Your startup has finally taken off and your products are selling like hot buttered popcorn. You’ve hired the best people out there and revenue is pouring in. You’re about to pay off that loan you got from the back when a message pops up saying: “Hi, Your Company just got sued!”.
After browsing the internet for a couple of minutes, you find a post on a blog that describes the lawsuit and offers a link to the federal court complaint. You need a moment to catch your breath. You’re flabbergasted that somebody accuses you of stealing their technology or intellectual property given the fact that you haven’t stolen anything in your life. Yet, some people claim you have. The plaintiff is asking a judge to prevent you from releasing your product and asks for millions of dollars in damages. People call you a thief; the media is ripping the flesh from your bones. So what do you do? You, my friend, need a game plan.
1. First of all, make sure you call the right person. Don’t waste your time emailing or calling the plaintiff’s lawyer trying to explain why that person is wrong. The lawyer doesn’t really care about your explanations; he or she only cares about winning the lawsuit. Moreover, this can later be twisted into evidence against you. The very first thing you should do is speak with your lawyer.
2. Make sure that you have the best legal team on the job when dealing with this situation. For example, consider hiring a litigator regardless of how good your regular lawyer is. You cannot really afford to have any mishaps, so make sure that you don’t rely only on a lawyer that isn’t really in his or her comfort zone. You need a lawyer who is specialized in litigating intellectual property and commercial cases. He or she should know examples of similar cases which he or she has handled in the past. That person should also offer a strategy and a solid-proof road map for defending your case.
3. Before you actually go to court, knowing your enemy should be your top priority. This will help you develop and execute a strategy that can ensure victory. For example, if you are taken to court over patent infringement, chances are one of your competitors or a non-practicing entity is responsible for the whole mess.
Lawsuits filed by non-practicing entities usually seek money damages and future royalty payments. But who are the non-practicing entities? Some may be research institutes and universities while others are only shell companies better known as “patent trolls.”
However, in some cases suits are filed by well-financed adversaries that are not only doing this for the money, but they also want to prevent you from launching your product in the market. They can also create concern among your business partners and customers given the fact that the litigation can damage your company’s ability to pay the bills or the employees.
4. The legal team should be provided with all the necessary information. The lawyer will help you gather the documents he or she needs to win the lawsuit. The information you need to provide encompass emails, notes, contracts, documentation on the development of any of your products or technologies. The process may also include talking with involved employees. By doing this the lawyer is able to prepare the strongest defense of your business and take you one step closer to winning the lawsuit.
5. Last but not least, consider pursuing strong countermeasures. If you are taken to court by a competitor, ask your attorney whether you might have strong counterclaims to bring. For example, if your company has several patents covering technology that is being used by the competitor, you could assert those patent rights as counterclaims to the competitor’s suit.