A patent demand letter usually arrives like this: a certified envelope, a polite-but-firm letter from a law firm you've never heard of, citing a US patent and accusing your product of infringement. There's a number — often $50,000 to $500,000 — and a deadline.
Most defendants do the wrong thing in the first 48 hours. Here's what to actually do.
The first 48 hours
1. Don't panic. Don't reply.
The deadline is artificial. Your legal rights aren't extinguished by missing it. The plaintiff isn't ready to sue tomorrow — drafting a complaint takes time, and most demand letters are part of a campaign covering many targets.
Do not call or email the sender's attorney to "explain" or "clarify." Anything you say can be used against you. Anything you offer can be construed as an admission.
2. Don't destroy any documents.
The moment you receive a demand letter, document preservation obligations attach. Anything you delete from this point forward — emails, source code commits, internal docs — can be used to claim spoliation of evidence. Tell engineering not to do "routine cleanup." If you have automated retention policies, freeze them for the asserted product.
3. Save the letter and date the envelope.
Scan the letter, the envelope, and the postmark. Save everything. The date matters because it triggers obligations and starts clocks.
4. Pull the patent.
Look it up on Google Patents. Read the abstract. Read the independent claims. Note the issue date and the earliest priority date. (How to read a patent claim →)
5. Ask: am I a likely real target, or one of many?
Some demand letters are bespoke — a specific company, a specific product, real research behind the assertion. Others are blanket campaigns where the same letter goes to 50 companies in an industry, hoping a few pay. Tell-tale signs of the latter:
- Vague claim mapping ("Your products generally include features that infringe...")
- Round-number demand
- Letter from an unfamiliar law firm rather than a major IP firm
- The patentee is a shell LLC with no products, no employees, and a P.O. box address
A blanket campaign is much weaker than a bespoke assertion. The plaintiff's strategy is settlement volume, not litigation expertise. (What is a patent troll? →)
The first week
Get an attorney — but the right kind
You need a patent litigation attorney, not your general corporate counsel. Major IP firms have practitioners who do this every day. Smaller specialty firms are usually cheaper and just as effective for early-stage analysis.
For a first conversation:
- Most firms will do an initial consultation for free or a fixed fee.
- Bring the demand letter, the patent, and a description of your product.
- Ask about flat-fee or capped engagements for invalidity research.
If the matter does proceed to litigation, expect $50,000–$150,000 in attorney fees just to get to the first major motion.
Run a quick invalidity check
A patent attorney's first move is usually a fast Google Patents and Espacenet search for prior art. Even an hour of research can reveal whether the patent has obvious vulnerabilities. If the patent already has a public IPR petition or post-grant review filed against it, that's a major signal — someone else thinks it's invalid.
If you're on this site, search the patents we track for the asserted patent. There may already be an invalidity dossier on it. If we don't have it, add it via the homepage form — verification + six-section analysis runs in about 3 minutes.
Run a quick non-infringement check
Read the independent claims with engineering. For each claim, ask: which limitations does our product not have?
If a single limitation is missing, the product doesn't infringe that claim. List the missing limitations across every independent claim — this is the foundation of your non-infringement defense.
Decide your posture
Three rough postures:
- Settlement-minded. The number is small enough that it's cheaper to pay than fight. Common for $5,000–$50,000 demands against small companies. Not always wrong, but understand: paying tells the troll you're an easy target. Other patents from the same portfolio may follow.
- Negotiate-down. Push back on the number, demand specifics, drag out the timeline. The plaintiff often settles for 10-30% of the original demand, especially if you make litigation look expensive.
- Fight. File a declaratory-judgment action in your home court, file an IPR if prior art exists, and prepare for litigation. Most expensive in the short term, cheapest if the patent is junk and you have prior art.
The first month
Look for the troll's track record
Pull the patentee's litigation history — RPX, Unified Patents, and PACER all have data. (Or browse our database by plaintiff — every named plaintiff with on-file cases gets its own page.) A pattern of dropping cases at the first sign of resistance suggests a settlement-shop. A pattern of pushing through to claim construction suggests they'll actually litigate. (See the litigation lifecycle for what each phase costs.)
If the patentee has filed against many other targets, the other defendants are valuable allies. Joint defense groups share invalidity research and split costs. Reach out to defendants in earlier-filed cases through their attorneys.
Consider an IPR
If prior art exists and the patent is litigation-grade vulnerable, an IPR is often the right move. $200,000–$500,000 all-in, 18 months to a final decision, and a stay of the district-court case if granted.
Consider a § 285 fee-shift threat
If the patent is junk and the plaintiff knew or should have known, your eventual fee-shift motion is a real threat. Mention it in correspondence. Octane Fitness v. ICON Health (2014) lowered the bar enough that NPEs occasionally drop weak cases when faced with a credible fee-shift threat. The 2014 Lumen View v. FindTheBest fee award against the holder of US Patent 8,069,073 is a touchstone — among the first applications of the new exceptional-case standard.
What not to do
- Don't ignore the letter. It won't go away. The plaintiff will sue, and you'll be in worse shape because you wasted preparation time.
- Don't pay quickly. Settlement value rarely goes up with delay. The plaintiff's litigation costs are racking up too.
- Don't talk about the case publicly. Anything you say can become evidence. Litigation runs on careful, controlled communication.
- Don't try to design around without legal advice. A "design-around" that still infringes is worse than the original product. A design-around that destroys product-market fit is a self-inflicted wound.
Bottom line
A patent demand letter is a request for money, not a court order. Don't panic. Get an attorney, pull the patent, run a quick invalidity and non-infringement check, and decide on a posture. The plaintiff's leverage is your fear; preparation removes it.
The asymmetry that lets patent trolls work — cheap to file, ruinous to defend — only operates when you're caught flat-footed.
This article is for general education and is not legal advice. Get a patent litigation attorney before doing anything other than not destroying documents.