Response to Patent Infringement Litigation
Release Time：
2020-04-01
A party accused of infringement in a patent infringement dispute should respond calmly and promptly after receiving a warning letter or a notice of court response. The general decision-making ideas are as follows:
(1) Decision-making mapping preparation.
Firstly, the following facts should be assessed by professionals: comparative analysis between the allegedly infringing product and the patent generating the infringed patent to assess whether it is infringed; the validity of the patent in question; the likelihood of winning the infringement lawsuit; the direct litigation costs, such as legal service fees; and indirect litigation costs, such as orders and markets that may be lost by the possible litigation of the enterprise.
Secondly, you can contact the right holder as appropriate to understand the other party's intention and bottom line. Finally, evaluate and count your own resources, such as the means that can cause pressure on the other party (e.g., patents, market behavior), the tolerance of your own goodwill, and the allies that can be united.
(2) Decision-making considerations.
Patent litigation decision-making primary consideration is not the odds of winning or losing, but the possible costs and benefits of litigation. If winning the patent litigation will pay a high price, or may win the market is extremely asymmetric, no matter the success or failure of the litigation will be more than worth it.
If it is assessed that there are special circumstances that exist in the enterprise at the present time: for example, the confidence of an important customer cannot be affected at a particular time or the enterprise is engaged in other important legal activities, and infringement litigation must be avoided, then it should respond to the right holder in a reasonable and measured manner, and at the same time, start negotiation and try to reach a settlement within the range of costs that can be afforded.
If it is assessed that a non-infringement defense has a high chance of success but may be costly, such as the risk of losing a large number of orders and damages due to the risk of infringement, or triggering a patent war, or if the cost of legal services is much higher than the cost of a settlement, then it is also inappropriate to choose to litigate, and should actively explore non-litigation avenues to resolve the problem.
If it is assessed that there is a high likelihood of patent infringement and that the patent in question is relatively stable, the infringing behavior should be stopped immediately and the company should withdraw from the relevant market. However, if the resulting losses are significant and even have a substantial impact on the survival of the enterprise, the accused infringing enterprise should, on the one hand, make the fullest possible preparations to respond to the lawsuit, and on the other hand, make the utmost effort and promote the peace talks in good faith, and strive for the least costly settlement terms to be reached.
Source: China Intellectual Property Rights Defense Assistance Network
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