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Fish COVID-19 BlogFish Litigation BlogFish IP Law Essentials Blog

Arbitration: A Way to Advance Patent Litigation During the COVID-19 Crisis

April 9, 2020

Fish COVID-19 BlogFish Litigation BlogFish IP Law Essentials Blog

Arbitration: A Way to Advance Patent Litigation During the COVID-19 Crisis

April 9, 2020

Back to the Fish Litigation Blog

 

Clients and their litigation teams face short and long-term scheduling uncertainty during the COVID-19 crisis. District courts have postponed trials and granted motions for extensions that tack on three or more months to the case schedule. Stay-at-home orders make in-person depositions and hearings nearly impossible. Even after local and state governments lift stay-at-home orders, courts will face a backlog of hearings and trials. In sum, no one can predict when the normal pace of litigation will resume. In the fog of uncertainty, consider arbitration as a way to advance patent litigation.

Q1. Arbitration vs. litigation: what is the difference?

The key difference between arbitration and litigation is that arbitration eliminates the jury trial. The parties select one to three arbitrators to decide the issues. In IP cases, parties routinely select retired federal District Court Judges and experienced patent litigation attorneys. Parties typically begin the selection process by exchanging candidate lists and vetting each other’s candidates. Negotiations whittle the lists down to a single arbitrator or a panel of two or three. By selecting highly-skilled arbitrators, such as those with particular technology experience, or a former Judge, the parties enter arbitration confident that their case is in good hands. However, arbitration is not free and the parties will incur the expense of the arbitration panel.

Q2. How can arbitration advance patent litigation?

Parties may enter into binding or non-binding arbitration. In a binding arbitration, the parties identify an issue—infringement, invalidity, claim construction, or even the entire case—for the arbitrator to consider. The parties conduct discovery, submit briefing, and can elect to have hearings. Afterward, the arbitrator issues an opinion. The parties are then bound by the terms of the opinion, and it would fully or partially resolve an issue in the District Court case. For example, if the arbitrator decides some agreed-upon set of the prior art does not anticipate the patents-in-suit, defendants may not raise invalidity as a defense at trial. One drawback to arbitration is parties typically relinquish the right to seek appellate review. If the parties are willing to forego that right for some issues, arbitration can simplify the case. Any issues that do not require extensive discovery, such as certain equitable issues or possibly discrete claim construction issues, may be attractive candidates for arbitration. And while the parties might only resolve one issue, in some cases the outcome of the arbitration may increase the likelihood of settlement.

Q3. What is non-binding arbitration?

Non-binding arbitration operates exactly as a regular arbitration, but, as the name suggests, it is non-binding and can still be litigated. In some ways, it is similar to mediation and gives a window into how a neutral third party views the strengths or weaknesses of the case. However, unlike mediation, the arbitrator does not try to negotiate a settlement. The arbitrator takes in the facts and makes a decision. The more the parties respect the arbitrator’s expertise, the more the parties will likely value the opinion, which can catalyze settlement.

Q4. How has COVID-19 impacted arbitration proceedings?

Like the district courts, arbitral institutions, like the American Arbitration Association, have canceled in-person hearings. What then is the advantage to arbitration? Arbitration is designed to provide parties maximum flexibility to tailor the proceedings according to the needs of the parties. During the COVID-19 crisis, parties can use that flexibility to select their preferred technology platforms for remote hearings; hammer out procedures to address the complexities of conducting depositions online; and streamline discovery. The arbitrator will set the schedule after taking into account the parties’ preferences and availability. The parties may proceed knowing (with as much certainty as the COVID-19 crisis allows) the schedule will stick since the parties will not be dependent upon the court’s availability or for juries to be empaneled.

Q5. How do the parties initiate arbitration?

The American Arbitration Association, the International Institution for Conflict Prevention, and JAMS Comprehensive Arbitration Rules and Procedures are among the most reputable arbitral institutions. If the parties have already selected an arbitrator, the parties may send her a joint letter expressing the desire to arbitrate along with a brief description of the dispute. If the arbitrator agrees to arbitrate the case, she will explain how to commence the arbitration according to the procedures of her affiliated institution. If the parties have not already selected an arbitrator, each arbitral institution provides a bevy of skilled arbitrators from which the parties may select and a procedure for facilitating the selection process.

Authors: Benjamin Elacqua and Karrie Wheatley

More questions? Contact the authors or visit Fish’s Intellectual Property Law Essentials.


The opinions expressed are those of the authors on the date noted above and do not necessarily reflect the views of Fish & Richardson P.C., any other of its lawyers, its clients, or any of its or their respective affiliates. This post is for general information purposes only and is not intended to be and should not be taken as legal advice. No attorney-client relationship is formed.

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Blog Authors

Patent Trial Attorney
Benjamin C. Elacqua | Principal

Practice Distinctions Trial lawyer with experience spanning all phases of complex litigation or regulatory investigations, including handling multijurisdictional parallel proceedings both in district courts and at the International Trade Commission (ITC). Sought after counsel for myriad...

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Karrie Wheatley, Ph.D. | Associate

Karrie Wheatley is a patent litigation associate in Fish & Richardson’s Houston office. Dr. Wheatley represents clients in patent cases in federal district courts throughout the country and in the International Trade Commission. She has substantial experience in matters involving...

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