Any founder worth his/her salt would have ensured that the company has full legal insurance cover. I.E. it won't cost them money (other than a small excess) to get lawyers involved.
Sorry, my startup is based in London, UK - the only insurer we found here that was willing to provide worldwide coverage for a tech startup was Hiscox.
Are you sure that's normally done? We had general liability insurance, is that what you're referring to?
It's not just about cost though, it's attention. Think of the google/oracle trial: Andy Rubin, Eric Schmidt, Larry Page, etc all have better things to do than be in a courtroom.
