Don’t Get Derailed by a Surprise Patent Lawsuit

Imagine, just as you are about to launch a new product, you are given notice that someone is seeking an emergency injunction against you for patent infringement.  You may have to put your product-launch on hold until the complaint can be resolved.  This can be fatal to your company.  Even in a best-case scenario, it is an unexpected expense and a massive distraction.

In a previous post, I introduced the concept of “Freedom to Operate” (FTO) which is an analysis of whether you may be infringing someone else’s patents.  Unfortunately, having your own patents doesn’t tell you anything about whether you’re free to use your own invention or technology, because it may still be covered by one or more patents that don’t belong to you. Doing an internal “Technology Audit” is an important step in understanding where these FTO risks may exist.

It’s very important for any business that is selling a product or commercially using an important process to identify and then manage the risk of infringing third-party patents.  Businesses can be blind-sided by a notice of patent infringement or a patent lawsuit. 

Starting with a Technology Audit

So now that you know this risk exists, how do you manage it?  When we do FTO analyses, we work closely with our clients along a specific set of steps to convert the unknown risks to risks that are (a) identified, (b) ranked, and (c) managed or eliminated.

My recommended first step is almost always a “technology audit.”  This involves a review of all of the steps, ingredients, tools, and technologies that you use commercially in your business.  This is followed by a triage of everything identified in the first step to try to rank the relative importance or risk associated with each item.  After this, we conduct a careful search for issued patents that relate to the highest-ranked items.

Classifying the Search Results

Then we review each patent to classify it as (1) clearly not infringed, or (2) study further.  We then review the second group in detail with our clients to identify a clear basis for non-infringement—this moves that patent into class (1).  If such a basis is not immediately evident for a given patent, we classify it as (3) deep analysis.

Sometimes, when it’s hard to identify a reason that your product or process does not infringe a patent claim, we can identify a feasible change to your product or process that would avoid infringement.  This is called “designing around” the patent claim.  If a design-around is implemented, then a patent that was a problem may cease to be.

When a Deeper Analysis is Necessary

When there is no feasible design-around, the deep analysis involves a careful review of how that patent was examined, including all arguments made to the patent examiner to achieve the patent’s allowance, often also including a thorough reading of the references on which the examiner based any rejections.  In this process, we look for mistakes made by the applicant or the examiner.  These mistakes can be evidence that the patent was improperly granted and may be invalid.

At this stage in the process, we have identified potential risks and usually eliminated most of them as not being of serious concern.  We have also focused on the ones that are serious and have either designed around them or identified a good-faith reason we believe the patent is invalid.

Eliminating the Risk by Getting a License

However, in some cases, there’s no clear way to avoid infringement or to advance a case of invalidity.  When that happens, the only remaining option is usually to seek a license from the patent owner.  This can be easy, difficult, or even impossible, depending upon the circumstances.

This is just an overview of the process we use for FTO.  Future posts will go into much more detail.  While the earlier post gave the bad news that infringing third-party patents is a genuine risk, the good news is that there is an established process for FTO analyses and risk management.  This is the second in a series of posts that will explain FTO in detail. If you would like some advice about your own situation, you can email the author here.