2001/01/01 by Mark A. Lemley · 4 citations
Business, Management and Accounting · #Intellectual Property and Patents
paper · pdf · doi:10.2139/ssrn.261400
crossref issued 2001/01/01 · crossref published 2001/01/01 · openalex publication_date 2001/01/01 · crossref created 2005/11/03 · openalex created_date 2025/10/10 · crossref deposited 2026/07/27 · crossref indexed 2026/07/27 · openalex updated_date 2026/08/04
It is common to assert that the Patent and Trademark Office does a bad job of examining patents, and that it should spend more time and money weeding out bad patents. In this article, Professor Lemley challenges that conventional wisdom. Using available data regarding the cost and incidence of patent prosecution, litigation, licensing and other uses of patents, he demonstrates that strengthening the examination process is not cost effective. The core insight is that very few patents are actually litigated or licensed; most simply sit on a shelf unused, or are used only for noncontroversial purposes like financing. Because of this, society would be better off spending its resources in a more searching judicial inquiry into validity in those few cases in which it matters than paying for a more protracted examination of all patents ex ante. In economic terms, the patent office is "rationally ignorant" of the objective validity of the patents it issues.