Questions to Ask When Threatened with Patent Litigation

August 9, 2015

By: Thomas P. McNulty

You have been sued for patent infringement, or have received a letter accusing your company of patent infringement, and demanding that you cease and desist and agree to pay for past damages. Here are ten points you should immediately consider.

Have you been served?

A patentee can write threatening letters, and can even prepare and file a complaint with a court, without triggering any required response from you. It is only when the patentee “serves” the complaint that the litigation clock starts running. You should work with your attorney to make sure that the plaintiff has actually served you according to the rules of the court.

Have you contacted your attorney?

Regardless of whether you believe the threat has any merit, you should contact an attorney who handles patent litigation. Understanding what a patent covers requires a detailed understanding of patent law.

Do you do business in the District that the complaint was filed?

Patentees often strategically choose a particular court in which to file suit, to maximize their convenience, maximize your expense and inconvenience, or because they believe they will obtain a favorable result in that jurisdiction. However, if you do no business in that district, you may be able to argue that it is an improper forum for the case.

Have you contacted the party who threatens to sue you?

It is highly advised that you do not contact the opposite party (or their counsel) unless and until you have spoken with your own attorney, as anything you say can be used as an admission against you.

Have you assessed your risk?

You should determine the volume of sales since the patent issued, as well as the importance of the product or service being accused to your overall business to determine the degree to which you will go to overcome the threat.

Do you know anything about the entity accusing you of infringement?

You should gather all information that you can about the accusing party, and work with an attorney to find out as much about their litigious behavior as possible, to determine a strategy for attacking the threat the particular entity represents. Good intelligence may also help appreciate your bargaining position during settlement negotiations.

Have you assessed your own patent portfolio?

Once you have an idea of the nature of the party accusing you of infringement, you should consider whether anything in your own patent portfolio can be asserted against them, and also whether you can obtain any third-party patents that could be brought to bear.

Have you ensured that documents and evidence are being preserved?

A party that is threatened with litigation, or actually sued, is required to preserve all relevant evidence, including electronic files and emails. This includes halting any automatic email deletion processes that are normally in place. A failure to preserve relevant evidence can have potentially severe consequences in litigation.

Have you taken steps to avoid a finding of willful infringement?

A party that is found to knowingly and willfully infringe a patent can be made to pay treble damages and the other side’s attorney’s fees. An attorney can help to minimize this risk by determining whether there is a good faith basis to assert that the patent is not being infringed or is invalid.

Have you considered redesigning the accused products to avoid infringement?

One strategy for limiting damages or mooting the case may be to simply redesign the accused product. You should work with your attorney throughout the redesign process to understand the scope of the patents being asserted and to verify that the change in design will lead to a non-infringing product.