5 ms·

Unfortunately they still paid a big price in legal fees. Can anyone tell me what the downsides are to a loser-pays-the-fees system? I heard it's used in the U

Unfortunately they still paid a big price in legal fees. Can anyone tell me what the downsides are to a loser-pays-the-fees system? I heard it's used in the UK but not in the US. What gives?

nucleardog 13y ago
If you're down for a bit of light reading: http://www.legalaffairs.org/printerfriendly.msp?id=923 http://www.legalaffairs.org/printerfriendly.msp?id=923
- Tomte 13y ago
  Many of those "problems" really don't seem to exist in Germany. I guess part of it stems from the common law system, but I'm not sure.
DanBC 13y ago
There's a downside to the UK system. You have to pay the costs, even if you win, if: i) You're offered an out of court settlement and ii) You reject it and iii) the settlement is more than the damages you are awarded by the court This is to make sure that people try to settle things before going to court. And I'm not sure how it would work for a non-practising entity. A company that has no assets apart from the patent that they're suing for would have no money to pay fees if they lose.
- nknighthb 13y ago
  Undercapitalization in the absence of liability insurance could be grounds for piercing the corporate veil.
  - tptacek 13y ago
    It can? Has that actually happened (in the UK or US), or been argued, ever? Can you cite a source?
    - nknighthb 13y ago
      Vuylsteke v. Broan, Minton v. Cavaney, State v. Weinschenk, Anderson v. Abbott.
      - tptacek 13y ago
        Sorry, I was imprecise. I understand that it is possible to collect damages from controlling shareholders of corporations; for instance, in any tort case; in several states, unpaid wages also incur liability on company owners, as they did in Vuylsteke. I was asking specifically about your liability insurance argument.
        nknighthb 13y ago
        You mean that insurance can count in determining adequate capitalization? The cases I can find that are most on point is Walkovszky v. Carlton, where a claim of underinsurance was directly at issue (unsuccessful because the insurance that was carried met an explicit statutory requirement) and Autrey v. 22 Texas Services Inc. (on a summary judgement motion finding there are facts in dispute, so not squarely ruled on). A couple of relevant papers that discuss insurance throughout: http://scholarship.kentlaw.iit.edu/cgi/viewcontent.cgi?article=2470&context=cklawreview http://scholarship.kentlaw.iit.edu/cgi/viewcontent.cgi?artic... http://www.law.emory.edu/fileadmin/journals/elj/56/5/Millon.pdf http://www.law.emory.edu/fileadmin/journals/elj/56/5/Millon....

Unfortunately they still paid a big price in legal fees. Can anyone tell me what the downsides are to a loser-pays-the-fees system? I heard it's used in the UK but not in the US. What gives?

nucleardog 13y ago

If you're down for a bit of light reading: http://www.legalaffairs.org/printerfriendly.msp?id=923 http://www.legalaffairs.org/printerfriendly.msp?id=923

Tomte 13y ago
Many of those "problems" really don't seem to exist in Germany. I guess part of it stems from the common law system, but I'm not sure.

DanBC 13y ago

There's a downside to the UK system. You have to pay the costs, even if you win, if: i) You're offered an out of court settlement and ii) You reject it and iii) the settlement is more than the damages you are awarded by the court This is to make sure that people try to settle things before going to court. And I'm not sure how it would work for a non-practising entity. A company that has no assets apart from the patent that they're suing for would have no money to pay fees if they lose.

nknighthb 13y ago
Undercapitalization in the absence of liability insurance could be grounds for piercing the corporate veil.
- tptacek 13y ago
  It can? Has that actually happened (in the UK or US), or been argued, ever? Can you cite a source?
  - nknighthb 13y ago
    Vuylsteke v. Broan, Minton v. Cavaney, State v. Weinschenk, Anderson v. Abbott.
    - tptacek 13y ago
      Sorry, I was imprecise. I understand that it is possible to collect damages from controlling shareholders of corporations; for instance, in any tort case; in several states, unpaid wages also incur liability on company owners, as they did in Vuylsteke. I was asking specifically about your liability insurance argument.
      - nknighthb 13y ago
        You mean that insurance can count in determining adequate capitalization? The cases I can find that are most on point is Walkovszky v. Carlton, where a claim of underinsurance was directly at issue (unsuccessful because the insurance that was carried met an explicit statutory requirement) and Autrey v. 22 Texas Services Inc. (on a summary judgement motion finding there are facts in dispute, so not squarely ruled on). A couple of relevant papers that discuss insurance throughout: http://scholarship.kentlaw.iit.edu/cgi/viewcontent.cgi?article=2470&context=cklawreview http://scholarship.kentlaw.iit.edu/cgi/viewcontent.cgi?artic... http://www.law.emory.edu/fileadmin/journals/elj/56/5/Millon.pdf http://www.law.emory.edu/fileadmin/journals/elj/56/5/Millon....