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Posted: December 13, 2011

Is a win always a win?

When it comes to litigation, the answer is no

Peter Lemire

Attorneys, in general, are a pretty competitive bunch. Most of us can be qualified as type A personalities (or at minimum, A-). A lot of successful business people fall into this category as well.

While this drive to win (or achieve something that is perceived as winning), most likely is responsible for getting the attorney or business person to where they are today, care must be taken by both sides to make sure that the result they are trying to achieve is really the best result for the client in the end. Put simply: Is the "victory" we are trying to achieve really a "win"?

This question is especially important in intellectual property disputes, due to the often sensitive or important nature of the technology or legal rights at stake. Recently, it played a big factor in the way our firm and a client approached the resolution of a lawsuit filed against one of our clients.

The case involved a piece of technology that is used in law enforcement and military circles; for confidentiality and national security purposes we will call it the "System." Our client had sold the System to a customer and the customer had claimed that the System didn't work properly and brought suit. We did not agree with the plaintiff's assessment and felt that other considerations were driving the plaintiff's motivation to engage in a legal battle.

Our legal position was strong. We figured the case would settle prior to trial. This did not happen.

After the plaintiff put on their case, we felt a "win" was assured. However, a discussion with our client raised the question as to whether a victory in the case was a "win." Due to the nature of the claims brought against our client, if the plaintiff won, we would retain possession of the System (the plaintiff refused delivery of the System when our client sent it back to them after maintenance) and our client would have to return the money tendered in purchase. If we prevailed we would keep the money, but have to turn the System over to the Plaintiff.

Our client recounted that a competitor's System had somehow been found in the possession of Al-Qaeda and all of the problems this caused for the company. That comment sparked a recollection that the Plaintiff made an off-hand comment that they would just sell the System to a competitor or worse yet any Joe off the street in order to get their money back. In an instant, the definition of a "win" changed. If we "won" the case, the client lost control of the System and could suffer a much more devastating kind of loss later on down the road.

Prior to that moment, both our and our client's focus was primarily on a legal victory, which is easy to do in the adversarial judicial system we have. The problem is that the legal system is limited in its remedies and its ability to redress harms. It is akin to being on a train that can't deviate from the tracks. In a lot of cases, neither of the parties truly "wins." That's not to say that lawsuits don't make sense, or that attorneys should not vigorously represent their clients in court and fight for their interests.

What it means is that both client and attorney need to be in sync as to what the ultimate objective is and that the end objective is in line with the client's long-term goals and objectives for their business. Additionally, it is important to step back and regularly reassess to ensure that the original rational for the end objective is still valid, and whether new information or circumstances might change the view of the situation.

In our case, we opened up settlement negotiations with the other side (after overcoming a bit of resistance from our client - they still wanted that court victory) and secured a settlement which was a compromise for both parties, but which allowed our client to retain the possession and control of the System, which in the end was the real "win."
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Peter Lemire is a founding member of the intellectual property law boutique, Leyendecker & Lemire. Leyendecker & Lemire specialize in patents, trademarks and related complex civil litigation. Peter Lemire can be reached directly at 303.768.0641 or peter@coloradoiplaw.com. Visit www.coloradoiplaw.comfor further information, including Leyendecker & Lemire’s weekly blog, “Control, Protect & Leverage.” 

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