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Patent Infringement Recourse

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danocap1982

Junior Member
What is the name of your state? WI

A company I have been asked to join and invest in is in the process of hiring an attorney to file both US and International patent infringement lawsuits... here's the story.

The inventor has spent the last two years going to (6) different US companies trying to get licensing agreements for his patented product and told at each that his product will not work. At each company he has a non disclosure agreement signed. He also went to a Chinese company to manufacture and they have also stolen the product and are making an identical product. Now four of the six companies are rolling out products here in the United States that (in the inventors opinion) are identical in every (functional) way to his product.

Here are my questions:
1. What (if anything) can be done to halt the production and sale of these products? (stems from a comment the inventor has made that there will be an (injunction?) to halt the manufacture and sale once the lawsuit is filed)

2. Is there anything (lawsuit associated) that would interfere with our own company manufacturing and selling this product? (this question stems from a comment the inventor made about him not being able to sell any products until after the lawsuit is finished... 2-3 years)

3. Would our company starting the manufacture of this product benefit the lawsuit in any way?

Some other items
- I do not know if the invetor has put these companies "on notice"
- I do not have a copy of the non-disclosure agreement
- I know that the people that have stolen the ideas have been turned down for their own patents as they were too similar to the inventor's
- This product has shown up in China, US and England.
- I believe that the inventor is looking to a Texas attorney to file the lawsuit.


Any help would be greatly appreciated.
 


divgradcurl

Senior Member
1. What (if anything) can be done to halt the production and sale of these products? (stems from a comment the inventor has made that there will be an (injunction?) to halt the manufacture and sale once the lawsuit is filed)
It's typical to ask for a preliminary injunction in a patent infringement lawsuit. However, such injunctions are rarely granted, and an injunction requires that the party obtaining the injunction post a bond to cover the loss in sales to the other party(s) if the injunction is granted, which can tie up quite a bit of cash.

2. Is there anything (lawsuit associated) that would interfere with our own company manufacturing and selling this product? (this question stems from a comment the inventor made about him not being able to sell any products until after the lawsuit is finished... 2-3 years)
Nothing related to the lawsuit, from the information you've given.

3. Would our company starting the manufacture of this product benefit the lawsuit in any way?
At the present time, no.
 

danocap1982

Junior Member
Thank you for your response - extremely helpful.

Are there any other actions we can take to prepare for this suit that do not require a lawyer (i.e. putting them "on notice" of our patent).


Again, Thanks for your help.
 

divgradcurl

Senior Member
danocap1982 said:
Thank you for your response - extremely helpful.

Are there any other actions we can take to prepare for this suit that do not require a lawyer (i.e. putting them "on notice" of our patent).


Again, Thanks for your help.
Putting them on notice is a good thing, as you don't start accumulating damages (for lawsuits in the U.S.) until the alleged infringer is on notice of infringement -- and this requires either letting the other party know that you think they are infringing, or by marking your products that they are copying with a patent number -- which I don't think is what is happening in your case, based on what you have written.

Putting someone on notice merely means writing them a letter telling them you think that they might be infringing, and what patent number. That's it, and it can be done without a lawyer. However, it's also potentially a bad idea, and here's why. There is a fine line between providing "enough" notice such that the damages start accumulating, and putting the other side under "reasonable apprehension" of a lawsuit. In other words, if you don't provide enough notice, the damages don't start to accumulate (in other words, the other side is not "on notice), but if you give "too much" notice, the other side is under "reasonable apprehension" of a lawsuit -- the "just right" amount of notice is a very narrow path.

The problem with too much notice is that if the other side is put under "reasonable apprehension" of a lawsuit, they can take the initiative and file for declaratory judgment -- basically filing a lawsuit themselves asking the court to determine whether or not the patent is valid, or if infringement is occuring. If they do file a DJ action, they get the choice of venue (where the action will be hear) and will control the timing of the case going forward -- in other words, they'll be in the driver's seat. This can be particularly troublesome if you are not ready to sue, and merely want to threaten them -- you can lose control of the situation.

For that reason, it's probably best to work with an attorney even for the notice.

BTW, this is the rule for any infringement action in the U.S. For the foreign infringers, things are certainly different, and you'll need local (foreign) counsel anyway, so you might as well start lining them up...
 

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