Enforcement Risks and Mitigation
As long as you are informed throughout the patent search and examination, you should have a relatively clear understanding of what your patent does and does not cover. While a good patent is often sufficient to dissuade a would-be infringer, there may still be an occasion where you will need to enforce your patent.
There are a number of risks associated with enforcement. The most unpleasant is to have the patent determined invalid. We are pleased to report that none of the patents that we searched and prepared has been invalidated. While that is in no small part due to the quality of our searches and patent applications, we can only mitigate the risk and not ensure it won't ever happen.
Cost of Patent Litigation
Another risk associated with enforcement is the out-of-pocket cost associated with patent litigation. Even for a simple and low-dollar product, each party to the lawsuit can easily spend several hundred thousand dollars in the suit.
There are several ways to deal with litigation costs. Most large companies "self-insure", meaning they have sufficient cash available to cover the costs associated with patent infringement litigation.
A second way to deal with litigation costs is to retain a patent attorney or firm that specializes in contingency-fee based litigation. In these cases, the attorney will agree to do the work, typically only charging out-of-pocket expenses such as plane tickets and hotel rooms. In exchange, if you prevail, you will share a percentage of any award or settlement with the attorney, typically on a percentage basis. Particularly where there is willful infringement, this arrangement can be very attractive for both you and the attorney.
The third way to deal with litigation cost is to take out a patent infringement insurance policy. There are several companies that specialize in policies that, in exchange for yearly premiums, cover the cost of litigation.
While many of our clients are also concerned about infringing products produced off-shore being imported into the US, and other related outsourcing issues, through the International Trade Commission the US has some of the strongest patent enforcement procedures in the world, and as a result these issues are surprisingly less common now.