Tuesday, September 23, 2014

INTELLECTUAL PROPERTY ABATEMENT (ENFORCEMENT) INSURANCE



The Abatement policy reimburses litigation expenses to enforce intellectual property rights against infringers as well as countersuits or post-grant reviews for invalidity. In the event the insured loses the IP lawsuit the Abatement policy responds as a pure insurance policy. In the event the insured wins the IP lawsuit and has recognized an “Economic Benefit” the insured reimburses only the money paid out by the insurer and retains any additional recoveries. Repayment of the “Economic Benefit” reinstates policy limits and those funds are then available to pursue other infringers. IP covered under the Abatement Policy includes patents, trademarks, copyright and trade dress.

Advantages of holding the abatement policy:
·        Prevents loss of market share by timely and forceful response to infringement
·        Prevents unexpected cash drain on operations
·        Provides litigation funds to optimize a favorable decision for the IP holder
·        Reduces pressures to settle because of mounting legal expenses
·        Attracts investors who may be asked to fund the business
·        Strengthens the "licensbility" of the IP

Premiums:
·        The premium will be about 1 to 2% of the limit purchased. For example, the premium for a $1,000,000 coverage limit at 1% would be $10,000 per year
·        The actual cost will vary according to the type and number of IP covered

This material is for informational and promotional purposes only, and in no way changes the terms or effect of the policy language. Consult a copy of the Specimen Policy itself for all terms, conditions and exclusions. For additional information please contact:   

                                  Alex Fjelstad
                                                            Senior Vice President
                                                            Twin City Group
                                                            4500 Park Glen Road
                                                            Minneapolis, MN 55416
                                                            952-924-6910 or afjelstad@twincitygroup.com

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