A patent affords the patent holder a monopoly on their invention for a set period of time. With patents, though, often come patent challengers. These could be people who genuinely believe they’ve come up with the idea on their own (referred to as an independent invention), an intentional patent infringer, or a non-practicing entity (more commonly known as a “patent troll”). Here’s what you can expect from a patent infringement case and what it can mean for your business.
The Patent Dispute Process
The patent dispute process brings the case to one of the U.S. District Courts. The patentee bringing the infringement case to court presents their argument to a federal judge. This judge will determine the case and make a ruling. If either party is dissatisfied with the ruling, the next step is to appeal the case. This process sends the case to an appellate court. In the case of patent infringement appeals, this court is the U.S. Court of Appeals for the Federal Circuit in Washington D.C.
If it happens that either party is unhappy with the appellate court ruling, they are able to submit what’s called a writ a certiorari, a document asking the Supreme Court to review the case. It is up to the Supreme Court to decide if they want to hear the case and potentially overturn the lower court’s decision.
During the proceedings themselves (in any of these courts), it’s up to the patent lawyers to argue the merits of each party’s case. Lawyers on the side of the patentee will state that the patent infringer is using the invention without a license. The defense will put forth the argument that this new product is different and not an infringement on the patent, or perhaps that the defendant invented the subject of the patent on their own, independently.
In general, the counsel for the defendant first attempts to prove that no infringement has occurred. This is done by reading the claim language. If the court decides that what the defendant has made doesn’t fall within a valid patent claim, it could decide that there wasn’t any infringement. If the defendant’s product does fall within the patent claims, the defendant’s lawyers will then question the original patent’s validity. If the patent is invalid there can, of course, be no infringement.
Effects of Patent Infringement
If the patent holder can prove infringement, the rewards can be worth it. The financial damages rewarded to a patent holder who wins an infringement case are manifold.
Lost profits are something that can be recovered if the patent holder can prove that they lost profits due to the patent infringement. They will be able to recover the money made as well as interest on those funds. Patent holders who license their inventions receive royalty payments from licensees, and an infringer who’s lost a case joins the ranks of licensees by default. The court may order a patent infringer to pay royalties to the patent holder for future sales of the patented product. Court costs are also able to be recovered from the infringer in some cases. Lastly, treble damages, which are financial damages awarded to the patent-holder worth three times the amount of actual financial losses suffered, may be awarded to the patent holder.
Intellectual Property Insurance
The introduction of intellectual property insurance is a big development in this area, and it serves patent holders and accused infringers alike. Patent holders can open a defense policy to protect themselves in the case of being sued for infringement. With an abatement policy, patent holders can receive reimbursement for infringement case-related costs, such as patent valuation.