The Important Early Steps To Know About
If Faced With An Intellectual Property Infringement Claim.
David M. Kleiman – U.S. Patent Attorney

If you find yourself accused of infringing someone else’s intellectual property rights there are some important actions you should take early on which can greatly increase the chances of a quick, fair and cost-effective end to the intellectual property rights dispute.

1. Don’t Miss Important Legal Deadlines

Respond To Deadlines On Time. In a legal dispute time can often be critical. Missing deadlines can significantly affect your legal rights. For example, to avoid a default judgment being entered (i.e. automatically losing the case) as a defendant you must respond to a properly served complaint by the legal deadline. So, pay careful attention to any documents or communications received regarding an actual or potential legal dispute. Promptly inform your attorney about them so that you don’t miss deadlines or opportunities.

2. Talk With A Qualified Attorney Immediately

Do not delay in speaking with your own qualified attorney. It can be dangerous and very unwise for a business owner or executive to take action without qualified legal counsel. The sooner you talk to your own qualified attorney about litigation, or the prospect of it, the better. The law can be complex. What you don’t know can hurt you. By talking early to your qualified attorney you may learn of simple steps to take or avoid that can greatly increase your chances of successfully resolving a legal dispute quickly and cost effectively.

3. Preserve Records And Information

Once there is notice of a legal claim (e.g. a lawsuit) the law requires that a party take reasonable steps to preserve anything relevant to the legal dispute (e.g. records, communications, accused products, etc.). This is frequently referred to as a “litigation hold”. A litigation hold applies to tangible things (e.g. papers, products, etc.) and electronically stored information (such as emails, spreadsheets, word processing documents, social media, websites, accounting data, etc.). The destruction, modification, or loss of relevant information or things can adversely affect your case and have very serious consequences.With respect to the preservation of electronically stored information it is important to do this properly so as to avoid deleting or altering the electronic information. Expert legal and technical assistance may be necessary in some cases. Accordingly, it is important that all individuals at a business be promptly informed of the litigation hold and receive appropriate instructions. Consult with qualified legal counsel and technical staff as soon as possible after receiving notice of a legal claim.

4. Control & Limit Communications

One of the very first steps to take in any legal dispute is to consult with your attorney about the best practices for handling communications and information regarding the dispute. It can be tempting to immediately pick up the phone and start talking, texting, or emailing others when you learn about a lawsuit or the prospect of one. This can lead to trouble. In litigation an adversary can ask for and receive copies of all unprivileged communications and information relevant to the legal dispute. This could include discovery of communications (both verbal and written) with friends or colleagues, business associates, suppliers, employees and customers. So, it is important to be careful about creating communications or information that concern the legal dispute or the adversary. What may seem like a reasonable or harmless communication to you about the dispute will need to be preserved, will be subject to discovery, and it could be used against you in unanticipated ways. This is certainly true when it comes to expressing opinions about the dispute or your adversary. When it comes to such opinions, reserve expression of them to verbal communications had with your attorney in confidence. Attorney-client communications are privileged and generally not subject to discovery by an adversary. However, to preserve the protection of the privilege you must keep all such communications with your attorney confidential.

5. Investigate Insurance Coverage

A defendant in a lawsuit may be entitled to coverage for the expense of the lawsuit and any resulting judgment or settlement under the terms of an insurance policy or indemnification agreement. For example, if a defendant is sued for selling a product purchased from a third-party manufacturer then there may be the possibility that the manufacturer is responsible for indemnifying the defendant against the claim. If the defendant has an insurance policy it might also provide coverage for a lawsuit. In a lawsuit the parties are required to advise the other side of any applicable insurance or indemnification they may have. So, promptly investigate whether you have any coverage. Don’t delay this because coverage might depend upon reporting the claim within a certain time. Insurance coverage or indemnification can save a business a significant amount of money in defending a lawsuit.

6. Get The Evidence

Arguments alone usually don’t win cases in court: Evidence is usually required to win. This can be true even when it is the other side that bears the burden of proof. Evidence generally consists of the testimony of individuals under oath, documents and things. So, a priority in any legal dispute is to identify the people, documents and things which are relevant to the case. The sooner you can collect the evidence in your favor, the sooner you may be able to resolve the dispute. Work with your attorney by helping to identify witnesses, documents and things. This includes informing your attorney about any evidence that may be harmful to your case. Only by being aware of harmful evidence can your attorney take the appropriate steps to deal with such evidence and advise you of its potential impact on the case. The litigation process makes available a number of discovery tools for litigants to obtain evidence (e.g. interrogatories, requests for production, depositions, and subpoenas). However, these can be very time consuming and expensive. Much valuable evidence can often be obtained without resort to such discovery tools.

7. Know Your Settlement Position

The vast majority of lawsuits ultimately settle. This means that the fighting parties usually arrive at a solution themselves to end the case rather than a judge or a jury deciding the issues. You should be clear at all stages about what you are fighting for and why so that you can make the right decisions. Discuss settlement options with your attorney early on. In the early stages of litigation the settlement positions of the parties may be very far apart. However, sometimes this is not the case. It may be possible to achieve an early settlement and avoid the unnecessary burdens and expense of protracted litigation.

8. Understand The Litigation Risks

Know that litigation is generally expensive, burdensome and risky. Neither side in litigation has any real control. There is certainly no control over how a judge or jury will decide an issue. Even if you are in the right, and the evidence is on your side, a judge or jury may decide against you. They might get it “wrong”. That is why there is an appeals process which still offers no guarantee of success: Whenever a case is submitted to a judge, jury or appellate court to decide there is always uncertainty about the outcome. To avoid such uncertainty the parties can compromise and settle the dispute on their own terms. So, throughout the litigation process communicate with your attorney about the risks of the litigation and the consequences of winning or losing. Always remember that just because you can or should win in court doesn’t mean that you will. Even if achieving a legal victory is important to you be sure that you understand the risks and expense of pursuing a legal victory to the end.

The above steps if followed properly can greatly improve the chances of achieving a quick, fair and cost-effective resolution of a lawsuit. Of course, this is general information only and nothing in it is intended as a substitute for legal advice from a qualified professional for your particular situation or lawsuit. Matters involving intellectual property and business law can be complex and professional legal assistance is usually advisable, especially so in any lawsuit.

If you are in need of professional assistance with an intellectual property lawsuit, or any other intellectual property law matter, schedule an initial consultation with attorney David M. Kleiman today to discuss how he may be able to help.