What Litigation Funders Look for in Patent Infringement Cases
Note: Protego, LLC is not a law firm. This content is for general informational purposes only and should not be relied upon as legal, financial, or tax advice. See full disclaimer at the end of this article.
Patent litigation can be financially and strategically challenging, particularly for individual inventors and smaller companies. Third-party litigation funding is one avenue that may provide patent owners with the resources needed to pursue enforcement against parties that are believed to be infringing. If you are considering outside funding for a patent infringement case, here is a general overview of the factors that funders commonly evaluate.
1. The Strength of the Patent
Funders generally assess whether the patent is likely to withstand validity challenges. Factors that are commonly considered include:
- Whether the patent has been issued (as opposed to a pending application)
- Whether the claims are clearly defined and reasonably broad
- The prosecution history, including whether the patent has survived any prior IPR proceedings, reexaminations, or other challenges
2. Evidence of Infringement
Clear, well-documented evidence showing that another party is using the patented technology without authorization is generally a prerequisite for funding. This typically includes:
- Technical claim charts comparing patent claims to the accused product or service
- Supporting materials such as product documentation, screenshots, manuals, or publicly available technical specifications
3. Economic Value of the Case
Funders generally prefer cases where there is a reasonable basis for expecting a meaningful financial recovery. Key factors in this assessment may include:
- The commercial success and market reach of the accused product or service
- The financial impact of the alleged infringement on the patent holder
- Whether there is a realistic and supportable damages model, ideally supported by expert analysis
4. Quality of the Legal Team
The experience and capabilities of the legal team handling the case are important factors in a funder’s evaluation. Funders generally look for:
- Attorneys with significant experience in patent litigation
- Access to technical experts in the relevant technology area
- A clearly defined litigation strategy and realistic budget
5. Risk Profile and Jurisdictional Considerations
Funders evaluate the overall cost-to-benefit ratio of the case, including the estimated cost of litigation relative to the expected recovery. Jurisdictional considerations—such as the venue where the case will be filed and its track record with patent cases—may also factor into the evaluation.
Preparing Your Case for Funder Review
Understanding these factors and preparing your case accordingly may improve your chances of securing third-party funding for patent enforcement. If you would like assistance preparing your case for funder review, contact Protego, LLC.
Disclaimer
This article is for general informational purposes only and reflects the views of the Protego, LLC (“Protego”) team as of the date of publication. Protego is not a law firm and does not provide legal, financial, investment, or tax advice. Nothing in this article should be construed as or relied upon as professional advice. The information presented may not reflect the most current legal developments, and Protego makes no representations or warranties regarding its accuracy or completeness.
Protego does not guarantee that litigation funding will be obtained or that any particular outcome will result from pursuing patent enforcement. All cases are unique, and results depend on the specific facts and circumstances involved. For advice specific to your situation, please consult a qualified attorney, financial advisor, or tax professional.
Protego has a financial interest in matters it presents to funding partners. Fee structure and terms are disclosed in writing before any engagement begins.
Last reviewed: February, 2026
Sources: Consult the U.S. Government Accountability Office and academic research on litigation finance for additional background. Protego recommends verifying all cited sources independently.