MO Patents, MO Problems: Patent Lawsuit Economy

Patent litigation is when an inventor or other practicing entity owns a patent, and MO' PATENTS, MO' PROBLEMS: THE PATENT LAWSUIT ECONOMY that patent is infringed upon by a third party. Patent litigation is usually a lengthy, drawn-out process that can cost both parties a significant amount of money. Number of Patents in Litigation 2008 = 10 Patent Litigations OF THE PATENTS LITIGATED IN 2008... The long-term win rate for patent 25% owners is 25% 14% Only 14% of patent litigations |are adjudicated Half of those are adjudicated on summary judgement II 50% 2,602 T= About 85% of cases reach a 85% settlement Average Patent Litigation Costs I= End of discovery COSTS INCLUDE: $350,000 I= Through diposition ATTORNEY FEES LESS THAN $1 MILLION AT RISK $600,000 PRODUCTION COSTS $1,250,000 DOCUMENT MANAGEMENT BETWEEN $1 MILLION AND $2,500,000 $250 MILLION AT RISK TRAVEL EXPENSES WITNESS FEES $3,000,000 $6,000,000 GREATER THAN $250 MILLION AT RISK IF ALL PATENT THE TOTAL LITIGATIONS WERE COST WOULD ADJUDICATED IN 2008 HAVE BEEN $31,224,000,000 Average Damage Awards PATENT TROLLS PER LITIGATION NON-PRACTICING ENTITIES A NPE or Non-Practicing NPE'S have a 67% trial success rate Entity is sometimes referred to as a Patent Troll. Patent PRACTICING ENTITIES trolls are companies that acquire patents and seek payment from companies they claim are infringing on those patents. $12 MILLION 67% $3.4 MILLION Patent Litigation Timeline I Most patent litigation lawyers are based on an hourly basis. This can rise to astronomical costs when considering how long a patent litigation suit takes. Summary Judgement COMPLAINT ANSWER FACT DISCOVERY CLAIM CONSTRUCTION DISCOVERY EXPERT PRE- TRIAL CMC TRIAL APPEAL 2-3 MONTHS 1 MONTH 9 MONTHS 2 MONTHS 2-3 MONTHS 1-2 MONTHS 1 MONTH 2-4 MONTHS Parties exchange Parties exchange initial disclosures and documents. Depositions occur. Lawsuit is filed, Filed 30 days after Exchange of lists and motions, statements drafted. claim terms and work summons are issued. judgement to compromise Case Management Conference Expert witnesses, expert Jury selection, testimonies reports and rebuttals and closing statements Plantiffs and defendents have the right to appeal decision made my the court. This appeal process is costly and time Patent Litigation Appeals consuming. Cost of an Appellate Trial: The cost of an appellate trial can raise the cost of patent litigation from $3 Million to $5 Million dollars on average. 15% 15% of patent infringement cases went to appeal. 2$ $3 MILLION $5 MILLION 40% of judgements 40% are favorable to the plaintiffs Sources: The National Law Journal Jan 09, Invention Statistics.com, United States Court of Appeals "Case- load Patent Infringement', PwC 2009 Patent Litiga- FOCUS tion Report, 271 Patent Blog, Harbor Law Group "Con- trolling Costs in Patent Litigation', Business Week