C NTENTS 6-7
Cabinet Oproiu
The new law of employee inventions, by Raluca Vasilescu, Cabinet M. Oproiu, published in WIPR September-October 2014
8-9
Dannemann Siemsen
What should we expect from re-elected President Dilma Roussef in terms of IP protection in Brazil?
10-11
Haynes Boone
Intellectual Property
12-13
OMC Abogados & Consultores
Protect Your Goods At The Border
14-15
Rothwell Figg
How To Deal With ‘Patent Trolls’ In The Digital Age
16-17
Wong Cabello
Boutique IP Law Firm
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CABINET M. OPROIU, Patent and Trademark Attorneys Margareta Oproiu Senior Patent and Trademark Attorney 42, Popa Savu, Sector 1, Bucharest, Romania Tel: (4021) 260 28 33; (4021) 260 28 34 Fax: (4021) 260 28 35; (4021) 260 28 36 office@oproiu.ro moproiu@oproiu.ro www.oproiu.ro
Education Margareta Oproiu is the senior partner and a patent and trade mark attorney with Cabinet M Oproiu. Mrs. Oproiu, (PhD in Physics) graduated from the University of Bucharest. and has a stage of 15 years in the research in the field of plasma physic applied to several technologies, including biotechnologies. After passing the Patent Attorney examination in the first session organized in the eary 90’s in Romania, she become Patent Attorney and opened one of the first agencies in private practice. She attended several high level courses on European Patents and Trademarks, and legal courses related to IP litigation. She is particularly experienced with opposition and appeal procedures and national invalidation and infringement proceedings before the Patent Office and the Courts. She is well experienced in conducting all procedures related to the SPC .
Practice Areas: -Filing and Prosecution of national patents, trademarks, designs; -Filing and Prosecution of European patents, community trademarks and community designs; -Opposition and appeal proceedings before national Patent and Trademark Office, and before the EPO and OHIM; -Court proceedings in Romania for cancellation and for infringement of patents, trademarks, designs; - Supplementary Protection Certificate: filing and prosecuting applications, including higher stages in case of refusal or infringement. -Other proceedings related to IP enforcement (customs action); -Legal opinions regarding validity or infringement;
The Firm Among the medium IP community of Romania, Cabinet M. Oproiu is known for having set
the highest standards of practice in all IP matters, shaping the future of the IP profession. In the field of patent and trademark prosecution and infringement, the Cabinet is one of the leading firms in Romania, with a large client base and the experience of many years, continuing to strengthen its leading position. In recent years there has been a significant increase in the number of patent and trademark litigation actions in the Romanian courts, Cabinet Oproiu representing clients in a large number of cases. Consequently, the jurisprudence on patent cases, including Supplementary Protection Certificate (SPC), and trademark matters has been enriched. Although the courts are still not fully familiar with all aspects of the IP cases, especially with the technical aspect of the patents, or SPC, there have been a majority number of correct rulings delivered. The competitive advantage the CABINET stems from an indepth knowledge of IP Attorneys of the firm, of both, the patent matters
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including legal aspects of patent infringement and unfair competition, and trademark legal aspects, being involved in cancellation actions and in infringing IP rights. According to the worldwide annual survey conducted by the Managing Intellectual Property Magazine, the firm has been voted for the last seven years in the first tier of the leading firm in the Patent and Trademark fields.
The new law of employee inventions, by Raluca Vasilescu, Cabinet M. Oproiu, published in WIPR SeptemberOctober 2014 At the end of June 2014 the first Law of employee inventions came into force in Romania. In order to fall within the provisions of this Law, there must be at least one inventor in the inventor’s team that is employee of a juridical person that is either public or private called employer. For simplicity, throughout the article the wording “inventor” stands for one or several employee inventor(s).
Definition To qualify as “employee invention”, one of the two situations below should apply: a) The invention is created by the inventor during his activities incumbent on him on the basis of a form of contractual agreement with the employer, where the contractual agreement includes an “inventive mission”. b) The invention is
obtained during the term of employment that includes a period of up to two years after the termination thereof; using the knowledge and the experience of the employer; following the professional training of the employee that was paid and cared for by the employer.
Right over the invention, release of the employee invention, free inventions The default provision is that the right over the invention belongs to the employer in case a), except for situations that were clearly agreed upon beforehand. In case the employer is a public juridical person operating in the field of research and development, the invention always belongs to the employer. In case b), the right belongs to the employer, in case he claims this right within the term prescribed (four months), in the contrary the invention is released to the inventors. All the other inventions that do not fall within the situations above are free inventions to be filed by the inventors.
Obligations of the parties The inventor must communicate “immediately” the invention to the employer in a clear manner. The employer has a term of up to four months from the communication, or a term stated in the
internal rules of the company, whichever is longer, to inform the inventor that the invention is considered to fall within the category of service invention (or not) and, if yes, to claim the right thereof. When the right belongs to the employer, he has the right to file a patent application or a utility model application in Romania and abroad, claiming priority from Romanian application. He has the duty to inform the inventor about the progress of the procedures for obtaining patent/utility model protection, whereas the inventor has the duty to assist the employerapplicant in his effort to obtain protection and to work the invention. Should the employer decide that the continuation of the prosecution procedures is no longer of interest for him for other states than Romania, he must assign the invention to the inventor under the condition that the latter shall give the employer a non-exclusive license. When the right belongs to the employee, he has the duty to inform in writing the employer about the progress of the procedures for obtaining protection.
For inventions made during the term of employment - case b), the employer shall set the criteria of calculating the compensation taking into account the economic effects of the invention, the degree to which the employer is involved in the actual realization of the invention, including the means that he uses for this purpose and the contribution of the inventor within the team. When employer -proprietor is a research and development public juridical person, the inventor has the right of a percentage of minimum 30% of the revenue obtained as result of the working of the invention. The author is o opinion that it is very difficult to separate the revenue generated by one invention from the revenue generated by other invention. When proprietor of rights is a university, at the request of the inventor, the university shall grant him free of charge the right to work the invention under a non-exclusive license agreement, even if the inventor is not employee. The duration of said agreement shall be equal to the term of the research contract.
Financial compensation The Law does not provide any specific compensation for inventions created by the employee whose contractual agreement includes “inventive mission” - case a)
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Dannemann Siemsen Ivan B. Ahlert Partner Tel: +55 21 2237-8700 ahlert@dannemann.com.br www.dannemann.com.br Rua Marques de Olinda 70, Rio de Janeiro, RJ, 22251-040, Brazil
Biography Degree in Mechanical Engineering by Federal University of Rio de Janeiro. Guest researcher at the Max-Planck Institute for Foreign and International Patent, Copyright and Competition Law in Munich (1994). Languages: Portuguese, and English, and working knowledge on German, Spanish and French. Main activities: advising, and assisting in administrative prosecution and litigation involving patent law, design law, and unfair competition. Joined Dannemann, Siemsen, Bigler & Ipanema Moreira in 1981. Teacher at the Industrial Property Training Course of ABAPI, guest teacher at other courses. Technical assistant and expert of the judge in court actions related to patent infringement and unfair competition. Author of several amendments to the Bill of the new Industrial Property Law. Representative of ABPI, ABAPI and FICPI in working sessions at WIPO concerning the PLT, the SPLT and the PCT reform. Member of FICPI (currently vice-president of the CET, Study and Work Commission), AIPPI, LES, ICC, ABPI (former chair of the Patent
Commission) and ABAPI. The author has several articles published on patent topics in Portuguese in national periodicals, books and newspapers and in English in international magazines such as IIC, Managing Intellectual Property, and Latin American Law & Business Report.
The Firm Dannemann Siemsen is the result of the consolidation of the firms of Carl Buschmann, founded in 1900 and succeeded by Luiz de Ipanema Moreira, and Eduardo Dannemann, which was founded in 1919. In 1947, the attorney and industrial property agent Peter Dirk Siemsen and the industrial property agent Catharina Bigler became collaborators of the firm of Eduardo Dannemann, and in 1953, went on to found Dannemann, Siemsen & Co. In 1958, the firms of Luiz de Ipanema Moreira and Dannemann, Siemsen & Co. merged to form Dannemann, Siemsen, Bigler & Ipanema Moreira. In 2000, the year that marked the firm’s centennial , the Dannemann Siemsen Institute and the firm Dannemann, Siemsen
Advogados were created. Our firm has 54 partners and over 800 employees providing swift and accurate services both in Brazil and abroad. We have offices in the cities of Rio de Janeiro, Sao Paulo and Brasilia. Our Documentation and Information Centre contains more than 9,600 books, 600 periodical titles, 35,000 indexed articles and 467 laws in the areas of intellectual property (30% of the entire collection), general law, commercial law, civil procedural law, information technology, biotechnology, in addition to reference works. In order to best serve its clients the Dannemann Siemsen firm has a worldwide presence, with more than 400 overseas associates. Dannemann Siemsen works actively to protect our client’s Industrial Property rights, and also takes care of the management of our client’s portfolio of intangible assets with national and international authorities, allowing our clients to focus on achieving results.
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Our fields of operation include: Biodiversity Biotechnology Design Domain Names Franchising Geographical Indications IP valuation and IP portfolio management Licensing Patents Plant Varieties Software Trade Names Trademarks Traditional Knowledge Transfer of Technology Unfair competition
What should we expect from re-elected President Dilma Roussef in terms of IP protection in Brazil? Writing still under the fresh impact of a re-election that was undesired by about half the Brazilian voters, more precisely 48,36%, many questions remain in the air. Mrs. Rousseff ’s acceptance speech placed emphasis on the need to seek dialog and reconciliation. She announced that she will foster economic activity in all sectors, especially in the industry, and she promised to promote urgent initiatives to resume economic growth, which should be just 0.27% this year, according to market estimates. Mrs. Roussef also admitted
her responsibility to construct a modern and more productive country, which is more devoted to science and innovation. Will this speech translate into actions? Probably this will depend on a combination of two elements: (1) the reelected president’s ability to nominate ministers that will be able to implement proper policies and (2) the ability of a now reinvigorated opposition to use its political capital to push for needed changes. In any way, continuity of the government suggests that we will not witness sudden changes in the IP panorama. This is good news in some aspects, and bad news in others. Paradoxically, it was during the recent period of successive mandates of representatives of the Labour Party (PT) that the Brazilian Patent Office (INPI) was finally authorized to hire new patent examiners, after a very long period with a stagnated or even slightly decreasing number of examiners. The patent team has about doubled, and new hiring of examiners was already approved by the Government. On the other hand, the net result of the increase in examiners was not yet felt in terms of a decrease in the delay in examination, which is currently far above historical and reasonable levels. Some among the new examiners were assigned to administrative duties, including the development and implementation of
an electronic patent filing system, which is now operative, with clear gains in terms of efficiency. The recently appointed president of INPI, Mr. Otavio Brandelli – former chief of the IP division of the Ministry of Foreign Affairs – has commanded patent examiners to resume their regular duties in patent examination, and a consequent increase in the speed of examination is now expected. The negative impact of the patent examination backlog is also reduced by the fact that a patent applicant may request expedited examination if he/she is aware of the unauthorized use of the claimed inventions by third parties in Brazil. In such cases the applicant may send a warning letter to the potential infringer, and later submit to INPI a copy of the warning letter together with any available evidence, along with a request for accelerated examination. Usually a first office action will be issued a few months after the request for accelerated examination has been approved. On the downside, IP protection – specially in the pharmaceutical field – has been under strong scrutiny in recent years, as indeed it is the case in several other countries. The fact alone is not of particular concern, except that in some aspects ideology has been playing a role where technical and legal considerations should prevail. One example is the interference of the National Agency of Sanitary Surveillance
(ANVISA) in patent examination. The allowance of patent applications in the pharmaceutical field is subject to ANVISA’s acquiescence. However, despite an opinion issued in 2009 by the Attorney General of the Union - AGU (Case 00407.005325/2008-71) to the effect that it is not ANVISA’s role to perform the examination of patentability requirements, that agency continues to perform substantive examination of patent applications, with a clear political bias, and causing legal uncertainty. Yet, in the enforcement front our daily practice shows that generally judges have a proIP approach, and in more blatant cases of infringement preliminary injunctions can be granted inaudita altera parte, although admittedly this is not the prevailing situation.
The Brazilian Industrial Property Law provides some useful legal resources for patent owners , such as the express provision of infringement by equivalence and contributory infringement. Considering the current
scenario, should foreign applicants continue to file patent and trademark applications in Brazil? Despite the obviously self-serving aspect of my reply, my answer would be yes, having in mind that IP rights have a long duration compared to occasional fluctuations in the economic and political environments. According to data available at the website of the World Bank (http://data.worldbank. org/country/brazil) Brazil is an upper middle income country with a current GDP (2013) of US$ 2.246 trillion, placing the country among the 10 largest economies in the world, and with a population of slightly more than 200 million. While the economic growth for 2014 is estimated to be somewhere between 0 and 1.5%, the World Bank forecasts growths of 2.7% and 3.1% for 2015 and 2016, respectively, reflecting
expectations of an increase in the economic activity in the years to come. Therefore, the importance of the Brazilian market should not be shadowed by hopefully only transitional uncertainty about the country’s immediate future.
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Intellectual Property Our goal is to help you realize and protect the value invested in the development of products and brands. We help companies of all sizes ensure they have proper intellectual property protection.
What Sets the Haynes and Boone IP Practice Apart The Haynes and Boone approach to intellectual property protection is to provide our clients with an all-encompassing solution to protecting tangible assets and highly visible brands. All of our intellectual property attorneys treat their client’s problem as unique and realize that in patent and trademark protection, there is no such thing as a «one size fits all» approach. Every company’s technology is different and every brand is unique. All patent attorneys should have technical backgrounds and ours do; however, we go a step further than most firms as more than half of our lawyers worked as engineers, software programmers or in a technical sales capacity prior to becoming patent attorneys. This means that our lawyers not only understand the complex legal aspects of intellectual property law but also the business roles that innovators play in leading companies. Our trademark attorneys are all adept at managing the largest trademark portfolios and well versed at addressing the dynamism in trademark and copyright law created by the Internet. The outsourcing and technology transactions attorneys also bring technical experience to an area often overlooked by non-IP attorneys. We pay special attention to the IP and technology issues associated with innovative business process outsourcing transactions.
How the Haynes and Boone IP Practice Can Help You
Haynes and Boone, LLP Jeffrey Wolfson Partner and Head, Patent Prosecution Practice Group Tel: 202.654.4565 jeff.wolfson@haynesboone.com www.haynesboone.com 800 17th Street, NW, Suite 500 Washington, DC, 20006-3962
Clients get a tightly integrated efficient group of IP attorneys with Haynes and Boone. Our goal is to provide each and every client with exceptional and efficient service, an unparalleled understanding of the law and the knowledge and advice of a trusted business advisor.
Patents Over the past 5 years the firm filed more than 9,000 patent applications worldwide in a variety of technologies including medical devices, semiconductors, nanotechnology, oil well technology, wireless technology, software and telecommunications networking equipment – to name just a few. The benefit of our patent practice to the client is the goals we establish before drafting each patent. We focus on writing solid claims and the ideas that you, the client, are trying to protect with each and every patent. Should a patent we prosecute ever end up in a dispute we want you to have the strongest protection possible.
Trademarks The trademark attorneys at Haynes and Boone work closely with in-house lawyers and marketing personnel to design carefully crafted brand protection strategies. Our lawyers are experienced in counseling companies on the best strategies to protect their trademarks on a worldwide basis. Additionally, we help in pre-launch clearance and trade dress issues. Not only can they help protect trademarks before the USPTO, our lawyers work to protect trademarks on the Internet. We have handled hundreds of domain name disputes as well as keyword advertising claims and other instances of trademark abuse on the Internet.
Technology Transactions Our technology transactions lawyers address the intersection of technology and contracting. In many technology transactions the transfer of knowledge involves agreements that include patents, copyrights and software. Our lawyers in this area work on licensing agreements to complex business process outsourcing arrangements.
International The IP attorneys at Haynes and Boone routinely provide strategic counseling and management for international clients looking to secure intellectual property rights in the United States. Our attorneys understand the most optimal structures and procedures for protecting such intellectual property rights across a global portfolio.
Industry Focus Our lawyers provide value by knowing their client’s industry and business strategy. We want to visit your facilities, talk to your innovators and see your ideas in action. We feel these types of experiences allow us to write better patents, draft better trademark applications and create
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better technology contracting arrangements. Our lawyers wrote some of the early patents involving nanotechnology and MEMS. We have other lawyers who are active in the pharmaceutical and biotechnology fields who understand ANDA filings and chemical compounds. We also work with software, including the open source model. No matter what industry you are in, we have lawyers who understand it and will work hard to make sure that they understand how your technology fits into the bigger picture of your business.
Handling Disputes at the US PTO - Patent Review and Trademark Cancellation Proceedings We both pursue and defend against objections to patent and trademark filings before the Trademark Trial and Appeal Board and the Patent Trial and Appeal Board of the U.S. Patent & Trademark Office. An effective Inter Partes Review proceeding, interference action, or Trademark Cancellation proceeding depends on investigation strengths and techniques that we have developed during many actions before the Trial and Appeal Boards. Often we are able to determine that a rival claim seeks to expand and support its claims by relying on materials developed after the filing date, leading to a rejection of the opponent’s claim. In other instances we can demonstrate that the claims of other parties are incomplete, or that former employees’ claims are invalidated by the terms of their employment.
Intellectual Property Litigation No matter the forum, Haynes and Boone will protect its clients’ intellectual property from infringers and defends its clients from infringement or misappropriation claims. We have represented IP clients in federal and state courts and in the dispute-resolution forums of the U.S. Patent and Trademark Office (“USPTO”), as well as in international tribunals.
Our definition of success is to achieve client business objectives. That can mean aggressive representation at trial, strategic settlement negotiations or alternative dispute resolution that achieves competitive goals without the expense of litigation.
A Well-Rounded Team Approach At the core of our IP litigation team are true patent lawyers who have undergraduate and graduate advanced technical degrees and are licensed to practice in the USPTO. They work closely with trial lawyers - many of whom are also licensed patent lawyers - who use their technical knowledge and advocacy skills to clearly and concisely present their client’s case to judge and jury. Together the members of this multidisciplinary practice can leverage and enforce IP assets and rights throughout the world, representing clients as plaintiffs and defendants in controversies over: •
Patent, trademark and copyright infringement
• Trade secret misappropriation •
Interferences, oppositions and re-examinations
•
Technology contracting
•
Solid Technical Foundation
Unlike boutique IP litigation specialists, our IP litigation group is positioned to protect clients’ intellectual property assets across a full spectrum of technologies and applications. Our lawyers have worked as patent examiners at the Patent and Trademark Office, and as engineers or in-house counsel with leading technology companies. Our trial lawyers are also technologically savvy, and can break down complex concepts for judges and juries alike. Multinational corporations, emerging companies and established mid-sized business all
depend on Haynes and Boone IP litigators to fully understand their technologies. That knowledge enables us to create an effective defense for the IP rights of any product.
Defending Rights to Trade Secrets Disputes over non-compete agreements often pit employers against each other. We have handled litigation representing both employees’ former and new employers, and are skilled at securing and resisting temporary restraining orders (TROs) and permanent injunctions to protect employer interests in either type of case. Our lawyers can effectively deal with trade secrets involving both hard (for example, in semiconductor fabricating equipment) and soft (such as software for processing everything from customer orders to income tax returns) technologies.
Copyright and Trademark Litigation In addition to complex patentinfringement litigation, Haynes and Boone also regularly handles litigation involving trademark- and copyright-infringement claims. Haynes and Boone has successfully represented both plaintiffs and defendants in bench and jury trials, and before federal and state courts.
Defending Competitive Advantage Companies make major investments of time and money in developing patents, trademarks, and other intellectual property assets. Haynes and Boone’s IP litigators know that creating competitive advantage depends on making the risks and rewards of intellectual property development pay off for our clients. We are skilled at finding the most creative ways to help them exploit and protect their intellectual property assets and advantages.
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Oscar A. Mago Carranza Germán Bobadilla Barreda Juan Carlos Díaz Iglesias Kathrin Kalb Luis Maura Moscoso Federico Mevius Pigati Eugenio Melgar Barabino Fernando Santivañez Juli Alejandra Espinosa José Marquis
Jacqueline Mena Gheira Mori Miguel Ángel Peña
production of said copy constitutes an infringement of a copyright or a related right under the law of the importer country. A counterfeit good is defined as any good, including packaging, bearing without authorization a trade mark that is identical to a trade mark already registered in respect of such goods, or a trade mark in which the essential aspects cannot be distinguished from the registered trade mark, thereby infringing the rights of the owner of the trade mark in question under the law of the country of importation.
PROTECT YOUR GOODS
Finding fakes
AT THE BORDER
The border control measures can be initiated by a citizen, a lawyer or the Customs administration. Peruvian Customs can perform spontaneous inspections of goods if they have reasonable grounds that they are counterfeit or pirated and cannot be held liable for any damage to inspected goods.
As part of the enforcement of the Trade Promotion Agreement entered into between Peru and the United States, Legislative Decree 1092 of June 27 2008 and its Regulation (Supreme Decree No 003-2009-EF) entered into force on February 1, 2009, approving Border Measures for the protection of copyrights or related rights and trade mark rights. It defines pirated and counterfeit goods and makes provision for border control measures to be taken by the Peruvian Customs administration. Its protective scope covers exported and imported goods and goods in transit that are suspected of infringing intellectual property rights, but does not cover small quantities of goods, inherently non-commercial goods and the personal belongings of travelers.
When requesting protection at the borders, the petitioner will be required by the Customs administration to deposit a bond to cover possible losses or damages caused to the importer, exporter and/or consignee of the goods resulting from any suspension of the release of non-infringing goods. This bond must be a sum equivalent to 20% of free on board (FOB) value of the goods. In the case of perishable goods, the guarantee shall be constituted by 100% of FOB value of it. Merchandise under US$ 200 FOB value will not be affected.
A pirated good is defined as any good that is a non authorized copy of a work protected in the manufacturing country, when the
The precautionary measures that can be granted are immobilization, seizure or withholding of the merchandise.
OMC Abogados & Consultores Oscar Mago CEO Tel: ( 511 ) 628 - 1238 omago@omcabogados.com.pe www.omcabogados.com.pe
Sworn declarations will be accepted only from public entities, as well as foreign entities and institutions of international cooperation, ENIEX, nongovernmental organizations for national development, or nonprofit private institutions funded by donations for educational purposes that are duly registered before the Peruvian Agency of International Cooperation (APCI). In order to verify the ownership of the relevant goods and to suspend them at the border, trade mark owners or their legal representatives or agents must be registered in an official database kept by the Customs administration. The Customs board will liaise with the Peruvian Trademark Office (INDECOPI) for the purpose of registering right holders.
Parallel imports As mentioned above, the border measures are only applied to those goods bearing a counterfeit trade mark or pirated goods. They are not applicable to so-called parallel imports, or goods bearing an authentic trade mark that are traded by third parties without the consent of the trade mark owner. Based on the principle of exhaustion of trade mark rights, the trade exclusion right of a trade mark owner ends once he has authorized the incorporation in trade of the goods identified with his trade mark. This principle has been included in the Andean Community legislation in Article 158 of the Decision 486 of the Cartagena Agreement, which reads: “Trademark registration shall not confer on the owner the rights to prevent third parties from engaging in trade in a product protected by registration once the owner of the registered trademark or another party with the consent of or economic ties to that owner has introduced that product into the trade of any country, in particular where any such products, packaging or packing as may have been in direct contact with the product concerned
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have not undergone any change, alteration, or deterioration.” The quoted regulation, which is applied to the Andean Community countries (Bolivia, Colombia, Ecuador and Peru), deals with a doctrine known as “supranational exhaustion of trade mark rights”. This doctrine comes into effect when the good is first traded in a supranational market (in this case the Andean Community of Nations). National exhaustion occurs when the first sale of trademarked goods by the owner (or a third party with its authorized consent) takes place in the local market of the subject country. Finally, the international exhaustion of trade mark rights is invoked when the first trade is conducted in a foreign market, i.e., in the market of an export state that is not integrated within a supranational market. International exhaustion assumes the complete freedom of imports and the attendant parallel sales of the authentic trademarked goods in the import state wherein that trade mark is registered.
Copyright Regarding copyrights and related rights, the WIPO treaties of 1996
state that no aspect of the treaties will affect the parties’ abilities to determine the conditions, if any, whereby the right of exhaustion shall be applied after the first sale or another transfer with authorization of the owner. The Andean Decision 351, Common Regime on Copyrights and Related Matters, includes in its Article 13 d), says that the author enjoys the exclusive patrimonial right to prohibit (or authorize) import into the territory of any Member Country any reproductions made without the authorization of the right holder. Thus, the right does not exist when the reproductions have been made with the authorization of the owner, in which case it can be asserted that the owner’s right has been exhausted and therefore he can not oppose the parallel import.
exhaustion and claims that segmentation of the markets is contrary to free trade. This concept is ironically supported by many industrialized countries who, in other circumstances, proclaim themselves defenders of the free market of goods and services. Prohibiting parallel imports could propitiate abuses and predatory practices by the holders of IP rights, particularly with respect to underdeveloped countries, where the presence of competitor goods is a basic need. The other school of thought advocates the advantages of territorial exhaustion, claiming that segmentation would allow prices of merchandise to be lowered in poorer countries without the risk of resale in markets of greater economic affluence.
Parallel imports are vital to the economy and development of Latin American markets. Whether a country decides to allow parallel imports or not has a direct impact on the development of the free market. The subject has become divided into two irreconcilable camps. One believes in international
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Rothwell Figg Ernst and Manbeck Steven Lieberman Partner Tel: 202-783-6040 slieberman@rothwellfigg.com www.rfem.com 607 14th Street, NW, Suite 800, Washington, DC 20005
How To Deal With ‘Patent Trolls’ In The Digital Age
Law360, New York (June 20, 2013, 12:53 PM ET) Nonpracticing entities have targeted virtually every media organization in the United States with a significant digital presence for patent infringement lawsuits. A majority of these lawsuits have focused on features or functions of the entities’ websites or mobile apps. This article describes the legal issues raised by these lawsuits and provides practical options for successfully (and cost-effectively) defending against them. Who Are the Nonpracticing Entities? Some NPEs are funded by private equity investors and others by real operating companies that have decided to “monetize” their portfolios. Others are publicly traded companies that exclusively acquire and license patents. Often these entities have relationships with multiple law firms. Consequently, the number of NPE cases has exploded. NPEs sued companies for patent infringement 1,065 times in 2006 and 5,307 in 2011. These patent lawsuits distract media entities that, by and large, had until recently never expected to be embroiled in expensive patent litigation. How It Begins An NPE encounter begins in one of two ways: • a letter calling your attention to one or more patents and offering you a license; or • an infringement complaint, typically followed by an invitation to participate in licensing discussions. Until recently, NPEs most commonly approached with license offer letters. A well-crafted offer letter would discuss the patents and the inventors’ credentials and list the companies that had already agreed to license the patent. Any prior litigation involving the patent would be described. The letter would then typically invite the target to explore the possibility of licensing. Forum selection is often a critical part of an NPE’s strategy. Because a license offer letter typically provides subject matter jurisdiction for a declaratory judgment lawsuit, possibly depriving the NPE of its chosen venue, most NPEs now forego the offer letter and simply file suit. If you receive a license offer letter, retain counsel quickly to minimize your chance of liability by taking the following steps. First, send a document retention memorandum to persons most likely to have potentially relevant documents. Crafting the hold memorandum is not easy because patents subject to NPE licensing overtures are typically vague, and document preservation notices tracking the language in the offer letter could call for preserving millions of pages of documents. Take care defining both the scope of the retained material and the
identity of the individuals to whom notice should be sent. Just sending the document retention notice is insufficient. Steps should often be taken to ascertain that auto-delete features are disabled, etc. Second, ascertain the merits of the infringement claim. A determination that the claim has no merit will affect litigation strategy and will play a role in how, if at all, you respond to the license offer letter. Third, ascertain potential indemnitors — e.g., third parties who created features on your website or mobile app and, if so, how and when to notify them of the potential claim. Fourth, decide whether to respond to the letter. Some NPEs send thousands of license offer letters. The best strategy may be to not to respond, since responding often seems to increase the likelihood of being sued. Fifth, after ascertaining that you have a strong defense, you must critically decide whether to file a declaratory judgment action against the NPE in your chosen forum. Filing a declaratory judgment brings two significant advantages. First, you get to choose the forum. If the NPE’s assertion is particularly frivolous, you may wish to sue in a jurisdiction that more frequently grants attorneys’ fees. Second, Federal Circuit Judge Kimberly Moore, before her appointment to the bench, found a significant benefit in being a declaratory judgment plaintiff rather than a defendant in a patent infringement action. I often have recommended to clients that they file declaratory judgment actions after receiving a license offer letter. We often obtained for our clients a covenant not to sue from the patent holder in return for our agreement to dismiss the declaratory judgment action. If the litigation proceeded, the benefit of having chosen an advantageous jurisdiction frequently resulted in a victory that we might not otherwise have obtained. Before filing for declaratory judgment you should do at least three things: 1. Determine that you have strong case of either non-infringement or invalidity (or both) on the merits; 2. Determine that there is personal jurisdiction over the NPE; and 3. Ascertain that the license offer letter gives rise to subject matter jurisdiction allowing a declaratory judgment action. Most license offer letters are sufficient to give rise to subject matter jurisdiction. Finally, before filing a declaratory judgment complaint, you must decide whether by doing so you are trading the certainty of a patent litigation against a much lower likelihood that the NPE will never pursue your client with a lawsuit. After receiving a license offer letter, consider whether it is necessary or useful to obtain an opinion of counsel. Such an opinion can be useful in defending
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against a claim of willful infringement. Deciding whether to get an expensive full opinion, a less formal opinion, or no opinion is a fact-intensive analysis with no single right answer. If you have been sued for patent infringement, you need to complete each of the steps above, except exploring the option of filing a declaratory judgment lawsuit. Additional decisions must also be made quickly. First, explore the possibility of a transfer motion. One of the most popular venues for NPEs is the Eastern District of Texas. This district is typically viewed as a difficult one for patent defendants, principally because it is challenging to get a case-dispositive motion heard early in the litigation. A number of judges in that district are less inclined that those in other jurisdictions to grant summary judgment. For years, Eastern District of Texas courts routinely denied transfer motions. However, the Federal Circuit has granted a series of mandamus petitions directed to the district court in the Eastern District of Texas ordering transfer of patent cases to other jurisdictions. Such a motion may be appropriate even when the plaintiff purports to have its principal place of business in the Eastern District of Texas, since the principal place of business is often no more than a post office box or an empty office. The new venue of choice for NPEs appears to be the District of Delaware, principally because of the perception that judges there infrequently entertain summary judgment motions prior to the close of discovery. However, several judges in that district have entertained and granted early summary judgment motions, where appropriate. Second, NPEs often carelessly use language in their complaints. Allegations of indirect infringement and willful infringement are many times made without appropriate legal basis. Motions to dismiss such complaints, while rarely dispositive of the entire lawsuit, narrow the issues and should be filed where appropriate. Third, it is critical to evaluate the merits carefully. Evaluating the Merits Explore Noninfringement Defenses If an NPE identifies an exemplary claim in its complaint that it contends is infringed, focus on that claim. Even when faced with a seemingly broad patent claim, there are often non-infringement defenses. Explore this possibility early. Develop an Invalidity Defense “Traditional” prior art searches by prior art search firms are largely useless for invalidity defenses in the business method/Internet commerce areas. Most experienced patent litigation firms have developed a better understanding of where the best prior art is. Consider Post-Grant Review Post-grant review options and the old ex parte review procedure that is sometimes still available, have both upsides and downsides, a discussion of which is beyond the scope of this article. The upsides include having a more streamlined and less expensive process for patent invalidation, while (hopefully) staying the litigation. The downsides including some estoppel provisions in the
event that you lose your post-grant review challenge. Strategies for Defending NPE Litigations You do not necessarily have to settle if you have been sued. You can win the case and decrease the defense costs. Work with counsel to maximize your chances of obtaining attorneys’ fees. Consider a Rule 11 motion regarding the lack of adequate prefiling investigation by an NPE — particularly if the NPE sued many defendants and did not personalize its complaint. In a patent suit, “a reasonable pre-suit investigation ... requires counsel to perform an objective evaluation of the claim terms when reading those terms on the accused device.” The Federal Circuit has held that before filing a complaint for patent infringement the plaintiff should attempt to obtain the accused device or a technical description of it. If your website or mobile app is accused, the NPE must have reviewed that site or app with great care and compared it on an element-by-element basis to at least one claim. Consider diligently preparing for an application that the case be declared exceptional under Section 285 of the patent statute, which can result in a shift of attorneys’ fees. Also consider an application under 28 U.S.C. § 1927, relating to vexatiously multiplying litigation. While district courts reluctantly shift fees, a fee shifting motion sometimes seriously threatens an NPE. Chief Judge Randall Rader of the United States Court of Appeals for the Federal Circuit has written: One remaining option to control trolls ... reverse the fees and costs! When the case is over and the court can identify a troll ... I strongly advocate full-scale reversal of attorney fees and costs! ... While I understand that the case must qualify as exceptional, I believe that adequate documentation of «trolls» would qualify. Chief Judge Rader echoed this sentiment in a recent op-ed piece in the New York Times. President Obama recently issued five executive orders and seven recommendations to lawmakers targeting NPEs, among them a proposal that would facilitate judges’ awarding attorney’s fees to defendants prevailing in frivolous lawsuits.[13] The following strategies can also be useful and effective. 1. Consider joint defense groups. NPEs often count on the cost of defending a lawsuit to induce a settlement. Multiple defendants paying a single firm substantially lowers the “cost of defense.” When a defendant pays only one-sixth of the bill, litigating the case vigorously becomes a much more attractive option. 2. Consider reexamination and post-grant review options. Sometimes they are the best choice. 3. Consider early case-dispositive summary judgment motions. In certain cases, a Section 101 motion can dispose of an infringement claim at the beginning of the case, before starting discovery. Just because you are threatened by an NPE, you need not necessarily settle. Settlement may be the right approach if the offer is low, you have real liability, or the litigation cost is too high. But there are many ways to handle the litigation defense such that settlement is not your only option. --By Steven Lieberman, Rothwell Figg Ernst & Manbeck PC Steven Lieberman is a partner in Rothwell Figg’s Washington, D.C., office. The author acknowledges and thanks the Media Law Resource Center, which published an expanded version of this article in MLRC Bulletin 2013 Number 1 - Legal Frontiers in Digital Media.v
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Wong, Cabello, Lutsch, Rutherford & Brucculeri, LLP John Cain Partner Tel: 832-446-2400 jcain@counselip.com www.wongcabello.com 20333 State Highway 249, Suite 600, Houston, TX 77070
Wong, Cabello, Lutsch, Rutherford & Brucculeri, L.L.P. is a boutique intellectual property law firm headquartered in Houston, Texas. Our practice focuses on helping our clients develop, protect, strategically manage, and maximize the value of their intellectual property, as well as assess the relevance of third party intellectual property to their business. We provide legal counsel for a broad range of issues involving patents, trademarks, copyrights, trade secrets, rights of publicity, web properties and complex technology transactions. In today’s competitive world, a business’ long-term growth and success is often defined by its intellectual capital and that of others. But protecting your innovations as well as navigating with and around the rights of others is increasingly complex. Creating a strategy that effectively links your intellectual property (IP) to your organization’s commercial strategy and business goals is essential to maximizing the value of your IP portfolio. At Wong Cabello, we work closely with our clients to help build and strengthen their IP portfolios by developing a strategy that is tailored to each business and to each industry.
Unique Blend of Experience Our blend of experience, including serving as in-house counsel for
large corporations and start-ups, as well as experience at large IP law firms, provides a unique perspective. Our attorneys combine litigation, counseling and prosecution experience, along with private practice and real-world experience, to offer our clients an exceptional level of service that is focused on their success. Members of our firm have served as General Counsel, Chief IP Counsel, IP Litigation and Licensing Manager and IP Strategist. This in-house experience also enables us to serve some of our clients in the role of virtual in-house counsel.
Strong Dispute Resolution Skills Wong Cabello has extensive experience in trial and appellate patent, trademark, and copyright disputes. While our first priority is always to seek to resolve disputes without unnecessary litigation, we also understand the importance of strategy, speed, and effective representation when litigation is required. Wong Cabello’s IP litigators have combined experience and knowledge to resolve countless disputes as well as trying cases before federal courts and other tribunals. Should our clients be sued or need to protect their intellectual property through litigation or in the U.S. Patent and Trademark Office or U.S. Copyright Office, our team is ready to help you navigate the legal system. Depending on our client’s needs, we have aligned ourselves with leading trial attorneys and coordinated suits and managed discovery internationally through our network of attorneys specializing in the laws of their respective countries.
Experts in IP Our seasoned professionals have a significant amount of experience in intellectual property matters coupled with in-house experience in complex business transactions including intellectual property licensing, technology transfer agreements, due diligence matters, corporate compliance issues, insurance coverage, indemnification,
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complex litigation, subrogation, and technology issues in general. This blend of experience uniquely qualifies us to serve as consulting and testifying experts relating to reasonable royalties, trade secrets, copyrights, software licensing, attorney fees, patent infringement, insurance coverage, indemnification, inequitable conduct, willful infringement, merger and acquisition due diligence, and corporate compliance.
Litigation, Opinions, Patent Litigation, Patent Portfolio Management, Patent Procurement, Testifying and Consulting Experts, Trademark Litigation, and Trademark Protection.
Specialists in Industry Standards Industry standards are fundamental to many areas of computers and communications. They can provide great benefits but they can also be a problem area, particularly at the intersection between standards and patents. Our attorneys are among the most experienced in the country in the area of standards and standards bodies, having developed many of the basic agreements and structures used with ad hoc consortia. We are very familiar with the various patent disclosure requirements of standards bodies and the potential estoppels which may arise if the disclosure is not properly handled. We have also been very active in the development of patent licensing pools and their legal considerations. In addition to advising corporate clients on standards matters, our attorneys act as legal counsel for a number of standards groups. Wong Cabello represents companies specializing in numerous technology areas including the following: computer science, electronics, manufacturing, semiconductors, internet technology, petroleum services, nanotechnology, chemical processing, fiber optic switches, financial services, communications, hospitality, consumer products, and biotechnology.
Other Practice Areas Copyright, Intellectual Property Licensing, Intellectual Property Strategy, Inter Partes Review,
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Maximizing the Commercial Potential of your Intellectual Property Intellectual Property Licensing Intellectual Property Strategy Inter Partes Review Opinion Work Patent, Trademark, Copyright & Trade Secret Litigation Patent Portfolio Management Testifying & Consulting Experts Trademark Portfolio Management
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