What is Patent Infringement?
Patent insurance is a form of intellectual property insurance. Patent insurance is meant to protect the patent holder in the even that a third party infringes up on the r patent, or intellectual property, and causes the patent holder a financial loss.
There are two types of patent infringement insurance:
- A defensive policy will assist an insured if they have been sued for infringing upon someone else’s patent or intellectual property.
- Patent litigation insurance, also known as patent abatement insurance, covers legal costs associated with defending a holder of a patent or someone’s intellectual property if they have to sue someone else for patent infringement.
What is the cost for Patent Insurance?
On average, patent infringement lawsuits cost around $2.8 million if the disputed idea is worth anywhere from $1 million to $25 million. Damages are usually around $9 million. Premiums for patent infringement insurance can range from $10,000 to over $50,000 annually and are based on a number of factors.
Patent Infringement Loss Scenario
A small company based in Texas won its patent infringement lawsuit against Nintendo of America. The jury awarded iLife Technologies $10 million in damages when it decided that Nintendo’s Wii controllers infringe on iLife’s six patents on motion-sensing technology.
The suit stated that Nintendo’s Wii and Wii U controllers use accelerometers to track how a player is moving their hands relative to their environment, which is a system iLife says it invented and patented for use in medical monitors that would automatically call an ambulance if an elderly person fell or if a baby was at risk of dying from sudden infant death syndrome.
