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Wealth of Ideas, August 2004
In a previous article (June 2004 issue), we wrote about
the problem of laches – usually linked with estoppel,
but not quite the same thing. Laches results from a
patentee’s failure to take action against an infringer
in a reasonable time period (see the full article for
more about laches). Estoppel, on the other hand, arises
when an action of a patentee causes an accused infringer
to believe that the patentee has abandoned any claim
against him or will not take action against him. It
may result when the patentee threatens to take action
– and then fails to follow up.
Estoppel is based on the reasonable reliance of the
accused on the patentee’s action. For example,
the infringer considers the case closed and makes further
investment in plant and equipment.
The most common estoppel scenario is that the patentee
writes to the infringer, describing the infringement
and requesting that the infringer either “cease
and desist” or take a license. The infringer then
either ignores the letter or sends back the usual response
that they aren’t infringing, and they will consider
the matter closed unless they hear back from the patentee.
If the patentee then fails to follow up, the infringer
– logically – considers the matter finished.
As a consequence of estoppel, the plaintiff may be
estopped, i.e. barred, from enforcing his patent against
this particular defendant. Patentees can prevent estoppel
simply by filing suit – so considering the stakes,
why wouldn’t they do so?
Some patent holders put off filing suit in the hopes
that damages will accumulate over time. But by waiting
and thus exposing themselves to a charge of estoppel
when they do file suit, these patent holders actually
jeopardize whatever damages they may be entitled to
and give the infringer an easy defense.
So if you bark (by informing the infringer of the infringement),
you have to bite promptly (by filing suit) – or
it will come back to bite you! Just make sure you have
a good attorney on your side.
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