Lawyers who handle IP cases may deal with matters such as handling registration applications with the USPTO or Copyright Office, pursuing or defending against infringement or misappropriation claims, or negotiating licensing deals. IP matters can involve high financial stakes for clients. As a result, lawyers who practice in IP cases need professional liability insurance coverage tailored to the unique risks they face in handling IP matters for clients.
The High Stakes of IP Litigation
Intellectual property litigation can involve significant financial exposure for clients, as they may face potential liability for infringement or misappropriation, the loss of the ability to sell products or services, or the cancellation of IP protection. Furthermore, intellectual property can involve complex issues. As a result, attorneys who handle IP litigation matters may, in turn, face substantial financial liability to clients for errors, omissions, or misunderstandings that may cause clients to lose an IP case.
Clients who obtain an unfavorable outcome in IP litigation may pursue malpractice claims against their counsel to mitigate their financial losses from the litigation. Such professional liability cases can involve complex litigation, including a potential “trial-within-a-trial” legal malpractice claim.
What Is Intellectual Property Coverage?
Lawyers who handle IP matters may obtain intellectual property coverage from their professional liability carrier. Intellectual property coverage may come as a separate insurance policy or an endorsement to an existing malpractice policy. Alternatively, malpractice insurance providers may cover IP matters as part of their standard professional liability policies but require law firms to identify each attorney who works on cases involving intellectual property matters and describe what kinds of IP cases each attorney handles.
Intellectual property coverage provides additional protection for attorneys who may face professional liability for IP-related work. It can provide attorneys and firms with defense costs incurred in defending against malpractice claims arising from a client’s IP case and payment of settlements or judgments in such claims.
Key Benefits of Having IP Coverage
Some of the essential benefits of ensuring you have IP coverage when handling intellectual property matters for clients include:
- Financial Protection – IP coverage protects lawyers from the economic burden of high-cost litigation in legal malpractice cases arising from intellectual property matters, including legal fees to defend against claims and liability for settlements or judgments.
- Assurance to Clients – Lawyers who have intellectual property coverage demonstrate professionalism and preparedness, which may encourage more sophisticated clients to trust those attorneys with complex IP work.
- Confirmed Coverage – Obtaining IP coverage ensures you can file claims related to all kinds of IP work, including transactional matters such as registration or licensing and litigation matters.
- Peace of Mind – Having IP coverage can help attorneys who practice in intellectual property matters provide more confident advocacy, knowing they have financial protection.
Common Scenarios Where IPC Becomes Crucial
Common kinds of legal work that make it essential for attorneys to have intellectual property coverage include:
- Drafting or reviewing IP licensing agreements that later become the subject of litigation
- Missing deadlines during copyright, trademark, or patent applications
- Representing a party while under a conflict of interest without obtaining the client’s informed waiver of the conflict
- Providing erroneous legal opinions regarding the patentability of inventions or the enforceability of IP rights
Contact WILMIC Today
If you practice in IP law, you should review your professional liability insurance policy to ensure you have appropriate coverage for the kinds of cases you handle. Having malpractice coverage tailored to the legal risks you may face will protect your financial interests and professional reputation. Contact WILMIC today for an initial consultation to learn more about the benefits of intellectual property coverage and discuss adding coverage to your malpractice policy.