Why the IP Law Firm Business Model is Broken And What I Am Doing About It

As a former IP law firm shareholder and senior corporate lawyer, I know all too well the expense required to start and maintain an IP law practice.  Not only are IP lawyers of all levels of experience paid handsomely, but so are the highly skilled paralegals, docket clerks and administrative professionals traditionally required create the infrastructure needed to handle the myriad of details involved in an IP law practice.  Of course, this expensive infrastructure must be sustaining, so while a lawyer serves today’s clients, her eye must also be on finding the next client because payroll and rent obligations don’t take a holiday when clients do. This “feed the beast” nature of the IP law practice model was a primary reason that I decided several years ago that I would not again work in the traditional practice of law.  How could I?  The standard legal service framework required me to build and maintain a business model where the product offered is obtaining patents for clients.  However, over the years I discovered that often the client does not need the very product that sustains the IP law firm business model.  What I perceived as an inherent conflict between my business interests Continue Reading →

Patents–Who Needs Them? Not Most Startup Entrepreneurs.

A recent article in TechCrunch indicates that entrepreneurs are less likely to file patents than in the past.   Nonetheless, there remain countless patent lawyers and agents who will argue convincingly that an entrepreneur must obtain a patent in order to succeed and who will take their $5-15K to file a darned good patent application that won’t provide them a bit of business value in the long run. Even worse, the resources expended in the patent process robs the entrepreneur of needed cash that will allow them to gain customers, and of their most valuable asset: time.  But when the only tool you have is a hammer, everything looks like a nail–which is why those still in the business of writing patent applications will continue to make their case to entrepreneurs (and investors) who lack the domain expertise to know better. Now that I no longer make money obtaining patents–instead, I am the CEO of a startup battery charging company–I understand that patents are generally a poor way for a startup company to expend scarce resources.  I rarely, if ever, recommend that my startup colleagues file for patent protection for any tech/web-based ventures. Further, when asked what they should do Continue Reading →

False Marking Lawsuits are Real Problem for Business and Make Little Sense When Applied to Expired Patents

The threat of false marking lawsuits has garnered much attention in the IP business press in the last couple of years.  Companies of all sizes have been hit with qui tam actions (that is, suits brought by an individual or company on behalf of the US government to right wrongs done to the government, not the individual) where the basis of the action is the mis-marking of a product with an incorrect or expired patent number.  Like a gold rush, these lawsuits have resulted in a number of legal entrepreneurs seeking out products that are incorrectly marked–usually by identification of expired patents, which is an easy thing to find–and their bringing suit against the offending companies.  Indeed, there were over 500 false marking lawsuits filed in 2010, making this cause of action seem almost like a way for un- or under-employed patent lawyers to generate income after the rash of layoffs and firm closings in the last few years. For patent lawyers representing corporations, false marking cases may seem like a pain for clients, but something which nonetheless leads to business if a suit is brought against his client.  But, in reality, the uncertainty raised by the current rash of Continue Reading →

Success at Open Innovation Requires Finding the Right Partners: Here’s How to Improve Your Success Rates

With more companies building open innovation into their product development platforms, there would appear to be increasing opportunities for companies and independent IP owners to sell or license their technology.  In my many conversations with corporate innovation professionals, I find that that the desire to in-source externally developed products and technology may be strong, but few know how to go about finding and acquiring what their companies need.  As I have written about before, developing fruitful open innovation relationships is very much like dating:  you may want to do so, but unless you know where to show up, and how to initiate conversation, chances are you will remain single for a long time unless you engage a matchmaker. Well, I guess you could be your own “matchmaker” and search for potential partners.  This is easier today than it used to be because many corporations have idea submission portals and a few, like General Mills and Clorox, are even publicizing their detailed needs to the public.  This is a lot like finding your own mate, however.  You may show up someone all dolled up, but if your ideal mate isn’t also at the same place with the same message at the Continue Reading →

Patent “Expert” Opinion on Reasons for Google Tender Offer for Groupon Reveals Fundamental Problems with IP Professionals

After several years of writing about how business leaders need to wrest control of their IP matters from lawyers, today brought a revelation that illuminated why this seems to be such a hard point to get across.  It should be a no brainer:  it has been shown time and time again that when a company aligns its IP strategy with its business strategy, value creation opportunities abound.  So, why is it so hard to get business people to sign onto something that is unquestionably in the best interests of their shareholders?  It’s simple–patent experts wholly lack credibility with business people on these issues.  This lack of credibility is compounded by the fact that these experts are given a forum to trumpet these views through use of their firms’ large marketing budgets, as well as by haphazard journalists who give them a forum to expound their self-interested views without counterpoint. To this end, my realization was caused by a blog post from my friend Patrick Anderson, the proprietor of the great GameTime IP blog.  He posted an excerpt of an article in the National Law Journal, authored by Amanda Bronsted, where Patrick Arnold, a patent attorney at the Chicago law firm Continue Reading →

GSU Corporate IP Roundtable on November 4 and 5: A Great IP Event at a Great Discount

Many of you who read my blog also follow my Tweet Streams when I am at conferences.  Last Fall, I blogged from the Georgia State University Corporate IP Institute.  Several people admonished me for not letting them know beforehand that the event was occurring, so this year I am giving everyone advance notice, as well as providing folks with the ability to attend using my discount code. The 2010 GSU Corporate IP Institute will be on November 4-5 at Georgia State University.  Unlike most IP-related CLE’s, this event generally is light on the case law citations, and heavy on practical tips for those who view IP as a primary form of business value today.  (Editorial note:  if you are a case law geek, then this is not the event for you–but if you are a caselaw geek, why the heck are you reading this blog anyway?!) The full details are in this brochure, but one super highlight is that on the 4th, Ray Niro will go up against Dan McCurdy to discuss IP monetization–those in the know will recognize that this is like having matter and anti-matter in the same room!   This will be my 4th year attending this event, Continue Reading →

The Disconnect Between IP Business Value and IP Legal Services and How Business Leaders Can Do a Better Job Choosing Their IP Counsel

Last week, I did what I these days rarely ever do:  live in the world of corporate and law firm IP lawyers.   I traveled to Minneapolis to speak at the Midwest IP Institute and, while there, I was treated to a baseball game in a luxury box, a high end hotel room with cocktails and hors d’oeuvres, a fabulous steak dinner and various other fringe benefits that I have not seen recently.  It was clear to me that even in these trying economic times when law firms have folded and merged and lawyers have been laid off in droves from all sorts of law firms, many lawyers are still living the high life.  I must say, I was somewhat surprised, because I thought business people were getting smarter about how they spent their money these days and, as a result, would not be impressed with fancy law offices and “bling” provided by their lawyers.  And, I also thought that lawyers who saw their colleagues lose their jobs and long-standing law firms collapse would express more humility and caution in their spending habits, but apparently their “near death experiences” had little effect on the way law firms operate.  But, the more Continue Reading →

Want to Know More about IP Strategy? A Selection of Posts for In-House and Outside Counsel

This week, I am speaking at the Midwest IP Institute.  I will be participating in a “fire side chat” with my good friend, Edna Vassilovski of Stoel, Rives LLP. Our session is entitled “How Patent Prosecutors and In-House Counsel Can Provide Work Product Better Aligned with Client’s Business Needs.”  Specific topics we will discuss include: How clients’ views of IP and intangible assets are changing and ways both inside and outside counsel can stay relevant to clients today; What you can do to help clients obtain meaningful patents at reduced cost; How to really understand clients’ business goals and how to help make those happen; and How to help clients monetize their patents I am really looking forward to sharing my passion for IP business strategy with in-house lawyers and outside counsel, especially since I will be doing this with someone like Edna who I think has a great grasp on client service from a business perspective.  In preparation for this talk, and for the benefit of those attending the the session who would like to learn more about my perspective, I thought it made sense to revive some previous blog posts from the past couple of years where I Continue Reading →

An Innovation Expert Sticks Up for IP Lawyers!

Regular readers of this blog know that I strongly believe that IP lawyers can do a whole lot more to better serve the needs of innovation teams.  Much of the disconnect between what IP lawyers do and those of their innovation clients can be traced to misalignment of incentives, as well as a structural and cultural impediments that makes it difficult for legal and business experts to communicate and work well together.  Last week, along with my good friend Deb Mills-Scofield and Mike Riegsecker of Menasha Packaging, I co-led a workshop on this topic at the 2nd Annual Open Innovation Summit.  The workshop was well-attended, and the response was very positive. Also, it appears that my message got through to at least one attendee, who is a prominent innovation consultant.  Keven McFarthing of Innovation Fixer wrote this post in which he asks open innovation professionals to not just look at their IP lawyer as an “extraneous irritant,” but instead as a member of the team.  Kevin also provides these recommendations: Ideally, make the lawyer a member of the formal team. If that can’t happen, treat them as if they are on the team. Don’t leave the final decision up to Continue Reading →

2 Ways to Reduce Open Innovation Risk: Convert the Naysayers and Bring on the Seasoned Veterans

Open Innovation is risky.  It’s like letting a stranger in your house to see what valuables are there for the taking, and letting them keep the key to your secrets even after you finish working with them.  For some, this perception of risk is enough to stop any attempts of Open Innovation in its tracks.  Other corporations respond to the risk by “lawyering up,” which, at a minimum, markedly increases the costs of proceeding or, at worst, causes the relationship to break down before any collaboration can occur.  And I, as IP counsel to a number of corporations in my prior life, must admit to being responsible for shutting down Open Innovation due to my role as IP risk the person responsible for mitigating my clients’ IP risk. After leaving the Friendly Confines of defined roles and responsibilities set out in my corporate and law firm life where it was clear that my job was to stop risky behavior, I now realize that this approach to risk mitigation was, quite simply, wrong-headed and misdirected.  Indeed, halting or slowing third party collaboration as a result of perceived risk is actually more risky than taking the leap into Open Innovation.  I mean, Continue Reading →