Thousands of companies, ranging from startups to Fortune 100 companies, have been sued for allegedly infringing patents that they didn’t even know existed. Since 2010, over 20,000 companies have found themselves unexpectedly facing enormous legal fees to defend against these types of cases, sometimes also paying outsized settlements to patent plaintiffs. These companies have learned the hard way that patent litigation has become a common business risk, on par with D&O liability and cyber risk. Patent litigation is hard to predict and can be devastating when it occurs. But like other common business risks, claims of patent infringement can be insured.
Insurers have tried to cover patent insurance in the past, but it has been a difficult risk to predict and to price; the nature of litigation means that legal costs and settlements usually remain secret. RPX has surmounted this particular obstacle through our work with the hundreds of companies in our defensive network. We have access to the actual costs of patent risk—something that no other insurer has. That data has allowed us to build an actuarial model that enables us to accurately assess the frequency and cost of the patent cases with which a company is likely to be threatened.
Particularly for companies that see only occasional patent assertion threats, a cost-effective approach to managing that risk is RPX Insurance. Premiums are affordable—as little as a few thousand dollars a year for most Series A companies. And RPX Insurance works. Companies that are insured through RPX often save as much as 60% on their overall litigation costs, and they spend half as much time in litigation as those that don’t have coverage.
RPX has saved its clients more than $3.5 billion to date in avoided legal and settlement costs through liability insurance, defensive patent acquisition, market intelligence, and strategic advisory services. To start protecting your company against patent risk, click here.