Taiwan’s IC design industry has gradually emerged among international semiconductor manufacturers, but due to the lack of key core technologies required for independent research and development. Therefore, strategic alliances and competitive cooperation have become a means for enterprises to quickly obtain patents and lay out the market. However, listed companies upstream and downstream of Taiwan's supply chain have been facing international patent infringement lawsuits in recent years.
Therefore, this research mainly hopes to provide investors with investment strategies to deal with when companies face patent litigation. Analyze the abnormal returns of the underlying stocks through the event research method and use cross-sectional regression models and quantile regressions to explore the changes during the US-China Trade War and COVID-19 pandemic and under different factors and components based on the results. The empirical results show that the company will generate positive and significant abnormal returns the patent litigation. In addition, the accumulated abnormal returns after the event are all positive and significant, indicating that the company still has a profit opportunity in the face of patent litigation, which can be used as a reference for investors. According to cross-sectional regression analysis, trading volume are significantly negative, indicating that they are considered as key variables by investors. In the quantile regression analysis, with the change of quantiles, there were no significant variables in 0.05, 0.25, 0.5, 0.75. At 0.95 all variables were significant except for trading volume. Therefore, the declared effects of these variables on cumulative returns are different.
