All too often we get entrenched in our positions. We focus on legal rights instead of what we really want to achieve through the lawsuit. In the process we dig ourselves a foxhole and set the stage for battle, not constructive negotiation.
Legal rights are certainly important. They establish a baseline of expectations and a protected zone of interest. But even if you’re right about your “position,” hammering each other into the ground with legal rights comes at the expense of the relationship. It means you could win the battle and lose the war.
For years software giant Microsoft refused to settle cases with anyone. They took a hard line, scorched earth approach to litigation. But in 2002, with a new general counsel at the helm of its legal department, the company reevaluated its litigation strategy and entered a less confrontational era.
They realized that the uncertain nature of patent suits hampered the company’s ability to innovate. Shortly after adopting its new strategy, the company settled approximately twenty-one cases, including some major ones: an antitrust and patent infringement case involving archrival Sun Microsystems, an antitrust case involving time Warner, and a patent infringement case involving InterTrust Technologies.
Settlement, including cross-licensing arrangements and business collaborations, made more business sense than protracted litigation. Microsoft realized that it was easier to license patent technology than to design around it. The new philosophy was evident again in 2005 when Microsoft settled an antitrust claim with Gateway for $150 million and agreed as part of the settlement to collaborate on the marketing and development of Gateway products.
By focusing on the future and recognizing that there was more to be gained by making peace instead of war the company was able to focus more on innovation than litigation and reduce some of the cost of bringing product to market. A change in position opened new doors and opportunities.