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Message: Insurance issues - another consideration

Insurance issues - another consideration

posted on Mar 22, 2006 07:43AM
I just spent some time reviewing the burgeoning market of insurance as it relates to patents, and specifically the following:

Defensive policies:

Patent Litigation Defense Insurance (my personal favorite)

Patent Liability Insurance

Patent Infringer`s Insurance

Offensive policies:

Offensive Patent Insurance

Patent Pursuit Insurance

Patent Enforcement Insurance

Infringement Abatement Insurance

Since the mid `90`s this insurance has developed/matured and, in my opinion, is now a critical component of risk management for many companies, particularly those in the tech fields.

We all know that insurers prefer to settle than fight, if the cost/benefit ratio is to their favor. In other words, they don`t often much care about principle, or who is right and who is wrong in a lawsuit; they track expenses v. premiums and go from there.

I would conclude that many of the parties now `caught in our web` probably have this type of insurance coverage which will likely lead to prompter settlements. To some degree then, the argument that some of our infringers have deep pockets may not have as much bearing, since their insurer may be calling the shots. This could be good for us in the sense that swifter settlements may be likely and their may be a nice pool of insurance money to draw from. It could however, be bad in the sense that insurers may settle before we ever win BIG in court. Hard to say.

Then there is the issue of the ``offensive policies`` and whether PTSC or our colleagues, TPL and Alliacense, are employing such and perhaps garnering benefits therefrom.

Anyhow, you may want to spend some time surfing the net as there is a wealth of information available on this topic; and it could certainly play a factor in our ongoing pursuits.

Best, MW

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