Patent Litigation Overview

There are several possible twists and turns and possible outcomes to patent litigation, and the patent owner needs to be aware of them. The following is an general overview of Common Patent Litigation Matters:

Negotiated Settlement: If the patent owner has a skilled and well-financed firm managing the litigation one who will not be bullied into submission the patent owner may be able to avoid a trial and negotiate a settlement involving a licensing arrangement under which the patent owner is paid a royalty for use of the patent. Such an arrangement can also include retroactive payments for prior use of the patent. Most patent infringement lawsuits are settled. According to industry statistics, 70% of patent infringement lawsuits are settled after one year in litigation and after parties have spent one million dollars in litigation costs. Of all filed patent infringement cases only about 4% ultimately reach trial. The rest are either settled or disposed of on summary judgment.

Mediation: A skilled patent litigation plaintiff may be able to force the defendant to agree to the use of a mediator. This process often leads to a settlement of the patent litigation, and avoids a trial and subsequent appeals of the verdict by the defendant. Patent attorneys and licensing professionals at General Patent have participated in dozens of successful mediations and are very skilled in settling patent infringement lawsuits in this manner.

Injunctive Relief: As part of a total patent litigation strategy, we may be able to secure an injunction ordering the patent infringer to cease production and/or sale of the infringing product or service that uses the patent. While this puts a halt to the illegal use of the patent, it provides no compensation to the patent owner. It does, however, put pressure on the infringer that is now deprived of an income stream from that product. However, it is very difficult for a non-practicing entity (that is, the patent owner does not manufacture a product that uses the patent) to obtain a permanent injunction.

Exclusion Order: Another patent litigation approach, if the patent infringer is a foreign entity, and the patent owner is an efficiently-run domestic industry, is to take the case to the International Trade Commission (ITC), which may issue an exclusion order. The exclusion order is similar to a permanent injunction as it prohibits the patent infringer from importing products that use the infringed patent into the United States. However, as in the case of an injunction, the exclusion order does not compensate the patent owner for damages. For this reason, General Patent often pursues patent litigation along parallel tracks in both the ITC in the hope of obtaining an exclusion order and in Federal Court in the hope of recovering monetary damages.

Monetary Damages: Whether or not a permanent injunction is an option or is obtained, a patent owner is entitled to recover damages from the infringer. If the patent owner practices the patented invention, it may be entitled to receive lost profits that it would have made from the patent. A patent owner is entitled to at least receive royalties from the infringer for use of the patent. The Court may leave it up to the plaintiff to bring a subsequent patent infringement action if the defendant continues to infringe the patent.

*Accepted Patent Law Cases will be represented under a Joint Counsel Agreement between Carabin Shaw and the Tom Rhodes Law Firm P.C.