This is Part of Greg Wood's Series on Why to Choose Early Mediation in Intellectual Property Cases

Resolving disputes through litigation is expensive, time-consuming, emotionally and physically draining. The unique characteristics of IP cases make mediation ideal. Here's why.

Most Infringement Plaintiffs Have Only Distributive Aims

 

Intellectual property lawsuits are filled with risk, even for the aggressor.  When an infringement action is brought, one defense is to challenge the validity of the patent.  This is dangerous for the patentee.  He or she faces the possibility that the scope of his patent will be narrowed significantly in the claim construction process, or that it will be invalidated altogether. While current data shows that only 31% of validity claims succeeded in 2013, that is still nearly a one in three chance that a presumptively valuable asset will be proven worthless. 

Nor is it clear that an infringement claim will be proven; in order to prevail, the patentee must show that the challenged invention meets every claim of the patent, or there is no infringement. [1] Approximately 60% of infringement claims fail. [2]

If infringement is proven, the remedy is a permanent injunction and/or costly royalties and damages. If using the patent is essential to the infringing business, it may be forced to shut down altogether as a result of the litigation. 

IP litigation is a hugely expensive, time-consuming, risky, uncertain path toward conflict resolution. Long-term uncertainty will impose heavy market costs and deprive parties of opportunities for innovation and profit. Early mediation is an ideal alternative to these problems.

By Greg Wood

ENDNOTES

[1] Allison, John R. and Lemley, Mark A. and Schwartz, David L., “Understanding the Realities of Modern Patent Litigation” (May 29, 2014). Texas Law Review, forthcoming; Chicago-Kent College of Law Research Paper No. 2014-12; Stanford Public Law Working Paper No. 2442451. Available at SSRN: http://ssrn.com/abstract=2442451.

[2] Id. 

Drawing on an engineering background, thirty five years as an advocate in commercial, intellectual property and e-discovery disputes, twenty years serving as an arbitrator, 200+ mediations and 400+ hours of formal ADR training, Greg is “all in” in assisting parties in the speedy and economic resolution of disputes whether as a negotiation or settlement counselor, a mediator or an arbitrator. While Greg is available for mediation and arbitration of various disputes, his focus remains on complex commercial and intellectual property matters including e-discovery disputes. Greg can be reached at greg.wood@agencydr.com