Contingency fees in patent lawsuits


Paul Sutton

Individuals and small companies who own US patents encounter hurdles when faced with suing infringers, including the significant legal costs associated with representation.

The issue of how a patent litigator will charge for such services is normally a difficult consideration in retaining an attorney. Attorneys’ fees are generally charged on an hourly basis, a fixed fee basis, a contingency basis, or combinations thereof.

Patent litigation fees often reach millions of dollars, even in cases involving a single patent. Out-of-pocket costs, such as testifying expert fees, transcripts of proceedings, photocopying and legal research, may add up to tens or hundreds of thousands of dollars. Under these circumstances, the only viable avenue for a party without such financial resources may be to pursue high-quality representation under a contingency fee arrangement with willing counsel.

Unlike English law, under which a losing party in litigation is expected to pay the winning side’s legal expenses, the US legal system has evolved to avoid the ‘loser pays’ requirement and to permit contingency fees. A contingency fee is normally payable only upon successful completion of the services, where there is a recovery or another favourable result.

legal costs, patent infringement