Patent litigation is conducted in this country in the federal courts:

Cases are tried in the various district courts across the nation, and appeals rest with the Court of Appeals for the Federal Circuit, which has had exclusive appellate jurisdiction since 1982. Patent litigation can also be conducted in the International Trade Commission (or "ITC") pursuant to 19 U.S.C. Sec. 1337 where a domestic industry is deemed "efficient" and is shown to be adversely affected by the importation of goods that infringe a U.S. patent.

While there are about 18,000 patent attorneys registered before the United States Patent & Trademark Office, only about 100 - 150 or so, it has been our experience, are significantly experienced in patent litigation, whether representing the assignees of patents, or accused infringers. The "trial patent bar", as it has come to be known, is a specialty generally practiced out of the large intellectual property firms of America's large cities, and to a lesser extent (but growing) out of intellectual property departments of large general firms. It is the opinion of Falk & Fish l.l.p. that, as a general rule, the best patent trial lawyers have significant experience in prosecution, because much of the law concerning interpretation of claims is dependent on the interpretation of the file history of the patent in litigation and how the claims are to be interpreted in light of the prior art and statements against interest (so-called "file history estoppel") made by the applicant in the Patent & Trademark Office in his/her attempt to obtain patent coverage. There are exceptions to this rule, and a number of the nation's best patent trial lawyers have little prosecution experience personally.

Patent litigation as now practiced in this country is divided into three areas--chemical/biochemical/pharmaceutical, mechanical, and software/electronics/electrical engineering. Much of the "law" of patent law developed by the Court of Appeals for the Federal Circuit, the eleven numbered Circuits and the D.C. Circuit Courts of Appeal before the Federal Circuit, and the United States Supreme Court took place in the chemical area. With the increasing dependence of American industry on software and microprocessing, it is clear that the development of the law will shift to the software/electronics/electrical engineering end of the spectrum.

In a nutshell, patent litigation can be fairly said to be one of the most complex areas of the law. Cases that reach trial often take $1,000,000 -$5,000,000 per patent, and litigation can take, depending on the forum, from two years to four years to reach trial. Fees and expenses are a function of the "fight" in each of the adversaries, the complexities of the issues, the complexities of the subject matter, the number of non-privileged documents which can be discovered, the number of purportedly privileged documents the parties want to fight over, the make-up of the district court judge and the number and depth of briefing that Court desires, the number of witnesses, the docket of the court, and the administration of the local rules of the Court.

In each patent case we find the same issues litigated -- (1) whether the claims or some of them are "anticipated" by the "prior art", (2) if not anticipated, whether the claims would have been "obvious" to "one of ordinary skill in the art" "at the time the invention was made",(3) whether the alleged infringer's accused device, method, composition or compound "literally infringers", or (4) if not so "literally infringing", falls within the "doctrine of equivalents", (5) if there is infringement, whether or not the patent "marking"/"notice" statute was complied with, and if so (6) the level of damages; (7) whether the patentee or those in privity with him/her committed "inequitable conduct" in the Patent & Trademark Office during the prosecution of the patent; and (8) if infringement occurred, whether or not it was "intentional".

Patent cases are traditionally tried with the witnesses being the inventor/patent applicant, the team of scientists/researchers who developed the purportedly infringing device/method/composition/compound, scientific experts testifying as to testing of the accused device/method/composition/compound for infringement, or testifying as to the prior art and its interpretation at the time the invention was made, occasionally legal experts on Patent & Trademark Office practice and the interpretation of file histories, marketing personnel as to damages, key executives as to issues such as intentional infringement, the patent attorney(s) who prosecuted the patent in suit before the PTO, affiants who testified by affidavit before the PTO during the prosecution of the patent, and occasionally experts as to the effect of the invention in the trade. Patent litigation therefore is, largely, a "battle of the experts". Recently, with the decision of the Court of Appeals for the Federal Circuit in Markman v. Westview Instruments, Inc., 52 F.3d 967 , 34 USPQ 1321 (Fed. Cir. l995), so-called "Markman trials" occurring sometime before the close of discovery determine the interpretation and scope of claims. With this decision, the power of the jury in patent cases has largely diminished, as the Court in the pre-jury "Markman trial" hears the experts argue over interpretation of the prior art, file wrapper estoppel, and even infringement arguments. If the defendant alleged infringer "wins" the Markman hearing and the alleged infringer's view of the claims is upheld, the Markman decision is almost inevitably followed by a Motion for Summary Judgment on the issue of Non-Infringement. If the Markman hearing is "won" by the patentee, it is inevitably followed by serious settlement negotiations or by a Motion for a Preliminary Injunction.

The most expensive period in patent litigation generally occurs during discovery--each of a party's employee witnesses, as well as each party's experts are extensively deposed after a period involving a production of documents. Much of the country's law concerning the so-called "attorney-client" privilege has been developed during patent litigation, as the number of attorney-client documents developed during patent prosecution and the development of the alleged infringer's device/method/composition/compound are targets of opposing counsel for discovery. The construction of lengthy privilege lists and their exchange during discovery, so-called "privilege fights" by adversaries to pierce the prima facie privilege on account of subject matter waiver by selected production, or production to third parties, or the fraud/crime/intentional tort exception to the privilege, or any number of other grounds has become customary in patent litigation. At the end of many pieces of patent litigation, the history is much like a chess game, with one brilliant move by one party or an error by its adversary causing the fortunes of the litigation to shift one way or the other.

In that regard, it has been our experience that only the most sturdy of potential litigants should enter the arena. Unlike patent litigation in many foreign nations, the primary factor of who wins and who loses it has been our experience is largely governed by the following factors, in descending order:

(1) the "character" or guttiness of the respective parties, (2) the ability of each of the parties to handle large invoices month after month and avoid artificial constraints in the administration of the litigation, (3) the quality of counsel, (4) the favorability or lack of favorability of the facts, and last, (5) the law itself. The federal courts, on a case-by-case and judge-by-judge basis, can materially decrease or increase the cost and complexity of litigation. Because of the heavy investment of the federal courts in their time in patent cases relative to other cases, many judges have frequent status conferences and hearings, and often force the parties into mediation.

In recent years, more and more controversies in the patent area are decided by arbitration, which in general costs much less and takes less time than litigation in the courts. Unless one party or the other has an exceptional intentional infringement or inequitable conduct argument, it is our position that it is in both litigating parties' interest to give serious consideration to arbitration.