Free webinar on "IP Valuation for Wealth Creation"

OxFirst is pleased to host a free webinar, to take place on April 24th at 3:00 pm UK time, on the topic of “IP Valuation for Wealth Generation”, and why IP valuation can play a crucial role in every step necessary to generate wealth on the grounds of intellectual capital. The speaker will be the internationally noted IP expert, Dr. Guriqbal Jaiya. Dr. Jaiya will discuss various ways to value IP and will weigh the strengths and weaknesses of each method. As well, he will address how IP valuation can be leveraged in corporate finance, strategy, litigation, licensing and tax.

As readers of IP Finance are well aware, IP valuation is playing, or at least has the potential to play, a fundamental role in corporate strategy, helping maximize profits and attracting investments. The valuation of the portfolio of pending and granted patents, trademarks, trade secrets, copyrighted works and designs of a firm remains often the best guess of the firm’s value and its investment potential. As such, the valuation of IP can be crucial to realize the business potential of a company. Yet, despite this, IP valuation is still often underutilized.

About the Speaker

Dr. Jaiya is an internationally recognised expert on intellectual property and intangible asset management, with a special focus on entrepreneurship, start-ups and innovative small and medium-sized Enterprises (SMEs).

For 24 years, he served with notable distinction as a senior officer at WIPO. While at WIPO, he worked closely with a wide variety of multilateral institutions, including the WTO, UNDP, World Bank, UNESCO, UNIDO, WHO, ILO, ADB, AfDB, IADB, UNCTAD, Asian Productivity Organisation, ESCAP, UNECE, ESCWA, ECA, ECLAC, FAO, ITC, OECD, as well as over 150 national and regional IP offices. [This blogger wonders whether OXFirst will give a prize to anyone who can recite without consultation the full name for each of these acronyms.]

Dr. Jaiya has conceptualised, authored or co-authored numerous articles and book chapters on IP as well as some 15 books and 13 multimedia modules on different facets of IP management in business. He has delivered lectures, made public presentations and conducted training events on different facets of IP asset management in business for diverse audiences in regional and international events for participants from some 175 countries. [This blogger still cherishes the half-day that he spent with Dr. Jaiya at WIPO a decade ago, in which we discussed a wide variety of IP issues.]

Dr. Jaiya serves as a senior advisor to OxFirst.

For details about registration, see here. Please note that OxFirst cannot accept registration from private email accounts.

Fixing Facebook

Facebook has seen better times for sure.  The reviews on Facebook’s reaction to the recent Cambridge Analytica disaster have been far from glowing.  Can Facebook address consumer concerns with privacy, particularly when a good part of its business model is based on the commodification of user data?  If its profit center is primarily selling data, what can Facebook do to better protect privacy.  Should it obtain “more” consent?  How much “consent” is enough?  One potential fix (and practically I don’t know how this would be implemented) would be to change Facebook to a B Corp—a public benefit corporation.  Facebook could become a corporation that is not primarily driven by maximizing shareholder value, but instead also by the public interest.  Here is a description of the Delaware B Corp:

A public benefit corporation (PBC) will be formed in the same manner as any other corporation formed under the Delaware General Corporation Law. However, in order to be a PBC, the corporation’s certificate of incorporation must identify one or more specific public benefits and must have a name that clearly identifies its status as a PBC. Public benefits for which corporations may be formed include, but are not limited to, those of an artistic, charitable, cultural, economic, educational, environmental, literary, medical, religious, scientific or technical nature.

At least once every two years, a public benefit corporation must send its stockholders a statement with respect to its promotion of the public benefit(s) identified in its charter, as well as its promotion of the best interests of those materially affected by the corporation’s conduct. 

This is not a “perfect” fix, but maybe it is a move in the right direction. 

Chinese National Convicted of Conspiracy to Steal Trade Secrets in Kansas

Recently, Newsweek has published an article titled, “A Chinese Scientist Stole American Rice and will Spend a Decade in Prison,” by Max Kunter.  The article explains how Mr. Zhang worked for a biotechnology company, Ventria, around Manhattan, Kansas (the location of Kansas State University) and genetically modified seeds from that company were found in the baggage of Chinese research visitors from a Chinese crop research institute on their way back to China.  Mr. Zhang is Chinese national and a legal permanent resident. He has been convicted of conspiring to steal trade secrets.  He will serve 10 years in prison. 

Interestingly, the article notes:

FBI Director Christopher Wray has also warned about China. Asked during a Senate intelligence committee hearing in February about the counterintelligence risk from Chinese students in the U.S., Wray said, “The use of nontraditional collectors, especially in the academic setting, whether it’s professors, scientists, students we see in almost every field office that the FBI has around the country…. They’re exploiting the very open research and development environment that we have.”

Here are a couple of observations.  First, there could be an argument that this activity is not sponsored by the government in China.  Mr. Zhang may be acting illegally, but on his own accord.  He may realize that this seed is very valuable and that by passing the seed on to co-conspirators he may be entitled to a piece of a new company started in China selling the same seed in other markets.  The people starting the new company may similarly be operating without government approval or sponsorship.  However, it is interesting that he passed the seeds on to a Chinese crop research institute.  I wonder who sponsors the work of the research institute.  Mr. Zhang was also defended by public defenders, but I imagine that if this was state sponsored the government of China is likely not going to pay for his defense—that would look bad.  Second, I am curious to learn more about data substantiating Mr. Wray’s comments about “every field office . . . around the country.” 

OxFirst webinar on "IP indicators for business performance"

OxFirst has announced a webinar on the always challenging topic of “IP indicators for business performance.” The webinar will take place on April 12, 2018, 15:00 British Standard Time and the speaker will be Mr. Terry Adams, former Assistant Vice President of Intellectual Asset Management at Nestle.

The topic-- Connecting intellectual property metrics and key performance indicators (KPI’s) to business relevant metrics and KPI’s is critical to gaining and holding the attention of executives within an organization. The relevant information typically exists within disparate systems, but data are rarely properly integrated to generate meaningful perspective.

The speaker--Terry Adams has vast experience across numerous product categories, including food, beverages, home care, and personal care in the fields of scientific research and product development. He began his career at Procter and Gamble, where he became a Group Leader in 1991. In 1994, Mr. Adams joined the Dial Corporation (now a company of Henkel), where he eventually was appointed Manager of International Technology Coordination, covering all of Dial’s product categories. In 1998, Mr. Adams joined the Kimberly-Clark Corporation, where he was eventually appointed the Senior Research Manager of the Global Intellectual Asset Management Team, providing strategic coordination of Kimberly-Clark's 3500 patent families and other global intellectual assets. Mr. Adams joined Nestlé in July 2006 as Assistant Vice President and head of the Technology Intellectual Property function, a matrix network across 28 technology centers in 10 countries.

For registration, see here. OxFirst notes that the number of places is limited and that only registrations undertaken from professional email addresses are accepted (no registrations from Yahoo, Gmail or similar private accounts will be accepted).

By Neil Wilkof

Photo by Robert Cutts and is licensed under the Creative Commons Attribution 2.0 Generic license.

Some Worst Case Scenarios as the Trade War with China Escalates

As the trade war and tension with China escalates, I am thinking about some worst case scenarios—particularly in the academic context concerning intellectual property/valuable information.  At least one commentator has made the allegation that the Trump Administration may attempt to restrict students from China.  This will greatly hurt some universities who are deriving a substantial amount of revenue from Chinese university students—and will benefit universities in other countries without such a restrictive policy such as Canada.   It is not too much of a jump to think the Trump Administration may also attempt to restrict Chinese professors and researchers from visiting academic institutions or being hired by academic institutions.  There have been quite a few interesting allegations raised concerning Confucius Institutes at U.S. universities.  I am wondering whether the United States and other countries will attempt to restrict the travel and employment in China of their academics who are citizens of their respective countries.  For example, let’s say a top researcher who is a U.S. citizen at Stanford University is offered a position at a major university in China or another country.  Could the U.S. government attempt to restrict the academic from moving (or even giving academic presentations)?  Does that happen already?  Certainly, we do have U.S. export control laws that would restrict certain technologies from being disclosed to a national of another country even in this country.  Perhaps a distinction will be made based on whether the research is funded by the government.  What about publication?  Will the Trump Administration also attempt to restrict academics from publishing certain research--there are some rules concerning national security and publication of patents?  Ultimately, does it matter if we do not have adequate cybersecurity protections?  

The Importance of an Accurate Assessment of Patent Valuation and Potential Market

A recent article in the Saint Louis Post Dispatch by Christopher Yasiejeko describes a patent-related dispute between two academic institutions.  Two major research universities, University of Wisconsin (through its technology licensing arm, Wisconsin Alumni Research Foundation (WARF)) and University of Washington, Saint Louis (WUSTL) are engaged in litigation concerning royalty payments over a jointly invented patented invention that was licensed to Abbott Laboratories.  The inventors included a researcher from Wisconsin and one from WUSTL. 

One of the issues with university developed technology is who will cover the patent prosecution costs.  Here, WARF apparently agreed to cover the costs for a higher royalty rate.  The dispute concerns apparent representations made by WARF concerning the value of the patent—allegedly representations were made that the value was not very high by WARF.  WUSTL appears to assert that WARF made representations to others that the patent was actually quite valuable and eventually important to the pharmaceutical, Zemplar, which according to the article “generated $409 million in sales in 2011.”  This appears to be a case where fraud in the inducement in entering the contract is relevant.  However, it seems strange that WUSTL was unable to arrive at their own valuation or understand the potential market for the invention—perhaps they did not have the resources at the time invested in technology transfer.  WARF was likely well financed at that time and certainly experienced.

[Hat Tip to Technology Transfer Central]

Recording Industry Association of America Reports Revenues are Up in 2017

The Recording Industry Association of America (RIAA) reports that revenues are up for a second year in a row.  The RIAA states that:

In 2017 revenues from recorded music in the United States increased 16.5% at estimated retail value to $8.7 billion, continuing the growth from the previous year. At wholesale, revenues grew 12.6% to $5.9 billion. Similar to 2016, these increases came primarily from growth in paid music subscriptions to services like Spotify, Amazon, Tidal, Apple Music, Pandora and others, which grew by more than 50%. This is the first time since 1999 that U.S. music revenues grew materially for two years in a row. At $8.7 billion, the industry has taken a decade to return to the same overall revenue level as 2008, and is still 40% below peak levels as the growth from streaming has been offset by continued declines in revenues from both physical and digital unit based sales. 

Notably, “[s]treaming music platforms accounted for almost 2/3rd of total U.S. music industry revenues in 2017, and contributed nearly all of the growth.”  Interestingly, digital download revenues slipped 25%.  Also, “[s]hipments of physical products decreased just 4% to $1.5 billion in 2017, a lower rate of decline than in recent years.”  This is good news for the industry; although we are talking about returning to 2008 revenue levels. An earlier WIPO report noted that positive revenue growth in prior years was attributable to two causes: streaming (new business models) and an expansion into new markets (mostly developing countries).