Damages and injunctions in protecting intellectual property

Mark Schankerman, Suzanne Scotchmer

Research output: Contribution to journalArticlepeer-review


We investigate how liability rules and property rules protect intellectual property. Infringement might not be deterred under any of the enforcement regimes available. However, counterintuitively, a credible threat of infringement can actually benefit the patentholder. We compare the two doctrines of damages, lost profit (lost royalty) and unjust enrichment, and argue that unjust enrichment protects the patentholder better than lost royalty in the case of proprietary research tools. Both can be superior to a property rule, depending on how much delay is permitted before infringement is enjoined. For other proprietary products (end-user products, cost-reducing innovations), these conclusions can be reversed.

Original languageEnglish
Pages (from-to)199-220
Number of pages22
JournalRAND Journal of Economics
Issue number1
StatePublished - 2001


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