Determining patent infringement risk exposure using litigation analysis

• US 8,620,800 B1
• Filed: 09/12/2011
• Issued: 12/31/2013
• Est. Priority Date: 09/10/2010
• Status: Active Grant

• Current Assignee: IVP Holdings III LLC
• Original Assignee: IVP Holdings III LLC
• Inventors: Gorder, Gregory D., Micaelian, Fadi, Huey, Matt, Schank, Richard, Prasad, Sanjay
• Primary Examiner(s): Havan, Thu Thao
• Application Number:
  US13/230,704
• Time in Patent Office: 841 Days
• Field of Search: 705 35- 40
• US Class Current: 705/38
• CPC Class Codes: G06Q 40/00 Finance; Insurance; Tax strategies; Processing of corporate or income taxes
• CPC Class Codes: G06Q 50/184 Intellectual property management

Abstract

Methods, systems, and techniques for estimating patent infringement risk for a company using a statistical model of revenue are provided. Examples also provide a Patent Infringement Risk Assessment Tool, which uses these techniques to enable users to dynamically modify certain parameters and obtain a feel for their affect upon patent infringement risk exposure. Other examples describe the applicability of some of the methods and techniques for describing models of overall behavior when only the behavior of a segment at either the low end or high end (a tail) is known.

Claims

1. A method in a computing system for determining patent infringement risk exposure for a company, comprising:

under control of the computing system,

electronically receiving an indication of a revenue of the company;

electronically determining and storing an estimate for settlement costs of a litigation based upon the received indication of the revenue of the company;

electronically determining and storing an estimate for judgment costs for the litigation based upon the received indication of the revenue of the company;

electronically determining and storing an estimate for litigation costs for the litigation based upon the received indication of the revenue of the company;

electronically combining the stored estimate for settlement costs, the stored estimate for judgment costs, and the stored estimate for litigation costs into a payoff value for the litigation, wherein the electronically combining the stored estimate for settlement costs, the stored estimate for judgment costs, and the stored estimate for litigation costs into a payoff value for the litigation further comprises combining the stored estimate for settlement costs (S1), the stored estimate for judgment costs (J1), and the stored estimate for litigation costs (LC) into a payoff value as a function of the revenue of the company; and

forwarding the payoff value as the risk exposure for the company.

2. The method of claim 1 wherein the computing system is a server computing system.

3. The method of claim 1 wherein the forwarding the payoff value further comprises:

forwarding the payoff value to a computer based tool for presenting risk exposure from patent infringement litigation.

4. The method of claim 3 wherein the computer based tool is an electronically displayed risk meter.

5. The method of claim 1 wherein the electronically combining the stored estimate for settlement costs, the stored estimate for judgment costs, and the stored estimate for litigation costs into a payoff value for the litigation further comprises:

combining the stored estimate for settlement costs (S1), the stored estimate for judgment costs (J1), and the stored estimate for litigation costs (LC) into a payoff value using an equation of;

payoff=0.8S1+0.1J1+0.35LC.

6. The method of claim 1 wherein the electronically combining the stored estimate for settlement costs, the stored estimate for judgment costs, and the stored estimate for litigation costs into a payoff value for the litigation further comprises:

combining the stored estimate for settlement costs (S1), the stored estimate for judgment costs (J1), and the stored estimate for litigation costs (LC) into a payoff value using an equation of;

payoff=k1*S1+k2*J1+k3*LC, wherein the k1, k2, and k3 are constant values.

7. The method of claim 6 wherein the k1, k2, and k3 constant values are determined from data examined relative to a litigation tree.

8. The method of claim 1 wherein the electronically determined estimate for settlement costs (S1), estimate for judgment costs (J1), and estimate for litigation costs (LC) are expressed using revenue values.

9. The method of claim 8 wherein the revenue values for the settlement costs (S1) are calculated as 0.185 Revenue^0.545.

10. The method of claim 8 wherein the revenue values for the settlement costs (S1) are calculated as k4*Revenue^k5, wherein k4 and k5 are constant values determined from a best fit of industry settlement cost data as a function of revenue.

11. The method of claim 10 wherein the k4*Revenue^k5 formula is based upon grouping the industry settlement cost data into multiple buckets of different sizes of revenue.

12. The method of claim 11 wherein the groupings into multiple buckets increases the R² correlation between settlement cost and revenue.

13. The method of claim 11 wherein the groupings comprised four groupings.

14. The method of claim 8 wherein the revenue values for the judgment costs (J1) are calculated as 01.0232 Revenue^0.5.

15. The method of claim 8 wherein the revenue values for the judgment costs (J1) are calculated as k6*Revenue^k7, wherein k6 and k7 are constant values determined from a best fit of industry judgment cost data as a function of revenue.

16. The method of claim 15 wherein the k6*Revenue^k7 formula is based upon grouping the industry judgment cost data into multiple buckets of different sizes of revenue.

17. The method of claim 16 wherein the groupings into multiple buckets increases the R² correlation between judgment cost and revenue.

18. The method of claim 16 wherein the groupings comprised four groupings.

19. The method of claim 8 wherein the revenue values for the litigation costs are calculated as 0.1678 Revenue^0.388.

20. The method of claim 8 wherein the revenue values for the litigation costs (LC) are calculated as k8*Revenue^k9, wherein k8 and k9 are constant values determined from a best fit of industry litigation cost data as a function of revenue.

21. The method of claim 1, further comprising:

electronically receiving an indication of a number of litigations per year for the company;

determining a risk multiplier by determining a value for a function of the received indication of the number of litigations per year; and

multiplying the payoff value by the risk multiplier to obtain a measurement of annual risk exposure for the company from patent infringement litigation.

22. The method of claim 21, further comprising:

electronically determining one or more factors that can increase or decrease risk from patent infringement litigation for the company; and

adjusting the annual risk exposure for the company by the determined one or more factors.

23. The method of claim 22 wherein the determined one or more factors include a company growth rate (G) and/or annual revenue (R).

24. The method of claim 22 wherein the determined one or more factors include one or more of a number of patents held by the company (P), a number of patents licensed to the company (P_L), and/or a number of patent applications held by the company (P_A).

25. The method of claim 22 wherein the determined one or more factors include a measure of distribution across subject matter categories of patents associated with the company C.

26. The method of claim 22 wherein each of the determined one or more factors are normalized before adjusting the annual risk exposure.

27. The method of claim 22, further comprising:

combining the determined one or more factors into an adjustment according to the equation;

R*G*L*C*1/(P+P_L/c1+P_A/c2), where each of the terms is a normalized value, wherein c1 and c2 are constant values; and

adjusting the annual risk exposure for the company by multiplying the annual risk exposure by the adjustment.

28. The method of claim 27 wherein c1=2 and c2=3.

29. An electronic risk exposure measurement tool for determining patent infringement risk exposure for a company, comprising:

an input module for receiving an indication of a revenue of the company;

litigation exposure logic, stored in a computer memory, and that is configured, when executed on a computer processor to;

determine and store an estimate for settlement costs of a litigation based upon the received indication of the revenue of the company;

determine and store an estimate for judgment costs for the litigation based upon the received indication of the revenue of the company;

determine and store an estimate for litigation costs for the litigation based upon the received indication of the revenue of the company;

combine the stored estimate for settlement costs, the stored estimate for judgment costs, and the stored estimate for litigation costs into an estimated exposure for the litigation, wherein the litigation exposure logic is configured to combine the stored estimate for settlement costs (S1), the stored estimate for judgment costs (J1), and the stored estimate for litigation costs (LC) into an estimated exposure as a function of the revenue of the company; and

communication logic, communicably coupled to the litigation exposure logic, that is configured when executed to receive the estimated exposure for the litigation and forward the estimated exposure value for the company.

30. The tool of claim 29 wherein the tool is executed on a server computing system.

31. The tool of claim 29 wherein the communication logic forwards the estimated exposure value to a client side application for presentation.

32. The tool of claim 29 wherein the tool provides an electronically displayed risk meter.

33. The tool of claim 29 wherein the litigation exposure logic is further configured to:

combine the stored estimate for settlement costs (S1), the stored estimate for judgment costs (J1), and the stored estimate for litigation costs (LC) into an estimated exposure using an equation of;

exposure=0.8S1+0.1J1+0.35LC.

34. The tool of claim 29 wherein the litigation exposure logic is further configured to:

combine the stored estimate for settlement costs (S1), the stored estimate for judgment costs (J1), and the stored estimate for litigation costs (LC) into an estimated exposure using an equation of;

exposure=k1*S1+k2*J1+k3*LC, wherein the k1, k2, and k3 are constant values.

35. The tool of claim 29 wherein the k1, k2, and k3 constant values are determined from a litigation tree.

36. The tool of claim 29 wherein the litigation exposure logic is further configured to:

receive the electronically determined estimate for settlement costs (S1), estimate for judgment costs (J1), and estimate for litigation costs (LC) as revenue values.

37. The tool of claim 36 wherein the revenue values for the settlement costs (S1) are calculated as 0.185 Revenue^0.545.

38. The tool of claim 36 wherein the revenue values for the settlement costs (S1) are calculated as k4*Revenue^k5, wherein k4 and k5 are constant values determined from a best fit of industry settlement cost data as a function of revenue.

39. The tool of claim 38 wherein the k4*Revenue^k5 formula is based upon grouping the industry settlement cost data into multiple buckets of different sizes of revenue.

40. The tool of claim 39 wherein the groupings into multiple buckets increase the R² correlation between settlement cost and revenue.

41. The tool of claim 39 wherein the groupings comprised four groupings.

42. The tool of claim 36 wherein the revenue values for the judgment costs (J1) are calculated as 01.0232 Revenue^0.5.

43. The tool of claim 36 wherein the revenue values for the judgment costs (J1) are calculated as k6*Revenue^k7, wherein k6 and k7 are constant values determined from a best fit of industry judgment cost data as a function of revenue.

44. The tool of claim 43 wherein the k6*Revenue^k7 formula is based upon grouping the industry judgment cost data into multiple buckets of different sizes of revenue.

45. The tool of claim 44 wherein the groupings into multiple buckets increases the R² correlation between judgment cost and revenue.

46. The tool of claim 44 wherein the groupings comprised four groupings.

47. The tool of claim 36 wherein the revenue values for the litigation costs are calculated as 0.1678 Revenue^0.388.

48. The tool of claim 29 wherein the litigation exposure logic is further configured to:

receive an indication of a number of litigations per year for the company;

determine a risk multiplier by determining a value for a function of the received indication of the number of litigations per year; and

multiply the estimated exposure by the risk multiplier to obtain a measurement of annual risk exposure for the company from patent infringement litigation.

49. The tool of claim 48, wherein the litigation exposure logic is further configured to:

determine one or more factors that can increase or decrease risk from patent infringement litigation for the company; and

adjust the annual risk exposure for the company by the determined one or more factors.

50. The tool of claim 48 wherein the determined one or more factors include a company growth rate (G) and/or annual revenue (R).

51. The tool of claim 48 wherein the determined one or more factors include one or more of a number of patents held by the company (P), a number of patents licensed to the company (P_L), and/or a number of patent applications held by the company (P_A).

52. The tool of claim 48 wherein the determined one or more factors include a measure of distribution across subject matter categories of patents associated with the company C.

53. The tool of claim 48 wherein each of the determined one or more factors are normalized before adjusting the annual risk exposure.

54. The tool of claim 48 wherein the litigation exposure logic is further configured to:

combine the determined one or more factors into an adjustment according to the equation;

R*G*L*C*1/(P+P_L/c1+P_A/c2), where each of the terms is a normalized value between 0 and 1, and wherein c1 and c2 are constant values; and

adjust the annual risk exposure for the company by multiplying the annual risk exposure by the adjustment.

55. The tool of claim 54 wherein c1=2 and c2=3.