Practice Areas & Industries: Sutherland Asbill & Brennan LLP


Non-Practicing Entity (NPE) Defense Return to Practice Areas & Industries

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Practice/Industry Group Overview

Sutherland undercuts non-practicing entities’ leverage with swift, cost-conscious and strategically sound responses to allegations of infringement.

Sutherland works aggressively to avoid or mitigate the damage caused by non-practicing entities (NPEs). These patent holding companies and IP assertion entities—known colloquially as patent trolls—exist to game the patent process with an underlying threat of expensive litigation if their demands go unmet. Our team understands the demands NPEs make, as well as the pros and cons associated with the different strategies available to address them—from settlement based on a one-time license fee to decisive litigation. We collaborate with our clients to ensure that the legal solution fits with their long-term commercial interests and objectives.

Many of our IP attorneys have technical degrees and worked as researchers and engineers before becoming lawyers. This background enables them to assess the validity of the claims made by NPEs and to find both technical and legal flaws in the claims. Moreover, our technical experience helps our lawyers explain cutting-edge technologies to judges, juries, arbitrators or mediators, who sometimes lack the technical knowledge to understand the intricacies that can dictate the outcome of a case.

The NPE business model presumes that their targets desire to settle because of the potentially high cost associated with resisting their claims. Our approach to staffing NPE cases seeks to minimize costs to give our clients greater options for resolution. Staff and contract attorneys support our matters when appropriate, and we utilize legal project management (LPM) tools to increase efficiencies and minimize fees.

Why Sutherland
Our attorneys focus on the commercial needs of our clients when developing NPE defense strategies. We can negotiate or litigate as the situation warrants, but the needs and desires of the client always drive the course of action.

Technical understanding. Many of our attorneys have advance technical degrees and have worked in our clients' industries as researchers and engineers. This gives them powerful insight into the technical aspects of claims brought by NPEs. Moreover, in litigation, we can explain detailed technological facts precisely, accurately and accessibly to judges, juries, arbitrators and mediators.

NPE insight. We have encountered certain NPEs and their attorneys more than once because their business model involves targeting numerous similarly situated businesses in order to make a profit. We can anticipate what to expect from them in future claims, and we use this knowledge to increase our clients' leverage in the matter.

Legal project management tools. We enhance our clients’ leverage against NPE claims by using legal project management (LPM) tools to increase efficiencies and hold down costs. Because many NPEs rely on the fear of expensive litigation to force target firms to settle, our efficient processes help balance the equation to our clients' benefit.

Flexible staffing. As a further measure to contain the costs of NPE defense, Sutherland is flexible in its staffing of cases. When appropriate, we enlist contract attorneys to handle some aspects of the case. Other times, we will assign a competent associate with a lower billing rate than a partner to do as much of the work as is strategically sound. We always keep our clients’ preferences and budgetary constraints in mind when making staffing decisions.

Nuts and Bolts
Strategies Sutherland employs in NPE defense cases include:

  • Seeking indemnification
  • Conducting an immediate search for prior art
  • Exploring possible change in venue
  • Leveraging the joint defense opportunities with other parties
  • Exploring a settlement that bears a reasonable relationship to defense costs

Clients include firms engaged in:

  • Electronic financial transactions
  • Radio broadcasting
  • Generation, transmission and distribution of utilities
  • Check processing
  • Electronics manufacturing
  • Semiconductor design
  • University research
  • Cable television
  • Medical devices

Take Action
Companies can avoid the expense, time and aggravation of drawn-out NPE challenges to their business activity by relying on Sutherland’s experienced and efficient team of IP lawyers.

Selected Experience
Sutherland successfully defends IT firm against a non-practicing entity.
Sutherland presented invalidating prior art and pleaded in indemnitors as third party defendants, resulting in the voluntary dismissal with prejudice of a patent infringement suit. The non-practicing entity sought damages for alleged infringement of a portfolio of patents purported to cover networked use of optical scanners to convert paper documents to electronic files. Sutherland continues to advise dozens of targets of this patent assertion entity.

Sutherland settles case for radio station operator against non-practicing entity.
Sutherland defended a large U.S. operator of radio stations in a suit brought by a non-practicing entity asserting an Internet radio advertising patent. The case settled after limited document discovery.

Sutherland defends beverage company in Facebook promotion case brought by nonpracticing entity.
Sutherland defended a beverage company from claims by a nonpracticing entity that a Facebook promotion contest infringed their patent.  We represented the advertising agency which had provided indemnification.