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Patent litigation occurs when a person who holds the rights to a patent enforces her patent rights against someone else who is making or selling the invention without the permission of the person who owns the patent. This type of patent litigation is called a patent infringement lawsuit. In most cases, when one person decides to sue over the rights of a patent, the other person counter-sues, claiming the patent is invalid.
In the United States, a patent litigation case can go before a jury; however, only the judge is able to interpret the various patent claims. The United States is the only country to follow the "first to invent" rule, meaning the first person to invent the device is the owner of the patent. All other countries follow a "first to file" rule, meaning the first person to file their patent application is the owner of the patent.
There are several ways that a patent can be declared invalid. For example, if it was not novel or a different from all prior products, methods, or devices, then the patent can be declared invalid. Patent litigation can occur if the patented item or method has been described in a published document or if has been used by the public for over a year before the application was filed.
A patent must be non-obvious or surprising. In other words, it must not be expected. Initially, a patent examiner will determine whether the patent is non-obvious by looking at all related prior patents that existed before the date of the invention. During the course of patent litigation, if the issue of obviousness is raised, the court must review documentation to see if it was non-obvious since the date of the invention. Next, each side will bring an expert to court to show whether it was indeed obvious.
If the patent is not declared invalid after patent litigation occurs, the court can do one of two things. The first option is to issue a court order called an injunction. The injunction will stop the person infringing on or stealing the patent from using or selling the patented item or method anymore. In addition, the rightful patent owner can be awarded damages. If the infringement was considered willful, the court may award the rightful owner of the patent three times the actual damages, plus any legal expenses incurred.
The court can also mediate between the two parties until they come up with a written agreement. In most cases, the agreement will allow the infringing party to use the product, but the infringer will pay a royalty or a use fee to the rightful owner. This takes time and often goes to a mediator first.
It is not considered to be an infringement of a patent if a patented device is repaired or if unpatented parts of the device are replaced. For example, one particular company owned a patent for a mechanical device used for a car convertible top, but there was not a patent for the fabric on the convertible top. Under the repair doctrine, the court decided that the sale of the fabric to customers who purchased the patented convertible top was not an infringement of the patent.
When a business owns a patent, and that patent is infringed, the business has few options other than patent litigation. Many large settlements have been won by businesses that launched patent infringement lawsuits against larger businesses that were the infringers of their patents. However, entering into patent litigation is a lengthy process, and patent litigation is very expensive!
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