A common question I hear is, “How do I stop someone from infringing my patent?” This question is often accompanied by some variation of “Does the government enforce my patent?” Unfortunately, in the U.S. the patent owner is responsible for enforcing patent rights not the government.
Patent owners monitor their competitors to ensure their patent rights are not being infringed. If the patent owner suspects that a competitor is infringing their patent rights they will generally consult a patent attorney and then send a cease and desist letter. There is no requirement to send a cease and desist letter before filing suit, but it is standard practice and can result in a more cost effective outcome than litigation. Unfortunately, the alleged infringer may or may not respond to the cease and desist letter. While, these letters are often drafted to imply obligations upon the recipient, they do not carry any force of law, but they do put the alleged infringer on notice of a potential conflict. If the alleged infringer continues in their potentially infringing actions after receiving the cease and desist letter, the next step is either continued correspondence (possibly resulting in a license or some other agreement) or the filing of a patent litigation. Typical patent litigations can run from $100,000 to several million dollars. Further, even if the litigation is ultimately resolved in favor of the patent owner, the result may be a royalty payment that fails to cover the costs of the litigation. While attorney fees can be awarded for egregious actions before or during litigation, these awards are few and far between. Another potential windfall for patent owners are treble damages for willful infringement, but again, this is very rare and difficult to prove. Neither attorney fees, nor treble damages should be the predominant economic considerations when deciding to start a patent litigation. The costs of waging a patent litigation should be commensurate with the business need to remove (or license) the competitor’s sales in the market place. At a minimum, increased market share, damages and/or royalty payments should cover the costs of litigation and improve the market conditions for the patent owner. If you are Apple and you have decided to sue Samsung to maintain your market share in the multi-billion dollar smart phone industry the financial calculations may be easy. A team of attorneys may be expensive, but likely not when compared to the overall value of the smart phone industry. Unfortunately, these calculations becomes much more difficult for the small business or independent inventor. Many will ask, what then is the value of a patent? For a more detailed answer see my post titled “Do I need a patent to sell my product?” In short, patents can provide funding for investment by highlighting your invention and signaling that you are serious about protecting your IP rights. Additionally, a patent (or patents) are essentially prerequisites if you are seeking to license your invention. Moreover, while you may never enter a federal district court to enforce your patent, the notice function provided by the patent’s publication is a powerful incentive for patent filing. The patent places a stake in the ground putting competitors on notice of your rights, and allows you to enforce those rights when it becomes financially advantageous. This may seem like a far off reality for start-up businesses, but it’s one that must be considered early in the business lifecycle. Sales and/or offers for sale trigger a deadline under which patent applications must be filed or rights can be forfeited. To avoid forfeiture, a well drafted and properly claimed patent application should be prepared to protect your invention (for additional information on this topic, see “Five Early Steps to Patent Your Invention”). Without question patent litigation is a costly endeavor, but it is not the only reason to obtain a patent. Investment, licensing and assignments are additional major incentives for patent filing. Further, the publication of your patent puts competitors on notice of your rights. Serious competitors will conduct patent clearance searches and will think twice before intentionally infringing a well written and properly claimed patent (for more information on clearance searches, see “Does a Patent Protect me From Infringement?”). Patents can be exceedingly powerful tools in starting, funding and conducting business even if you never assert the patent in court. It is advisable to consult an experienced patent attorney to discuss the pros and cons of patent filing, and how patents can help protect and grow your business. |
Should I Copyright the Trademark in My Patent?
AuthorNick Chiara is an IP attorney with over twenty years of patent and trademark experience. Archives
July 2022
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