Patents R Us: Patent Lawsuit Information for Inventors and Patent Owners

Patent Lawsuits

The Only Way to Enforce Your Patent Is by Filing a Patent Lawsuit: It is the job of every patent owner to enforce his (or her or its) own patent. There are no patent cops because patent infringement is not a crime. Patent infringement must be pursued through civil litigation, so the patent owner who believes his patent has been infringed has only one way to enforce that patent − by the filing of patent lawsuits, a patent infringement lawsuit against the alleged infringer!

Patent Lawsuits Terminology: Patent lawsuits and, more specifically, patent infringement are sophisticated legal issues. Should you need to enforce a patent, here are some terms you should understand.

• Plaintiff: The party that initiates a civil action and files a lawsuit is the “plaintiff.” So the patent owner who seeks to enforce his patent via a patent infringement lawsuit is the plaintiff in the lawsuit.

• Defendant: The alleged patent infringer is the defendant in the patent infringement lawsuit. The term “defendant” refers to BOTH one accused of a crime in a criminal trial and the object of a lawsuit in a civil trial, so just because the alleged patent infringer is the “defendant” does not make a patent infringement lawsuit a criminal matter.

• Per se: This term refers to one who represents himself in court, as either the plaintiff or defendant. It comes from the Latin for “by himself.”

• Guilt: There is a finding of guilt in a criminal trial, not in a civil trial. In patent lawsuits there is a determination of such issues as negligence and liability, not guilt. The defendant in a patent lawsuits cannot be found “guilty,” but he can be found negligent and liable for damages.

• Prosecute: When an attorney pursues a lawsuit on behalf of a client, it is often referred to as  “prosecuting” the lawsuit. However, the term “prosecute” has two other meanings. It is also used to describe the process of applying for a patent. A patent agent or patent attorney will assist an inventor in “prosecuting” his patent application before the US Patent and Trademark Office. Also, in a criminal trial, the state is represented by a “prosecutor” who “prosecutes” the defendant.

• Legal Fees: This is what the attorneys charge for their and their staff’s time to enforce a patent.

• Disbursements: These are the out-of-pocket expenses incurred to enforce a patent.

• Jury Trial: This is a trial in which a jury determines the facts of the case such as liability and damages.

• Bench Trial: This is a trial at which there is no jury, and the judge decides both points of law and the facts of the case. Both sides are entitled to a jury trial, so both the plaintiff and the defendant in a patent infringement lawsuit must agree to a bench trial.

• Award: This is the amount the court determines the plaintiff is entitled to if the court finds in the plaintiff’s favor. A patent owner enforces his patent by forcing the patent infringer to pay for use of the patent or to enter into an agreement to license the patent for a fee.

• Settlement: Also referred to as an “out-of-court settlement,” this is an arrangement agreed to by the parties to the patent infringement lawsuit to enforce the patent in lieu of going to trial.

• NPE: This stands for “non-practicing entity” and it refers to a patent owner that wants to enforce his patent, but does not practice (use the patented invention to produce a product or service) the patent. In a patent infringement lawsuit, an NPE is only entitled to what he would have received in licensing fees had the infringer licensed the patent.

• Market Participant: The opposite of an NPE, this is a patent owner who seeks to enforce his patent AND the patent owner uses the patented invention to produce a product or service that he offers for sale. In a patent infringement lawsuit, a market participant is entitled to lost profits caused by sales of competing products that use his patented invention.

Patent Lawsuits Are Very Costly! In fact, the median cost of a patent infringement lawsuit is $4 million! Attorneys that specialize in patent infringement litigation charge hundreds of dollars an hour, and prosecuting the lawsuit will consume hundreds or thousands of hours of their time. Then there are numerous other costs such as producing transcripts every time a witness is deposed, filing fees, travel expenses, expert witnesses, research and trial demonstratives.

Bad News and Good News: The bad news is that few independent inventors or small businesses can afford to finance a patent lawsuit on their own. The good news is that there are patent litigators and patent enforcement firms that will prosecute a patent lawsuit on a contingency basis. They will cover all disbursements themselves, and take their fees and be repaid for all disbursements out of any award or settlement that comes from the patent infringement lawsuit. And such payment is contingent on the outcome of the lawsuit. If they fail to produce a settlement or award, they receive nothing and they write off the disbursements they made on behalf of the plaintiff. If you want to enforce your patent, but cannot afford to pay the legal fees and disbursements yourself, our free Patent Litigator Referral Service will refer you to a patent litigator or patent enforcement firm that represents clients on a contingency basis.

Per Se Representation? Other than possibly a traffic ticket, it is never a good idea to represent yourself in court, especially in a matter as specialized as a patent infringement lawsuit. The smartest way to enforce an infringed patent is to find competent representation and take the infringer to court. If you take your claim to a patent litigator or a patent enforcement firm, and the firm will not take your case on a contingency basis, you will have to assume that you do not have a viable claim of patent infringement.

Is It Viable to Enforce Your Patent? This is a financial, rather than an ethical or legal, decision. A person, business or other entity may well be infringing your patent. And they may even be doing so flagrantly! However, since it will cost at least a few hundred thousand dollars, and probably millions of dollars, to enforce the patent through a patent infringement lawsuit, attempting to enforce the patent only makes sense if you can secure a multi-million dollar settlement that will cover the legal fees and disbursements. For example, if a business with $2 or $3 million in annual sales is infringing your patent, attempting to enforce your patent via a patent lawsuit just does not make sense financially, so no patent litigator or patent enforcement firm will take your case on a contingency basis!