Value in the Shadow of Conflict: IP Rights in Dispute
Author: Robert J. Parnell, CFA
October 1, 2015
Much of the value of IP assets relies on their performance in dispute. Targeted analysis can help rights holders to determine how best to maximise that value when faced with litigation.
High-value IP rights inherently tend to attract legal disputes – in part because there is more to fight over and in part because the territorial nature of property rights encourages conflict. Once IP rights are ensnared in dispute, the associated value and risk become distorted and often compromised by the economics of litigation and the divergent outcomes of trial and settlement. In the presence of such distortion, how should we value these intangible assets? And how does the presence of legal conflict change the amount and character of IP risk? This article examines these issues and explores how game theory models of legal dispute can shed light on the problem.