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Case Studies - Litigation Risk Management & Settlement Valuation Overview Some of our cases have included:
License or Exclude IP Strategy Choice The client was a GC for a Small Pharma firm, although it could have been any technology-based company. His Problem was that he was facing a decision as to whether to protect their market position by litigating, which unfortunately could result in his firm essentially going out of business. The Business issue was How to balance upside of prevailing and keeping the competitor out of market with the possibility of loosing everything. If they sued the competitor, the competitor would have almost certainly counter-sued. However, if the competitor counter sued and was not found to infringe my client's patent and the client was found to infringe theirs, the client's company would not likely survive. He said he needed a way to objectively assess the dollar impact of every outcome of his decision. And he needed it to be documented in clearly so he could present it to the board and the senior executives. They would then make an informed decision on which way to go. We gave him that capability. Litigation Risk Management/Settlement Valuation helped the general counsel to show senior management the particular threatening scenarios and the small likelihood that could lead to the disastrous outcome. He could also make them understand that the events leading up to this outcome could be monitored and that effective contingency plans existed. Furthermore, the contingency plans would further reduce the probability of the disastrous outcome and raise the value of "Sue/Be Sued." With this information, and knowing that their own judgments had been used for the business impact analysis, the CEO and the Board felt comfortable, in fact confident, about proceeding with the litigation. return to top Controlling Litigation Costs A Fortune 500 company facing dozens of multimillion dollar suits each year decided after our analysis to spend less time and money on preparing its "motion to dismiss" in each case. The company saved $3 million in one year alone. return to top Product Defects A manufacturer had one of its engineers research specifications not covered by regulatory laws. He found certain flaws. A federal agency suddenly changed its regulations and the manufacturer was sued for previously sold products. After a judge ruled that the manufacturer should have informed the buyer about the engineer's report in one suit, 15 more suits were filed. We helped the manufacturer calculate risks and figure out in what order to settle the suits and for what amount. return to top Insurance Policy Buyout A major insurance company covers medical devices manufactured by company X. It soon becomes clear that half the devices fail in an off-label use promoted by company X. We analyzed the survivability of company X and whether it was worthwhile -- and at what price -- to buy out the policy before an avalanche of suits against the insured. return to top Starting An IP Litigation Armageddon A high-tech company sees its once dominant position dissipate and its industry dominated by an aggressive competitor. That company infringes on several of my client's patents. Should my client sue, it is obvious that its competitor would counter-sue. In addition, there is a risk of business disruption because my client buys other products from this company. Not withstanding the company's and its attorneys' intuitions and intense feelings, they could not decide whether to sue. The company then hires me. My analysis lays out clearly and unambiguously the issues involved in launching what would be a legal Armageddon. There would be about a one in five chance of getting the brass ring, being vindicated, and getting about a billion dollars in licensing revenues. However, there is also a one in five chance of losing and facing serious business interruptions at worst, or significant cost increases on the order of hundreds of millions of dollars at best. The most likely outcome is that there would be some wins and some losses, and that ultimately there would be a settlement at pennies on the dollar. In the meantime, there would have been significant litigation and business costs. Before my analysis, the company had waffled several times on making a decision. After my thorough analysis, the company decides not to file. return to top National Class Action Settlement A client has a very short time to decide whether or not to commit $50 million to a nationwide class action settlement. The company has a good legal position as a raw material supplier with few close links to the finished product at the center of the litigation. An intense one-day work session with lawyers and management convinces everyone involved that there are almost no circumstances in which joining the settlement does not make sense. This is not obvious before the analysis. The client not only has a decision, but a rational basis for the decision that executives could communicate to the board. return to top Patent Litigation-David v Goliath A manufacturer of networking equipment is sued by a small company, which while in a tiny related business, had as its primary assets several patents. Counsel is of the opinion that the client's products do not infringe, but going to trial is risky. The small company has signed licensing agreements with several major players in the industry at reasonable royalty rates, and so is willing to take a chance on hitting the jackpot at a trial. The small company is off the wall in its settlement demands. The client calls us in to analyze whether going to trial makes business sense. We show them that while there is some chance that they could lose over a billion dollars, the expected outcome is well below the plaintiff's demand. On the other hand, settling the case would leave the client vulnerable to other IP suits. We went to trial and won on all claims. return to top Valuing Potential Litigation Risks For a New Business Coming Soon... All cases have been altered only to protect the identity of the actual client. Any resemblance to actual cases in the particular industry mentioned is coincidental. |
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