An exploratory study of patent litigation behavior: Evidence from the smartphone industry

This study aims at providing a framework to delineate the patent litigation behaviors based on the resource-based view, transaction cost economics, and the view of competitive dynamics. Empirical data were collected from the smartphone industry during the period from 2003 to 2011. Propositions are raised to illustrate how high-tech firms launch patent litigation attacks, including what focused patents are, whom firms are motivated to attack, when to initiate an attack, and where to file the lawsuit. We first conclude that a patent with higher value would be more likely to cause litigation. Second, the firm with a dominant design is more likely to be attacked by the incumbents through patent litigation while enjoying greater performance and the defendant usually initiates a countersuit against their competitors with their own patents. Third, the more important stake of the patents in dispute, the more likely the plaintiff will choose the courts skilled in dealing with the complexities of patent law and the technology at issue, and the more likely the patentee will file patent litigations in district court and International Trade Commission at the same time. The study not only contributes to the patent theory, but also benefits both firms from developing and developed countries in formulating offensive and/or defensive patent litigation strategies.