For most executives at middle-market companies, pursuing intellectual property litigation might seem like a prospect to avoid at all costs. Litigation, they believe, is expensive, time-consuming, and unpredictable.

Those concerns can be particularly daunting for midsize enterprises, where in-house law departments are often small, and companies have fewer dollars to spend on legal matters, particularly affirmative claims.

But rejecting IP litigation out of hand may lead a company to squander strategic opportunities that will serve the bottom line, improve a business’s competitive position, and send a clear message to the marketplace that it is serious about protecting its intellectual property assets.

Reframing the Question

When facing a decision about litigation, executives might consider reframing the question from “can we sue?” to “what business problem are we solving?” This exercise can help the company focus on critical questions about their goals for the litigation.

Among the issues they might consider: Is the company looking to stop a fast-moving competitor? Is it protecting its pricing power? Does it hope to preserve a key customer relationship? Is the company looking to use a claim to create leverage for a license?

As these questions suggest, the best legal outcome is not always a headline-making verdict. While executives may envision IP litigation as a multi-year war aimed at scoring maximum damages, a company often will get just as much value from early, targeted injunctive relief or a settlement that guarantees future revenue.

Whatever the business motivation, getting help early is critical. A seasoned IP litigator can build a plan that fits the company’s budget and tolerance for risk. Counsel can also help executives break a case down into checkpoints that allow them, at regular intervals, to assess whether they should narrow their case, press for a settlement, or push the suit forward.

Strategic Considerations

In business terms, the litigator can identify issues that might spur a potential settlement or affect its value—such as whether to pursue an early injunction or temporary restraining order and the likelihood of summary judgment.

Forum selection and timing issues are also critical. With experienced counsel, the company can determine the right moment to file the case and best potential venue, factors that can affect speed, potential remedies, and an opponent’s ability to pursue parallel proceedings.

Different types of IP battles often have their own, specific quirks that can affect cost and timing. For instance, counsel will assess and plan for the possibility that a competitor may seek to invalidate a patent at the Patent Trial and Appeal Board (PTAB). This includes assessing the chances that a challenge will succeed and whether PTAB will take up the case.

Winning Scenarios

When business goals and litigation strategy are closely intertwined, companies can reap significant rewards—even without a headline-generating result. Consider the following two scenarios based on recent IP cases in the federal courts:

In one, a consumer-products company saw a steep increase in knockoffs of its wares listed on major online marketplaces. Chasing down sellers one by one would have been akin to a game of whack-a-mole, with the company throwing untold resources at hundreds of individual cases. Instead, counsel relied upon a litigation approach that allowed the company to include the online sellers in a single exhibit—also known as Schedule A—that was attached to the complaint. The Schedule A strategy allowed the company to pursue one case and to win early court orders that froze online sales and their proceeds.

In the other, a mid-market technology company discovered that a larger competitor had exploited a cooperative business relationship to steal its patented technology. While counsel maintained the stance that they would pursue the case to trial, the company’s actual goal was to win a settlement or force the competitor to license the patent or redesign its product. Outside counsel improved the company’s settlement leverage by offering early technical proof that the competitor was infringing on the patent and by pursuing early court rulings on claim construction. Counsel’s trial-ready posture also suggested the competitor was in for an expensive case that could damage its reputation.

In the end, a clear business objective can turn litigation into a tool that protects and enhances revenue, restores and improves leverage in settlement and licensing negotiations, and deters future misconduct. Further, working with seasoned IP litigators can ensure that the business objectives are served by a realistic litigation strategy, clear budget, and checkpoints that give the company flexibility to change course along the way.