IP for Your Business: Seven Steps for Reducing Patent Litigation Budgets While Increasing Effectiveness (Part II)

By The SE Texas Record | Oct 29, 2009

By R. David Donoghue

Last week, attorney R. David Donoghue shared the first three of seven strategies to help companies decrease patent troll litigation costs while increasing the effectiveness of their defense. Steps 4-7 are continued below.

4. Data Mining

If your patents have been litigated before, get as many of the prior pleadings as possible.

Many get the prior cases' final decisions, but it is a mistake to stop there. You want to see answers and counterclaims, any court orders, pretrial filings, jurisdiction motions, summary judgment motions and even discovery motions. You can learn a lot about plaintiff's case strategy and fact issues based upon what plaintiff says in discovery disputes.

For example, you may learn what documents plaintiff is missing, details of how plaintiff keeps financial information, and what documents plaintiff does not want to provide.

Additionally, privilege disputes can tell you what documents to look for on plaintiff's privilege log that may not be privileged and you may find old privilege logs which you can use to confirm plaintiff has provided a complete log.

Finally, claim construction, noninfringement, and invalidity briefing and supporting declarations are important sources of both plaintiff's case strategy and potentially contradictory statements by plaintiffs, their experts and party witnesses. You should review these papers whenever you are preparing a technical pleading from plaintiff.

5. Prepare Your Noninfringement and Invalidity Positions Early

Too often plaintiffs, expecting a pre-trial settlement, do not prepare their technical case until immediately before claim construction begins.

As a defendant, you can leverage this by preparing your case early. You can then use your deep understanding of the case and your positions to build your defenses in depositions, interrogatories and requests for admission. And your strong discovery position can set you up for a more effective summary judgment motion or a more favorable settlement.

6. Staff and Run a Lean Team

In addition to decreasing your litigation budget, a lean defense team protects against a favorite tactic of patent trolls – using the size of a corporate defendant's legal team against it.

When your legal defense is put on by two, or at most three, lawyers working principally with one corporate contact, every member of your team will know the entire case. You will avoid the cost of the technical specialist without litigation knowledge or the invalidity specialist that is not grounded in your noninfringement positions.

A lean team with each member having a larger percentage of their time on your case also avoids decision-making without case perspective and makes sure that plaintiffs cannot shop for answers by calling different specialists on your team.

7. Engage With Your Legal Team

Too often outside counsel are retained and take over a case. They proceed to develop a strategy for "winning" the case and periodically report their progress toward that goal, usually after major milestones like briefs being filed or opinions issuing.

Unfortunately, "winning" a litigation at all costs is not always a win for the defendant. It is critical to define what winning means for the defendant in each case. Once winning is defined, you should clearly communicate those goals to outside counsel and work closely with them to make sure each strategy, action item and expense in the case is focused on you winning.

I suggest a weekly, at least, update from outside counsel explaining what has been done and outlining what they plan to do next. Scheduled updates allow you to actively manage outside counsel's strategy, review task lists to make sure case strategy remains focused on your goals, and approve or modify plans at a fairly grander level.

These seven straightforward steps will decrease your patent troll litigation costs while increasing the effectiveness of your defense.

R. David Donoghue is a partner in the Intellectual Property Group of Holland & Knight in Chicago, Ill. He may be contacted at (312) 578-6553 or david.donoghue@hklaw.com.

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