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By: Matthew Bernstein, Perkins Coie LLP.
THE MAJORITY OF PATENT CASES ARE BROUGHT BY non-practicing entities (NPEs), also called patent trolls or patent assertion entities (PAEs). These parties litigate or license their patents but have no real products or services. NPE Lawsuits are commonly brought against U.S. companies and pose unique challenges. For example, many NPEs are represented on a contingent fee basis, and because NPEs do not have products, a defendant typically cannot level the playing field by asserting its own patents against the NPE. Whether you should litigate aggressively through trial or try to negotiate a quick settlement depends on your view of NPEs and the circumstances of the case.
This article discusses possible ways to respond to an NPE presuit notice letter and complaint, discovery considerations, and how to approach settlement negotiations.
A target company typically learns of an NPE assertion through either a pre-suit notice letter or a complaint. Regardless of the method of notice, you should immediately research:
Research the Patent
You should research whether the asserted patent has been the subject of a federal court case or a proceeding before the United States Patent and Trademark Office (USPTO) including:
Prior litigation documents may provide useful insight into the strength and weakness of the patent, as well as indicate a successful defensive strategy against the NPE. The NPE’s history of litigation may also provide some guidance as to how it will approach the current matter. In particular, you should check relevant dockets and proceeding histories for:
To read the full practice note in Lexis Practice Advisor, follow this link
Matthew Bernstein is the managing partner of Perkins Coie's San Diego Office, co-managing partner of the Taipei office, and a partner in the firm's Patent Litigation Group. His practice focuses on patent litigation and patent trial work. The views and opinions set forth herein are the personal views or opinions of the authors; they do not necessarily reflect the views or opinions of the law firm with which they are associated.
For a more detailed discussion on PTAB proceedings, see
> THE FUNDAMENTALS OF POST-ISSUANCE CHALLENGE PROCEDURES: IPR, PGR & CBM
RESEARCH PATH: Intellectual Property & Technology > PTAB Proceedings > Post-Issuance > Practice Notes > Post-Issuance Challenge Procedures
For information on patent pre-litigation notification letters, see
> PATENT INFRINGEMENT CEASE AND DESIST OR NOTIFICATION LETTERS
RESEARCH PATH: Intellectual Property & Technology > IP Litigation & Enforcement > Patent > Practice Notes > Notification Letters
For detailed information on responding to a patent notice letter, see
> RESPONDING TO PATENT NOTICE LETTERS
RESEARCH PATH: Intellectual Property &Technology > IP Litigation & Enforcement > Patent > Practice Notes > Notification Letters
For a detailed list of the steps to take upon the receipt of a pre-litigation notification letter, see
> CHECKLIST—RESPONDING TO PATENT NOTICE LETTERS
RESEARCH PATH: Intellectual Property & Technology > IP Litigation & Enforcement > Patent > Forms > Pre-Litigation Actions
For a sample response letter to a patent notice letter, see
> RESPONSE TO PATENT INFRINGEMENT CEASEAND DESIST OR NOTICE LETTER
RESEARCH PATH: Intellectual Property &Technology > IP Litigation & Enforcement > Patent > Forms > Pre-Litigation Actions
For a comprehensive explanation about post-grant proceedings for challenging the validity of patents before the PTAB, see
> NAVIGATING PTAB TRIAL PROCEDURES IN AIAPROCEEDINGS
RESEARCH PATH: Intellectual Property &Technology > PTAB Proceedings > Post-Issuance > Practice Notes > Post-Issuance Challenge Procedures