Monday, October 31, 2011
Insurance for Patent Enforcement?
Right, you had a question. Yes, an independent inventor with limited funds is in a bind when it comes to patent enforcement. Even if the funds can be found to fight a big company, the battle can drag on for years and cause much personal turmoil. Like patent expert David Pressman puts it, the utility patent is basically a hunting license. Obtaining the license without the necessary funds to use it against others makes it a useless piece of paper. There are three common solutions for this issue:
- align yourself with a big company. A big company usually will -- as part of your licensing agreement -- chase down (or possibly scare off) thieves and competitors. The downside is that you may end up earning less from your invention if someone licenses it (versus the profit margin if you manufacture it). On the other hand, often it's just the opposite and the right licensee can earn you substantial profits and save you a lot of hassle.
- consider offensive insurance. Yes, there is such a thing as offensive patent insurance and you can read more about its pros and cons.
- find a contingency litigator. Some patent attorneys take cases on contingency. This is often difficult and can be expensive (giving up a third or more of the recovery). Learn more here.