Tag Archives: Managing Intellectual Property

Can blockchain be a game-changer for millions of IP transactions?

The abundant promise of blockchain has yet to be realized. To many in IP, finance and tech, it is just beginning to come into sight.

The initial application of blockchain’s distributed ledger, bitcoin, has turned out to be more of a speculative sideshow than a legitimate alternative currency. We hear repeatedly that bitcoin is merely the first of many possibilities, and that blockchain should not be judged on the basis of bitcoin.

Fundamental Change?

One of the most intriguing areas of potential for blockchain, or encrypted distributed ledger of data, is transacting IP rights — so-called smart transactions. Smart transactions aim to make more efficient millions of copyright, patent and trademark licenses by providing greater transparency and the removing costly middlemen. It sounds great – but can it really happen or is it merely the alchemists’ fantasy?

In April, Managing Intellectual Property, magazine ran a feature on blockchain, “Blockchain Party,” which can be found here. The special report discusses how blockchain will fundamentally change IP transactions, and haw already started to. The race for blockchain patents is well under way, with U.S. and some European banks, fintech firms and tech companies jockeying for position with the Chinese.

Who use blockchain?

The following infographic from Bitfortune.net, a bitcoin promotion and gaming website, offers 16 industries and areas where distributed ledger adoption is underway. (Sources for the data are offered at the bottom of the graphic. They have not been checked.)

Bitfortune says “many experts believe that blockchain will change our world in the next 20 years as much as the internet has over the past 20.”

[Three useful blockchain articles follow the long infographic below.]


More on blockchain:

IP CloseUp: 59% of blockchain patents are owned by developers; BofA and IBM dominate banks and tech players.

DS Avocats: Blockchain, Smart Contracts and Intellectual Property.

WIPO Magazine: Blockchain and IP Law: A Match Made in Crypto Heaven?

Inauspicious Beginnings

Can blockchain shake off its inauspicious beginnings as bitcoin foundation and deliver on its promise?

Many are pulling for it, including me and several banks, fintech businesses and technology players, who are either investing heavily or hedging their bets.


Image source: bitfortune.net

$300 discount for IPCU readers to attend US Patent Forum 2016

The fifth annual US Patent Forum is returning to Washington DC on March 17, 2016. A similar forum will precede it in Palo Alto on March 15.

In light of the recent US patent developments, the US Patent Forum, hosted by Managing Intellectual Property magazine, will take an in-depth look at topics affecting US patents today.

The conference will delve into post-grant proceedings before USPTO’s PTAB, examine strategies that make patents more secure, and explore levels of proof and understanding regarding how claims are construed.

Topics covered in the Washington US Patent Forum will include:

  • ITC Litigation and Licensing
  • Post-Grant Proceeding Before the PTAB
  • Uncertainty of Patentable Subject Matter
  • Patent Reform
  • Focus on Unitary Patent & Unified Patent Court
  • Trade Secret Protection for Innovationpress-mip

Featured speakers include Tom Scott, former chair of Goodwin’s Proctor’s IP Department and now Senior Vice President and General Counsel of Personalized Media Communications (PMC), one of the leading patent licensing companies.

IPCU Reader-Discount

For Silicon Valley, the US Patent Forum, is being held at the Sheraton on El Camino and University, opposite the Stamford University Campus in Palo Alto on March 15. The focus will be the Patent Trial and Appeal Board and strategies for dealing with it.

A $300 discount is being offered off of the full delegate price to IP CloseUp readers who attend. Just mention this article. (In-house counsel and corporate executives attend for free.) 

Delegates are invited to attend a full day of discussion to hear from, and network with over 100 leading experts in multiple fields.

They will be able to participate in important discussion about the most significant developments in the US patent system and receive updates on important changes to major global IP systems from experts. There also will be opportunities to contribute to the discussion as well as learn.

For more information, or to register for US Patent Forum 2016, go here for Washington, and here for Palo Alto.

Image source: huffingtonpost.com; managingip.com

Patent Troll “Witch Hunt” Slammed; IP Litigation Tactics, Too

Companies and lawmakers who bash businesses that license patents got a dose of their own bitter medicine this week when their techniques were compared with those of fear-mongering, 1950s anti-communist demagogue Joe McCarthy.

“Villains of the new millennium” is how Jamie Siegel, an Acacia Research Group’s Senior Vice President, characterized the portrayal of non-practicing entities NPEs, also known as patent “trolls,” by those that stand to gain from their demise and who routinely disparage them in the press.

Speaking at the second annual Benchmark Litigation U.S. awards dinner in New York, Siegel was quoted in a story by reporter Michael Loney that appears in the Managing Intellectual Property blog as saying.

“[J]ust as McCarthyism sought to unfairly tag so many with the ‘red’ moniker, Congress, the press, many giant software companies, and even our president, today Jaime-Siegel-retouchedseek to slap the moniker of ‘troll’ on attorneys and business people who are doing nothing more than monetising assets that they own – assets whose very existence is protected by Article 1 Section 8 of our Constitution.” Siegel joined California-based Acacia from Sony last year.

Siegel added that the hysteria around NPEs has been further inflamed by a lack of knowledge, including from the U.S. president. He said Barack Obama showed a lack of understanding when he issued executive directives to change the patent system. Contrary to public perception, he reminded the audience of lawyers, NPEs are good for innovation.

[Gene Quinn in IP Watchdog ran well-linked piece this week that took a deeper look at the sources of NPE-bashing, “Obama on Patents: The One-Sided USPTO Patent Ligation Beta.”]

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In a separate but related development this week, Hon. Randall Rader, Chief Judge of the Court of Appeals for the Federal Circuit (CAFC) provided his strongest and most vocal defense of patent holders’ rights to date.

At a global IP conference in California Law.com reported that he said that  the problem of so-called patent trolls really boils down to a problem of excessive litigation costs. And it’s lawyers who are driving up those costs by spending millions on discovery in search of elusive “smoking-gun” documents.

“You yourselves should be going to your trial judges and requesting restrictions on discovery,” he added. “We cannot tolerate $3 million in discovery expense.

randall-r-rader2While chastising lawyers Judge Rader did not challenge their clients who can afford to pay the exorbitant legal bills and make it increasingly difficult for plaintiffs to file a legitimate complaint. No mention was made of the role recent legislation, which effectively forces holders of even the best patents to sue first to get the attention of an alleged infringer and prevent a declaratory judgement, and negotiate a license later.

“The problem isn’t the patent system. The problem isn’t even trolls,” Judge Rader said, and any effort to single them out will inevitably penalize universities, research clinics and other legitimate contributors to the U.S. innovation system.”

Doug Croxall, CEO of Marathon Patent Group (MARA), a patent licensing and management company, said that “the focus should be on patent quality not ownership. Many companies are unaccustomed to having good patents enforced by knowledgeable parties. We need to embrace good inventions, not fear them.”

Image source: daylife.com/photo/09r76Bpdgh003; patlawcenter.pli.edu; acaciaresearch.com

Apple v. Samsung Shows Brand Matters to Patent Holders, Juries

There is a Tendency to View Patent Prowess as a Function of Reputation and Perceived Innovation

Much of billion dollar verdict in Apple v. Samsung turned on brand reputation and perception of what it does that is truly innovative.

“What Apple v. Samsung Says About US Jury Trials” in Managing Intellectual Property quotes Ronald Beaton of Trial Graphix as saying “Juries in Silicon Valley are particularly IP-Savvy. The longer you live there the more it gets into your head.”

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Apple’s brand reputation is tops, but what about its less than stellar IP performance? You can hardly argue with Apple’s virtually world leading market value (PetroChina is number one) and unrelenting growth. It’s patent strategy, while less cohesive, did not stop it from winning a billion dollar victory over a generally stronger patent (but not brand) rival. If nothing else, Apple is the consummate technology packager, and it takes every opportunity to let audiences know it. Its reputation as a design leader was at stake, as was its perception as an innovator. Samsung’s infringement of that asset, it could be said, is what the local jury rewarded.

Brand and IP reputation are intrinsically bound. Apple’s patent history is not the most auspicious. Many say it has the wrong or too few patents (probably less than 3,000 worldwide, excluding those it paid $2.6 billion for in the Rockstar Consortium). The company is believed to be vulnerable in many areas that it sells products. (See smart phone suit chart below.) Samsung has some 30,000 patents.

Faith in Proprietary Design

Putting so many eggs in its design patent basket was a bold move for Apple that paid off for now. The right combination of foreign infringer, venue (Silicon Valley) and jury pool,  clearly paid off. So did the company’s perceived value as a technology innovator.

One wonders if the chips would have fallen the same way if it were Google or Facebook defending itself in San Jose on a patent infringement charge asserted by a Silicon Valley neighbor. Apple to SV is what the General Motors was to Detroit. I’m not certain the others can claim the same loyalty.

At the end of the day Samsung is not likely to have to cut a check for $1 billion anytime soon, if ever. The effect on an injunction on its devices, should it be granted, will be negligible according to Sanford C. Bernstein analyst Mark Newman. The devices in question are older ones and will account for less than 1.4% of the Korean company’s worldwide profits. And bet you didn’t know this: Apple is still Samsung’s biggest customer for mobile device components.

In the end, Apple v. Samsung is really about a kind of court-ordered mandatory license that sets a high bar for any potential competitors. Samsung can certainly afford the “damages,” and what’s wrong with their having to live with an oligopoly if the high cost of entry narrows the competitive field? For smartphone outsiders the answer is simple: they will have to innovate better to succeed.

The uncharacteristic respect that the court and jury showed for design patents may have more to do with the fact they are Apple’s than any legal precedent or direction from the bench.  Brand can be powerful tool for enhancing patents and positioning a business as inherently innovative. It is something that Marshall Phelps realized at IBM in the late 1980s, as did Bill Gates at Microsoft starting in the late 1990s.

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A Culture of Success

Patent portfolio holders would be wise to be more transparent about their IP activities, and, where appropriate, attempt to establish a culture of IP success and ROI. A company’s reputation for innovation and managing its IP rights proficiently, today, can be a valuable asset.  Often, it can hinge on its perceived ability to innovate.

Michael Hages, an IP attorney writes in Core 77, a design magazine, that “The traditionally meager status of design patents is the reason why many designers are likely surprised by the prominence of design patents in Apple v. Samsung.”

“The real potential for impact, however lies in the mere fact that the design and business worlds are paying close attention to the design patent side of this case in the first place. Design patents have been around for over 150 years and in that time have only seen limited usage. Sure, many people or corporations have sued in the past to enforce their design rights with some success, but both the number of design patent lawsuits and the number of design patents granted pale in comparison to those of utility patents.

” …In all reality, practically everyone who has an opinion holds design patents in the lowest esteem of all the different forms of IP protection.”

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So, how did Apple pull off the design patent victory of a lifetime? What does it mean for other industries and products where design rights are crucial but not typically enforced?

That will depend on who else is willing to step up and defend their design patents as vigorously as Apple. It also will depend on who the parties are. The auto industry is one area where gentlemanly cross-licenses have trumped aggressive enforcement. Design patents can be useful, even if it is just to slow competitors down. But they have to be enforced, a nasty, expensive and somewhat speculative process that does not always result in direct financial return.  For Big Three U.S. automakers design enforcement has not been a cultural imperative. It will be interesting to see if Apple v. Samsung will have a lasting impact consumer electronics and other industries.

Illustration sources: hypebot.com; wsj.com; ritholz.com 

Disclosure: I have no position in the shares of or current business relationships with any companies mentioned in this article.

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Apple v. Samsung jury foreman, Velvin R. Hogan, is a 67-year old retired engineer who holds a patent and has had a 35 year career in hard-drive technology with Memorex, Storage Technology and Digital Equipment, companies that are either out of business or have seen better days. Fortune’s summary of interviews with Hogan about the case and what led the jury to its decision makes for fascinating reading.

The UK Drives IP Services

The British are Here!

The UK holds a unique position in intellectual property world, especially publishing and services. At least several of the top IP publications are British or British-owned. IAM(IP Media Group), Managing Intellectual Property (Euromoney Institutional Investor), IP Review (CPA Global), World IP Review (Newton Media) and Intellectual Property Magazine (Informa).

IP Law & Business, recently folded into Corporate Counsel, is owned by American Lawyer Media, which was acquired two years ago by British media and private equity firms and is now under the direction of the Royal Bank of Scotland (RBS). Jeremy Phillips’ seven plus blogs,IPKat and IP Finance among them, also originate in England. (Jeremy, BTW, founded MIP.) 

Additionally, the leading IP brokerage and transactions firm, ICAP OT, trades on the FITSE, and CPA Global, the leading IP renewals and administrative business, recently acquired in a management buy-out that valued it at $1.5b (USD), is located in Jersey (not New Joisey!). Anaqua, the top IAM software company that recently acquired SGA2, a French renewals business, was originally established in London and still has a key office there. There are other examples too numerous to cite.

English may be better equipped to observe and compute the world IP scene more effectively than Americans, who for the most part enjoy the best protections and reap the largest returns. The Brits are making it clear that there are many ways for many nations to participate in lucrative market for owning and understanding intellectual assets and the services that are required to maintain them.

In the 19th century gold miners relied on a variety of businesses to sell them picks, shovels and maps. In the early 20th century oil speculators needed drilling rigs and geological surveys. Digging for new ideas can be as daunting as mining for ore or drilling for crude.

Innovators and innovation managers need all of the help they can get. Apparently they are getting a lot of it from UK providers.

Illustration: EMI Canada

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