Abstract

Many standard setting organizations (SSOs) require participants to disclose patents that might be infringed by implementing a proposed standard, and commit to license their “essential” patents on terms that are at least fair, reasonable and non-discriminatory (FRAND). Data from these SSO intellectual property disclosures have been used in academic studies to provide a window into the standard setting process, and in legal proceedings to assess the relative contribution of different parties to a standard. We develop a simple model of the disclosure process to illustrate the link between SSO rules and patent-holder incentives, and examine the model's core predictions using a novel dataset constructed from the disclosure archives of thirteen major SSOs. The central message of the paper is that subtle differences in the rules used by different SSOs can influence which patents are disclosed, the terms of licensing commitments, and ultimately long-run citation and litigation rates for the underlying patents.

Highlights

  • Voluntary consensus standardization is an important activity in the information and communications technology sector, where compatibility standards can help launch markets or promote major upgrades to existing platforms

  • The large selection effects that we find in our cross-sectional and difference-in-differences models suggest that many declared essential” patents (dSEPs) would have a relatively high litigation rate even if they were not incorporated into a standard, and we cannot disprove the claim that time-varying unobserved factors may be driving both disclosures and litigation

  • In the first part of our paper, we provide an overview of disclosure policies, develop a formal model of the disclosure process, and describe a novel database containing information on declared essential patents

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Summary

DISCLOSURE RULES AND DECLARED ESSENTIAL PATENTS

NATIONAL BUREAU OF ECONOMIC RESEARCH 1050 Massachusetts Avenue Cambridge, MA 02138. At least one co-author has disclosed a financial relationship of potential relevance for this research. Further information is available online at http://www.nber.org/papers/w23627.ack. NBER working papers are circulated for discussion and comment purposes. They have not been peerreviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications. Disclosure Rules and Declared Essential Patents Rudi Bekkers, Christian Catalini, Arianna Martinelli, Cesare Righi, and Timothy Simcoe NBER Working Paper No 23627 July 2017, Revised March 2019 JEL No D22,K2,K21,L15,L17,L24,L63

Introduction
Intellectual Property Policies and the Disclosure Process
Disclosure rules
Licensing Commitments
A Model of Disclosure
Implications and Extensions
Disclosure Characteristics
The Significance of dSEPs
Cross-sectional Comparison Between dSEPs and Control Patents
Disclosure Effects
Citation Effects
Litigation Effects
Conclusion
Tables and Figures
Disclosure Year FEs Yes
Findings
DISCLOSURE EVENT
Full Text
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