”14 Ziedonis (2004) and Noel and Schankerman (2006) argue that a key factor driving transactions costs may be the degree to which ownership of patent rights is fragmented. Suppose a prospective entrant were to obtain licenses from holders of blocking patents.},

tags={},

thicket_stance_extract={},

thicket_def={Overlapping Patents, Cummulative Invention, Diversely-Held, Transaction Costs, Unspecified Blocking Mechanism},

tags={},

filename={[[Cockburn MacGarvie Muller (2010) - Patent Thickets Licensing And Innovative Performance]].pdf}

thicket_stance={},

thicket_stance_extract={},

thicket_def_extract={I study how the fragmentation of the ownership of complementary patents impacts the market value of the firm. This fragmentation builds a patent thicket, which contains a set of overlapping patents.3 The patent thicket requires obtaining permission from several right holders to commercialize a product. Firms that face a fragmented technology market have to pay higher transaction costs and royalty payments to license external patents, because they are confronted with larger number of entities in the thicket. They are more prone to opportunistic behaviour by external entities, since the likelihood of infringing other firms’ patents is high. They are also more exposed to the risk of being litigated against by other patent holders. The patent thickets hold several costs for the firms with cumulative innovations. They cause the “complement problem” which was first formally examined by Cournot (1838).12 Shapiro (2001) extends the Cournot idea into the context of intellectual property. He indicates right holders in the thicket make the prices of invented products much larger than their marginal costs by imposing the licensing fees. The result is lower consumer welfare and joint profit of right holders. Heller and Eisenberg (1998) also show that the licensing fees in the thicket lead to underinvestment in innovation or the “tragedy of anti-commons.” Furthermore, Shapiro (2001) shows that the dense thickets increase the transaction costs of firms, because identifying complementary patents is harder and more costly. Innovators usually find about all of the patents after bearing sunk costs. This means the innovator is faced with a hold-up problem.},

tags={},

research_type={},

industry={},

thicket_stance_extract={Finally, the group tackled prescriptive aspects. There was a lively discussion on whether patent thickets are a problem per se. While there was no clear answer to that, participants did agree that patent thickets appear to be closely related to the management of innovation and its complexity... A patent thicket generally has several characteristics (von Graevenitz, Wagner, & Harhoff, 2011). It usually involves (1) multiple patents or patent applications on (2) the same, similar, or complementary technologies, (3) held by different parties. Granted patents as well as patent applications may represent a barrier for new entrants, therefore a fair measure of patent thickets should include both.},

thicket_def={#A-T, #B, Quotes Shapiro, References Shapiro, References Heller/Eisenberg, Complementary Inputs, Diversely-Held, Transaction Costs, Overlapping Patents},

pages={54},

year={2004},

discipline={Law},

research_type={Discussion},

industry={Biomedial},

tags={},

filename={[[Epstein Kuhlik (2004) - Is There A Biomedical Anticommons]].pdf}

thicket_stance={},

thicket_stance_extract={},

thicket_def_extract={The theoretical economics literature argues that when innovations are sequential and cumulative, patents may impose more than the typical exclusion-period costs.113 For instance, a patent for an invention early in the innovative process could impose a toll on each sequential innovation that relies on it. Subsequent inventors, therefore, face higher transaction costs––they must pay licensing fees before they can further refine a technology. As the tolls build during the technology’s development path, later research could be discouraged altogether. Alluding to the famous argument for property rights, over-patenting has been dubbed the “tragedy of the anticommons,” as too many people with exclusionary rights can cause underutilization of resources.114 Shapiro uses another metaphor: the patent thicket... Based on the theoretical literature, software patent opponents claim that patent thickets will develop in the software industry. Thus, they assert that patents allow a company or individual to prevent the type of incremental innovation that is so important in the software industry. When small pieces of software that are adaptable to a multitude of applications can be and are patented, it becomes increasingly likely that each complex program will infringe someone’s patent. Therefore, opponents argue that developers have incentives to “over-patent” for strategic or defensive reasons in order to gain leverage in cross-licensing negotiations.119 Strategic patenting results in a patent thicket, an impenetrable barrier to further innovation.},

tags={},

thicket_stance_extract={},

thicket_def={Complementary Inputs, Diversely-Held},

tags={SSO, Patent Pools, Cross-licensing},

filename={[[Farrell (2009) - Intellectual Property As A Bargaining Environment]].pdf}

thicket_stance={},

thicket_stance_extract={},

thicket_def_extract={...are the fragmentation of patent rights (often referred to as ‘patent thickets’)... These two effects help reconcile the two opposing views on patent thickets in the recent economic and legal literature — the pro-diffusion view of Licthman (2006) and the anti-commons view of Heller and Eiseberg (1998) and Shapiro (2001)... This result is consistent with the ‘anti-commons’ view: thickets powerfully increase transaction costs and reduce the speed of technology diffusion.},

tags={},

filename={[[Galasso Schankerman (2008) - Patent Thickets And The Market For Innovation]].pdf}

}

discipline={Econ},

research_type={Empirical},

thicket_stance={},

thicket_stance_extract={},

tags={},

filename={[[Galasso Schankerman (2010) - Patent Thickets Courts And The Market For Innovation]].pdf}

}

thicket_stance_extract={},

thicket_def={Overlapping Patents, Complementary Inputs, Diversely-Held, Transaction Costs},

tags={},

filename={[[George (2006) - What Is Hiding In The Bushes Ebays Effect On Holdout Behavior In Patent Thickets]].pdf}

thicket_stance={},

thicket_stance_extract={},

thicket_def_extract={One of the earliest applications of the cumulative and sequential innovation theory was aimed at biotechnology research... In 2001, Shapiro pronounced the existence of a “patent thicket” in “several key industries”... Nonetheless, Shapiro does not present any evidence on licensing difficulties or holdup within the semiconductor or telecom industries... One of the key distinctions for the anti-commons theory as applied to standard setting lies in the timing of licensing negotiations. For those technologies that are easy to invent around, “the patented technology contributes little if anything to the final product, and any ‘reasonable’ royalty would be modest at best.”38 But Shapiro and others argue that after the technology is included in a standard or after potential licensees have started manufacturing, the patent holder “can credibly seek far greater royalties, very likely backed up with the threat of shutting down the manufacturer…” Shapiro sees little relief for this ex post hold-up aspect of patent thickets short of reforming patent law... Based on patent thicket and anti-commons theory, along with insights from transaction cost theory, Ziedonis predicted that firms would patent more aggressively than expected when the rights to the technology are highly fragmented},

tags={},

thicket_stance={},

thicket_stance_extract={},

thicket_def_extract={Relying on this logic, some authors have claimed that in high-tech industries—which are frequently characterized by cumulative innovation and dispersed ownership of patents—the cost of obtaining all necessary licenses is too high, such that innovation has been thwarted and consumers have been harmed.6... In an article evaluating the National Institute of Health’s (NIH) proposal to patent products resulting from sequencing the human genome, Kiley (1992) argued “[b]ecause every step along the way draws another patent application, the path toward public possession of real benefit is increasingly obscured by dense thickets of intersecting, overlapping, and cross-blocking patents . . . The cumulation of royalty obligations threatens to have [a stunting] effect in biotechnology.”... Shapiro (2001) applies the concern expressed by Kiley over “dense thickets of intersecting, overlapping, and cross-blocking patents” to high technology industries more frequently involved in standard setting.28 In particular, Shapiro argues that “[t]he need to navigate the patent thicket and holdup is especially pronounced in industries such as telecommunications and computing in which formal standard setting is a core part of bringing new technologies to market.”29... Referring to “Cournot’s lessons”, Shapiro presents a number of “unattractive consequences” resulting from “multiple patent burdens.”31 Namely, he argues that a complements problem would not only reduce consumer welfare, it also would lower the profits of patent holders, as compared to a coordinated licensing approach; it can result in market collapse if production is subject to economies of scale; and it “necessarily reduces the return to new product design and development, and thus can easily be a drag on innovation and commercialization of new technologies.”},

tags={},

thicket_stance={},

thicket_stance_extract={},

thicket_def_extract={The semiconductor industry also provides an excellent setting within which to examine the effects of stronger patent rights on firms engaged in rapidly advancing, "cumulative" technologies. Much like multimedia or computer firms, semiconductor firms often require access to a "thicket" of intellectual property rights in order to advance the technology or to legally produce or sell their products. Given the rapid pace of technological change in this industry, however, any new product or process is likely to overlap with technologies previously or simultaneously developed by external parties (Grindley and Teece, 1997)... This concern appears especially salient among firms that have made costly and rapidly depreciating investments in facilities that use a "thicket" of innovations developed by many parties. To obtain the rights to infringe patents held by external parties and to improve their leverage in negotiations with other patent owners, these firms amass larger patent portfolios of their own with which to trade... If patent rights were strictly awarded to inventors of "nonobvious," "useful," and "novel" inventions, then it should become increasingly difficult to obtain a patent when a thicket of prior art exists, and the number of successful patent applications should fall.},

tags={},

thicket_stance={},

thicket_stance_extract={},

thicket_def_extract={A patent thicket is “a dense web of overlapping intellectual property rights that a company must hack its way through in order to actually commercialize new technology” (Shapiro, 2000). Patent thickets consist of patents that protect components of a modular and complex technology. Here modular means that different sets of components can be assembled to yield a variety of technological products. Complex means that products consist of tens or hundreds of such modular components. Each component may end up being used in several products. Often there are partial or complete overlaps in the functionality of components and then the patents protecting the components may also overlap. If overlapping patents belong to different firms, then a patent thicket exists. Although technology areas with large number of patents often lead to patent thickets, this is not necessarily the case. In principle, an active technology area could have a large number of patents, each clearly delineating the invention concerned and none with overlapping claims or claims with uncertain breadth or scope. Thus it is important not to use numbers of patents as an indicator of patent thickets. Nevertheless, it is undoubtedly the case that one of implications of the presence of patent thickets is active patenting in the sector, so the two phenomena are correlated. Later in this report, we propose a measure of thickets in a technology area that incorporates an indicator of complexity and the possibility of overlapping claims, and controls for the overall level of patenting in the area.},

tags={},

}

@article{hargreaves2011digital,

author={Harhoff, Dietmar and Hall, Bronwyn H and von Graevenitz, Georg and Hoisl, Karin and Wagner, Stefan and Gambardella, Alfonso and Giuri, Paola},

journal={Report commissioned by European Commission},

}

title={Tragedy of the Anticommons: Property in the Transition from Marx to Markets, The},

author={Heller, Michael A},

volume={111},

pages={621},

year={1997},

abstract={Why are many storefronts in Moscow empty while street kiosks in front are full of goods? This article develops a theory of anitcommons property to help explain the puzzle of empty storefronts and full kiosks. Anticommons property can be understood as the mirror image of commons property. By definition, in a commons, multiple owners are each endowed with the privilege to use a given resource, and no one has the right to exclude another. When too many owners have such privileges of use, the resource is prone to overuse – a tragedy of the commons. In an anitcommons, by my definition, multiple owners are each endowed with the right to exclude others from a scarce resource, and no one has an effective privilege of use. When there are too many owners holding rights of exclusion, the resource is prone to underuse – a tragedy of the anitcommons. Anticommons property may appear whenever new property rights are being defined. For example in Moscow, multiple owners have been endowed initially with competing rights in each storefront, so no owner holds a useable bundle of rights and the store remains empty. Once an anticommons has emerged, collecting rights into private property bundles can be brutal and slow. This article explores the dynamics of anitcommons property in transition economies, formalizes the empirical material in a property theory framework, and then shows how the idea of anticommons property can be a useful new tool for understanding a range of property puzzles. The difficulties of overcoming a tragedy of the anticommons suggest that property theorists might pay more attention to the content of the property bundles, rather than focusing just on the clarify rights. },

research_type={Theory},

filename={Heller (1998) - The Tragedy Of The Anticommons.pdf}

}

thicket_stance={},

thicket_stance_extract={},

thicket_def_extract={In testing whether this effect shapes contributions to public knowledge, we relied on two characteristics that define the patent landscape: “thickets” and “fragmentation.” A patent thicket is “an overlapping set of patent rights requiring those seeking to commercialize new technology to obtain licenses from multiple patentees” (Shapiro 2001:1). We measured thickets as the number of patents claiming the same set of (gene) knowledge inputs.... Although patent thickets may be salient to follow- on researchers, the fragmentation of these multiple competing patent rights across many owners is potentially more problematic. Heller and Eisenberg outlined the following rationale... },

tags={},

filename={[[Huang Murray (2009) - Does Patent Strategy Shape The Long Run Supply Of Public Knowledge]].pdf}

}

thicket_stance={},

thicket_stance_extract={},

thicket_def_extract={The broadest form of the criticism – associated with Carl Shapiro and Larry Lessig – argues that the rapid proliferation of software patents has created a “patent thicket” that deters innovation, particularly by small firms that are not well placed to compete against the portfolios of their larger and better-heeled competitors... Larry Lessig presents it forcefully as a matter of truth that the proliferation of software patents has created a patent “thicket” (Shapiro’s term)256 or an “anticommons” (a term Lessig draws from Michael Heller’s work with Becky Eisenberg257). This concern also pervades James Bessen’s work (by himself and with other co-authors).258 Specifically, the idea is that there are so many overlapping patents in the industry that potential innovators cannot readily obtain the approvals necessary to conduct their research... On the contrary, a patent thicket would exist only if industry licensing practices were such that firms in the industry commonly were unable to agree on terms for licenses and thus retreated from the field of innovation. That is not a plausible portrait of the commercial software industry as it now exists.},

tags={},

filename={[[Mann (2004) - The Myth Of The Software Patent Thicket]].pdf}

}

@article{mann2005patents,

title={Do Patents Facilitate Financing in the Software Industry?},

volume={83},

pages={961--1009},

discipline={Law},

industry={Software},

filename={Mann (2005) - Do Patents Facilitate Financing In The Software Industry.pdf}

}

abstract={As intellectual property rights have gained in prominence, businesspeople and scholars alike have complained of the increasing burden of obtaining intellectual property licenses and, failing this, litigating intellectual property disputes. Intellectual property experts, especially scholars, have responded to this burgeoning thicket of rights with a series of initiatives to expedite deal making by means of statutory compulsory licensing. These licenses are classic examples of "liability rulesh" in the foundational legal entitlements framework of Guido Calabresi and A. Douglas Melamed. They appear to be a compromise: they address the mushrooming transactional hurdle created by new and stronger intellectual property rights, while preserving most of the economic advantages that accompany strengthened rights. In this Article, Professor Merges argues that proposals to create more compulsory licenses are rooted in a faulty theoretical framework. Based on a survey of the diverse institutions various industries have cultivated to handle intellectual property transactions, Merges contends that "repeat players" (individuals and firms that frequently need to exchange rights) can and often do take steps to overcome transactional bottlenecks. Whether through copyright collectives, such as ASCAP and BMI in the music industry, or undertakings such as patent pools in automobile and aircraft manufacturing, those with a recurring need to transact in intellectual property rights invest in administrative structures that lower the costs of exchanging rights. Among other functions, these collective rights organizations promulgate rules and procedures for placing a monetary value on members' property rights. They thus conserve on transaction costs either by making it easier to identify and locate rightholders, or by creating the occasion for repeat-play, reciprocal bargaining, versus more costly one-shot exchanges. Drawing on a body of academic literature known as the new institutional economics, Professor Merges explains and analyzes the origins and operation of these organizations. He also argues that entitlement theory must be adjusted to recognize the possibility that such institutions will evolve out of a background of strong property rights. More generally, he points out that entitlement theory ought to incorporate a more dynamic understanding of the importance of contracting after entitlements are granted. Professor Merges applies his observations and theoretical insights to an important contemporary controversy: whether Congress ought to legislate a compulsory license for digital content needed by the multimedia industry. He argues that it should not. Given the underlying economics, and consistent with experience in other industries, existing intellectual property rights will force industry participants to invest in institutions to conduct transactions. Indeed, consistent with the analysis in this Article, evidence indicates this is already occurring},

discipline={Law},

filename={Merges (1996) - Contracting Into Liability Rules.pdf}

}

research_type={Discussion},

industry={Software},

filename={[[Merges (1999) - Institutions For Intellectual Property Transactions]].pdf}

}

research_type={Discussion},

industry={Sewing},

thicket_def_extract={A ?patent thicket? exists when too many patents covering individual elements of a commercial product are separately owned by different entities.7 This concept is not unique to patent law; it is based on Professor Michael Heller‘s theory of the anticommons in real property, which arises when there is excessive fragmentation of ownership interests in a single parcel of land.8 According to economic theory, the problem of such excessive fragmentation of ownership interests is straightforward: it increases transaction costs, accentuates hold-out problems, and precipitates costly litigation, which prevents commercial development of the affected property.9 Additionally, a patent thicket can block new research into follow-on inventions,10 preventing the ?Progress of . . . the useful Arts.?},

tags={Patent Pool},

research_type={Discussion},

industry={Sewing},

thicket_def_extract={Professor Michael Heller first proposed a decade ago that excessively fragmented interests in land can frustrate its commercial development. There is now a vigorous debate on whether anticommons exist in patent law, and, if so, whether these “patent thickets” impede innovation in patented products... A “patent thicket” exists when too many patents covering individual elements of a commercial product are separately owned by different entities... According to economic theory, the problem of such excessive fragmentation of ownership interests is straightforward: It increases transaction costs, accentuates hold-out problems, and precipitates costly litigation, which prevents commercial development of the affected property.12 Additionally, a patent thicket can block new research into follow-on inventions... no one has yet explained why this patent thick arose beyond identifying the fact that there were overlapping patent claims. But this does not by itself create a patent thicket, as there have to be reasons why patent-owners assert these property claims against each other to the point of creating a litigation free-for-all, replicating the conditions of Thomas Hobbes’s state of nature.},

tags={Patent Pool},

research_type={Discussion, Empirical},

industry={},

tags={},

filename={[[Murray Stern (2007) - Do Formal Intellectual Property Rights Hinder The Free Flow Of Scientific Knowledge]].pdf}

thicket_stance_extract={},

thicket_def={References Shapiro, References Heller/Eisenberg, Complementary Inputs, Diversely-Held, Transaction Costs, Hold-up},

tags={},

filename={[[Nagaoka Nishimura (2006) - An Empirical Assessment Of The Effects Of Patent Thickets]].pdf}

thicket_stance={},

thicket_stance_extract={},

thicket_def_extract={The argument is that strategic patenting activity creates patent thickets that constrain ?rms?freedom of action in R&D and thus raise the costs of innovation... In such industries, it is a widely held view that patenting activity creates a ?thicket?of fragmented property rights that impedes R&D activity by constrain- ing the ability of ?rms to operate without extensive licensing of complementary technologies. This position was ?rst enunciated by Heller and Eisenberg (1998), who labelled it the ?problem of the anti-commons.?1 By increasing the transaction costs of R&D, patent thickets provide an incentive for ?rms to patent defensively. In e¤ect, this argument implies that patenting creates a negative externality on other ?rms: by increasing the ?rm?s bargaining power in the form of more ?chits to trade?in patent disputes, patenting by one ?rm raises the cost to other ?rms of protecting or appropriating the rents from their innovations. Some authors have claimed that this creates a pris- oner?s dilemma which can lead to excessive patenting in complex technology industries, including semiconductors and software (Bessen and Maskin, 2000).},

tags={},

thicket_stance={},

thicket_stance_extract={},

thicket_def_extract={The terms “thicket” has been used somewhat indiscriminately in competition law circles to describe various types of concentration of IPRs3. In this report, we use the term in a much more specific and precise sense. Following Shapiro’s definition, patent thickets are “an overlapping set of patent rights requiring that those seeking to commercialise new... technology obtain licenses from multiple partners”.4 Two conditions must then be fulfilled for a thicket to arise. Firstly, the production and sale of a given product involves the use of a large number of patent rights. Secondly, the ownership of those rights is dispersed... It is also important to understand the nature of “overlap” of patent rights that helps define a thicket. Such “overlap” has two main sources. Firstly, different patent rights might cover different aspects of the technology required to produce a new product. In other words, several patents might be technologically essential for the commercialisation of a given product. The second source of overlap comes from the nature of patent rights. These rights can be mutually blocking and are moreover uncertain. In practice this means that a firm with a valid patent covering a given aspect X of a new product might still fear that it might infringe another firm’s patent that relates to the same aspect or at least to a similar underlying innovation. In such a situation, access to the other firm’s patent is not technologically necessary but it is required if the firm wants to proceed under conditions of legal certainty... One might therefore settle on the following modification of Shapiro’s definition: patent thickets arise when the IP rights necessary to market a product and do so without significant risk of infringement are held by a large number of different parties.},

tags={},

thicket_stance={Weak Pro},

thicket_stance_extract={We further argued that the increasing technology monitoring efforts for victims of trolls, namely large manufacturing R&D intensive firms, due to ballooning numbers of patent applications, probably led to the increase of sharks’ relevance for innovators. It facilitates 'trapping’ manufacturers by ‘hiding’ patented technologies in confusing patent thickets—a second necessary condition for sharks to operate. oreover, the strengthening of patent holder’s rights in certain jurisdictions (e.g. the US) most likely enabled sharks to operate more profitably, too.},

thicket_def_extract={Multivariate analysis of the data suggests that in selected discrete technologies, patent ‘fences’ may serve to exclude competitors whereas in complex technologies, ‘thickets’ represent exchange forums for complementary technology.... yielding thickets of complementary patents held by different owners.... Patent thickets owned by various patent holders should prevail in complex technologies such as semiconductors, forcing players to use patents as ‘bargaining chips’.4 Here, from the patentee’s standpoint, exchanging technology should be the first-best use for a patent leading to the highest possible profits as exclusion is virtually infeasible.... As both articles show, the “strategic use” of patents (the two most important types being blocking and cross-licensing with patent ‘thickets’ playing a major role for the latter), has classically been discussed from the perspective of those patent holders who either engage in the production of their own technological goods or consider themselves professional intellectual property suppliers who repeatedly interact with manufacturers.},

tags={Private Mechanisms, NPEs, Firm Strategy, Defensive/Offensive Patenting, Value from Position/Portfolio},

thicket_stance={},

thicket_stance_extract={},

thicket_def_extract={See Review},

tags={},

thicket_stance={},

thicket_stance_extract={},

thicket_def_extract={In a patent thicket licensing provides a mechanism to either avoid or resolve hold up... In some high technology industries the process of research and development is comparable to the continuous extension of a pyramid through the addition of new building blocks at the top [Shapiro (2001)]. Here, the pyramid serves as a metaphor for the cumulativeness of scientific research in complex product industries.1 Firms increasingly protect their contributions to this pyramid with patents. As a result several high technology industries are now affected by a “patent thicket” [Heller and Eisenberg (1998); Hall and Ziedonis (2001); Shapiro (2001)]. In a patent thicket many rival firms hold patents protecting components of a single technology. Whenever a firm uses such a technology it is vulnerable to hold up by firms holding blocking patents [Grindley and Teece (1997), Jaffe (2000), Shapiro (2001)]. The threat posed by blocking patents frequently induces firms to build up a large portfolio of patents. This creates a strong bargaining position for the firm owning the portfolio in any disputes with rivals. In a patent thicket all firms face the prospect of hold up and have strong incentives to patent, which perpetuates the patent thicket. Hold up in a patent thicket may be resolved through licensing of blocking patents.},

tags={},

thicket_stance={},

thicket_stance_extract={},

thicket_def_extract={Complex high technology industries are increasingly affected by patent thickets in which firms’ patents mutually block the use of important technologies. Firms facing patent thickets patent intensively to acquire bargaining chips and use licensing to ensure freedom to operate. Such licensing allows rivals to either avoid or resolve hold-up from blocking patents... The complexity and modularity of technology combined with strong increases in the number of patent applications have given rise to patent thickets (Shapiro, 2001; Hall and Ziedonis, 2001). A patent thicket consists of complementary patents related to one technology. The patents in a patent thicket belong to many rival firms. In the absence of cross-licensing agreements, or patent pools, use of the technology is blocked. Avoiding exposure to rivals’ blocking patents is difficult because firms are often not aware of the precise technological trajectory pursued by their rivals (Grindley and Teece, 1997). Additionally, the complexity of high technology products gives rise to connections between patents that are not anticipated. Compounding these problems, the limits of patent rights are always open to interpretation which can lead to unanticipated overlap of patents. Finally, patent offices have limited resources and may overlook prior art or patent overlap (Lemley, 2001).2 In order to contain the threat of hold-up, firms build up large patent portfolios which provide “freedom to operate”... },

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thicket_def_extract={Licensing can be a solution for hold-up in patent thickets... Explosive growth of patenting world wide has raised fears that patent systems may inhibit economic activity rather than foster it (Jaffe and Lerner, 2004; Bessen and Meurer, 2008). The growth in patenting arising from legal reform (Jaffe, 2000), increasing technological complexity (von Graevenitz et al., 2008) and feedback mechanisms within the patent system (Ziedonis, 2004) is leading to patent thickets (Heller and Eisenberg, 1998; Shapiro, 2001). These occur in semiconductor- and information technology (Hall and Ziedonis, 2001; Ziedonis, 2004) and increasingly in other fields such as genetic diagnostic testing (Huys et al., 2009). In a patent thicket many firms hold patents protecting components of a single technology. Whenever a firm uses such a technology it is vulnerable to hold-up by firms holding blocking patents (Grindley and Teece, 1997; Shapiro, 2001). The threat posed by blocking patents frequently induces firms to build large patent portfolios in costly patent portfolio races. These bolster firms’ bargaining positions in disputes with rivals (Grindley and Teece, 1997; Lemley, 2001). Patent thickets undermine the proper functioning of patent systems: they raise costs of using complex technology and increase incentives to acquire marginal patents.},

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thicket_def_extract={It therefore seems that the latter company aims to protect its intellectual property by means of a company-specific patent thicket. There are some central patents, some highly cited, and a number of patent families clustered around, citing one or even more central patent families... },

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thicket_def={Complementary Inputs, Diversely-Held, Transaction Costs, Hold-up, Cummulative Invention},

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filename={[[Strandburg (2006) - Law And The Science Of Networks]].pdf}

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thicket_def_extract={The phrase “patent thicket” is a descriptive term which highlights issues that new entrants to a market may face when attempting to innovate within, or enter into, a technology space having existing intellectual property rights. The most generally used definition of a thicket is that coined by Shapiro: “a dense web of overlapping intellectual property rights that a company must hack its way through in order to actually commercialize new technology”. Equal weighting is given to fragmented technological areas (areas where there are large numbers of small patent holdings), or areas where there are small numbers of large players with large patent holdings, each of which creates a thicket that any entrants into the area will have to negotiate in order to be able to operate. There is no clear consensus on terms used to describe patent thickets and the entities involved with them. If these terms were applied consistently, further debate on any issues could be conducted on a level playing field. Any change in policy associated with patent thickets should be carefully considered for its potential impact across different technology landscapes... However, it was interesting to note that some indicators potentially give more useful insight into the type of thicket present... However, despite Shapiro’s comments, on reviewing the general literature in this area, it seems that no concrete definition of a thicket has yet been agreed by researchers, as a number of different interpretations have been created. These definitions tend to fall into a number of forms. Fragmented property rights: • When multiple organisations each own individual patents that are collectively necessary for a particular technology their competing intellectual property rights form a patent thicket10 • Patent thickets are sets of overlapping property rights that occur in fragmented technology Markets11 • A patent thicket exists when too many patents covering individual elements of a commercial product are separately owned by different entities.12 Blocking patents: • “The combination of complex technology and high volume patenting creates patent thickets which can be defined as dense webs of overlapping patent rights... The measure derives directly from information on blocking of one patent by another”13 • “A dense and overlapping set of complementary patent rights…of which at least one patent right is blocking the production of an innovation.” Alternative terms such as “patent floods”15 and “patent clusters”16,17 can also be used. For consistency the term patent thicket has been used throughout the current document. These differing definitions of what exactly a thicket may be, does not aid the reader in comprehending the scope of the issue. Indeed, the idea that patents should not be granted for the same invention, in theory, should not occur as was noted earlier in Section 2 where the scope of claims was discussed.},

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thicket_def_extract={The literature on patent thickets shows that several institutional arrangements allow firms to disentangle overlapping property rights - these include licensing, patent pools, standard setting as well as litigation (Shapiro, 2001, Scotchmer, 2005). There is some evidence that firms holding a large share of patents within a given technology benefit substantially from their patent portfolio and may be able to reduce the likelihood of hold-up... Secondly, the conditions under which strategic complementarity is likely to arise in our model fit our current understanding of settings in which patent thickets arise very well. These are settings in which technologies are highly complex, in which many firms seek to build large patent portfolios and in which the combination of multiple parties’ technologies yields the best standards and products... This is attributed to firms’ efforts to reduce potential hold-up by opportunistic patentees owning critical or blocking patent rights – a situation which is associated with the existence of patent thickets... To test our model we derive a new measure of complexity of blocking relationships in patent thickets.},

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thicket_def_extract={The combination of complex technology and high volume patenting creates patent thickets, which can be defined as dense webs of overlapping patent rights (Shapiro, 2001)... The advantage of the triples measure proposed here is that it provides a simple way of computing the density of patent thickets across technologies and at any given point in time. In this way, the measure enables researchers to analyze the effect of the threat of hold up in different technology areas on firms' patenting strategies.},

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research_type={Discussion},

industry={Software},

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filename={[[Walsh Arora Cohen (2003) - Effects Of Research Tool Patents And Licensing On Biomedical Innovation]].pdf}

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thicket_def_extract={Others raise similar concerns about the effects of dense “thickets” of overlapping patent claims, but predict that firms will “navigate” through these thickets by devising institutional solutions such as patent pools or joint ventures (Merges 2001, Shapiro 2001), or by acquiring firms with blocking patents (Graff et al. 2003)... the additional problems posed by multiple, fragmentary patent owners (i.e., the “patent thicket” or, more precisely, the “diffuse entitlements” problem)... A subtle but important insight from this “anticommons” (or “diffuse entitlements”) theory is that a firm’s bargaining challenge is affected by the level of dispersion among rights holders—not just by the number of patents in a “thicket” or the number of owners per se (as modeled by Shapiro 2001 and Buchanan and Yoon 2002)... Combining insights from transactions cost theory with studies of intellectual property (IP) and its exchange, I predict firms will patent more aggressively than otherwise expected when rights to complementary patents (i.e., ones that would likely be infringed if the firm manufactures or sells its products without a license) are widely distributed among outside entities...},

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