Competition Policy Center
The Rising Tide of Patent Damages
- Author(s): Gilbert, Richard J
- et al.
Very large awards and settlements for patent infringement have increased dramatically since the 1980s. A large fraction of these awards have occurred in the computer hardware and software industries. Complex technologies such as computer hardware and software require rights to a very large number of patents. One explanation for the large awards for patent infringement is the bargaining power of a patentee that has a credible injunction threat for a product that requires rights to multiple patents. This can lead to infringement damage awards and settlements that overestimate the patent’s contribution to product value.