Brainpower: Tips for Protecting Your Intellectual Property
The first half of 2015 saw over 3,000 new patent lawsuits filed; the most on record for the beginning of any year. According to the Lex Machina 2014 Patent Litigation Report, over $16 Billion in compensatory damages have been awarded since 2000, $2.2 billion of that in the last year alone. Meanwhile the AIPLA Economic Survey states the median cost of litigation for just the discovery period starts at about $350,000 and only gets higher as alleged damages increase.
While we often hear names like Samsung and Apple, lawsuits are by no means limited just to technology companies. In fact, the consumer products segment has seen the most litigation of any other industry; close to double that of electronics. Further, intellectual property lawsuits aren’t limited simply to patents. A business can be held liable for violating trademark, copyright or any other number of allegations.
Your standard general liability insurance policies are ill-equipped to handle the type of disputes that intellectual property raises. Not only is coverage limited to a very small set of “advertising-related” claims, but there are plenty of intellectual property-specific exclusions that can remove even the most basic of coverage. In short, you should never rely on your general liability policy to protect you from intellectual property claims.
Thankfully, insurance products specific to intellectual property make it easy and cost-effective to mitigate a significant portion of that otherwise uninsured risk. The most straightforward products are those that offer “defense” coverage for your alleged infringements of things such as patents. Coverage can also be added to protect against claims of improper use of copyright, trademark, trade dress and other intellectual claims. Some policies also offer indemnity coverage – covering you both for the cost of litigation as well as potential awards made against you.
There are also products specific to intellectual property holders. If you have valuable IP assets, you can purchase coverage to compensate you when you proactively protect those assets. In other words, the product is a plaintiff-specific product that pays legal costs associated with your bringing a suit against a third party.
The end result of all of this is simple: an intellectual property risk management plan is absolutely essential to your operations. Whether you’re an intellectual property user, or an intellectual property holder, the right insurance is essential to protecting your interests. Otherwise, you could become just another drop in the $16,000,000,000 bucket.
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