Patent It Yourself - PDF Archive

424 | Patent it YOURSELF
if the defendant built and commercially used the invention
more than one year before the patent application filing date.
(35 USC 273.)
Step 6: Find a Patent Attorney
When you first reasonably suspect that an infringement is
occurring, you should take the step, described above, and
then consult with a patent attorney. (See Chapter 6, Section
E.) This is because you’ll need to embark on a course of
action that is very difficult for the nonlawyer to perform
in its entirety. Unfortunately, the cost is high, and it’s
difficult to get a patent attorney to take this type of case on
a contingent fee (you pay them only if you win). This means
you’ll have to pay the attorney up front (or at least partially
up front). It depends on the complexity of your case, but
an initial retainer of $20,000 would be typical. However, if
you’ve got a very strong case and if the infringer is solvent
(would be good for the damages if you win), it’s possible
that you may find an attorney who will take your case on
a contingent-fee basis. If you do get an attorney to do this,
you still may have to pay the out-of-pocket costs through
trial; these can run as high as $100,000, so be sure you can
afford them. See Section T for sources of patent litigation
financing and contingent-fee attorneys.
If, as will usually happen, you can’t get a contingent-fee
arrangement, you should be prepared for a shock: patent
trial attorneys generally charge about $350 to $700 per hour,
and a full-blown infringement suit can run to hundreds or
even thousands of hours’ work, most of it before trial! The
American Intellectual Property Law Association, a trade
group for patent attorneys, estimates the median cost of
patent infringement actions through trial is in the $5 to
$6 million range. You should be sure that your damages,
if you win, will make this worthwhile. Also, be sure the
defendant can pay any judgment you obtain. And don’t
depend on getting attorney fees or triple damages; these are
awarded only in “exceptional cases”—that is, those where
the defendant’s conduct was “objectively reckless.”
Of course, what’s sauce for the goose is sauce for the
gander: An infringer will usually have the same fee burden,
and may be inclined to settle if your attorney writes a few
letters and he or she thinks you’re serious about suing. A
substantial number of cases are in fact settled before suit is
even brought and most are settled before trial.
Bear in mind that even though you think you have a
good case and your patent is being willfully infringed, it is
impossible to predict anything with certainty in the law.
Factors may prevent a fair outcome so that an infringer
prevails. As Len Tillem, a cynical talk-show lawyer in San
Francisco stated of trials, “Whoever puts on the better
show wins.”
Tip
The material in the following steps is not intended
to help you do your own patent infringement litigation. It
would take a big book just to get you started. However, it will
give you an overview of what’s involved so that you can play an
active role in deciding on your course of action and, if a lawsuit
is brought, helping your attorney bring its prosecution to a
successful conclusion.
Step 7: Write a Letter
The first step to follow in the event an infringement has
occurred is to write a letter. This letter can:
• Ask the infringer to stop infringing your patent and to
pay you royalties for past activity.
• Offer the infringer a license under your patent for
future activity and again ask for a settlement for the
past. Remember, any infringer is a potential licensee,
so don’t make war right away.
As is often the case, the letter may go unanswered, or
your demands may not be acceded to. If so, you’ll have to
sue for patent infringement if you want to recover damages
or an injunction. Also, if your letter creates a reasonable
apprehension that you will sue them, the infringer can
sue you in an inconvenient location to have your patent
declared invalid under what is known as a “declaratory
judgment (DJ) action.” To prevent this, don’t threaten to
sue, but instead simply notify the infringer about your
patent. Previously I advised that you could offer the
infringer a license, but, under recent antipatentee decisions,
many litigators feel that even this may give the infringer a
reasonable apprehension of suit and enable them to file a DJ
action against you.
Step 8: Act Promptly
The statute of limitations for patent infringement is six years,
which means you cannot recover damages that occurred more
than six years back from the date you filed suit. However,
despite this rather lengthy limitations period, it’s important
that you not wait six years, but act rapidly once you become
aware of an infringement. Otherwise, the infringer may
reasonably argue that it continued to infringe because you
appeared not to be concerned. Your inactivity may prevent you
from collecting the bulk of the damages you would otherwise
be entitled to. This would occur under the legal doctrines
known as estoppel and laches, which generally mean that a
court won’t award you damages if your action (or lack of action
in this case) in some way brought them about.
If you’re selling a product embodying the invention and
you failed to mark it with the patent number (see Section
D, above), the six-year term of damages can be considerably