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14 February 2010
Patent insurance can be either defensive or aggressive. In
buzz-word American or business-speak, Patent Liability Insurance and Patent
Patent Liability Insurance is defensive - it pays out to help
the insured fight an infringement lawsuit filed by a rival company. For this
simple reason it is also called Patent Infringement Defense Insurance. The
insurance company pays a part of the legal expenses and/or the damages.
Patent Pursuance Insurance provides to help the insured fight
against patent infringement by third parties. In the trade this may also be
called Patent Enforcement Insurance, Patent Abatement Insurance or Offensive
Patent Insurance, although this last might be considered by some to be.. umm..
Whatever it is called, in summary the insurance pays a portion
of the legal expenses incurred by the insured company.
For an example, the American Intellectual Property Law
Association estimates the average cost of US patent litigation to be a half to 5
million dollars for each party, depending on the amount of infringement in
The costs can go as high as 500 million. Patent litigation can
be enough to make or break a business of many sizes. Insurance is becoming a
necessity as the number of patent infringement lawsuits filed annually, in the
US - generally a keen business barometer, increased by 111 per cent in three
years over the turn of the century.
It has been estimated to cost alleged infringers on average
triple figures minimum to defend actions.
Tim Mount is a trainee solicitor at Lawdit, contactable at
About the Author
Lawdit Solicitors offer services and
advice for litigation, commercial contracts, Intellectual Property and IT legal
agreements. We are experts in commercial law with a heavy emphasis on
Intellectual Property, Internet and e-commerce law. Lawdit is a member of the
International Trademark Association, the Solicitors' Association of Higher Court
Advocates and we are the appointed Solicitors to the largest webdesign
association in the world, the United Kingdom Website Designers Association.
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Article Published/Sorted/Amended on Scopulus 2010-02-20 16:38:20 in Legal Articles