Hats Off to the ANA, Patent Trolls Beware

14 Aug

patent infringement defenseAdvertisers now have a viable tool to assist in protecting their organizations against some of the costs associated with defending themselves against frivolous patent troll law suits.

The Association of National Advertisers (ANA) working in conjunction with Nationwide Insurance’s Scottsdale Insurance division recently unveiled a unique new product called the “ANA Patent Infringement Defense.” According to the ANA, their membership will have two insurance options to select from, “a $500,000 plan and a $1 million plan” which advertisers can access at a “cost between $10,000 and $20,000 per year.”

This innovative approach will allow advertisers to offset a portion of their legal expenses in defending themselves in federal court or in arguing their cases before the Patent Trial and Appeal Board.

Over the course of the last few years, both advertisers and their agency partners have been targeted by patent trolls who have taken action on those entities’ utilization of technology applications ranging from location finders to QR codes. The cost to the industry has been steep, resulting in millions of dollars in claims and legal expenses for both advertisers and agencies.

In addition to the benefits derived from this new insurance coverage, it will also allow advertisers more comfort when negotiating client/ agency agreements containing contractual indemnification against patent infringement actions. This is sometimes a contentious point during negotiations since it is very difficult to assess and pre-assign responsibility for potential expenses and damages in battling such claims to any one party.

We believe that the leadership exhibited by the ANA on this important issue has been exceptional from the onset. This includes the education of its members, effective lobbying of federal regulators and now with the introduction of the ANA Patent Infringement Defense product being offered. As the noted American businessman, Harold Geneen once said:

Leadership is practiced not so much in words as in attitude and in actions.”

Hopefully, the 4As can leverage the good work that has been accomplished by the ANA in this area to introduce a similar approach, extending this same type of protection to its agency members.

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