Sued in America: A Canadian Company’s Plain-English Guide to U.S. Patent Lawsuits

If your company is based in Canada — or anywhere outside the United States — and you’ve been sued for patent infringement in a U.S. court, or hit with a demand letter, or named in a proceeding at the U.S. International Trade Commission, this page answers the questions we hear most often.

“We’re a Canadian company. Can we even be sued for patent infringement in the United States?”

Yes. If you sell, ship, import, or offer products or services into the U.S. market — directly or through distributors, resellers, or an online marketplace — a U.S. court can generally exercise jurisdiction over you for infringement tied to those U.S. activities. Being headquartered abroad does not put you out of reach.

“Where can they sue us? Can we be dragged into Texas?”

Often, yes — and this surprises people. U.S. domestic companies get venue protection under a 2017 Supreme Court decision (*TC Heartland*) that limits where they can be sued. Foreign defendants do not get that protection.  Under long-standing U.S. law, a foreign company can generally be sued for patent infringement in any federal judicial district in which personal jurisdiction exists, including the plaintiff-friendly districts in Texas. So, the venue that a U.S. competitor could avoid may be wide open against you.

“How is a U.S. patent case different from litigation in Canada?”

Three big differences: (1) Discovery is far broader in the U.S. — expect to produce large volumes of documents, emails, source code, and give witness depositions. (2) Cost is higher, driven largely by that discovery. (3) Juries decide many U.S. patent cases, including damages. The process is more front-loaded and more expensive than most non-U.S. companies expect, which is exactly why early strategy matters.

“What’s the ITC, and why did someone say we could be blocked from importing?”

The U.S. International Trade Commission (ITC) is a separate forum from the district courts. Under Section 337, a patent owner can ask the ITC to investigate imported products and issue an exclusion order that directs U.S. Customs to block your goods at the border. The ITC is fast (often 16–18 months), doesn’t award money damages, and its remedy — keeping your product out of the U.S. — can be more threatening than a damages case. Foreign manufacturers are frequent ITC targets, and it can run in parallel with a district-court suit.

“Can we challenge the patent itself instead of just defending the lawsuit?”

Yes. Inter partes review (IPR) and ex parte reexamination are proceedings at the U.S. Patent Office that let you attack the validity of the patent being asserted against you — available to any party, foreign or domestic. It can be faster and less expensive than a full district-court validity fight, and a successful challenge at the USPTO can end the dispute. Timing and strategy are critical, and the current environment matters: the Patent Office has been denying more IPR petitions on discretionary grounds, so the window and the approach need to be planned carefully with U.S. counsel. Reexamination has its own strategic issues to be evaluated carefully.

“What are we actually exposed to — money, an injunction, or both?”

Potentially several things: money damages (a reasonable royalty or lost profits), a permanent injunction or ITC exclusion order stopping U.S. sales, and — if infringement is found to be willful— enhanced damages of up to three times the award. In “exceptional” cases, a court can also shift attorney’s fees to the losing side under 35 U.S.C. § 285 (the Supreme Court changed the law on § 285 in a Harness IP case known as Octane Fitness).

“They served us in Canada. Do we have to respond?”

Almost certainly, yes — and don’t wait. Service on a foreign company is usually made under the Hague Service Convention. Ignoring a properly served U.S. suit risks a default judgment, which the plaintiff can try to enforce against your U.S. assets, your U.S. subsidiary, or your ability to sell into the U.S. Deadlines move quickly; the first move is to get U.S. counsel engaged before your response is due.

“If we lose in the U.S., can they collect against us in Canada?”

A U.S. money judgment is enforced first against any U.S. assets or U.S.-based subsidiary. Enforcing a U.S. judgment in Canada is a separate legal process with its own requirements and is not automatic — but you should not count on the border as a shield, especially if you have U.S. operations, customers, receivables, or inventory.

“Our product is basically the same as a competitor’s. Does that mean we infringe?”

Not necessarily. Infringement turns on the specific claims of the patent — the numbered legal definitions at the end of the document — not on whether two products look or function alike. A proper analysis compares your product to each claim element. Many strong defenses (non-infringement, invalidity, prior art) only surface once someone reads the claims against your actual product and the patent’s history.

“We got a demand letter but no lawsuit yet. What should we do?”

Take it seriously, but don’t panic or ignore it. A demand letter is often the opening move in licensing or litigation. Early steps: preserve relevant documents, avoid informal responses that could be used against you, and get a freedom-to-operate and validity read so you understand your real exposure before you negotiate. Sometimes the best response is a proactive challenge to the patent; sometimes it’s a quiet, well-supported non-infringement position.

“Do we need U.S. lawyers, or can our Canadian firm handle it?”

U.S. patent litigation and USPTO proceedings require U.S. counsel admitted in the relevant forum. The most efficient arrangement is usually your existing Canadian counsel or in-house team coordinating with a U.S. patent-litigation firm that runs the district-court, ITC, or USPTO strategy. One note that catches non-U.S. companies off guard: U.S. attorney-client privilege rules differ from Canadian ones, so how your internal communications and patent-agent advice are handled should be managed from the start.

“What should we do in the first two weeks?”

1. Calendar the deadlines — a U.S. response is due fast, and missing it is costly.
2. Preserve documents — issue a litigation hold; deleting relevant material creates its own problems in U.S. litigation.
3. Get a U.S. counsel read on jurisdiction, venue, the strength of the patent, and whether an USPTO challenge or ITC angle changes the picture.
4. Say little externally until you understand your position.

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Working with U.S. counsel on a cross-border matter

We regularly represent non-U.S. companies — including Canadian companies — in U.S. patent litigation, ITC Section 337 investigations, and USPTO challenges, coordinating with the client’s home-country counsel. If your company is facing a U.S. patent dispute, the earlier the strategy is set, the more options you have.

Matthew L. Cutler (Matt Cutler), Principal, Harness IP. Patent litigation, ITC, inter partes review, and ex parte reexamination.