You own a small company that developed software for organizing and playing music on mobile devices and computers. Your software contains a number of features that you have patented and the future looks bright. However, you have discovered something troubling. It appears that a number of the patented features were copied in similar software developed by Music 4 All, a huge software company with annual sales in excess of $1 billion. You are distressed. Music 4 All has appeared to have stolen your ideas. Worse yet, that company has the brand recognition and a marketing budget that far exceeds yours, which positions it to steal the market and possibly drive you out of business. You decide to sue Music 4 All for patent infringement. With attorney’s fees and other expenses, the cost of going to trial – win or lose – is expected to cost you $1 million. You and your attorney feel you have 60% chance of winning the case, which would award your $5 million in damages. If you lose the case, you get nothing. In addition, if you lose the case, there is a 50% chance the judge would order you to pay for Music 4 All’s court costs and attorney fees – an additional $1 million. Music 4 All has offered $1.5 million to settle out of court with you. Draw a decision tree for this problem. What does the decision tree tell you to do? Is this the right decision? Why or why not?
You own a small company that developed software for organizing and playing music on mobile devices and computers. Your software contains a number of features that you have patented and the future looks bright.
However, you have discovered something troubling. It appears that a number of the patented features were copied in similar software developed by Music 4 All, a huge software company with annual sales in excess of $1 billion. You are distressed. Music 4 All has appeared to have stolen your ideas. Worse yet, that company has the brand recognition and a marketing budget that far exceeds yours, which positions it to steal the market and possibly drive you out of business.
You decide to sue Music 4 All for patent infringement. With attorney’s fees and other expenses, the cost of going to trial – win or lose – is expected to cost you $1 million. You and your attorney feel you have 60% chance of winning the case, which would award your $5 million in damages. If you lose the case, you get nothing. In addition, if you lose the case, there is a 50% chance the judge would order you to pay for Music 4 All’s court costs and attorney fees – an additional $1 million. Music 4 All has offered $1.5 million to settle out of court with you.
- Draw a decision tree for this problem.
- What does the decision tree tell you to do?
- Is this the right decision? Why or why not?
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