When you buy your SD-WAN, or for that matter any WAN technology, you sort of assume that the vendor has the legal right to sell it to you.\nBut what happens if they don\u2019t? What happens if you\u2019ve built your WAN on an illegally acquired technology?\nThe question is not just theoretical. Last week, FatPipe sent me a press release pointing out how United States PTO Patent Court upheld a signature claim to its U.S. patent (number 6,775,235) for load balancing across disparate networks. Load balancing is a critical component of all SD-WAN products. As such, FatPipe could, in theory, claim licensing fees from SD-WAN players and their users.\nIt\u2019s a claim that anyone looking at SD-WAN cannot simply ignore. Back in the '90s, the Token Ring market was in part stymied because the inventor, Olof Soderblum, charged licensing fees for the technology, raising Token Ring costs. Vendors will use patent claims to deter competitors.\nRiverbed did as much in the WAN optimization market. Are we headed for a similar fall out in the SD-WAN market? (I\u2019d like to hear what you think. Leave a comment for me here.)\nIs this real?\nI\u2019m not a lawyer, but I have spent a fair amount of time involved with intellectual property law. At one time, I ran Fabulous Footage, a licensor of motion picture stock footage, before selling to Getty Images. Another company where I managed intellectual property, One Zero Media, was the exclusive entertainment content provider to AltaVista.\nAll totaled I negotiated over 150 licensing agreements at those companies. \u00a0I also took a course at Harvard Law School on the Intellectual Property and Digital Millennium Copyright Act (DMCA). \u00a0In the process of working with clients and their attorneys on licensing and service agreements, I have collected a breadth of real world experience with these agreements. \u00a0\nAnd in looking through the patent, it looks pretty cut-and-dry to me. But it\u2019s not.\nI just spoke with the patent counsel for Talari and in his word\u2019s Fatpipe\u2019s press release is not correct. The patent office\u00a0has not proven that the claim is valid.\nFatPipe has sued multiple parties on two of its patents (U.S. Patent 7,406,048\u00a0and\u00a0U.S. Patent 6,775,235) including 36 claims against Talari Networks. Those cases were stayed so that the U.S. Patent Office could review FatPipe\u2019s patents. Last week, the U.S. Patent Office issued two separate decisions\u00a0against\u00a0FatPipe.\u00a0\nThe first decision held that all 24 claims of FatPipe\u2019s \u2018048 patent were\u00a0unpatentable. (See\u00a0IPR2016-00977 FD FINAL.pdf).\u00a0The second decision held that all but one of the 12 challenged claims of FatPipe\u2019s \u2018235 patent were\u00a0unpatentable.\u00a0(See\u00a0IPR2016-00976 FD FINAL.pdf). The single remaining claim was not, as was suggested by FatPipe, ruled to be valid and in fact is still being challenged in other proceedings, including by Cisco and Talari.\nSo FatPipe lost 35 of 36 claims before its cases even got warm and tried to sell it as good news. That\u2019s good news for SD-WAN users who are unlikely to have to worry about FatPipe coming after them any time soon.\nWhat you should do\nPatent infringement cases come and go in the networking industry. Enterprises can and should protect themselves to avoid any problem.\nIt\u2019s not that difficult.\nMake sure contracts have an indemnification clause. It\u2019s standard for all of the vendor contracts we negotiate for our customers and your supplier should be doing the same. Basically, the clause has the vendor warranting they legally own the technology and in the case of a problem, will cover any third-party claims against the customer. Remember that vendor contracts are designed to protect them, not you.\nNo matter what you do, don\u2019t dismiss the issue. A lawsuit is the last thing you want to factor into your IT budgets.