Patent Trolls

“Non-Practicing Entities” (NPE) or “Patent Trolls” have drastically altered the balance of patent litigation. NPEs, which hold patents but do not practice the claimed inventions, typically acquire patents in a specific technology area, and target companies in that field. NPEs typically offer to license the patent portfolio at what they claim is a discounted price, with the threat of litigation if the target chooses not to license.

The targeted company is faced with a dilemma: fight the lawsuit – at a significant expense – or pay a licensing fee, usually for less than litigating the matter would cost. If a targeted company elects to litigate, the typical defenses or counterclaims are based on non-infringement, invalidity or unenforceability of the patent.

Few successful technology companies in the U.S. have evaded patent trolls. KPPB has a wealth of experience creating litigation strategies that take clients out of vulnerable positions and empower them to effectively litigate against such plaintiffs. Our ability to fully understand the patents, to delve deeply into the technology and to obtain favorable results, whether during claim construction early in the litigation, or in proceedings before the Patent Office, all while adhering to the budget we provide before the defense begins, allows our clients to maintain their strategy until the end. One of the biggest mistakes a defendant can make is to engage defense counsel without a budget, which often leads to paying off the NPEs so they can stop paying their own attorneys.

KPPB considers the client’s overall litigation strategy and business goals to achieve the optimal outcome inclusive of legal fees. Managing the cost of legal representation is an integral part of our clients’ litigation strategies. In many instances, the fee structures we have developed with our clients have a strategic advantage when dealing with NPEs.