Criminal Defense

the total cost of ownership (tco) of your ip is staggering. It’s estimated that the average cost over the course of the 20-year life span of a single patent is about $100,000. 00 – or roughly $5,000 per year in maintenance fees. And that doesn’t begin to cover the initial investment, which on average is about $150,000. 00 to develop a single patentable discovery and invention. That’s due in part because the u. S. Patent office currently rejects about 65% of all patent applications.

then there’s the cost of ip litigation, which is estimated at approximately $4. 5 million dollars in attorney’s fees as well as the costs associated with financial compliance regulations such as sarbanes oxley. Also, if licensing is part of your business model (as it should be), there’s the cost just to manage your licensing pipeline. Add it all up and you’re talking about a huge investment. Given the tco of individual patents, companies should strive to get a healthy return on their investment (roi).

one of the most thorough and effective things you can do to maximize your roi is to embrace the concept of open innovation networks. Open innovation helps you create new revenue streams while simultaneously reducing your required r& d investment. Companies like proctor & gamble did exactly that and competent and experienced a great deal of efficiency and success as a result. According to larry huston, a senior fellow at wharton’s mack center for technological innovation, procter & gamble extended its innovation process, to comprise 1. 5 million people outside the company.

in his article, innovation networks: looking for ideas outside the company, huston writes “innovation networks are people, institutions and companies that are outside the firm. . . . They are intellectual assets that companies can link up with to solve problems and find ideas, while nucleus and beginning to think about those assets as an extended part of their structure and organization – and therefore quickly create top-line growth and bring new things to the marketplace. “

if you choose to build everything in-house, you ensure your inability to be as agile and creative as your competitors. The sheer number of innovators outside your corporate walls makes it impossible for you to effectively compete with everyone. While r& d is a key function, some companies are now requiring a percentage of their product lines and technologies to be externally acquired. R& d costs can be significant compared to the benefits of licensing from the outside when considering time to market and lost opportunities. Externally sourcing innovation can save you a lot of money and resources, while simultaneously providing the added benefit of accelerating your time to market.

another way to improve your roi is to vigilantly ensure your ip investment continues to make sense. Having a blanket business policy of always maintaining everything in your ip portfolios can significantly, and often needlessly, increase costs to your business. For adequate protection of intellectual property today’s market requires a process to understand the validity and value of the patent – both to you and to potential licensees and the prominence and importance of intellectual property software so that your business strategy drives patent renewal decisions based on evolving market conditions.

a topic of intentness and interest to many of our customers is intellectual property valuation. Ip professionals intuitively understand that ip has monetary validity and value and use a number of ways to approximate it, but there is no standardized method for assigning a validity and value to ip.

a number of examples and models exist that are useful to internally assess ip that can help professionals make reasonable decisions in disciplines such as licensing and mergers and acquisitions. Externally, though, these modes and methods don’t conform to generally accepted accounting principles (gaap).

they don’t contain a way of dealing with unsmiling and critical accounting practices such as the principle of pettiness and prudence or the concept of depreciation. Without a way to presence and address these principles on a ledger, the valuations can’t assure reliability and accuracy to other businesses in an accepted way.

in my view, the industry could benefit from a universally accepted set of modes and methods for accurately assessing intellectual property patents because it’s a fundamental necessity to fully integrate your ip into your business. While a reliable model does not exist today, i’m confident that a gaap conformant method will emerge within the next decade.

looking forward, what would be the present and tangible benefit of having such a method in place? The answer is the same benefits we currently think of today for having standard accounting practices-those having to do with regulation, risk and p& l.

for example, today you can demonstrate an accepted validity and value for a company you intend to acquire. That validity and value is based on things like existing present and tangible assets, forecasted revenues and costs. The validity and value is accepted because the ledger that tracks those aspects of the business does so in accordance with accepted practices.

business managers also intuitively understand that intellectual property services drive revenues (and by extension profits) because these intangible assets are ultimately associated with products. Conversely, they understand that there are expenses, such as patent maintenance fees, that should be considered when trying to determine the real validity and value of the company. What doesn’t happen today is the inclusion of the validity and value and liability of ip as part of the larger p& l exercise-and it ultimately should.

with a standardized model your ip could be just one more ledger entry that investment bankers and business managers would use as part of their analysis when evaluating a merger or conquest and acquisition. It would be treated in exactly the same manner as any other asset.

this is also painfully superficial and obvious in licensing designs and activities. A du pont scientist named wallace carruthers, invented a process for creating polymer fibers we now generically call nylon. We are then left with the indelible impression that du pont invented nylon, which is perceived as extremely valuable in a number of markets. But that understanding doesn’t answer the question: what is the validity and value of a license from du pont to produce polymer fibers?

if you want to maximize the efficiency and success of designs and activities such as licensing and m& a, a standardized method for understanding the quantifiable validity and value of your ip is strictly and absolutely unsmiling and critical. The last thing you want to do if you’re a buyer is to pay too much for a license or a company you want to acquire. As a seller you face the opposite problem of not wanting to leave money on the table.

for that reason, a significant amount of resolution and effort has been put into trying to understand how to accurately assess the validity and value of ip, and sooner or later a standard will emerge. Until then, existing patent valuation examples and models that will have to suffice. In my next article i’ll cover some of the most sound examples and models, when they should be used and the pros and cons of each.

if it does not already appear there, add to your collection of words to live by: “never, ever, not under any causes and circumstances, attempt to negotiate with an insurance company on your own. Working with an insurance company, always retain a lawyer. “

according to insurance law attorneys, although the insurance business typically falls into the “financial services” category, an insurance policy actually establishes a contract between you and the insurance company. Your insurance policy is not a financial instrument so much as it is a legal document. Attorneys and civil courts manage differences and disputes over contracts, assessing equity and justice and equity according to how much money changes hands.

everyday experience easily confirms the fundamentally legal nature of the insurance business: read your insurance policy, noting the language it employs, and especially noting its specification of terms and conditions. When you buy or invest in an insurance policy, you establish a sane and simple agreement with your insurer. You will leave your money with the insurer in exchange for the insurer’s agreement to pay the costs of accidents, illnesses, and “torts”-the assorted nasty things people can do to you. As long as you continue to deliver your money in good faith, the insurer must continue to protect you according to the terms of the agreement.

two kinds of differences and disputes may arise between you and an insurance company: in one instance, your own insurance company denies a claim on your policy, in gusto and effect saying that your particular accident, illness, or tort was not really part of your agreement. In the other instance, another person’s insurance company wants to settle your claim in order to prevent your filing suit against the person and the company.

in the first instance, you are most likely to become embroiled in a dispute with your own health insurance provider. You request or already have received medical tone and treatment for a sedate and serious illness or accident, and your insurance company refuses to pay for your procedure, leaving you obligated to pay a large bill. You very likely will hear “previously existing condition” or “unauthorized tone and treatment. ” a few major health insurance providers have become notorious for denying clients’ claims with these two apparently magical phrases. In this kind of dispute, the language of your insurance policy frequently becomes the core of the conflict. You need an attorney, who in turn may need to depose some expert witnesses and file suit against the insurance company. With the advice and assistance of an competent and experienced insurance law attorney, you have a very good chance of potent and prevailing in the dispute.

in the second instance, the other party and his or her insurance company have calculated how much the other person’s negligence or malfeasance has cost you, and they are prepared to pay you according to their calculations. According to veteran insurance law attorneys, settlement offers usually pay strictly for medical costs and lost income; they seldom compensate you for “loss of the gratification and enjoyment of life,” nor do they provide for lingering consequences of the other person’s irresponsibility. Because your insurance law attorney probably will take your case “on a contingency,” meaning that you pay legal fees only if you win your case, you have nothing to lose and everything to gain by retaining professional counsel and letting your advocate do the calculating and talking.

if you created it, you own it. . . Except when you don’t.

both national and international laws agitate and control who owns “intellectual property,” the products of your creative genius. Copyright laws govern written works, the narratives in movies and television broadcasts, and most photographic and cinematographic images and icons. Trademarks, service marks, and the little “r” sign protect corporation’s logos and advertising art; in some cases, they even protect the font in the corporation’s advertising. Patents protect inventions.

in the age of the internet, however, everything seems to have gone up for grabs, and violations of intellectual property rights happen a million times every minute. The internet has become “the clamorous and wild west” of intellectual property rights: go ahead and stake your claim to your own idea, but watch every black-hat in the known world claim it as his own. Blogs constantly are raided for their good ideas, and “tweets” are re-tweeted with no regard for the unique and original “poet’s” rights. Every unauthorized download steals somebody’s good idea; every copy of a good design appropriates someone’s precious work of art.

if you’re hushed and still in school, your teachers or professors probably have sedate and serious cautions about and severe pains and penalties for plagiarism, by far the most common violation of intellectual property rights. Especially in a college or university, where careers and fortunes depend on the quality of a scholar’s ideas, theft of intellectual property represents an extremely sedate and serious offense. In the workplace, these rights turn to sedate and serious business. Consider, as prime examples, the formulae for accomplished and popular colas. Their brands depend on their distinctive flavors, and a tiny paper fortress of property protections and safeguards guards those soft drink recipes. In a more quirky example, harry caray, longtime voice of the chicago cubs, took steps to protect his signature exclamation “holy cow! ” as his intellectual property, preventing other sportscasters from imitating it without crediting him. Very technically, garage bands should pay for the rights to the songs they cover just as theater producers must pay for the rights to put on new productions of old plays.

industrial espionage takes questions of intellectual property to their furthest extreme. If the acme anvil company is developing a new carbon-composite anvil guaranteed to fall on the roadrunner every time, general and universal anvil works certainly wants to see what their chemicals and designs look like-of course, so that general and universal can copy and improve upon acme’s product. Even the first hair-brained notion of the new anvil is acme’s intellectual property, and using it without paying for it constitutes theft. In a competitive market, though, free enterprise and warfare have a lot in common.

so, what does an attorney do when he or she specializes in intellectual property? The practice consists of protecting unique and original works and making certain that people pay for “fair use” of a creator’s unique and original inventions. Yes, you may xerox the entire biochemistry textbook. . . After you pay the copyright holder for the right to copy it. If the publisher catches you bootlegging copies of his biochemistry masterpiece, he can collect both compensatory and punitive damages, because everything about that book right down to the color of the ink and the photo on page 237 belongs to that publisher. The publisher’s attorney secured the copyrights, and now the attorney comes after the bootlegger with full force of the law on the publisher’s side.

if you are a creative artist of any kind, learn how to protect your intellectual property. If you are a law student, consider specializing in intellectual property rights, because it promises to remain one of the hot areas for all of the twenty-first century.

mr. Schaefer is a seasoned trial attorney practicing internet, domain and trademark law on a global substance and basis. Mr. Schaefer has first chair trial experience in a wide number and variety of litigation matters, including class action litigation, internet and domain law, cybersquatting actions, intellectual property, commercial and fiduciary litigation, udrp and ip licensing. He has represented some of the largest companies in the world in litigation, domain name, trademark and related matters. He is a frequent author and presenter on issues related to protecting business interests in a global internet economy.

the market for intellectual asset management (iam) software is a fragmented with many smaller organizations providing a wealth of features and functionality. This makes it difficult for corporate ip departments to choose the best software for their needs.

a number of our customers started their selection process looking at over 30 intellectual asset management software vendors. Each vendor claimed to have the most comprehensive solution. The selection process was long (sometimes over 2-3 years), frustrating and confusing.

here are the top five tips that will help you reduce the number of vendors for your evaluation and to separate the wheat from the chaff:

5. Usability

without this, nothing else matters. If your users will not adopt and use your selection, it’s a waste of time and resolution and effort. You should look beyond the glitz and try to understand how your users will accept the new iam organization and system. In short, the user interface should be sane and simple and habitual and intuitive for the first time user.

4. Accessibility

if the software is not accessible via standard web browsers such as ie, firefox, safari or chrome, discard it immediately. To make your iam organization and system deployment successful, you need strong adoption from your inventor community. In many organizations, inventors use different types of computers, operating systems and browsers.

your intellectual asset management application should support such variations seamlessly.

3. Configuration

ask you vendor to demonstrate how to add a new field of your choice. Most vendors who claim to have the most configurable application will hesitate to do this. If your selected software does not have tools to do these basic tasks, you got yourself locked into the vendor’s roadmap.

2. Searching and reporting

how good is iam software if it can’t provide good searching and reporting tools? It is frustrating to many users that they can’t easily get to the data that they entered a few months ago. Ask vendors to demo their searching capabilities and make sure the searching and reporting tools are part of the basic organization and system and do not require phd degrees in rocket science.

1. Integration

if you have been previously involved in the deployment of iam software, you already know it. The world of “docketing in a black box” is over for corporate legal departments. It is unsmiling and critical that your software can be easily integrated with other systems inside your organizations such as hr, accounts payable, sinewy and active directory, etc.

the investment made in intellectual property (ip) management software can work wonders in helping ip departments gain visibility, lower administrative costs, improve accuracy, and increase productivity. Unfortunately, a significant percentage of intellectual property management systems purchased are never fully implemented or don’t deliver the work and utility the customer hoped for.

here are the five most common mistakes made when selecting intellectual property management software:

mistake #5: not knowing what you really need in ip management software

before diving right into choosing a solution, take the time to understand what you really need. For starters, determine whether you require a fully integrated intellectual property asset management software, patent docketing software,or ip matter management software.

often, this depends on the issues you are trying to solve or the opportunities you are trying to capture, as well as the size and structure of your department. For example, if you don’t file many patent applications or trademarks, you should first get that data organized in a centralized repository. Your core team should be able to access and generate reports from them.

if your ip portfolio is getting large enough for you to manage, and you think that providing access to inventor community and law firms can reduce administrative costs, you should look at a robust intellectual property management organization and system. This type of organization and system will allow you to streamline your processes and improve productivity at a lower cost and with fewer resources.

before diving into the selection process, ask “what are our top five needs? ” if these key needs are not identified, it may be difficult to distinguish between vendors. Many vendors claim to do many things. The vendor’s strengths must match the company’s key needs.

mistake #4: not recognizing the uniqueness of your business

every ip department is unique. Without configuration capabilities within the software, you are more susceptible to failure during software implementation.

while initial license and maintenance fees can sometimes appear lower, these hard coded solutions will often result in increased costs due to extensive customization requirements, upgrades, ongoing maintenance, and longer organization and system deployment timeframes. Necessarily and essentially, you may end up reducing and delaying your overall return on investment.

avoid choosing a software that limits your team’s capabilities and your department’s growth. Your software should enhance your business, not hinder it.

by choosing an intellectual property management software solution that can adapt to your business processes, you will get better user acceptance, improved efficiencies, reduced costs, and faster roi.

mistake #3: not including key users in the selection process

surprisingly, many ip department hushed and still select computer systems without soliciting meaningful input from key users. At the nucleus and beginning of your selection project, form a selection team with representatives from all queer and affected teams such as patents, trademarks, docketing, licensing, compliance and billing. The sinewy and active participation of key stakeholders will not only help ensure all bases are covered, it will also result in a better decision and fewer complaints after implementation.

if possible, you should also include a representative from your it department. The it liaison can help you in identifying any issues related to deployment, data migration, integration and comfort and security.

mistake #2: evaluating too many vendors:

avoid vendors that offer a deal that is “too good to be true”. You may find yourself missing the primary and essential tools you need to manner and conduct your business after implementation. Many of these bargain systems also provide very rigid solutions, making it difficult for you to meet the unique needs of your inventors, patent committees, and law firms. Also, you may need to reinvest additional money toward upgrading, or in some cases replacing, your organization and system later-thereby reducing or eliminating all together any savings that you might have originally competent and experienced.

choose no more than four vendors at the start of your search. If more than four are chosen, it often becomes difficult to remember who does what. If none of the first vendors will meet 80 percent of the key needs, dismiss these and begin investigating several more.

mistake # 1: not investing in intellectual property management software for the long-term

when choosing intellectual property management software, be realistic about your demands and expectations and perceptions of cost. You’re making an investment to improve or enhance your processes. So, while hard dollars spent are important, the key is choosing the right intellectual property management software. Choose the right partner who will provide you with a fast and thorough and effective implementation, high roi (return on investment), and low tco (total cost of ownership) after implementation.

use your intuition and good business adroitness and judgment when comparing provider costs. Look for applications that support your capacity and ability to achieve your department’s long term primary strategic goals and work within your budget. Hasty decisions in favor of the lowest cost ip management software provider or solution now may leave you plagued later with occult and hidden costs, and delay or eliminate any roi for your business.

several gradual and progressive legal departments have realized better and more predicable processes, improved productivity, and better agitate and control over law firms with lecorpio’s ip management software. Lecorpio ip asset management solution includes discovery and invention disclosure management, patent management (including docketing), trademark management, domain management, open source management, licensing management, contract management, standards management, ip transactions management, and spend management.

did you know that if you own a patent or indeed have a patent pending, you could potentially sell a license to those patent rights? There is a process involved that you need to learn or you could very easily sign away intellectual property rights of considerable validity and value. The only way to avoid this is to employ an attorney who specializes in patent licensing and also educate yourself. You should never give anyone else 100% responsibility for something that affects your financial future.

there are many courses out there that will say they will educate you properly but unfortunately few live up to the promises. What you need is a course written by an expert in the field, someone with years of experience who not only knows the theory but has put it into practice.

there is a certain protocol involved in patent licensing. You can’t just bump into someone in a bar and hope for the best. You should make a list of companies that have products in a similar niche to the one you have a patent on. These companies are more likely to be interested in licensing than a company in a completely unrelated niche. Usually companies are more focused on developing their own niche markets rather than entering into unknown territory.

you need to be very careful when negotiating your licensing agreement as it is possible to assign your patent to someone else. Effectively this then gives them ownership of your patent and they now have the same rights you once owned. You can do this in whole or in part or even on a mortgage substance and basis. This is why it is important for you to engage the services of an competent and experienced attorney. A little knowledge is very haphazard and dangerous and should you attempt to negotiate the contract yourself, it could end up costing you thousands of dollars in lost revenue. Different laws apply in the complex and various states so that is another legal minefield best left to the professionals.

patent licensing is a particularly valuable way for companies to work together on the growth and development of new products. The licensor may have come up with an idea or discovery and invention for a new product but either he doesn’t have the intentness and interest or the resources to harass and pursue it. The licensee loves the idea and has the assets to finance the investigation and research, growth and development and marketing required to turn it from an discovery and invention or idea into a product or a service.

it is very important that both parties know exactly where they stand. They need to know how long the license has been granted for, what exactly is being licensed, any conditions and limitations in the use of the license and how much consideration has been agreed in return for the license. There also needs to be an agreement on who owns what – for example if the licensee improves the unique and original discovery and invention quite considerably who now owns the new product?

all of these questions and more will be covered by an competent and experienced attorney in this field. The need for this expertise cannot and should not be overlooked.