Responding to an allegation of patent infringement
It can come as a shock to receive a patent lawyer’s letter alleging patent infringement and threatening court proceedings against you.
We are expert patent attorneys ideally placed to guide you through the process. Please contact us to discuss how we can assist.
The process for responding to an allegation of infringement mirrors the process for alleging infringement (discussed here).
Swift action is important. Typically the lawyer’s letter will ask for a response within two weeks or so. Engage a qualified patent attorney (if you don’t already have one) well within this response period so that they can work with you to provide a timely and professional response. Don’t simply ignore the letter. That would give the patent owner little choice but to escalate the matter.
An experienced patent attorney will have seen many such lawyer’s letters and be able to “read between the lines” to advise on the other party’s intentions and how best to proceed. For example, a letter that ends with “we have instructions to commence proceedings if we don’t hear from you…” is far more aggressive than a letter that ends with “we will seek instructions…”, and a well-written letter from a reputable patent firm suggests that the threat is more serious.
The attorney will then check that there is in fact a relevant, in force patent. You wouldn’t be the first Australian to have been threatened in relation to a patent that has lapsed or in relation to a US patent!
Assuming there is a relevant, in force patent, the next step is to consider the economics of the situation. A pragmatic commercial focus is important – e.g. if the lawyer’s letter demands that you stop selling a product and there is little profit attached to that product, it might be best simply to stop selling rather than incur the expense of any sort of dispute. On the other hand, you don’t want to send a signal to the market that you are a push-over.
If the situation warrants further consideration, the attorney will assess the coverage of the patent to determine whether or not you are fact infringing, and then (if necessary) turn to considering the validity of the patent.
If the threat has no merit, a stern and professionally worded response to the lawyer’s letter may well bring the matter to an end. The lawyer’s letter could have been a bluff or perhaps simply uninformed.
If the threat has merit, detailed consideration of a range of issues is likely warranted. Can infringement be avoided by making a small change to your product (or process)? Do you have good reason to suspect that further investigation will show that the patent is invalid? For example, do you suspect that the patented product was publicly known before the patent was filed?
You might then choose to negotiate with the patent owner and/or to seek to challenge the validity of the patent.
If you cannot invalidate (or are not confident of invalidating) the patent, a genuine attempt to resolve the dispute will likely reduce the costs and disruption to your business. Hopefully, a satisfactory agreement can be negotiated. If not, agreement might be reached through some form of alternative dispute resolution. Any agreement should be properly documented in a professionally prepared settlement agreement (as discussed here).
If agreement cannot be reached, the patent owner may initiate court proceedings against you. If you are unsuccessful in court, you may face significant penalties.
Please contact us to discuss how we can assist.