Tech Startups: Get Smart about Patent Litigation

The Webb Law Firm

The Webb Law Firm

By Daniel H. Brean, The Webb Law Firm

It is a sad fact, but success often breeds opportunistic lawsuits.  The technology sector seems especially vulnerable to this phenomenon, and the litigation de jour is patent litigation.  Startups have never been targeted with patent infringement lawsuits more than they are today.  Companies that dance in the footsteps of elephants (i.e., tech giants) and show promise as new competitors may find themselves being sued for infringement by a well-funded plaintiff.  Additionally, when startups garner enough attention they can find themselves targeted for patent infringement by patent assertion entities, or “patent trolls,” who are not market participants but merely own patents and attempt to enforce them in order to monetize them.  Patent trolls send demand letters and file lawsuits to pursue these monetization efforts.  The end result of these actions can be suppression of competition and stymied innovation.

Receiving a demand letter or a complaint for patent infringement can be intimidating.  The technology and the law at issue is often highly complex, and the burden and expense of litigating can render a dispute a “bet the company” scenario.  Most patent trolls are looking for at least tens of thousands of dollars to settle cases early on, with the settlement demands increasing if the litigation proceeds past the initial stages.  Ultimately, they will seek millions of dollars in damages for the cases that go to trial.  Operating companies may be seeking even more money, mandatory licensing schemes, and might also want to get an injunction to stop a company from making, using, and selling its technology.  Often these demands are made with barebones analysis and paper thin allegations, relying on the expense and hassle of defending an uncertain and vaguely-defined case to lead most companies to try to resolve matters outside of formal legal proceedings.

While there is no doubt a place for legitimate disputes regarding the scope of patent claims and the need to enforce patents, curbing abusive patent litigation is so important to this country that all three branches of our federal government are taking steps to help stem the tide.  Congress has been considering legislation to reduce patent infringement litigation abuse for the past few years, and seems to be nearing the passage of such reform.  Such legislation would, among other things, potentially increase the burden of filing lawsuits by requiring more specificity about the alleged infringement from the patent owner when the case is filed.  The Supreme Court is set to consider this term whether there are better ways to make those who file baseless lawsuits pay the legal fees incurred by their targets who defend themselves and prevail in the litigation.  And President Obama recently issued several executive orders to improve the quality of issued patents, and even worked with the Patent Office to launch a website with information to assist those who may find themselves threatened with patent infringement allegations (http://www.uspto.gov/patentlitigation).  Getting up to speed on patent litigation via this website is a must for any new or small technology company.

This new website explains the basics of how to tell if a patent is infringed and how to tell if it is valid.  It identifies some options to fight a lawsuit or to challenge the validity of a patent in a proceeding at the Patent Office.  It provides information on how to learn who has been sued or threatened with litigation over a particular patent, and how to find the court documents or demand letters in those related cases, along with crowd-sourced discussions about the patent owners and the patents in some cases.  It includes guidelines for how to understand and respond to both demand letters and complaints.  There is also a glossary of patent terminology and there are links to resources for legal research.   Finally, the website provides guidance on when you may need to seek legal help and how to find qualified counsel.

Hopefully, you never find yourself targeted with spurious patent infringement claims, but if you ever do, do not allow yourself to be blindsided or intimidated when faced with an allegation of patent infringement.  Once a demand letter is sent or a lawsuit is filed, a lot can happen very fast and legal assistance may be necessary.  Knowledge is power, so empower yourself to defend against infringement allegations that have no merit.

Daniel H. Brean is a senior intellectual property attorney with The Webb Law Firm in Pittsburgh, PA.  He is an experienced patent litigator and patent prosecutor, working primarily with mechanical, electrical, and software technologies.  Dan also has considerable expertise in the area of industrial design protection and design patents, frequently publishing and speaking on these topics.  Questions or comments for Dan may be directed to dbrean@webblaw.com or (412) 471-8815.  The opinions expressed in this article are solely those of the author, and should not be attributed to The Webb Law Firm or any client thereof.

Institute for Entrepreneurial Excellence launches Entrepreneur Hotline

Institute for Entrepreneurial Excellence

Institute for Entrepreneurial Excellence

Searching for answers regarding the startup, growth, or transitioning of your business? Look no more! The Institute for Entrepreneurial Excellence has just launched a business advice hotline that can assist you with any of your business questions. The Institute for Entrepreneurial Excellence has been helping entrepreneurs succeed for over 20 years. In 2013, the Institute helped startup 47 new businesses, impacted 450 jobs and raised over $13 million in new funding for clients. The Entrepreneur Hotline will provide free, fast assistance to your business questions.

Call now! 1-844-PITTIEE.

About The Institute for Entrepreneurial Excellence
The Institute for Entrepreneurial Excellence at the University of Pittsburgh Joseph M. Katz Graduate School of Business helps entrepreneurial business leaders harness the power of innovation, collaboration, and knowledge to increase profit margins, create jobs, diversify revenue streams, connect to emerging markets, and secure new research and development dollars. We take pride in knowing that, collectively, the people we serve fuel southwestern Pennsylvania’s resurgent economy.

PTC member, Digital Doc, featured in KDKA report on cold weather

David Greer, owner of Digital Doc on McKnight Road, knows a lot about electronics. This past Monday when temperatures were hovering right around zero degrees Fahrenheit, KDKA ran a timely story about the effect of cold weather on electronics, specifically smartphones. With his knowledge of electronic devices and repair, Greer was the perfect source for the article. Check it out here and stay warm!

Emerging Pittsburgh Technology Companies Thrive in Oakland Community

Startup Oakland

Startup Oakland

Startup Oakland, a partnership project between Revv Oakland, the Oakland Business Improvement District, and Oakland Real Estate, has captured the momentum of new startup companies moving into upper-floor spaces of the central Oakland business district. The project is growing Pittsburgh’s technology community to significantly impact the region’s economy.

Revv Oakland, the Oakland Business Improvement District (OBID), and Oakland Real Estate partnered in October 2013 to kick off Startup Oakland, a project that captures the benefits of locating startup technology businesses in Oakland and provides a home for new businesses to thrive and achieve success. Revv Oakland, a community of technology startups that offers affordable and productive work environments for early stage companies, has already attracted 17 new companies that have created 75 new Oakland-based jobs and expanded startup workspace into more than 10,000 square feet of upper-floor space in the heart of the Oakland business district.

“In order to compete in a 21st century global economy, Pittsburgh must focus on job growth,” said Dan Gilman, Pittsburgh City Councilman District 8. “The companies starting in Oakland will continue to grow and provide a new tax base to the City, new consumers at our retail establishments, new homeowners in our neighborhoods, and new investors in the next generation of innovation. Startup Oakland is critical to the long-term vitality of not only Oakland, but the City and region.”

Not only are new businesses vital to Oakland’s economic success, but businesses also benefit from locating their startups in the neighborhood of Oakland. Shoefitr, a Revv Oakland business, was founded in 2010 by Carnegie Mellon University graduates Matt Wilkinson, Nick End and Breck Fresen. The company created software that uses 3D scanning technology to help online shoe shoppers find shoes that are the proper size and fit. Shoefitr now has 41 clients who use the Shoefitr app on their website. There are 700 brands of shoes in their database, which grows daily. The app is accessed from 10 countries in 7 different languages. OBID recently published a feature article on Shoefitr’s growth and success on their blog.

“We have a lot of pride in this city and are excited to be a part of its transformation into a tech town,” said Matt Wilkinson, Co-Founder of Shoefitr. The goal of Startup Oakland is to spur a technology movement that attracts many more businesses to Revv Oakland and for 100 companies to become OBID members and use Revv Oakland business space in the long-term. “This partnership highlights Oakland as the perfect location for new and emerging technology companies and as a 21st century destination attracting future visitors, employees, students and residents,” said Georgia Petropoulos, Executive Director at OBID. The future of Pittsburgh tech companies is in Oakland. Learn more about how to be a part of the movement at http://startupoakland.biz.

About Startup Oakland
Startup Oakland is a unique partnership project that captures the benefits of locating startup technology businesses in the Oakland innovation economy. Formed by a strategic alliance between OBID, Revv Oakland and Oakland Real Estate, Startup Oakland is funded by the Pittsburgh Partnership for Neighborhood Development.

Don’t miss the Institute for Entrepreneurial Excellence’s Winter Social on December 11

The Institute for Entrepreneurial Excellence is holding its Winter Social for members and guests on Wednesday, December 11 from 6-9:30 p.m. at J. Verno Studio, 3030 Jane Street, South Side. To register online go to http://register.towercare.com/pitt-iee or contact Tara Gerek at ieeregistration@katz.pitt.edu or (412) 648-1389.