Organization and Strategy Seminar（2019-07）

Topic: Litigating Patent Monetization and Patent Trolls: Evidence from the America Invents Act

Speaker: Mingtao Xu, Purdue University

Time: Thursday, 27 June, 10:00-11:30 am

Location: Room K02 , Guanghua Building 2

Abstract:

This paper studies the behavior of non-practicing entities (NPEs, also known as PAEs or patent trolls) in the market of technology. Different from conventional patent commercialization that seeks profit from the product market, NPEs do not produce any products and services and only appropriate value from licensing, sale, and settlement via threats of legal actions. By decoupling the value from technology from the value from exclusion, I theorize and show that patents acquired by NPEs have lower technological strength; and although NPEs generally prefer patents with broader exclusion scope, NPEs do not acquire patents with broadest scopes. Also, patents acquired by NPEs are more likely to be litigated in the future. Using patent transaction data, I test the theory exploiting the enactment of America Invents Act (AIA). This study contributes to the literature in the market for technology by showing how the monetization methods affect the acquisition of patents, and shed light on the discussion surrounding competing business models.

Introduction:

Mingtao Xu is a doctoral candidate in Strategy at Krannert School of Management, Purdue University. Before Purdue, he attended Georgia Institute of Technology and Emory University studying statistics, economics, and management. His primary research areas are technology and innovation, entrepreneurship, and business strategy. His research span topics of non-practicing entities (NPEs), patent monetization and litigation, property rights, and machine learning and strategy.

In his projects, he uses approaches of theoretical modeling, quantitative analysis, and simulation. His current research analyzes different patent monetization methods and value appropriation mechanisms of firms, and explores how firms with different business models value resources differently in the strategic factor market. He also examines how patent litigation and property rights protection affect firms and how technologies such as machine learning affect business strategies.

//mingtaoxu.weebly.com

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