Posts in Licensing

Time to Get Back to Business

While some companies continue to wait and see, we saw a dramatic shift in late 2014. The most sophisticated companies on IP matters used the uncertainty to their advantage. They hypothesized the market couldn’t get much worse, and since they would eventually need to engage in licensing discussions, they used the negotiation leverage they had during a slow market to get the best deal. Similar to a “buyer’s market” in real estate, the IP market was (and continues to be for some) a licensee’s market as many companies sit back and wait to see how the uncertainty will shake out.

Ford patent licensing announcement may signal end of NIH bias in auto industry

In the automotive industry, it seems as though companies cannot give their patents away fast enough. The firesale began in earnest last June when Tesla Motors CEO Elon Musk announced to the world that neither he nor his company would enforce their patent rights on innovations made using their lithium-ion battery technologies. This decision to open source about 200 U.S. patents was bested in January of this year when Japanese auto manufacturer Toyota released a portfolio of more than 5,500 patents in the area of hydrogen fuel cell vehicles through a cost-free licensing program. Most recently, Ford Motor Company (NYSE:F) has joined this collaborative jamboree, announcing that it would facilitate licensing of more than 650 patents and about 1,000 patent applications in the field of electric vehicles (EVs).

Open Innovation for the Electric Vehicle Market

Ford and Tesla have offered their patents for licensing in the hope of increasing electric vehicle (EV) adoption and improving the supporting infrastructure. In contrast, Toyota is banking on fuel cell vehicle (FCV) technology. The broader automotive innovation game is being won by “connected cars” at the moment because consumers are unwilling to pay more for physical car features, but they are influenced by software related innovations. Technology companies are now entering the car sector with their own EVs. This is leading to competition to access the talent needed to drive innovation and a willingness to open up technology investments. By opening their patent portfolio, Ford could be sharing their existing inventions in the hope that their technology is adopted more quickly and of acquiring the talent needed to be at the forefront of innovation.

Vocal minority cannot keep PATENT Act from passing Senate Judiciary

At the end of a three-hour long hearing held by the U.S. Senate Committee on the Judiciary this Thursday, June 4th, S.1137, the proposed legislation known as the PATENT Act, was approved to move to the floor of the United States Senate by a 16-4 vote of the Senate committee. Proponents of the bill lauded the bipartisan support which brought the bill committee approval. Interestingly, a small but vocal bipartisan minority has developed, a couple of whom have pledged to continue debate aspects of this legislation which they fear will pose a threat to American innovation.

Disney leverages entertainment IP for business success

Disney holds 2,257 active patents as well as 2,287 trademarks, many of which protect design and character marks for beloved characters like Tinkerbell and Mickey Mouse. One recently acquired trademark protects the use of the standard character mark “ScoreCenter” when used with an electronic scoreboard service for athletic events which is distributed to computers and wireless devices by means of a global computer network. The owner of this trademark is ESPN Inc. but ESPN is a subsidiary of Disney so at the end of the day, this sports entertainment trademark is Disney property.

No Empirical Evidence that Standard Essential Patents Hold-Up Innovation

It is important to emphasize that we are not claiming that the patent system as currently defined cannot be improved. Rather, we offer evidence on two interrelated predictions of the SEP hold-up hypothesis. First, if SEPs are holding up innovation, then products that are highly reliant upon SEPs should experience more stagnant quality-adjusted prices than similar non-SEP-reliant products. Second, if SEPs are holding-up innovation, then changes in the legal system (eBay) that weaken the excessive negotiating strength of SEP holders should accelerate reductions in quality-adjusted prices in SEP-reliant industries relative to non-SEP-reliant industries. We find no evidence for either prediction.

Patents: The future of competitive success through innovation

Now more than ever succeeding is all about making better products and offering new and improved services quicker and more reliably than your competitors. Surprisingly, at a time when many major technology corporations are struggling to innovate, we see utter disdain for patent owners. Void from the discussion is any perspective on the real problems facing American companies – namely innovating to obtain a competitive advantage and set themselves apart from the competitors they have today and the competitors they will surely have tomorrow. Increased patent licensing, or outright acquisition of patents, will not only help, but will likely become essential for those companies who understand the importance of continually squeezing out innovation as fast and efficiently as possible.

Chinese Joint Venture Rules and Respect for IP Cause Concerns

These rules of the game for operating within the Chinese market are especially troubling given the lack of respect paid to American patent rights by Chinese firms. Foreign companies operating in China are forced to operate as 50-50 joint ventures with domestic companies and technology transfer has been a part of the price of entering the Chinese market going back to the early 1980s. Nominally, this practice runs afoul of tech transfer regulations that the Chinese government must respect as a member of the World Trade Organization, which it joined in 2001. However, as the economic policy paper points out, the regulations are difficult to enforce, private firms are dissuaded from speaking out publicly about negotiations while entering the Chinese market and the Chinese government stands to gain by letting the system continue as it has.

Patent Licensing is as American as Apple Pie

To hear the rhetoric from lobbyists for some large tech companies you would think patent licensing is some sort of shady business, akin to extortion. Never mind the hypocrisy inherent in these same firms earning tens of millions of dollars annually licensing their own patents — most of which are never used in their own products — to other companies. The truth is that patent licensing is as American as apple pie, and always has been.

Senate Small Business Committee finds consensus on patent reform

Significant consensus was reached between representatives of small business and universities at a hearing of the U.S. Senate Committee on Small Business and Entrepreneurship on March 19, 2015. The hearing was held to take testimony relating to proposed reforms to the U.S. patent system. The day’s discussion prompted Sen. Chris Coons (D-DE) to make the comment that the argument over…

In Defense of Patents and Licensing: Why the Newest Attack is Bogus

Fortunately, a new study showing that academic patent licensing contributed more than $1 trillion to the U.S. economy over eighteen years blows the stuffing right out of that straw man. We can only hope Congress gets the message before it turns the patent system into a weapon to squash inventors.

Understanding the valuable role played by Patent Trolls

The U.S. economy is full of intermediaries everywhere you look. But for some reason we have demonized the intermediaries in the market for innovation. Think of it this way. Most people buy their groceries at a grocery story. That grocery store does not grow any of the vegetables, raise the meat, nor catch the fish. It is simply an intermediary. Now I can see why from the point of view of a manufacturer the PAE may be a nuisance. But from the inventor’s point of view the PAE is a valuable intermediary.

Congress Seeks to Fix Unfair, Outdated Royalties for Songwriters and Composers

According to Congressman Collins, who I spoke with via telephone on Friday, March 6, 2015, there was a great deal of treatment of the SEA at the subcommittee level during the 113th Congress, but now during the 114th Congress consideration will move to the full Committee level, which suggests a seriousness about getting something done. ”Music licensing will be an area where something bubbles up this Congress,” Collins explained. ”I’m hoping the industry will come together.”

Demand Letter Legislation Must be Narrowly Tailored

An effort to address bad actors may unnecessarily create significant hurdles for innovators seeking to enforce or license the rights to their own innovations. The fear of unintended consequences requires targeted reform that will specifically address only the abusive behaviors relied upon by the bad actors, namely misleading and fraudulent demand letters. The trick will be to tackle these abusive behaviors that serve no legitimate purpose while not making legitimate business communications impossible. Luckily, it is not difficult to spot fraudulent demand letters and distinguish them from legitimate business inquiries. But will Congress be able to strike the appropriate legislative solution?

Don’t Complicate Things: Existence of a License Comes Down to the Terms of a Contract

In a case located at the intersection of bankruptcy and IP law, the Third Circuit ruled that, under the terms of a contract, Walt Disney Studios Motion Picture Production and its affiliates did not acquire a perpetual worldwide license to use patents to convert conventional films into 3D.