IP Litigation to Defend Against a Patent Troll

A recent infographic from Inc.com, compiled from data published in an article by Colleen Chien, outlines some interesting statistics about the costs of fighting a patent lawsuit. Notably, Ms. Chien's article, Startups and Patent Trolls, suggests most defendants in lawsuits brought by patent trolls are small, with companies earning less than $100 million in annual revenue representing at least 66% of unique defendants. Smaller companies – those earning less than $10 million in annual revenue – represent 55% of all patent troll defendants. Notwithstanding the small size and limited resources of most defendants, Ms. Chien notes that the average startup spends $857,000 fighting a patent lawsuit to trial. Litigation costs for cases that end short of trial are $168,000 on average. The average settlement for patent troll cases is $340,000.

For many small companies, the costs of fighting – or even settling – a patent lawsuit may quickly erode profits. Understandably, 40% of small companies targeted by trolls report that the lawsuit caused significant operational impact. According to Ms. Chien, receiving a patent demand from a patent troll represents "a death knell for a prefunded company. No one wants to invest in a company where founder time and investor money is going to be bled to patent trolls."

Source: http://www.inc.com/lindsay-blakely/cost-patent-trolls-startups.html?nav=featured

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Klemchuk LLP is an Intellectual Property (IP), Technology, Internet, and Business law firm located in Dallas, TX.  The firm offers comprehensive legal services including litigation and enforcement of all forms of IP as well as registration and licensing of patents, trademarks, trade dress, and copyrights.  The firm also provides a wide range of technology, Internet, e-commerce, and business services including business planning, formation, and financing, mergers and acquisitions, business litigation, data privacy, and domain name dispute resolution.  Additional information about the IP law firm and its IP law attorneys may be found at www.klemchuk.com.

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