Re-examine the determinants of market value from the perspectives of patent analysis and patent litigation

Abstract

This study re-examined the determinants of market value from the perspectives of patent analysis and patent litigation in the American semiconductor industry. We used artificial neural networks to explore the influences of patent counts, defendant counts of patent litigation, and patent share on market value in the American semiconductor industry. The patent data were collected from the United States Patent and Trademark Office, legal data were collected from the database of Westlaw and the financial data were collected from the database of COMPUSTAT. The results show that patent counts and defendant counts of patent litigation have a positive effect on corporate performance in the American semiconductor industry. However, patent share has a negative effect on corporate performance in the American semiconductor industry. Accordingly, we can apply the three indicators, patent counts, defendant counts of patent litigation, and patent share, to assess market value of American semiconductor companies.