Does the patent system protect innovators? Challenges for small firms in infringement litigation

Abstract

A patent is a type of intellectual property right (IPR) that provides the patent holder the right to exclude others from commercializing the patented invention. To maintain this right, the patent holder must actively identify any infringements and enforce the patent. Enforcing patents is expensive, and due to the legal and technological complexities involved patent litigation is considered one of the most complex forms of civil litigation. Against this background, there has been some previous research indicating that small firms might have a disadvantage compared to large firms in patent litigation. This study investigates this issue in detail, and aims to examine if and in what way small firms have a disadvantage compared to larger firms in patent conflicts and identify potential causes to and consequences of the disadvantage. The study complements previous research by providing insights from patent attorneys, rather than only from small firms themselves. The data consists of rich interview material from semi-structured interviews with 16 patent attorneys with significant experience from Swedish patent cases. The findings indicate that small firms are at a disadvantage compared to large firms in patent conflicts. The findings further highlight that the causes of the disadvantage are not limited to only the litigation process itself but relate back to much earlier stages in the patent process, already from the decision to get a patent. Overall, the disadvantage is caused by attributes that are unique to small firms, rather than a fundamentally unjust patent or litigation system. Specifically, the disadvantage is caused by economic constraints, knowledge and resource constraints, and lack of foresight in small firms. Overall, the study highlights the complexity of the issue and implies that a broader perspective than only focusing on the litigation process is needed to remedy the problems small firms face.