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Intellectual Property Infringement Insurance
About IP Insurance About IP Insurance Defense Reimbursement Defense Reimbursement Infringement Enforcement Infringement Enforcement Request a Quotation Request a Quotation

Infringement Enforcement (Abatement)

Intellectual Property Insurance Services Corporation's Enforcement Insurance (Abatement) coverage is available for intellectual property (patents, trademarks and/or copyrights). The policies cover litigation expenses incurred in enforcing the intellectual property against infringers up to the policy limit.

Infringement Abatement Insurance:

  1. Covers litigation expenses incurred in enforcing the intellectual property against infringers up to the policy limit.
  2. Reimburses you for your legal expenses when you have to enforce your patents, trademarks, or copyrights (intellectual property) against infringers.
  3. Pays your legal costs when your intellectual property is challenged by a countersuit for invalidity.
  4. Covers US and foreign patents, copyrights, and trademarks, as well as patent or trademark applications including provisional patent applications. Why do I need Infringement Abatement Insurance?

Annual infringement policy premiums start as low as $1,300.

Obtain a Free, No Obligation quote Online: CLICK "Request Quotation" above.

Why do I need Infringement Abatement Insurance?

Your intellectual property is a valuable asset. Every act of infringement lowers its value and indeed unabated infringement can render it totally worthless! Infringement Abatement Insurance:

• Prevents loss of market share by timely and forceful response to infringement.
• Prevents unexpected cash drain on operations.
• Provides adequate litigation funds to optimize a favorable decision for the intellectual property holder.
• "Insured patents, trademarks and/or copyrights" are more attractive to investors who may be asked to fund a business.
• Insurance strengthens the "licensability" of your intellectual property.
• In most cases, the policy reimburses you for 80% of your legal costs until the per claim limit of your policy has been reached.
• The Insured controls the conduct of the litigation.
• The Insured may invoke the policy by

  1. notifying the Company of the discovery of INFRINGEMENT and other relevant facts by completing a claim form provided by the Company; and
  2. providing the Company with a favorable opinion letter from an intellectual property counsel regarding the issues of enforceability, validity and INFRINGEMENT.

Upon compliance with the policy terms, the Company will then authorize the suit and the policy will begin to reimburse the Insured for his LITIGATION EXPENSES.


Answers to Frequently Asked Questions

Q.

Are invalidity counterclaims covered by the policy with no additional increase in premium?
A.

Yes, to the extent they arise out of AUTHORIZED LITIGATION. Bear in mind that the policy covers enforcement and invalidity counterclaims only, and covers no claims of antitrust.

Q.

Can coverage be obtained if there is a known Alleged Wrongdoer(s) at the time insurance is sought?
A.

Yes. However, that particular Alleged Wrongdoer(s) will be excluded from coverage under the policy at least to the extent of his current activities.

Q.

Are the expert witness fees and other non-legal costs associated with proving infringement covered by the policy?
A.

Yes, all outside legal and non-legal costs necessary to prove infringement and rebut any counterclaim of invalidity arising from AUTHORIZED LITIGATION, including travel costs of expert witnesses, are covered.

Q. What happens when I discover an infringer?
A.

Once you detect the existence of a possible infringer, you must notify the Company on a standard claim form supplied by the Company. Having complied with this and all of the other policy terms, the Company will consider the action to be covered under the terms of the policy, absent fraud or material misrepresentation on the Company.

Q.

Is the rating of my intellectual property prior to quoting a premium discoverable in a subsequent trial?
A.

The Company takes all steps possible to ensure that the rating worksheets are company confidential and cannot be discovered. They are not disseminated to outsiders and are strictly the work product of the rating committee, all of whom are attorneys. Since rules of discovery vary from jurisdiction to jurisdiction, however, we suggest you check with your counsel to confirm that rating materials would not be discoverable.

Q. What endorsements can be added to the policy?
A. There are several endorsements available which modify the standard policy. Some of the more frequently used additional premium Endorsements are as follows:
  • Foreign coverage.
  • Patent or Trademark Applications: The Patent or Trademark Applications Endorsement changes the policy to include patent or trademark applications listed on the Declarations page and provides that any infringement or like activity which begins after the application was insured, is covered for CIVIL PROCEEDINGS after issuance.
  • Economic Benefit Relief: This Endorsement waives Company's right to seek any recovery of the first $250,000 in LITIGATION EXPENSES by virtue of any economic benefit deemed to have occurred as a result of the Named Insured winning in the sense of (1) eliminating competition because of settlement with or without a cross license arrangement; or (2) gaining operating freedom because of injunctive relief where no awards have been granted or the amount awarded results in a shortfall in the Company's recoupment of its payments made as LITIGATION EXPENSES.
  • Exclusion of present infringer(s): The Exclusionary Endorsement provides that the Company will not Authorize Litigation under the policy by the Named Insured against those parties named in the endorsement.
  • Licensee Coverage: This endorsement provides that Licensee(s) may be defendants in Authorized Litigation provided the License Agreement was terminated by Licensee or the Insured because of a material breach thereof.
  • Re-Issue/Reexamination Coverage: The Reissue/Reexamination Endorsement provides that if during Authorized Litigation you decide to pursue re-issuance of your Insured Patent's claims or the Defendant petitions to have your Insured Patent reexamined in the Patent Office, the policy will pay the associated costs as Litigation Expenses.
  • Other endorsement options that we will provide you with for your consideration.
Q.

What kind of legal impediment could exist with my patent which would result in an unsuccessful prosecution of the infringement suit?
A.

The Company wants to make certain that prior to Authorizing Litigation, there are no legal impediments such as an on-sale bar (where the product has been on sale or in public use for more than a year before the filing date of the patent) which would prevent the successful prosecution of the infringement suit.



Abatement Insurance Program Summary

PROGRAM
ADMINISTRATOR:
Intellectual Property Insurance Services Corporation
CARRIER: Nutmeg Insurance Company (a Member of The Hartford Group); and Indian Harbor Insurance Company (a subsidiary of XL Capital, Ltd.)
A.M. BEST
RATING:
A+, XV, both carriers
LIMITS: From $100,000 to $5,000,000 Each Claim
From $100,000 to $5,000,000 Aggregate
SIR/
DEDUCTIBLES:
From $0 to $50,000; Higher Options Available
COINSURANCE: 20% minimum; Higher Coinsurance Available
COVERAGE: Litigation Expense Reimbursement for:
  1. AUTHORIZED LITIGATION (intellectual property infringement suits) brought by the Named Insured against an Alleged Wrongdoer for INFRINGEMENT which began during the POLICY PERIOD;
  2. Defense of Patent Invalidity counterclaims in AUTHORIZED LITIGATION;
  3. Reexamination in the Patent Office of Named Insured's patent in AUTHORIZED LITIGATION if petitioned by the Defendant in an attempt to invalidate Named Insured's patent;
  4. Reissue costs during AUTHORIZED LITIGATION in an effort by Named Insured to strengthen the patent claims.
TERRITORY: The United States, its territories and districts.
PARTIAL LIST
OF CONDITIONS
:
  1. Acts of the Alleged Wrongdoer must begin and claim must be filed during the POLICY PERIOD.
  2. Favorable opinion by IP counsel of Named Insured's choice re IP validity and INFRINGEMENT required before authorization.
  3. Company issues authorization letter after claim form received and all conditions are met.
  4. Company shares pro rata in any award of attorney fees and costs as well as any infringement damage awards up to the amount Company has spent with respect to AUTHORIZED LITIGATION under most conditions, but never to exceed 1.25 times the amount Company has spent.
  5. Economic Benefit Relief Endorsement is available for additional premium. This Endorsement waives Company's right to seek any recovery of the first $250,000 in LITIGATION EXPENSES which might arise by virtue of any ECONOMIC BENEFIT deemed to have occurred as a result of the Named Insured (1) eliminating competition because of settlement with or without a cross license arrangement; or (2) gaining operating freedom because of injunctive relief, where no or insufficient monetary awards have been granted.
PARTIAL LIST OF EXCLUSIONS:
  1. Preexisting acts of an Alleged Wrongdoer.
  2. Liability for judgments and damages. (May be available for defense reimbursement policies, however).
  3. Expenses incurred prior to initiation of a CIVIL PROCEEDING underlying AUTHORIZED LITIGATION.
  4. Breach of contract by Licensees (unless included by Endorsement).
  5. Willful acts of Named Insured giving rise to infringement.
  6. Criminal acts.
  7. Coverage against licensees which are not included by endorsement (New licensees must be added within thirty (30) days of license).
Obtain a Free, No Obligation quote Online: CLICK "Request Quotation" above.

The above material is for presentation and marketing purposes only, and in no way changes the terms or effect of the Policy language. Consult a copy of the Policy itself for any specific questions that you may have. The term, "Alleged Wrongdoer(s)" referred to throughout this document shall mean an entity which is or is suspected of making, using, selling, offering for sale or substantially completing and displaying any process, machine, manufacture, composition of matter, symbol, slogan, mark or work of authorship defined by the IP for which insurance is sought.

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