Violation of a Patent
Patent violation describes the act of a person or a company who uses, sells or manufactures a product based on someone else's patented idea without a prior licensing agreement with the patent owner, states the U.S. Patent and Trademark Office, or USPTO.
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Power
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A patent represents a legal document granted by the USPTO that protects the inventor's intellectual property for a period of 14 to 20 years. It gives the patent owner legal power to keep at bay others who want to benefit from a novel concept without compensating the inventor.
Consequences
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Whether the mistake resulted from an accidental oversight or a purposefully planned act, the party that perpetrated the violation faces risks of a lawsuit. Typically, courts request that the guilty party pay back licensing revenues from past sales in addition to honoring punitive fees, according to the Cornell University Law School.
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Strategy
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Patent insurances create a safety net for companies who want to mitigate the financial risk of stepping on someone's intellectual property. Manufacturers, who want to avoid legal battles, also run their own due diligence by searching the database of the USPTO to ensure that they do not sell products protected by patents for which they do not have licensing rights.
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