Contingency law firms shoulder a bulk of the risk in asserting a patent. For that privilege, they commonly take 40% of the revenues reaped from the patents for which they sally forth. The contingency firm only covers attorneys time; the "sponsoring" patent holder pays expenses, including the cost of outside expert witnesses and technical consultants.

But first, the contingency firm must be persuaded into taking the case. Preparing a sales pitch to a contingency firm has a few steps.

The first step is to ensure that the goods are good: is the patent valid? Validation requires a prior art search scrubbing.

Having a patent granted provides little assurance that the patent is valid. The prosecuting attorney who got the patent for the company had neither the budget nor the interest in killing a incipient golden gosling. The patent examiner did his best to vet the patent on a pressure cooker time schedule that leaves much in doubt. Many patent litigations hit the rocks of invalidity for the plaintiff, sinking the patent ship and all vested in it.

An outside technical consultant is recommended for vetting a patent prior to assertion, because an outsider can serve as a buffer with regard to the litigation discovery process: whatever the outsider knows is kept to himself, other than a seal of approval to proceed, or a damn-the-torpedoes warning.

Once vetted for validity, get a grip on the claims, specifically, how broadly the claims may apply to potentially infringing products. Claim construction is always the big-top boxing draw in a patent litigation carnival, and Markman is the barker.

The Supreme Court ruled in Markman v. Westview Instruments, Inc. 116 S.Ct. 1384 (1996), that the interpretation of patent claims is an issue of law for a trial judge, not a jury, to decide. As a result, an infringement trial's Markman ruling determines claim construction, setting the scope by which infringement (and possibly validity) are subsequently determined.

In obtaining a patent, statements made by the prosecutor in order to get the patent allowed may limit the scope of claims. This is called prosecution estoppel - a patent holder is stopped from broadening claim scope beyond what was delineated during prosecution of the patent.

Often, a company is incited into asserting a patent by noticing infringement by another company. But it's not unusual for adoption to occur by multiple companies, with the patent holder initially becoming aware of only one or a few potential infringers. Best to take a survey for infringement; there may be "Easter egg" infringers just waiting to be found.

Determine infringement by matching patent claim limitations to product features. It's a misstep to be overly optimistic and overlook details that may prove decisive in litigation. Again, having an independent consultant perform preliminary infringement analyses is prudent.

Finally, develop a damage model for infringement: figure a bottom line for how much revenue an infringer is garnering from infringing the target patent. In many cases, that figure is likely to be a fraction of product revenue, and infringing product revenue is only a portion of total company revenue for an infringer that sells multiple products. Infringement damage assessment is a complex issue, addressed in the posting Infringement Damages Primer.

A contingency law firm must assume that any litigation could run its course without settlement, maximizing risk and cost for the firm. As such, a patent should sparkle like a $10 million dollar diamond to hope to attract the interest of a finicky contingency partner in the patent litigation dance.