What are the pitfalls to avoid in IP protection?

Dai Yoshida / November, 2018


Dai Yoshida is the Founder and Attorney of BlackBelt Legal. After corporate gigs at GE, Blackrock, Sony and a big law firm, Dai Yoshida started his own legal practice. In this video, Dai explains the costly process of litigation and why it’s important to protect your IP early on.

Video transcript:

What are the pitfalls to avoid when it comes to IP protection?

IP is a valuable asset when it gains some value. It might happen at the inception. In many cases, the value doesn’t kick in until down the road. So, it is always the case that at the beginning nobody thinks that spending some time, money and resources on the protection or even in getting the patent or properly registering it until somebody says that a piece of your assets is mine.

When that litigation kicks in it’s very costly for the companies to show that everything that went into the invention is their own. Unfortunately, there are a lot of people who will claim that the patent is infringed by your own asset.

It is likely that litigation or the problem solving down the road is very costly especially when the company is doing well. You have to balance the fact that, yes it does cost some money, time and resources up front for future protection, which could pay off later. It’s a kind of insurance premium.

The cost of litigation it’s one of the hardest things to estimate. Out of all these allegations and lawsuits, most cases settle. When it settles usually the settlement amount are forever sealed as part of the nondisclosure agreement. However, when the lawsuit goes all the way to trial, the two phases that cost the most are discovery where both parties have to go into their hard drives and peoples notes and memos to identify and provide any relevant information to the other party.

Also, the actual trial cost a lot because it involves a lot of people. It is usually the case that both parties try to work out a settlement before the discovery or before the trial. These two things are very costly and also unpredictable.

IP value goes up when it gains a value. That’s when it attracts people. A lot of companies who are successful enough let’s say, to achieve a series A finance. That is when they are likely for them to receive a letter or two of the demand or a decease letter alleging that the IP has been infringed upon by your use or by your service. It is a very good indicator of how successful your business is because nobody will come after you if you are not successful or if you don’t have money. But that is when you should be fully allotted because if you get one case it’s likely that other cases will follow.



Next Up

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