Is Patent Litigation Worth the Headaches? Wolf Greenfield Lawyers Explore the Issues

BOSTON, MA -- (MARKET WIRE) -- December 13, 2006 -- If someone has stolen your patent it can cost $2 million to $5 million in legal fees to bring a court case against the infringer, but your company might win tens of millions, or even hundreds of millions, in damages.

"How do you balance the toll on your business from years of litigation against the potential to shut down a competitor with an injunction?" ask Michael Albert and Ilan Barzilay, lawyers with Wolf, Greenfield & Sacks, P.C., in a recent article in Mass High Tech.

Both the big expenses and the huge payoffs are unusual.

"Most patent cases never reach these extremes, but settle early on with lower costs and less dramatic outcomes," they write.

Roughly two-thirds of patent cases are resolved outside of court, and only 11 percent to 16 percent of patent cases get court rulings on the merits, with only 3.6 percent of cases actually going to trial. The average patent case lasts 1.2 years.

"Ironically, the stronger a case you build for trial, the more likely you are to get the results you want without one," they write.

Who you are and where you file influences the odds. Patent holders win around 59 percent of cases that are decided on the merits, with juries ruling for them 68 percent of the time, and judges 49 percent. Patentees demand a jury trial 78 percent of the time compared to 43 percent for defendants.

In Delaware, 15 percent of patent cases go to trial, compared with the national average of 4 percent. In one Texas district, patent holders have reportedly won 92 percent of cases!

"If at first you don't succeed, appeal. The Federal Circuit reverses 35 percent of claim construction rulings," Albert and Barzilay add.

If you want to avoid court, consider mediation and arbitration. Licensing patent rights is another way to hedge your technology bets.

If you are suing or have gotten sued, remember that while the case will probably settle, you should prepare for it to go through trial. "Discuss a reasonable budget with your attorney, structured around key phases of the case. Be flexible -- costs may depend on how aggressive your opponent is and what case-management plan the court adopts," they write.

"Patent lawsuits can be risky," they conclude. "But mega-dollar verdicts aren't awarded to those who fear the courtroom."

Albert, chair of the litigation group at Wolf Greenfield, a Boston intellectual property law firm, can be reached at malbert@wolfgreenfield.com. Barzilay, an associate, can be reached at ibarzilay@wolfgreenfield.com.

Their article can be read online at http://masshightech.bizjournals.com/masshightech/stories/2006/10/02/focus4.html. Mass High Tech is the journal of New England Technology.

Founded in 1927, Wolf Greenfield in Boston (www.wolfgreenfield.com) is one of the most experienced law firms specializing in intellectual property law, including patents, trademarks, copyrights, licensing, trade secrets and litigation.

Contact Information: Contact: Henry Stimpson Stimpson Communications 508-647-0705 HStimpson@StimpsonCommunications.com Sara Crocker Wolf Greenfield 617-646-8231 scrocker@wolfgreenfield.com