Dec. 2011/Jan. 2012 / Intellectual Property
Don’t Overlook Insurance Coverage in IP Disputes
Companies involved in IP litigation routinely fail to invoke coverage under both traditional and non-traditional insurance policies, according to the author.
Traditional policies include Comprehensive General Liability (CGL) and Directors and Officers (D&O) insurance. CGL policies may cover, for example, both “advertising injury” and “personal liability,” both of which may be alleged in connection with some IP matters. Advertising injury has been interpreted by courts to apply to trademark, trade dress and copyright infringement and, less commonly, unfair competition. Personal injury coverage, with regard to “disparagement, could be implicated in a trade libel matter.
D&O coverage also may apply in the context of IP litigation – for patent infringement claims, among others – by way of its applicability to negligent or even intentional “wrongful acts.”
The author cites specific examples where CGL or D&O policies have covered liabilities arising from a variety of IP related allegations, including patent infringement claims and misappropriation of trade secrets.
The author suggests that companies, especially those with significant IP portfolios or that do a lot of online sales business, also consider some of the newer specialized insurance products, such as IP infringement insurance and “IP Value Insurance.” The latter may indemnify for the loss of revenue or value associated with intellectual property that loses value as a result of challenges to its validity or enforceablility. Also available are policies that specifically address computer and cyberspace-related liabilities that may be related to IP matters.
