Skip navigation
Virtuoso

0113 237 9900

Book Free Call

Knowledge

Navigating the Complexities of Patent Infringement: A Comprehensive Guide

Back to IP FAQs Overview
General

Patent Infringement | What Is It, Examples & Costs

Before looking at patent infringement, it is important to look at what a patent is. Outside the arena of experts this is a poorly understood area of law, so it is important to obtain expert advice. At Virtuoso Legal, we're proud to offer our help and expertise.

Patent Infringement Guide

What is a Patent?

Patents are legal rights, granted by a sovereign state to exploit unique and new ways of doing things or new products. In some cases the invention is a process. It is often referred to as a monopoly right as once you have a granted registered right to carry out the technology, you can stop other people from carrying out those rights for up to 20 years and sometime longer.

In order to explain it better, here are a few examples of how this right works.

Company A invents a very efficient and effect way to produce a low calorie sweetener from sugar cane. In order to protect that manufacturing process, the technical team work with a patent attorney to break down the precise nature of how an existing procedure is improved and submit a patent application with specific claims to the technology. After rounds of examination at the Patent Office by a technical examiner, a registered Patent is granted to Company A to exploit the invention as they so require. In simple terms Company A can then license the right to others, sell it or do nothing at all with it!

Company B invents a brand new lens for wearing glasses. Again the details of that new product of that new lens are given to a patent attorney, who turns it into claims and submits a patent to the patent office for examination. Provided the product is new and inventive (the tests required by the patent office to grant a patent), then after examination against existing technology, it should be granted.

So patents cover processes, products and ideas – but there are some things that you can’t patent such as software, medical procedures and business methods. Having said that some countries do allow patents in these areas!

Patent Infringement

Infringement arises where another person or company uses the rights granted under a patent but without the permission of the rightful owner. In practical terms a lot of patented technology is licensed to third parties. This generates an income for the patent owner and permits others to benefit from the technology. However, there are circumstances where patent rights owners will wish to withhold that exploitation of their patent rights, for example Company C might not wish to allow Company D – a much larger competitor – the rights to exploit the technology that they’ve created. In these circumstances, Company C will often seek advice as to what their rights and remedies are.

In these cases it is important to have an expert solicitor or legal expert to review the potential legal claim.

Infringement analysis for patent claims is a rare art form, but the general principles are:

  1. The expert will look at the patent claims to see what is covered by the patent rights. Note that it is always very important to have a patent attorney draft the patent and in particular the claims as this is key to enforcement of your patent claims down the line.

  2. The expert will then look carefully at the infringing process or product and see if the patent claims are infringed by a third party.

  3. The expert will then set the infringing items or activities against the claims (and particularly claim 1 of the patent) to see if there is an overlap and to what degree (if any) there are variations when profiled against the patent as it is claimed in the patent. Again this profiling process is a vital part of deciding whether or not to take action against an infringer

Once this evaluation report of patent claims versus infringing product or process has been carried out, then a patent owner will have a much better understanding of how his or her technology has been copied and is being used without permission.

At this stage – and it can be a bit of a protracted, expensive and difficult process to get this far – the patent holder has various options open to them.

Letters before Action or Cease and Desist Letters for Patent Infringement

The first stage is usually a detailed or particularised letter of claim is drafted by an IP expert solicitor and is sent to the infringer or their legal advisor. This should contain specific and clearly set out and understood details of the allegations of infringement. Firing off a badly drafted letter can be utterly counterproductive. First of all, the recipient will almost certainly respond asking for fuller details, but even worse they could ask the Court for a claim for so called unjustified threats or a declaration of non-infringement. This happens where someone has made a claim which they can’t substantiate but which threatens the other side.

Any cease and desist or letters before action letters MUST be carefully considered to avoid problems or even worse making the potential defendant in an action invalidate the patent or seek the defence of a claim for non infringement from the Court. It is also imperative that such actions are combined with the relevant pre-action protocol and originate from someone with the right to do so. The right to engage in any litigation is a so called reserved right and such rights are reserved to appropriately qualified people who are usually solicitors and regulated by the SRA. These restrictions on activities are there to protect the public from unqualified people engaging in litigation especially in company matters.

Acts Constituting Infringement

The Patents Act 1977 is quite clear about which acts constitute infringement of a patented invention. These are covered by s60 of the Patents Act 1977. These include such acts as importing, storing, offering for sale and using amongst others. It is quite a comprehensive list of activities. So by way of example, if you import an infringing product such as a car battery charger and list it for sale on Amazon, this could be patent infringement even though you were unaware of the fact that the battery charger is a patented product. Hence there is direct and indirect infringement as types of infringement action.

Direct and Indirect Infringement

Direct infringement would normally involve selling, offering to sell or disposing of a patented product in the United Kingdom, where you do not have permission or a license from the patent owner. Indirect infringement is a more complex area of law and there is far less case law in this situation. Simply put this means assisting the infringement of a patented invention by knowingly assisting a third party to incorporate a patented product.

Direct Patent Infringement

Direct patent infringement means doing the following without permission of the patent owner (normally this is by way of a formal license the details of which may be recorded at the Patent Office in the United Kingdom).

  1. Where the patented invention is a product: importing, selling, offering for sale, storing or even keeping a patented product.

  2. Where the patent covers a process: importing, selling, offering for sale and incorporating that process into manufacturing and in particular where you know you are infringing someone else's patented process by doing that. The element of knowledge is key here and it is also key for indirect infringement claims which are set out below. Where you then sell such product you could be directly infringing someone else's rights.

Contributory Patent Infringement

This arises where there is a joint act between two or more people or companies where the parties act together as part of some common design or common purpose to directly or indirectly copy and use a patented product or process. So beware of situations where one party induces, encourages or even assists in copying as this can have unintended consequences and lead to allegations of direct and indirect claims of patent infringement. Where a product obtained directly is involved, then contributory infringement can still be an issue for you.

Contributory infringement arises where parties act together. A good example of contributory infringement would be where a company decides to create a new product and one of the directors knowingly imports a patented product to incorporate into the new product. Contributory infringement arises where the director knowingly imports a patented product without the permission of the patent owner and then helps the company actually incorporate the patented invention into a new product. Contributory infringement is quite common and can land individuals as well as companies in problems with the patent owner. So beware of contributory infringement, it can get quite personal.

Indirect Patent Infringement and its Proving

Perhaps the best way to explain this is by way of an example of indirect infringement in the United Kingdom.

Company A has a new patented process to make a fire retardant fabric which is patent protected. The fabric is for use in the fire service or where people come into contact with fire. There are two patents here. One for manufacturing and one for the actual fabric itself. If another company comes along - Company B - with another way of making the same fabric then there could be claims of indirect infringement. If Company B makes a copy machine which uses exactly the same process but creates another kind of fabric which doesn't infringe the patent fire retardant fabric, then there would be indirect infringement of the process. To be wilfully blind is not useful - if your knowledge can be proved and you are committing an infringing act then you can be brought into the claim as an individual.

Infringement by Resellers and End Users

One of the most thorny areas of infringement claims arise where you wish to go after resellers of patented inventions or where end users inadvertently and unknowingly incorporate a patented invention or a patented process. Here the alleged infringer may not be aware of UK patent law and be blind to any patent disputes. Whilst it is possible to pursue resellers and end users the first question to ask is what evidence do you have of their knowledge and do they know what constitutes infringement? Quite often the answer to that is that they are completely unaware.

Pursing a reseller or end user is often a finely balanced set of reasoning and commercially this can be quite damaging for the reseller or end user. Also if the primary infringer succeeds in their defence against patent infringement claims then you could be on the hook to repay damages to the defendant AND the resellers and end users. Patent infringement insurance can be extremely useful but especially in these cases.

Patent Infringement Caveats

There are a few key issues to suggest under this heading over a granted patent.

  1. Be aware that patents like all IP rights are territorial in nature. This means you must have a UK granted patent before you can take action in the UK either in the UK IPO, the High Court or IPEC. So not just filed or pending but granted.

  2. Many patents are now coming through to registration which are also covered by European patent office rights - the Unitary Patent. There is now a central court for dealing with these and this should make enforcement easier on a European wide basis.

  3. Patent protection and the pursuit of patent law is complex and expensive. We advise clients to either have infringement insurance and a war chest to kick actions off. Ring fencing some money to make sure you have patent protection is very important indeed.

  4. Always make sure that your patented invention and granted patent are done professionally. You also need to consider a European Patent or Patent Cooperation Treaty (PCT) patent filing for other parts of the World early on in the filing process. If your patent is only just a published application, then you can not act until it is granted.

  5. Any analysis of the claims also needs to be done by a professional who is skilled in looking at your patent application and is also skilled at comparing claim construction versus the infringing acts. You will need a suitably qualified and experienced person in patent litigation cases.

  6. Only solicitors who are experts in intellectual property and patent litigation are qualified to take action in the High Court in the United Kingdom. Whilst some patent attorneys have some experience in IPEC matters, few of them have a great deal of litigation experience and more broadly intellectual property matters.

Legal Proceedings and Remedies

Where a rights holder wishes to exercise their rights in the invention then the first part of the process is to do a full analysis of the patented invention or where the invention is a process to look at the claims of the patent versus the alleged acts of the infringer. Most patent infringement cases need the patent holder to uncover the infringement and this can be more difficult than it first appears. By way of example it can be difficult to see if an essential element of the patent has been copied either in whole or in part. Sometimes it is important to engage an expert early on to do a claims analysis and to work out precisely where direct infringement occurs. What appears to be an allegedly infringing product, isn't the case at all and infringing acts or infringing processes aren't quite what they seem. In some cases the protected invention isn't infringed and the patent proprietor hasn't got a great claim.

In pursing a claim a reasonable person also has to consider the following;

  1. Was the patent being infringed for a commercial purpose?

  2. Are essential elements of the patent infringed? To understand this you will need to have a good understanding of the subject matter.

  3. Who put the invention into effect?

  4. Was the patent used for non commercial purposes?

  5. Was there a disposal or otherwise?

  6. Was the patent being used for experimental purposes? Note that sometimes patented products can be precursors to commercial tools and therefore work is done in anticipation of disposal or otherwise.

  7. Does the infringer have prior use? Did they bring the invention into effect before you?

  8. Are other IP rights such as design rights or trade marks being misused?

  9. Can you actually find infringement by way of use of a particular product, an infringing act or further infringement?

  10. Are the patents national patents or European patents?

  11. Are you acting as a patent owner or as an exclusive licensee?

  12. Lastly but not least will any kind of action precipitate and action for unjustified threats? Unjustified threats can be a major problem and we see this quite regularly, especially where non experts draft letters before action,

The Patent Litigation Process

Under normal circumstances any remedy for patent litigation is started off by way of a letter before action and in the UK this must start with a fully fleshed out letter created in accordance with the pre-action protocol. Letters which do not comply with this can be an issue down the line especially in relation to costs, monetary damages such as an account of profits, settlements and Court actions. A UK patent is a valuable asset and needs to be protected by an expert in intellectual property.

Normally a good letter before action can swiftly settle matters and lead to either licensing arrangement to regularise a matter and to create a royalty income stream or to stop someone from exploiting a patent for commercial activities. It is always important to stop infringing use of your patent as this can lead to significant loss of income for the rights holder. Infringing products can also be problematic for other reasons such as loss of investment, diminution of shareholder value or simply creating a competitor who produces inferior products.

Remedies for Infringement

There are a number of remedies that you can ask for in proceedings for infringing acts. These include:

  1. An account of profits. Here the Courts look at how an infringer has been unjustly enriched by a particular product. Where the invention has been widely used without permission in an industrial setting, this figure can be a significant sum. However, it is normally a calculation that is difficult to assess, even by experts.

  2. A reasonable royalty is often a better way of assessing damaging. This calculation is far simpler as it requires the parties to try and agree what a license would look like and what royalties would be payable in those circumstances.

  3. A permanent injunction can be granted to stop an infringer using the patent whilst patent cover is granted. Injunctions won't normally be granted where the patent is used for experimental purposes.

  4. Other remedies which are often sought include, delivery up or destruction of infringing products, an award of legal costs.

  5. Was the product obtained directly from the process covered by a patent.

  6. An inquiry into suppliers, end users and details of national and international sales are often order by Courts especially where the invention is a product.

Patents are valuable assets - you wouldn't let someone drive around in your car at no charge would you?

Injunctions

An injunction is a Court Order which normally bars something from happening. So an injunction can stop a gathering of people for example. However, in intellectual property cases an injunction can be granted to stop someone from exploiting industrial property including patents, design rights, copyrights, patents, rights in confidential information and databases.

The rights are granted either short term - for example an interim injunction to preserve the status quo whilst further investigations are undertaken or a final injunction. Final injunctions are normally remedies sought at the end of litigation in intellectual property law matters where the winner stops the infringer from carrying using the patent, trade mark or other intellectual property.

Damages or an Account of Profits

Damages are given where the rights owner or patent holder has been found at a patent trials to have suffered a financial loss because of the actions of an infringer. Damages in intellectual property law are frequently calculated as if the parties had entered into a contract over licensing of the UK patent. Here the damages calculation is based on a royalty payable on the patented product or patented process according to what is a normal licensing type arrangement. Royalties payable are calculated on certain industrial norms in the relevant industry and these can be highly variable. A royalty could be anything from 1% to 30% of the net cost of an item or process. Valuing such damages is a job for an expert.

An account of profits is an entirely different type of calculation. In an account of profits the key driver of value is the underlying gain the infringer has obtained by not obtaining a license. A number of material facts may impact this calculation. For example the infringer has not had to pay for R&D or may have had access to a process or market they would not normally have available to them were it not for their actions.

Delivery of Infringing Products

Patent owners often ask infringers for the delivery up or destruction of infringing products. Alternatively, if they're feeling generous, they may allow the infringer to simply sell off goods and then pay damages on that. It is often very important to find out where products have been sourced, who has supplied them and how many have been sold. This will help with any damages calculations. Often that information provides a valuable commercial purpose such as finding out which factories in China are posing a problem or indeed who is buying infringing goods, especially if both the supplier and the end user are aware of the infringement issues.

Revocation of Patent as a Counteraction

One of the downsides to patent infringement claims is the opportunity for an infringer to claim that the actual patent should be revoked. A patent can be revoked where the defendant finds out that a product isn't novel or was in the public domain before being patented. Revocation can also be a risk where prior art comes to the surface and shows to the Judge that the patented invention wasn't new or is an obvious development of existing technology and that as a result of that knowledge the patent should not have been granted.

Defendant's Counteractions in Litigation

The Defendant has a number of defences that can be deployed. Revocation is discussed above, but apart from destroying the Claimant's patent rights, the Defendant can also ask the Court to grant an order that the threats of the patent holder are unjustified threats threats as the infringer doesn't have the rights they claim to have over the subject matter. Defendants can also ask the Courts for a Declaration of Non Infringement, a Declaration of Obviousness or a Declaration of Invalidity. This later Order if granted applies where the alleged act of infringement is said to be outside the scope of the patent claims.

Discovery Phase and Pre-trial applications

Discovery in any litigation is the stage where both parties go back and look at what documents may or may not be relevant to patent litigation. So for example, discovery may cover the documents created when an invention was being refined or during the prosecution process. The alleged infringer will often have to disclose matters such as how a process is conducted, or how an invention has been incorporated into another product. Patented products are often complex items and discovery may mean looking through a great deal of archived material or even prior art if the defendant wished to revoke the patents in question.

Pre-trial applications could include things such as asking a third party to deliver up information or items. Such a request is called a Norwich Pharmacal Order. Other pre-trial applications may be required for an interim injunction -to stop on-going damage pending trial, and order for specific disclosure, where specific items may help resolve the claims earlier or a request for expert evidence, experiments and similar matters relating to the invention. Where a patent has been used in a non commercial way then again specific disclosure may be required to assess the invention.

Trial Stage and Markman Hearing

Markman hearings do not apply in the UK patent proceedings. In the USA such a hearing is used to determine the exact meaning of phrases used in patenting.

Trials in patent hearings are often relatively short and heavily fact and evidence based. In some instances a Judge can provide an opinion purely on the papers. However, normally the trial date is set during the directions phase of patent litigation and the length of the trial will depend on:

  1. The amount of disclosure in the matter.

  2. The degree to which expert witnesses or experiments are required.

  3. The number of witnesses of fact.

  4. The complexity of arguments.

  5. The financial ramifications of the case.

Longer trials are associated with complex matters where more than one patent is at issue and where the potential damages are significant.

Verdict, Judgment, Post-trial, and Appeals

The verdict of any patent litigation is often handed down months after the trial when the Judge has had time to digest all the evidence and documents. The decisions are often lengthy and complex. In some instances such as the Shorter Trial schemes, post trial there will be a legal costs decision too which can last up to one day in Court.

Frequently in patent cases the parties will agree on directions that mean that once liability has been decided, there will be an entirely separate hearing about damages and costs. These are so called split trials and such a split of liability and quantum of damages is commonly found in most intellectual property cases.

Where one party disagrees with the findings in the final decision or even parts of it, then that party may wish to take the matter to the Court of Appeal to appeal all or part of the decision.

Patent Infringement Analysis

A careful and prudent solicitor will undertake a full patent infringement analysis at the start of the case. By doing such research up front, the issues should become clear early on, meaning the parties can explore settlement or even a mediation without going all the way to trial. At Virtuoso Legal we do all this homework up front to de-risk any enforcement or defence of an invention.

Importance of Comprehensive Patent Infringement Research for Lawyers and Law Firms

One key and vital aspect of dealing with any invention is to look at the prior art which was known to the public before the patent was filed. This is a job for an expert and requires in depth legal analysis of the claims of the patent and key word searching. AI has a significant role in reviewing this material quickly and easily.

How to Identify Patent Infringement

This can be very difficult to spot. Even experts or those skilled in the art of patenting and invention find the matter an acquired skill.

Case Studies Illustrating Patent Infringement

Some well known cases of infringement include:

Optis v Apple. Here Apple was held to have infringed a patent owned by Optis. The patent was later found to have been missing an inventive step

Flynn v Mylan. Here the Claimants Flynn filed a claim for infringement over Mylan for the production and sale of a generic version of melatonin the sleep hormone. Flynn applied for an interim injunction which failed as the Court held that if the Mylan product infringed the patented invention then damages would have been an adequate remedy.

Practical Considerations in Patent Cases from Virtuoso Legal

At Virtuoso Legal, we have been involved in a number of patent cases and here are some practical considerations:

  1. Evidence. We hate to say this but good documentary evidence is vital to win or defend a case. Cases can be won or lost on the documents. A thorough analysis upfront is costly but often saves a great deal of time down the line. Always come to us with as much information as you have.

  2. Cost. Preparing to pursue or defend in patent litigation is costly, time consuming and demanding of management time. You will be asked for a chunk of the early costs up front and we strongly advise UK and European patent holders to have IP legal expenses from the date the patent is granted. You also need to think about obtaining a European Patent early on in the process.

  3. Experts. Do think about expert witnesses early on - these could be useful for Claimants or Defendants. It is usually time consuming and expensive to enforce a UK patent.

  4. Witnesses. It is important to take a proof of evidence from witnesses of fact in the early stages of litigation when matters are fresh in the mind of the witness.

How Long Does the Patent Litigation Process Take?

Patent litigation can take months or years. An urgent application for patent litigation using an interim injunction can mean that cases are effectively disposed of in a matter of 3 months or so.

Complex litigation with multiple patents and invention in lots of different countries can take several years. A normal start to finish piece of litigation will last around 1 year to 18 months from start to finish.

How Much Does Patent Litigation Cost?

This can be very variable but start costs of £30,000 are not unusual and the costs all the way to trial could be anything between £300,000 to £1,500,000. Complex cases with more than one patent will vastly increase the costs.

Community Patents and their Influence

Community patents are more commonly called Unity patents and these cover invention in Europe. A unity patent can be enforced through out Europe which means patent owners don't have to seek enforcement in every single European country. As such they are now becoming very desirable and sought after.

 

Conclusion

Patents are key assets and should be used and protected accordingly.

Where a patent is a key part of your business it pays to be alert to and aware of infringers.

A patent which yields a licensing stream can be a great way of ensuring that productive income is made from your asset, rather than simply by defensively closing down infringers.

Make sure you instruct an expert who knows and understands not just the law but also your commercial concerns. This is key to success.

Legal Expenses insurance is both useful and strategic. Make sure you are aware of what is available. At Virtuoso Legal we can help with this.

A patent can be used to obtain tax advantages such as Patent Box allowances. Inventions can be expensive but money can be reclaimed from the tax man using R&D tax credits.

Strategic Considerations for Practitioners

Always consult an expert. High value disputes will need to be sent to the High Court and properly qualified experts regulated by the SRA will need to be consulted early on in any dispute process. Whilst many patent attorneys can help with issues of claims analysis and infringement opinions, few have much direct experience of litigation. Obtaining good advice early on is often a cost saving exercise and not a cost drain.

 

Frequently Asked Questions (FAQ's)

We've done what we can to answer some frequently asked questions about patent infringement.

What is meant by Patent Infringement?

This is where your product or process uses technology captured by a granted and subsisting patent. It is not infringement until the patent is granted although damages may be back dated to when the patent was originally filed.

What happens if you infringe Patent Law?

Infringement can be costly and time consuming. If you have infringed a patent or you think someone has copied yours seek early redress from an expert.

How do you determine Patent Infringement?

This is done by looking carefully at the claims in the patent versus the product or process which is patented.

What is a Famous Example of Patent Infringement Action?

There are many famous cases of infringement, especially cases involved mobile phone technology and automotive technology.

Want to get started?

Click below to be get started working with us.

Leeds 0113 237 9900

London 0208 088 2367

Get in touch

Cookies

This website uses cookies. You can read more information about why we do this, and what they are used for on our Privacy and Cookies policy page.

Accept Decline