Originally published in the May 2025 issue of IP Litigator and The Licensing Journal. 

Patent opinions of counsel encompass a variety of deliverables ranging from focused opinions addressing infringement and/or validity of a particular patent to broader freedom to operate (FTO) opinions addressing multiple patents and the ability to develop, manufacture, and market products without infringing valid intellectual property rights of others. Patent opinions offer a number of well-established business benefits, including avoiding liability for patent infringement, defending against allegations of willful infringement and associated risks of enhanced damages, and establishing a valid basis for asserting patent infringement and bringing an enforcement action. They also present strategic opportunities for innovation, technology roadmap development, and business resource planning and conservation. This bulletin reviews the well-established benefits of patent opinions and outlines how businesses can leverage them to support strategic growth.

Well-Established Benefits

Avoiding Infringement

Patent litigation can impose significant direct and indirect expenses. Direct expenses include defending litigation in federal court, challenging asserted patents before the USPTO, and exposure to potential damages. Indirect expenses include customer and marketplace reactions to infringement assertions such as potential loss or postponement of sales or business opportunities, indemnification claims from customers, and disruption of productive work and burdening employee time to participate in the defense. By understanding and acting to mitigate exposure to patent infringement, businesses can reduce or avoid both direct and indirect expenses.

Defending Against Willful Infringement and Induced Infringement Allegations

Patent opinions of counsel are an important tool for defending against allegations of willful patent infringement. While the Federal Circuit’s decision in Seagate (2007) eliminated the affirmative duty to obtain an opinion of counsel, an opinion remains powerful evidence of good faith and reasonable behavior. The value of such evidence is underscored by the Supreme Court’s decision in Halo Electronics (2016), which gave more discretion to District Courts in deciding whether or not to award enhanced damages.

When accused of patent infringement, companies that have obtained and relied upon competent opinions of counsel can demonstrate they acted responsibly and with due diligence. This evidence can help avoid enhanced damages, which can be up to three times the base damage award in cases of willful infringement, as well as potential exposure to awards of a plaintiff’s attorney’s fees.

Additionally, patent opinions of counsel can be utilized as a defense against allegations of induced patent infringement. Induced patent infringement requires proof that a defendant actively encouraged infringement, knowing that the induced acts constituted patent infringement. Business decision-makers who obtain, review, and rely upon an opinion of counsel, can use the opinion as evidence to show that their company lacked the required intent and is not liable for induced infringement.

Establishing Grounds for Enforcement

Patent opinions of counsel are also a valuable tool for preparing to enforce your company’s patents against potential infringers. An infringement opinion can be used to satisfy your obligation to conduct a reasonable pre-filing investigation, establishing a good faith basis for bringing suit. An opinion can inform litigation strategy by identifying strengths and weaknesses and focusing effort on buttressing your infringement case. A well-developed infringement position can also drive settlement or licensing opportunities, maximizing monetization while mitigating the cost and time commitment of litigation.

Strategic Opportunities

Spurring Innovation

Patent freedom to operate (FTO) opinions offer opportunities for driving innovation. Undertaking FTO analyses during research and development helps organizations identify opportunities for innovation both in crowded technology spaces and in areas with more limited patent activity. This proactive approach allows research and development teams to strategically focus efforts and resources on technologies ripe for patent development and to gain valuable footholds in crowded spaces.

Technology Roadmap Development

When FTO analyses identify potential blocking patents, businesses can take several different approaches. One productive possibility is to design-around the identified patents by developing alternative technical solutions that avoid infringement. Such design-around efforts can lead to next-generation technology which may itself be patentable.

In some circumstances, FTO analyses can reveal potential collaboration opportunities. When patent landscapes show complementary technologies held by different parties, organizations can pursue cross-licensing agreements or joint development agreements to access needed technologies and combine expertise.

Business Planning and Resource Conservation

When planning an FTO project, it is important to consider and include all relevant business stakeholders and to consider both positive and negative results of an FTO analysis and your business responses to both results. Aligning stakeholders from research and development, legal, and business development teams helps converge on the best available commercial responses to an FTO analysis and aligns the FTO project with business objectives, including prioritizing projects and work based on the legal risks of certain technologies. It is also important to coordinate FTO analysis with product development timelines, so that products can be revised as needed before incurring significant exposure.

Following best practices also helps to maximize the value of FTO projects. For example, establishing a regular FTO review schedule and maintaining up-to-date patent analyses helps your company understand and adapt to a changing patent landscape in relevant technologies. A regular review schedule also helps businesses plan and allocate resources to effectively address and mitigate patent risk, for example, by allocating technical and business experts to assist legal counsel, budgeting resources to address and mitigate patent risk, and preparing and budgeting for potential validity challenges and infringement defenses.

By following these guidelines, organizations can transform FTO from simply a compliance exercise into a strategic advantage that promotes sustainable innovation while managing IP risks effectively.

Conclusion

Patent opinions of counsel remain a vital tool for businesses to manage patent risks and strengthen their legal position in potential patent disputes. They can also be leveraged to support innovation, product development, and improvement. When investing in patent opinions, business decision-makers should mindfully consider how to take advantage of these opportunities.