NOTE TO READERS: Since I am on vacation this week (well, sort of), I have asked my friend Scott Garrison to pen a piece about IP Strategy for me. He has been so gracious to do so, and the post follows. At bit about Scott: Scott Garrison is Chief IP Counsel and Assistant General Counsel for Scientific Games which, among other things, makes scratch off lottery tickets. Prior to joining SciGames, Scott was a senior IP attorney at Kimberly Clark and, prior to that, was a law firm patent attorney. Scott Garrison is a true IP Strategist and I am pleased to present him a forum to express his views on this blog. Scott's blog post: A short while ago I had an interesting conversation with an out of town acquaintance named "Mike" who works at a large international B2B ("business to business") corporation. I was interested to find out that his
Scott Garrison Guest Posting: A True Story of Wasted IP Assets & Why a Chief IP Officer Could Have Stopped the Loss
Entrepreneurs: Ask 2 Simple Questions to Determine Whether IP Strategy is Critical to Your New Business Venture
Intellectual property ("IP") is often a subject that is "out of sight, out of mind" for entrepreneurs who are launching new business ventures. And, why shouldn't it be: business schools rarely teach much about law in general, let alone about the highly specialized world of IP law. Since non-business school trained entrepreneurs generally take their cues from the methods of their colleagues, it follows that a significant majority of entrepreneurs likely do not consider IP to comprise a necessary step when they are formulating their business plans. My conversations with entrepreneurs from all backgrounds over the years bears this out. When IP does form a fundamental basis of an entrepreneur's new venture, it is likely because scientific or technical subject matter forms the basis of the business. In this context, it makes sense that the scientific or technical core of the business model must be protected by seeking patent coverage. While
An Introduction to Patent Monetization Resources for Corporations and Entrepreneurs
For corporations and entrepreneurs seeking to monetize their un- or under-utilized patent rights for the first time, it can be difficult to know where to begin. The patent monetization market is not yet mature and, as with other emerging marketplaces, no established methodologies and few experts exist to guide patent owners through the process. Today, there are as many as 17 different business models used to monetize patent rights. More will likely spring up as the market continues to evolve, even while some of the current models will certainly fall away. With such a range of options, it is not surprising that those seeking to sell their patent rights may be confused about what path to take. This blog post is intended to provide an overview of ways that a corporate and individual patent owners can most effectively monetize their patent rights in today's market. The models discussed in this article
How a Patent Strategy Focused Only on Obtaining the Lowest Cost Patents May Reveal a Company’s Future Inability to Remain Viable
Commentators like me frequently rail against what we view as the often unnecessarily high cost of obtaining patent protection. In truth, many patents are overpriced and provide questionable business value to their clients. Over-priced patents do not form the basis of this article, however. Instead, this is about the opposite phenomenon, i.e., under-priced patents. Specifically, in this article, I describe a company's desire to obtain low cost patents and what such a patent strategy may reveal about its long term viability. I was recently contacted by a large printer manufacturer ("PrinterCo" for the purposes of this discussion) to see whether I was interested in preparing patent applications for the price of $1300 each. This price seemed somewhat ridiculous to me because even the most "bargain basement" patent preparation prices that pop up on my Google sidebar advertising do not seem to dip beneath a threshold level of $2800. And, as a
A Consumer Product Company’s Costly Patent Lesson: It’s Not Enough to Protect the Invention, the Innovation Must Also be Patented
A SVP at a large consumer products company recently expressed frustration that he cannot bring a patent infringement lawsuit even when his company holds 18 US patents (and many other foreign patents) on a product that closely resembles a competitor's product. His annoyance is compounded because his company spent several years developing the product and technology covered by the patents. His company also spent several $MM introducing the product, which turned out to be a failure. The company removed the product from the market after several months, but the many patents remain in the portfolio today, and are still being maintained at considerable expense. I estimate that the patent protection for this failed product cost as much as $500K for patent coverage worldwide. Significantly, the product did not fail due to quality or performance issues. Rather, it failed because it was over-engineered and used many expensive ingredients, a fact which made
What is an IP Strategist? A Lawyer Who is Not Afraid to Say No
As a self-described "Recovering Patent Lawyer," I am now effectively an outside observer of the way the patent business is conducted in the law firm practice environment, and how corporate and other clients purchase patent legal services. In this last year in which I have re-invented myself as an IP Strategist, I have come to firmly believe that the basic patent law firm business model contains a fundamental flaw: outside patent counsel can make money only when they actually do work for their corporate clients. As such, there is no value when a patent attorney (or her law firm partners) tells a client that he should not pay you for the attorney's expertise. This necessarily sets up a tension between what the best interests of the law firm attorney and those of the corporate client.
How Asking One Fundamental Business Question Can Reduce Expense and Improve Business Outcome of Patent Litigation
While a majority of companies consider the cost of obtaining patent protection an essential element of the product and technology development process, few of these same organizations favor the prospect of asserting their patent rights against potential infringers. Moreover, no company relishes the prospect of being a defendant in a patent lawsuit. That most do not readily welcome patent litigation is not surprising given that the average cost of large case (i.e., over $25 MM at stake) patent litigation through trial in 2007 was about $5MM per party in 2007. For disposition of smaller cases, the total amount per party was about $1MM in 2004 dollars. Why does it cost so much for a patent owner to assert her patent rights against an alleged infringer? Put simply, patent litigation at its core is an adversarial undertaking in which lawyers typically define the meaning of a successful outcome. In this context,
Confessions of a "Recovering Patent Attorney" and Why I Have Joined the Growing Ranks of IP Strategists
I often facetiously refer to myself as a "recovering patent attorney." This somewhat tongue-in-cheek phrase seems appropriate to my present professional state of mind because, after many years of drafting and prosecuting patents for clients of all sizes and degrees of sophistication, in the end, I became disillusioned with the way the patent business traditionally operates. Too often, I found that the patents I worked so hard (and was paid handsomely) to obtain failed to serve my client's business needs. In searching for the source of the disconnect between my efforts, the client's expenditures and the ultimate value of the patent to my client's business, I realized that those responsible for the client's business often did not participate adequately in the patenting process. Instead, at many organizations, inventors and patent attorneys served as the gatekeepers for most patent decisions. While the relevant client business unit typically held some say in patenting
Do You Know Your Company Needs Strategic In-House IP Counsel, But Think You Can’t Afford It? One Company’s Solution is Hiring Part-Time Counsel
Analysts say that the current economic downturn will likely last at least until early 2010. While this no doubt seems like almost an eternity for the average consumer, for business strategic planning purposes, this date is just around the corner. Indeed, business managers at many companies are likely conducting “short term” strategic planning efforts targeted for introduction in mid-2010. This might account for the recent uptick in job postings for experienced corporate intellectual property attorneys. I see this increase in job opportunities as signifying that smart corporate leaders are realizing that sustainable business success requires companies to not only introduce innovative products and technology offerings, but also that they strategically protect such innovations. As a result, I believe that more companies will seek to hire strategic in-house IP counsel, which is good news for us IP types. Of course, the traditional model of hiring an in-house IP counsel results in
Companies Adopting Open Innovation Methodologies Must Incorporate Patent Information for Maximum Value Creation
Open Innovation is unquestionably becoming a "hot" area of focus for U.S. companies, especially in the current economic climate in which businesses are more than ever focused on smarter ways of doing business. And, why wouldn't Open Innovation be an intriguing business model when companies can fill their product and technology pipelines for significantly lower cost and with more variability of ideas than typically is possible from their own R&D infrastructures? As a result, more and more business leaders are today viewing Open Innovation as a necessary direction in which to move their company's innovation efforts. A fundamental premise of Open Innovation is that good ideas can come from anywhere, even when a company operates in a very specialized core business. Moreover, innovations that come from outside of one's core business, such as in packaging or transportation, are better left to those who specialize in those areas. Perhaps more controversial