Tuesday, 14 November 2017

China Changes Policy on Transfer of Technology for Market Access?


As previously discussed, China has been criticized for outright theft of trade secrets as well as requiring the disclosure of trade secrets to do business in China.  Keith Zhai, Bloomberg Technology, has reported in an article, “China Says Foreign Firms won’t be Forced to Turn Over Technology,” that a senior Chinese official has stated that market access in China will not require disclosure of trade secrets.  Notably, the article also states that China “pledged . . . to treat all companies equally" and the timing of the announcement came “close in time” to Trump’s exit from China.  It will be interesting to see if there are meaningful changes. 

Wednesday, 8 November 2017

A pioneer in the world of university tech transfer to share his insights in a free webinar


IP Finance has been informed of an exciting free webinar that will take place next Wednesday, November 15, at 3:00 PM- 4:00 pm British Standard
Time. The topic of the program, under the auspices of OxFirst, will be "Academic Entrepreneurship & IP Management in Universities" and the speaker will be the distinguished Professor Graham Richards. Prof Richards was a founding member of Oxford University’s tech transfer office and a successful inventor, whose IP formed the foundation of a multi-million publicly traded company. He will talk about the core elements of turning science into business.

About the Speaker

Professor Graham Richards is a pioneer of British technology transfer. The university spin out that he established -- Oxford Molecular Group, was the first university spin out after the UK introduced a regulatory change that attributed the IPR generated in a university context to the university itself. Under the leadership of Professor Richards, Oxford Molecular Plc grew from a £350,000 start-up to a £450 million public company. He is also a founding member of the Technology Transfer Office of the University of Oxford and he was a director there for over 20 years. Another flagship project is the publicly traded company IP Group Plc. Originally created out of the necessity to attract further funding for the chemistry department of the University of Oxford, it is nowadays one of the most important investors in technology generated by universities. IP Group Plc is a FTSE 250 company with a market cap of £1 billion.

How to Join

Please sign up here with your professional email account. The program organizers will not accept a registration from a personal email address.

Tuesday, 7 November 2017

Chemical Company Joins the LOT Network Against Trolls


Covestro, a chemical company which uses digital technologies to build better products, has joined the LOT Network.  As previously discussed, the LOT Network was started to thwart patent trolls.  Essentially, each member agrees to provide a license to the other members of the network if their patent is transferred to a patent troll.  Covestro’s press release states:

“With the convergence of the chemical industry and digital technologies, our sector has increased exposure to PAE litigation,” said Gilbert Voortmans, Vice President, Head of Intellectual Property Rights at Covestro. “Innovation is core to our business, and we feel it’s important to take a stance against anything that could interfere with the fair use of intellectual property.”

Interestingly, this is the first chemical company to join the LOT Network, according to the press release.  We’ll have to see whether other companies in industries generally thought not to be subject to troll suits will join the network, particularly as digital technologies influence almost all industries.  Moreover, I count around 170 members listed on the LOT Network website, including companies ranging from Alibaba to Crate and Barrel to Wells Fargo to Uber to Target to Honda. I wonder if universities should create something like the LOT Network to protect themselves from future suits by university based patents.  

Tuesday, 31 October 2017

Ending Soveriegn Immunity for Tribes from Inter Partes Review


U.S. Senator McCaskill has introduced a Bill that would remove sovereign immunity as a defense against Inter Partes Review of patents for Indian Tribes.  The Bill is refreshingly short.  It states:

A BILL

To abrogate the sovereign immunity of Indian tribes as a defense in inter partes review of patents.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. Abrogation of tribal immunity in certain patent claims.

(a) Definition.—In this section, the term “Indian tribe” has the meaning given the term in section 4 of the Indian Gaming Regulatory Act (25 U.S.C. 2703).

(b) Abrogation of immunity for purposes of inter partes review.—Notwithstanding any other provision of law, an Indian tribe may not assert sovereign immunity as a defense in a review that is conducted under chapter 31 of title 35, United States Code.

As previously discussed, the Bill is directed at Allergen’s recent attempt to use sovereign immunity of Indian Tribes to insulate patents from Inter Partes Review at the PTO by transferring its patents to the tribe in exchange for cash.  Notably, Judge Bryson (of the Federal Circuit), sitting at the trial court level, recently asked Allergen to demonstrate that its transfer is not a “sham."  Judge Bryson further found the Allergen patents to be obvious.  

Saturday, 28 October 2017

When naming the company after yourself might make good business sense


For trademark professionals, dealing with a name usually means encountering an objection to registration on the ground that the surname is not inherently distinctive. The name of the game, at least from the point of view of trademark registration, is to either argue that the mark is not in fact an objectionable surname, or, even if it is, to show the name has acquired sufficient distinctiveness. But in so doing, we tend to ignore the threshold question: why adopt a surname as a trademark at all, especially if we know that it will likely encounter difficulties in registration? A brief report in The Economist, published on August 19th, discussed an article by Sharon Belenzon, Aaron K. Chatterji and Brendan Daley, entitled “Eponymous Entrepreneurs” and published in the American Economic Review, offers some interesting economic insights regarding eponymously-named entities, i.e., entities named after their owner (think of an enterprise such as Bloomberg).

In their article, the authors argue that eponymously-named enterprises result in better performance as measured by the return on assets (3% percent greater). The authors develop an explanation for this finding, centering on what they call signaling, noting that--
“[s]pecifically, eponymy creates a stronger association between the entrepreneur and her firm that increases the reputational benefits or costs of having the market hold a favorable or unfavorable impression of her ability (or of the quality of her firm). Consequently, high-ability entrepreneurs are more drawn to eponymy than are low-ability ones.”
Contrary to common perception—
“Our key assumption is that greater levels of the signaling activity (i.e., a stronger association between the firm and the entrepreneur herself) are not directly costly, but instead increase the reputational impact of successful or unsuccessful outcomes.”
Lying at the heart of their results is what kind of person is more likely to choose to put his or her name on an enterprise. An eponymous company name puts at stake the reputation not only of the entity, but the person behind it. This may especially so when a start-up is involved. What seems to be suggested is a bit of self-selection. People of higher ability are more likely to select an eponymous name for their company, and customers are likely to understand the signal in this manner, thereby viewing the company more favorably (at least for the intermediate term, although it seems to leave open the question of the long-term value as a positive market signal).

A second aspect of the study deals with the impact of whether the surname is common or unusual. Here, the authors found that while the link between performance and eponymy will be greater when an uncommon name is used, entrepreneurs with uncommon names will be less likely to adopt an eponymous naming strategy. It seems that having an uncommon name serves as “a barrier to entry” with respect to adopting the name for one’s company, but those who do so will be more likely to show even greater levels in the performance of their company. In effect, their signal to the market is stronger than that which is received from an eponymous company with a common name.

One further point merits attention, even if it is less central to the heart of the study. The authors find that 19% of the entities studied (consisting of a database of approximately 1.8 million firms) adopted an eponymous name. Interestingly, the authors are of the view that this is a “relatively uncommon” event. To the contrary, this blogger was surprised about how large this number is. From his anecdotal experience in the trademark registration world, the percentage of companies that seek to register an eponymous mark is much lower than 19%. It suggests that entrepreneurial companies are less likely to seek trademark protection of their eponymous company name. if that is the case, perhaps trademark practitioners need to do a better job of alerting their clients to the potential value of an eponymous company name.

Photo on lower left by Keith Cooper licensed under Creative Commons Attribution 2.0 Generic license

By Neil Wilkof

Friday, 27 October 2017

Another Case of Pharma Weakening the Patent System (and University Technology Transfer)


The LA Times recently published an article, "UCLA’s Efforts to Patent a Costly Patent Cancer Drug in India Hurts the Poor, Critics Say,” concerning Pfizer’s drug, Xtandi.  Xtandi, which is used to treat prostate cancer, was developed (with U.S. government funding) and licensed out by University of California, Los Angeles.  Recently, in a royalty securitization deal, UCLA received more than $500 million in exchange for future royalty rights from Royalty Pharma.  Notably, UCLA is now seeking patent rights for Xtandi in India, which it states it has a contractual obligation to do.  The article states:

“What’s special about this case is the fact that the University of California is going against their own licensing policy by aggressively seeking a patent in India on this drug,” KEI Director James Love said.

That policy, as UCLA summarized in a statement to The Times, is “intended to facilitate all populations having access to medications and other products and services made possible by UCLA innovation.”

But UCLA also noted the “concerns about prescription drug pricing” among the activists and others and said it was willing to explore the problem further.

The school said “we are convening a working group to evaluate our approach to technology licensing in ways that benefit California, the nation and the developing world” while also continuing to give drug companies enough incentive to commercialize its discoveries, just as Medivation did with Xtandi.

In the meantime, the activists contend that a daily dose of Xtandi is selling in India for roughly 40 times a person’s daily income in that nation, which they called “excessive and shamefully unaffordable.”

Notably, the University of California is a signatory to the In the Public Interest: Nine Points to Consider in Licensing University Technology White Paper.  Point 9 of the White Paper states:

Consider including provisions that address unmet needs, such as those of neglected patient populations or geographic areas, giving particular attention to improved therapeutics, diagnostics and agricultural technologies for the developing world

Universities have a social compact with society.  As educational and research institutions, it is our responsibility to generate and transmit knowledge, both to our students and the wider society.  We have a specific and central role in helping to advance knowledge in many fields and to manage the deployment of resulting innovations for the public benefit. In no field is the importance of doing so clearer than it is in medicine.  

Around the world millions of people are suffering and dying from preventable or curable diseases.  The failure to prevent or treat disease has many causes. We have a responsibility to try to alleviate it, including finding a way to share the fruits of what we learn globally, at sustainable and affordable prices, for the benefit of the world’s poor. There is an increased awareness that responsible licensing includes consideration of the needs of people in developing countries and members of other underserved populations.

The details involved in any agreement provisions attempting to address this issue are complex and will require expert planning and careful negotiation.   The application will vary in different contexts.  The principle, however, is simple.  Universities should strive to construct licensing arrangements in ways that ensure that these underprivileged populations have low- or no-cost access to adequate quantities of these medical innovations. 

We recognize that licensing initiatives cannot solve the problem by themselves.  Licensing techniques alone, without significant added funding, can, at most, enhance access to medicines for which there is demand in wealthier countries.   Diseases that afflict only the global poor have long suffered from lack of investment in research and development: the prospects of profit do not exist to draw commercial development, and public funding for diseases suffered by those who live far away from nations that can afford it is difficult to obtain and sustain. Through thoughtful management and licensing of intellectual property, however, drugs, therapies, and agricultural technologies developed at universities can at least help to alleviate suffering from disease or hunger in historically marginalized population groups.

This appears to be another case of a company making a decision based on pricing that will likely undermine confidence in the patent system, particularly undermining technology transfer from universities.  Universities should exercise care in licensing to ensure that they have the final word on enforcement as well as patenting in other countries (see follow-up patenting noted by Professor Lisa Larrimore Ouellette).  Let’s not kill the "golden goose."  Perhaps UCLA can use part of the $500 million for a fund for people who need access to the drug in India. 


Wednesday, 25 October 2017

OxFirst again: Free webinar on open source software, defensive patent pools and innovation


OxFirst is putting together what looks like yet another excellent free webinar, this time on the topic of "Open Growth: The Contribution of Open Source Software and Defensive Patent Pools to Innovation" The presenter will be Mr. Keith Bergelt, CEO of Open Invention Network, and the program will take place on October 31, 2017 at 2:00 pm, British Standard Time (make sure to check when your jurisdiction changes to winter time!).

There are few topics in the world of innovation and technology that are as dynamic as open source software and defensive patent pools. Open Source Software (OSS) is well-established in sectors as diverse as aviation, health, telecommunications, finance, publishing, education, and government. As nations increasingly rely on knowledge assets to grow, the adoption of OSS will have profound economic consequences. This talk identifies the mechanisms inherent to OSS that help fuel innovation in knowledge-based economies. In doing so, it conceptualizes the role of patents from an Open Innovation Paradigm and looks at the role that defensive patent pools can play in fostering collaborative exchange and open growth.

About the Speaker

Keith Bergelt is a pioneer in intellectual property finance. He is currently the CEO of Open Invention Network (OIN), which is a defensive patent pool and community of patent non-aggression enabling freedom of action in Linux. At OIN, Mr. Bergelt is responsible for coordinating the establishment and maintenance of a patent ‘‘no-fly” zone around Linux. As such, he is responsible for safeguarding an open and competitive landscape in key technology markets, such as back-office transaction processing and mission critical IT.

Prior to his extensive private sector experience, Mr. Bergelt served for 12 years as a diplomat with postings at the United Nations in NY and the American Embassy in Tokyo, Japan, where he was involved in the negotiation of IP rights protection in Asia. He holds a BA degree from Duke University, a JD from Southern Methodist University School of Law and a Masters of Business Administration degree from Theseus Institute in France.

Please sign up here with your professional email account. We do not accept a registration from a personal email address.

Friday, 6 October 2017

New report commissioned by UKIPO on IP valuation market: Observations by the authors


In September 2017, the UK Intellectual Property Office (IPO) published a 148-page independent report, entitled “Hidden Value: A Study of the UK IP Valuation Market” that it had commissioned, and which was authored by Mr. Martin Brassell, Chief Executive, Inngot Limited and Dr. Jackie Maguire, Managing Director, Firm Advantage Limited. Mr. Brassell and Dr. Maguire have kindly provided IP Finance with a number of key observations based on the report. Interested IP Finance readers are invited to consult the report in its entirety (see below).

“Our study has provided an opportunity to investigate some important issues in the area of IP valuation. Why don’t more companies havean awareness of what their intangible assets are worth? What drives them to find out? What methods can they use to understand their asset value, and who helps them? Lastly, what can be done to encourage more firms to take IP value seriously?

We were unsurprised to discover that few, if any, managing directors wake up in a cold sweat at night worrying about how much their IP is worth. As previous research has indicated, many companies do not think of intangibles as being assets at all in the conventional sense. Even if they decide to capitalise the cost of developing or acquiring intangibles, their accounts sometimes appear to suggest that these assets are declining in value as they are being written down, even if their business contribution is in fact growing.

We found that the drivers for IP valuation are very specific and heavily transaction-oriented. We identified 22 distinct reasons for valuing IP, which fell into three categories. The largest number of drivers, accounting for the majority of IP valuation activity, relate to specific needs, such as transfer pricing, post-purchase accounting, preparation for M&A activity, estimating damages in litigation or (occasionally) insolvency. There is some IP valuation activity that is done as a positive response to specific opportunities, such as licensing, collaboration or raising investment. Finally, there is a small but growing number of occasions where there are new applications for IP that require value to be better understood – and this is where a specific opportunity for improved awareness appears to lie.

From the drivers that can be measured, it is unlikely that more than a few thousand IP valuations are currently being conducted annually. The valuation providers fall into two broad categories – large accounting firms and specialist ‘boutiques’ – with a very wide variation in costs, depending upon the complexity, purpose and origin of the valuations. Cost does not emerge as a barrier, as there is a range of services being provided addressing a range of needs. However, valuation providers confirmed a high degree of reliance on introductions or referrals from other professionals, which suggests that people only tend to value their IP when someone they respect tells them it is necessary to do so.

All of this points to an insufficient appreciation of the benefits of being able to measure IP value and thereby manage it better. More educational outreach, better access to information and meaningful testimonials could all help to address this situation over time; but the obvious question that remains is, if the benefits were more compelling, would not more businesses choose to value their IP? Realistically, in the busy world of the SMEs that form the overwhelming majority of UK firms, some pretty compelling incentives will be needed to make business leaders sit up and take notice when they have so many other competing priorities.

From the research that we conducted, it seems that these incentives might come from one of two directions. The first is strategic reporting in its various forms. It has long been apparent that financial statements miss out an important source of value creation in companies (for the reasons noted above); more attention is now being paid to filling these information gaps with insights on how a company is innovating and the assets it is producing as a consequence. Also, the most recent Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) within generally accepted accounting principles (UK GAAP) is beginning to have some impact on accounting awareness of intangibles.

The second direction concerns access to finance, particularly debt, which remains the primary source of business funding. At present the regulations that are designed to ensure capital adequacy do not look kindly on intangible assets, because there is no accepted risk weighting for them. However, there are signs that lenders are beginning to take steps to obtain a better understanding of these assets and their business contribution. Of course, the main concern for a lender when dealing with any asset class is ultimately related to the value that it can recover if the asset needs to be sold to repay a loan. However, if the trend continues to find new ways forward to apply intangible asset value, IP assets could become more concretely associated with money in the minds of SMEs, which would certainly increase the appetite for IP valuation."

For the full results of the research and interviews with over 250 industry players see here.

Tuesday, 3 October 2017

UKIP - Political Parties, Branding and Trade Marking.

Yesterday I wrote this piece over on Afro-IP on UKIP’s new logo picking up on the weekend controversy of it being remarkably close to the English Premier league logo, and concluding that trade mark rights are probably best placed of all the potential IP rights available to the FA to stop it. To further substantiate the point I have since come across two European decisions on the similarity of lions which I wanted to share with you together with an observation that political parties ought to pay more attention to the protection of the symbols that they use.


UKIP and the UKIPO have two things in common - the similarity in their acronym and the fact that they have a bent toward national rights but that is where it ends. UKIP have no registered trade mark rights, perhaps for good reason. Their new logo would likely be opposed by the FA and depending on the current practice of the Registry their old logo may attract an objection because it features the pound currency sign so prominently. 

By contrast the Labour Party, The Conservative Party and some others have been actively registering their symbols as trade marks. Their level of activity is, however, relatively low; a few trade marks here and there many of which have been allowed to lapse. Nothing in comparison to the level of expense that their campaigning deserves. Stateside a cursory search of the USPTO Register reveals much the same. The Republicans and Conservatives are low on the polls when it comes to protecting their campaigns using trade marks. This is in stark contrast to the level of trade marking President Trump is renown for in his normal business affairs. Why is this so?

Politics is mostly about winning votes. Winning votes requires communication of manifestos and persuasion. The symbols used by politicians and their parties are incredibly important and as carefully chosen as any brand, perhaps more so given the significant potential for public ridicule or offence and on the upside, their unique ability to encapsulate their message through symbolism. Trade marks are the means of protecting such symbolism. UKIP’s adoption of a lion so close to that of the FA is a glaring admission of the value of brands to political parties, even if they deny it.

Closer to home, a decade ago, a breakaway of the African National Congress - Congress of the People (COPE) was taken to task, initially on trade mark grounds, for their adoption of what they ANC regarded as a symbol which belonged to them. You can read about that here.  This illustrated not only the importance of trade marks and symbolism but also the risk of adoption, and injury to "market share" by an incumbent. In other parts of Africa political parties have been sued for using lyrics of well known songs and even infringing patent rights in ballot boxes; not strictly a branding dispute but close enough to illustrate that political parties face the same risks as any business when it comes to intellectual property rights in general.

Another indication of the lack attention paid to brand protection for political parties is the Nice Classification search feature on WIPO’s website which shows no hits for “politic” or “campaigning”. The USPTO filings illustrate protection in class 35 for campaigning as a promotional activity for political parties whereas filings in the UK tend to focus on class 36 for fund raising and class 41 for events, together with a range of classes protecting marks applied to badges, posters and clothing. For those countries that have not adopted service marks, marks of political parties are filed in classes 9 and 16 for the usual reasons.




Getting back to UKIP, the illustrations above are those of successful lions (Lonsdale v Puhin Deng* and ING v Daniel Cekal) who have protected their market share or hunting grounds, so to speak, based in similarity. One would think that that the FA would likely be successful too against UKIP. It is worth noting though that the registration of the lion on its own i.e. not with the wording accompanying it, makes the task of the FA significantly easier. Put differently, if the FA are setting the standard for good trade mark counsel, then a political party should pay much the same attention to their branding from a governance perspective, if nothing else.

Posted by Darren Olivier

*OPPOSITION No B 1 718 249 and OPPOSITION No B 2 520 529

Wednesday, 27 September 2017

Development of innovative new standards jeopardised by IEEE patent policy

I recently wrote a paper for 4iP Council about the effect of the Institute of Electrical and Electronics Engineers' (IEEE) 2015 patent patent policy change on submissions of Letters of Assurance (LOAs) indicating whether patents are pledged to the new policy. In this, I have reviewed some third-party analysis on adoption of the new patent policy and LOAs. And, I have also included my own analysis of LOA data available from IEEE. The summary of my paper is reproduced below with some updated figures from one third-party analyst and with the addition of an IEEE logo:

Development of innovative new standards jeopardised by IEEE patent policy


In March 2015, IEEE significantly amended its patent policy in what was couched as an “update” but that seeks to significantly revise commitments from parties holding patent claims essential to IEEE standards to license those rights on reasonable and non-discriminatory (RAND) terms. Changes disallow patent holders from receiving any value attributable to the standards, require licensing at the smallest saleable patent practicing unit level, and deny these rights holders entitlement to seek an injunction against an unlicensed implementer until appellate review is exhausted.  IEEE’s stated objective was to protect implementers from patent holdup, which was alleged without any substantiation.[1]  IEEE is promoting, by reducing technology licensing costs, the short-term interests of certain implementers while undermining standard-essential patent values and the ability of SEP owners to receive adequate compensation, they are entitled to, from licensing their SEPs.

As I predicted in the IP Finance blog prior to the adoption of this controversial new patent policy,[2] and as indicated by others including senior government officials,[3]  the purported “clarification” is significantly jeopardising the IEEE Standards Association as a venue for development of open technology standards that include significant patented intellectual property. Large proportions of contributors to IEEE standards are now unwilling to provide “positive” Letters of Assurance (“LOAs”) under IEEE’s new patent policy.

In this paper, I have reviewed available data on LOAs and some third-party analysis of this. My conclusions are striking: almost three quarters (i.e. 73 percent) of LOAs for the IEEE flagship 802.11 WiFi standard, accepted by IEEE and posted on its website in the 18-month period to June 2017, are “negative” LOAs, indicating the submitter’s legitimate ex ante refusal to pledge RAND licensing under the new patent policy. Nearly half (i.e. 47 percent) of all accepted LOAs posted on the IEEE website over the same period are negative LOAs. More than one third (i.e. 42 percent) of companies portrayed as leaders with LOAs to IEEE standards are unwilling to pledge their SEPs under the new patent policy or have not provided LOAs when asked to do so.

The new patent policy has created a perverse situation among patent owners and implementers.  In the absence of positive LOAs, implementers are left uncertain about which patent policy applies, if any, and about future ability to implement the standard. Therefore, implementers may be unclear whether many SEPs are subject to new licensing terms, the old licensing terms or are not subject to RAND licensing terms under any patent policy at all. This is unacceptable. Proponents of the new patent policy are also lamenting this lack of clarity, while trying to use this as a pretext to breach binding contractual agreements between IEEE and patent owners in previously-accepted LOAs.[4]

Chart 1: More than one third (10/24=42%) of companies IPlytics portrays as leaders with LOAs to IEEE standards are unwilling to pledge their SEPs under the new patent policy or have not provided LOAs when asked to do so
Source: IPlytics empirical study report on patenting and standardisation activities at IEEE[5] (black and green); WiseHarbor added Chart titles in bold black, identifiers and annotations in other colours.
Orange is the successor to France Telecom.
“Not applicable:” Positive blanket LOA accepted prior to March 2015 under previous patent policy.


Approvals for “standard-amendments” 802.11ah and 802.11ah deferred with policy impasse


There is deadlock between the two sides of this argument – largely, patent owners who seek adequate compensation from licensing their SEPs versus some implementers[6] who would like to minimise their costs. Despite attempts by advocates of the new patent policy text to portray IEEE standardization work as continuing to proceed well, to the contrary, this is an illusion with unreconciled differences regarding applicable patent policy and LOAs. Previous attempts to significantly undermine rights of patent owners in other standard development organizations (SDOs) have failed: for example; with an intellectual property rights (IPR) policy change at ETSI in the 1990s that was abandoned before taking effect.

Unwillingness of SEP holders to pledge to the new patent policy are delaying standardization approval decisions. IEEE seeks to approve standards for which all known SEPs are pledged under the new patent policy with accepted IEEE LOA forms. But it is failing in this objective with an unprecedented high number of negative LOAs submitted and because LOAs requested from others are not forthcoming and should therefore be regarded as “missing.” Negative LOAs that have been accepted by IEEE are, for example, with standard-amendments 802.11ai and 802.11ah. However, numerous other prospective negative LOAs have been rejected by IEEE because patent owners have sought to indicate – and IEEE has refused to allow – willingness to license on a basis other than the new patent policy, such as on the basis of the previous IEEE patent policy. With numerous known SEPs for which there are no licensing commitments, the above amendments to the 802.11 standard have only been “conditionally approve[d]” by the IEEE-SA’s Standards Board.[7] 

Conditional approvals are merely deferral tactics because there can be no reasonable expectation that the LOA conditions preventing full approval with the new patent policy will ever be met. Patent holders who have submitted negative LOAs are not going to change their minds and replace them with positive LOAs in the prevailing circumstances. Similarly, it seems very unlikely that those who acknowledge receipt of a request for an LOA but refuse to submit a positive LOA are likely to change their minds about doing so and submit a positive LOA.  Deferring full approval until these two amendments are rolled up into the next version of the entire standard (i.e. 802.11/D10) amounts to “kicking the can down the road.” [8]

This impasse has occurred because many contributors to IEEE standards are, independently of each other, unwilling to pledge assurances under the new patent policy, which was established without consensus[9] among a closed group of interested parties. The new patent policy text is purported to be a “clarification” of existing patent policy and not a new patent policy — begging the question why many of the new positive LOAs submitted merely restate previous LOAs already-submitted pursuant to the previous patent policy needed to be submitted at all. It is, instead, increasingly creating ambiguities and concerns that courts might interpret new conditions as mandatory. Many patent owners are unwilling to agree to the new patent policy because being bound by it could undermine their licensing businesses — including pre-existing agreements.


Adjusted LOA counts have reduced dramatically since introduction of new patent policy


The counts of submitted LOAs have been misleadingly presented to suggest that the new patent policy is having no overall adverse effect on licensing commitments. The numbers of accepted LOAs since the patent policy change have been inflated by a large proportion of “duplicate” LOAs (resubmissions of LOAs for standards for which there are already existing LOAs) that are not required by IEEE bylaws. Instead, after some well-justified adjustments to LOA counts for these and for negative LOAs and “missing” LOAs (in cases where IEEE sought from a disclosed essential patent holder, but did not receive, an accepted LOA), figures indicate that LOAs are dramatically and statistically significantly lower since the patent policy change. This indicates major adverse effects.

Chart 2: Rejection of IEEE’s new patent policy is indicated by dramatic fall in positive LOAs[10]

Continuing activity in technical working groups, for now, is no assurance this will persist

Technical working group activity is continuing while participating companies wait to see if conflicts will be resolved so that new standards, as well as improvements and amendments to existing standards, will be approved. However, any suggestions that the continuing rate of Project Authorization Requests (PARs) — to commit IEEE-SA resources to new standard-development work — indicate that all is well in IEEE standardisation are phoney. Many IEEE projects do not include many, or even any, patented technologies: so, these might be unaffected by difficulties with the new patent policy. The standards that provide significant innovative value beyond compatibility are rich in patented technologies. LOAs identify these patents, their ownership, and the basis upon which they can be licensed. For those standardisation projects that include significant patented technologies, it is what is occurring with LOAs, rather that PARs, that spells trouble.

It could be several years before it is evident how much IEEE standardisation has been harmed. For example, clarity (to implementers, in particular) could be rapidly restored by allowing patent owners optionally to indicate their willingness to license based on the old patent policy. Meanwhile, IEEE standardisation work including supporting R&D and product implementation will suffer as participants consider switching to other SDOs. By then it could be too late to fix things.

The whole story

My entire paper can be accessed from 4iP Council's web site, here. Since its publication this month, Ron Katznelson has updated his analysis to 20th September 2017, here, as also reflected in my summary for IP Finance, above.



[2] Keith Mallinson: IEEE will jeopardise its attractiveness as venue for standards development if proposed new IP policies are adopted, February 6, 2015; http://www.ip.finance/2015/02/ieee-will-jeopardise-its-attractiveness.html
[3] See e.g. Former Rep. Terry Lee, Don’t turn off Wi-FI (January 8, 2015), available at http://thehill.com/blogs/congress-blog/technology/228817-dont-turn-off-wi-fi; Adam Mossoff, Reality Check: Weakening Wireless Technology Patents Hurts Everyone (RCR Wireless News, January 28, 2015) available at http://www.rcrwireless.com/20150128/opinion/reality-check-weakening-wireless-technology-patents-hurts-everyone-tag10; Leah Nylen and Lewis Crofts, EU Warns of Impact of IEEE’s Patent Policy Change (MLex, January 27, 2015); U.S. Senator Christopher Coons letter to U.S. Department of Justice (14 January 2015) available at http://www.advancingengineering.org/christopher-coons.    
[6] This paper’s author recognises that a large proportion of implementers are also patent owners.
[8]Put off confronting a difficult issue or making an important decision, typically on a continuing basis.” Oxford Living Dictionaries.
[9] To mask it, in the fall of 2014, the IEEE-SA removed the most-prominent indication of its previously long-standing principles of consensus, due process and openness from its website.  See comparative website snapshots http://web.archive.org/web/20140723051820/http://standards.ieee.org/about/strategy.html versus new page:  http://standards.ieee.org/about/strategy.html.
[10] Standard Essential Patents – the empirical record since adoption. Symposium on Antitrust, Standard Essential Patents, and the Fallacy of the Anticommons Tragedy, Berkeley, CA. October 29, 2016. [Updated March, 2017 in my full report and, again, to September 2017 in this summary for IP Finance] Ron D. Katznelson, Ph.D.* http://bit.ly/IEEE-LOAs





Tuesday, 26 September 2017

The Deft Touch: Humor to Protect Trademarks


As every competent trademark attorney knows: beware sending a cease and desist letter.  There are many strategic reasons for care: forum selection; admitting a likelihood of confusion; and souring a potential profitable commercial relationship.  One important consideration is appearing to be a “trademark bully” with an overreaching claim—particularly against a small company and when free speech interests may be involved.  In the days of the Internet, you don't want your client portrayed as a "bully."  Some of my favorite cease and desist letters, include the Jack Daniels cease and desist letter and the recent Netflix cease and desist letter.  The recent (relatively hilarious) video by Velcro is perhaps the funniest educational video about genericide and a brand I’ve seen.  It is truly worth a watch.  I do have to say that I didn’t even know Velcro was a brand until now.  My apologies for my poor trademark usage.   

Monday, 25 September 2017

New OxFirst webinar to share wisdom on IP valuation


IP Finance friend OxFirst Ltd is putting on another of its excellent webinar programs, this time on the topic--"Embracing the IP Valuation Universe”. CDP- Accredited, the Webinar will take place on October 4, 2017 - 15.00 BST = 16.00 CET - 09:00 CDT. The speaker will be Dominika Boehm, Senior IP Counsel Siemens AG. She will address that most basic yet analytically elusive of IP topics-- IP valuation, providing fresh insights into how it impacts at the core of the sale of IP rights, licensing transactions and litigation.

Dominika Boehm works in the Licensing and Transactions department at Siemens AG, where she is responsible for conducting monetary valuations of intellectual property and counseling and consulting internals stakeholders on various IP valuation topics. She is currently coordinating a task force on IP valuation and monetization at the International Chamber of Commerce. She also coordinated a group of professionals with respect to the sub-section “Valuation and Monetization of intellectual property assets” for the newly prepared edition of the ICC 2017 IP Roadmap.

OxFirst advises that to join this module, one will need to please purchase a £10 pass from the link below.Upon receipt of payment, OxFirst we will send you the necessary login information via email.

Here's the link--

Wednesday, 20 September 2017

Congratulations Jeremy Phillips!


Jeremy Phillips, the founder of the IP Finance Blog among many other blogs, was awarded the David Goldring Volunteer Award from Marques.  The Marques website describes the award:

David Goldring was instrumental in the launch of MARQUES, having been involved from the very start and participating in the steering committee that discussed the setting up of an association of trade mark owners in 1984.

A UK and European trade mark attorney, he held a law degree from University College, London and originally worked in-house for Allied Lyons, an FMCG company.

In 1991, he became head of UK operations for the Novagraaf Group (J.E. Evans-Jackson & Co) and in 2010, he set up his own firm, Oakleigh IP Services.

David joined the MARQUES Council in 1996 and in June 2003 was appointed Treasurer. He played a pivotal role not just in managing the Association’s finances and budget, but also in planning and researching the Annual Conferences. David was instrumental in almost all aspects of the development of MARQUES and the recognition which MARQUES enjoys today is traceable to his guidance.

David’s attendance and participation at MARQUES was exceptional, only missing one Annual Conference in thirty years. A very down-to-earth man, David particularly enjoyed engaging in debates with established friends and was always keen to welcome new delegates.

David sadly passed away on 28th June 2016. In honour of his dedication to MARQUES and huge contribution to the organisation over the years, the David Goldring Volunteer award was inaugurated and was presented to his wife Delia (Dee) Goldring at the Annual meeting in September 2016 in Villaitana.

Congratulations Jeremy!  We miss you and hope you are enjoying your retirement!  The Marques Class 46 blog has more information as does the JIPLP blog. 

Friday, 15 September 2017

Gaming Amazon Using Fake IP Claims for Competitive Advantage

CNBC has published an interesting article about fake IP claims on Amazon titled, "Amazon was Tricked by Fake Law Firm Into Removing a Hot Product, Costing This Seller $200,000."  The article alleges that competitors of sellers on Amazon are filing fake intellectual property complaints against sellers resulting in Amazon's immediate take-down of their product or service.  These claims appear to be timed before big sales days and at very profitable products.  Interestingly, part of the problem is that Amazon is overwhelmed with complaints and apparently doesn't have the time to review the claims carefully.  My guess is that the software Amazon uses to police and handle claims is not able to discern fake and legitimate complaints well.  Perhaps better software is the answer.  I am hopeful that some Internet companies that rely on software will hire more people instead to handle these complaints.  Because Amazon controls the platform and sellers make so much money using it, I doubt many sellers will push Amazon too hard.  Although continued complaints and lost sales may open the door for a competitor to Amazon, which may be a good thing.