Date Posted: 2002
Full text (most recent) on SSRN
In response to widely held perceptions of bias against foreign parties in the U.S., this Article tests the hypothesis that foreign and domestic parties are treated identically in adjudication of property rights. It does so by comparing patent acquisition data with patent enforcement and win rate data for foreign and domestic parties. There are two significant findings which this paper establishes and explains. First, although foreign inventors acquire 45% of patent rights annually, they enforce their patent rights in only 10% of the litigated cases. Second, domestic parties win 63% of the cases in which their adversary is foreign. These data suggest that people underestimate the extent of the prejudice against foreign parties. Because of selection effect theory, win rate data cannot predict the magnitude of the bias, but it does substantiate its existence. This empirical research has placed a floor, but not a ceiling, on the impact of the bias.