Does State Street Lead To Europe? The Case Of Financial Exchange Innovations

The authors study whether and to what extent financial exchange innovations are in practice patentable in Europe. They find that exchange-related applications initially increased significantly after the State Street decision but subsequently decreased. The clear majority (65%) of applications come from the U.S. investment banks and exchanges themselves being among the most active innovators. But patents were not easily granted in response to these applications (only 3% of them led to valid patent). The high post-grant opposition rate (41%) for granted patents indicated that competitors tightly monitored each other's patents.