Filing or responding to most any lawsuit is one of the boldest, or the most worrisome, activity in most businesses’ experience in dealing with the competitive process. IP litigation is among the most involved and complex types of litigation, where the issues and stakes are the greatest – from money to win or to lose, to product life, and to “bet the company” cases. Counsel experienced in all the phases of such litigation, both the substantive law and the procedural law, must be on your side in such matters, keeping a clear eye on your objectives for the case, whether obtaining a right to use, stopping an infringement, collecting or resisting assessment of damages, licensing the rights or the infringer, and such.
Patent, trademark, and copyright cases are nearly always filed and heard in federal court, since the rights are created by federal law, and they are filed in the federal court district where the defendant is headquartered or where the injury to plaintiff arose. The main exceptions to federal court jurisdiction are issues over ownership and license rights, which if based on a contract or agreement may be tried in state courts.
As soon as a federal lawsuit becomes likely, all parties must stop destroying evidence related to the matter, including any electronic files. Thus, parties must stop even normal re-use of or recording over computer back-up media for the times and the persons involved in the matter, both on company and individual back-up systems, on active computers, memory sticks, CD-ROMs, and the like. Paper file destruction must similarly stop. Substantial penalties have been imposed on parties, including money fines and preclusions from arguing certain facts or issues, due to their destruction of evidence whose preservation is now required by the federal rules of civil procedure.
IP litigation can last for several years from filing to verdict, judgment, appeals, or even settlement, or be resolved very quickly in appropriate cases by filing of a motion for a temporary restraining order, a preliminary injunction, or summary judgment. It is important to budget both necessary funds for the attorney effort involved and for the expenses of litigation (as, deposition transcripts, travel expenses, expert witness tests and reports, demonstrative exhibits for trial) and the time of executives and support staff to attend promptly as needed to the litigation, as for agreeing on strategies, advising counsel of the facts of the case, giving evidence and depositions, and attending trial. A survey by the American Intellectual Property Law Association, reporting 2006 data, shows that patent litigation with even less than $1 million at stake averaged $327,000 through discovery and $527,000 through trial, in 2006, in the Chicago federal court; if more than $25 million was at stake in a patent suit, attorney fees and expenses rose to $2.7 MM through discovery and $4.6 MM through trial. Trademark suits averaged somewhat less, $288,000 to $1.4 MM through discovery and $431,000 to $2.8 MM through trial, depending on amounts at stake: less than $1 MM or over $25 MM, respectively.