Taking a patent infringement case on contingency requires skills and experience in many areas, but two are key: determining infringement and analyzing damages. The investment of time, energy and resources in a contingency case can be substantial. Therefore, it’s not surprising that many of the determining factors for selecting a case revolve around potential financial recovery.
There are several factors we look at when we evaluate patent infringement cases to determine whether it is appropriate to take on a contingency basis.
- The strength of the patent.
- The strength of the infringement case.
- The value of the infringing feature to the infringer.
- The identity of the infringer.
- The willfulness of the infringement.
- Your lost profits.
- The availability of a favorable forum for suit.
1. The strength of the patent.
All patents are not created equal. Before we accept a case we perform an analysis of the patent prosecution history at the patent office. Problems encountered at the USPTO can signal potential problems for litigation relating to the patent.
A review of the prior art cited during the patent prosecution can also be important. In addition, a prior art search performed prior to filing litigation can help identify potential problems and suggest possible solutions and strategies.
2. The strength of the infringement case.
The language of a patent claim determines what the patent holder owns. Think of it as a property survey. If you own a piece of real estate the survey shows where your property begins and ends and what you own. The same is true for the terms of a patent claim which identify your intellectual property in words (or drawings for a design patent).
Patent infringement requires proof that the infringer has practiced at least one claim of the patent. A jury or judge must compare what the infringer is selling or doing with the language of claims of the patent. Infringement is found when what the infringer is doing matches the language of a claim exactly.
There are many ways to measure damages for infringement. Sometimes copyright owners are deprived of income or royalties when their works are stolen and used without authorization.
We analyze patent claims to determine whether we think a judge or jury will find infringement. How well the claims match up to the infringement will influence whether we decide to accept the case.
3. The value of the infringed features to the infringer.
Often the patent claim infringed may be just one small part of a complex machine or system. Patent law permits a plaintiff to recover money damages that are linked to the feature of the patent that was infringed. How much that feature is worth to the infringer becomes an important factor in determining damages.
Money earned by the infringer from the infringing feature may be recovered as part of the patent holder’s damages. We look at business earned by the infringer from exploiting your patents. We also look at comparable royalty rates for similar patents and technologies to forecast potential infringement recoveries.
4. The identity of the infringer.
Before filing suit we try to determine as best we can whether the defendant will be able to pay a judgment for damages. The time and expense of an infringement suit cannot be justified if the infringer will be unable to pay a judgment at the end of the case.
5. The willfulness of the infringement.
Whether the infringement was innocent or willful is an important factor. Willful infringement, if proven, can result in damages being trebled. An award of three times the infringement damages where the infringement was willful can serve as a powerful incentive to settlement.
6. Your lost profits.
Have you been in business and using the patent? Have you lost profits to the infringer as a result of the infringement?
Lost profits add an additional dimension to an infringement case. If your business has been damaged or failed to reach its potential because of infringement then lost profits may be a component of your damages for patent infringement.
7. The availability of a favorable forum.
Patent infringement cases are complicated. Several federal district courts have developed an expertise at handling patent cases. Some also have specialized patent procedures and expedited scheduling requirements.
We look to bring cases in federal districts favorable to patent infringement claims. We are admitted to practice in most of these districts across the country, or we can affiliate with local lawyers who can assist us.
Our firm may have more one or more infringement cases at the trial or appellate level at any time. Accordingly, this should not be construed as applicable to any of the firm’s pending cases.
About Joel Rothman
Joel B. Rothman represents clients in intellectual property infringement litigation involving patents, trademarks, copyrights, trade secrets, defamation, trade libel, unfair competition, unfair and deceptive trade practices, and commercial matters. Joel’s litigation practice also includes significant focus on electronic discovery issues such as e-discovery management and motion practice relating to e-discovery.
