Patent Infringement

What It Means

Patent infringement occurs when a party makes, uses, sells, offers to sell, or imports a product or process that falls within the scope of another party's patent claims without authorization. Infringement analysis is fundamentally a claims-comparison exercise: the accused product or process is examined element by element against each claim of the patent. If every element of at least one claim is present in the accused product, infringement is established. There are several types of infringement. Direct infringement requires performing all steps of a claimed process or incorporating all elements of a claimed device. Indirect infringement includes inducement (actively encouraging others to infringe) and contributory infringement (supplying a key component with no substantial non-infringing use). The doctrine of equivalents extends infringement to products that perform substantially the same function in substantially the same way to achieve substantially the same result, even if they do not literally match every claim element. Patent infringement litigation is among the most expensive forms of commercial litigation. A typical patent case costs $2-5 million through trial, with complex cases involving multiple patents exceeding $10 million. Damages can include lost profits, reasonable royalties, and in cases of willful infringement, treble damages. The threat of infringement litigation drives much of the strategic behavior in patent portfolios: companies build large portfolios partly for defensive purposes — if a competitor sues for infringement, the defendant can often countersue with its own patents, creating mutual deterrence. This dynamic makes patent portfolio size and quality a competitive factor even when companies never initiate litigation.

Frequently Asked Questions