IPPro Issue 011

Issue 11

11 December 2018

Stan Lee & Marvel IP The future of Marvel IP

Actavis v Eli Lily: outcomes

Jin Ooi discusses the future of English patent doctrine

Taming the trolls

Philip Swain on the battle against patent trolls

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In this issue

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Editor: Becky Butcher beckybutcher@blackknightmedialtd.com +44 (0)203 750 6018 Deputy Editor: Barney Dixon barneydixon@blackknightmedialtd.com +44 (0)203 750 6026

Microsoft’s accession to OIN

Stan Lee & Marvel IP

The addition of Microsoft to the Open Invention Network says a lot about the initiative and the way forward for open source

Stan Lee’s passing shook the industires he inspired, leaving the question: what is the future of Marvel IP?

The new INTA president

UK IP minister quits

David Lossignol has been appointed president of the International Trademark Association

Sam Gyimah, the UK’s minister for IP, has resigned, citing the government’s Brexit withdrawal agreement

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Junior Reporter: Ben Wodecki benwodecki@blackknightmedialtd.com +44 (0)203 750 6017 Designer: James Hickman jameshickman@blackknightmedialtd.com +44 (0)203 750 6021 Contributors: Jenna Lomax, Ned Holmes, and Maddie Saghir IP Portfolio Manager: Serena Franklin serenafranklin@blackknightmedialtd.com +44 (0)203 750 6025 Publisher: Justin Lawson justinlawson@blackknightmedialtd.com +44 (0)203 750 6028 Office Manager: Chelsea Bowles accounts@blackknightmedialtd.com Published by Black Knight Media Ltd Copyright © 2018 All rights reserved

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Actavis v Eli Lily: outcomes

Taming the trolls

Kirkland & Ellis associate Jin Ooi discusses the English patent doctrine following Actavis v Eli Lilly

Phil Swain of Foley Hoag explains a legislative measure in Massachusetts aimed at hindering patent trolls

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The changing IP landscape

Industry events

Brandstock’s Volker Spitz discusses IP portfolio management

Pick up your copy of IPPro at these industry events

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Industry · Latest News USPTO outlines goals for 2018-2022 Strategic Plan Optimisation of patent and trademark quality and timeliness, and increased global intellectual property enforcement and protection are just some of the US Patent and Trademark Office (USPTO)’s goals outlined in its 2018-2022 Strategic Plan.

The strategic plan, which was released on 29 November, sets out the USPTO’s main goals for the next four years.

A draft of the plan was published in July for employees to review, and a draft was open for public comment in August.

The three main goals outlined by the USPTO’s Strategic Plan were optimising patent quality and timeliness, optimising trademark quality and timeliness and providing domestic and global leadership to improve IP policy, enforcement, and protection worldwide. The plan highlighted the office’s commitments to expanding frameworks both in the US and abroad and aims to modernise its information technology systems.

The latter being notable due to the USPTO’s electronic filing system requiring emergency maintenance due to outages in August.

Commenting on the plan, USPTO director and undersecretary of commerce for IP, Andrei Iancu said: “We are confident in attaining the goals set out in this plan and look forward to the continued engagement and feedback from our stakeholders and employees.”

“Together we celebrate innovation and entrepreneurship—we are very proud of the men and women who stand behind a well-balanced American IP system.”

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Industry · Latest News Patent and trademark filings up by 6 percent, says WIPO Patent applications increased by around 6 percent while trademark filings almost surpassed 12.5 million in 2017, according to a World Intellectual Property Organization (WIPO) report.

WIPO’s annual World Intellectual Property Indicators report found that last year 3.17 million patents were filed, making it the eighth consecutive yearly increase.

Global trademark filing activity totalled 12.39 million, while that for industrial designs reached 1.24 million.

According to WIPO, activities by Chinese innovators was a leading factor behind the growth in filings for patents, trademarks and industrial designs.

The report also showed that China recorded the highest application volume for each of these IP rights as innovators and creators.

China’s IP office received the highest number of patent applications in 2017, a record total of 1.38 million.

Despite China’s growth in filings, Germany and Russia saw a decline in filings by 0.3 and 11.3 percent, respectively.

Worldwide plant varieties applications grew by 11.7 percent to reach 18,490 applications in 2017, while data received from 82 national and regional authorities highlight the existence of around 59,500 protected geographical indications (GIs) in 2017.

China also had the highest volume of trademark filing activity with a class count of almost six million. The US and Japan were second and third, respectively. The UK and Canada also saw considerable growth in filings.

WIPO director general Francis Gurry commented on the report’s findings: “Demand for IP protection is rising faster than the rate of global economic growth, illustrating that IP-backed innovation is an increasingly critical component of competition and commercial activity.”

“In just a few decades, China has constructed an IP system, encouraged homegrown innovation, joined the ranks of the world’s IP leaders—and is now driving worldwide growth in IP filings.”

David Lossignol elected as INTA president The International Trademark Association (INTA) has elected David Lossignol as president of the association, following a leadership meeting last month.

Lossignol succeeds Tish Berard, who served as president of the association over the past year.

As well as being INTA president, Lossignol serves as global head of trademarks at Sandoz International.

He has worked for a number of pharmaceutical companies as a trademark attorney and counsel and has served as an INTA board member since 2013.

Alongside Lossignol’s appointment, INTA announced the election of several other positions.

Ayala Deutsch of NBA Properties will serve as president-elect of the association, while Tiki Dare of Oracle and Zeeger Vink of Maus Frères will serve as vice presidents.

Jomarie Fredericks of Rotary International will serve as treasurer, while Dana Northcott of Amazon will serve as secretary.

Anna Carboni of Wiggin was elected as counsel of the association.

Why not read IPPro’s specialist feature on China’s increasing dominance as the world’s largest innovator?

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Trademarks · Latest News INTA and CIPO commit to trademark development activities The Canadian Intellectual Property Office (CIPO) and the International Trademark Association (INTA) have agreed to develop cooperative trademark activities.

A memorandum of understanding was signed by INTA president Tish Berard and CIPO’s commissioner of patents, registrar of trademarks and CEO, Johanne Bélisle, at the CIPO offices in Ottawa, Canada.

Both INTA and CIPO have worked together in the past on numerous initiatives, with both organisations sharing information and resources in 2018.

INTA provided CIPO with considerable input on drafts of its Proposed Trademark Regulations, Opposition Practice Changes, Examination Practice Notices (supporting Bill C-31 changes), and Practice Notice on Surnames.

Berard thanked CIPO for its continued part of a productive relationship, saying: “We greatly appreciate your office’s openness to stakeholders’ input and willingness to engage collaboratively with us.”

She added: “We now look forward to deepening this relationship in the areas of focus outlined in this agreement to help foster economic growth and consumer protection.”

Bélisle commented: “CIPO is happy to deepen our collaboration with INTA.” She said that the new memorandum of understanding proposes a number of new initiatives with the trademark association in important areas.

She explained that the memorandum of understanding included commitments for a “speakers’ series”, as well as “activities focused on improving the quality and timeliness of IP rights, awareness building and stakeholder engagement with the broader trademark community”.

Bélisle added: “This international collaboration supports the Government of Canada’s IP Strategy, and is another excellent example of our efforts on the world stage to advance the Innovation and Skills Plan, helping position Canada as a global innovation center.”

As well as this new agreement with Canada, INTA holds similar agreements with over a dozen IP offices globally, including China, Brazil, and Korea, and works extensively with the World Intellectual Property Organization.

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Mayer Brown hires former US solicitor general assistant as partner Former Gibson Dunn partner Nicole Saharsky has joined Mayer Brown as a partner in the firm’s Washington DC office. Saharsky will serve as a co-leader of the US Supreme Court and appellate practice alongside Supreme Court advocate Andrew Pincus. Previously, Saharsky served for over a decade as an assistant to the solicitor general at the US Department of Justice. She has also clerked for judge Carolyn Dineen King of the US Court of Appeals for the Fifth Circuit.

As well as intellectual property, Saharsky has been involved in cases in various business issues during her time at the solicitor general’s office. She said she is “thrilled” to be joining Mayer Brown and described her new team as “talented … with a long track record of Supreme Court victories that have fundamentally shaped US jurisprudence”.

Commenting on the move, the firm’s global litigation and dispute resolution practice leader, Michael Lackey, said: “Nicole Saharsky is among the leading women Supreme Court advocates in the US.” Her fellow Supreme Court advocate, Pincus added: “Saharsky is nationally recognised as a top appellate lawyer and will be an invaluable resource as we continue to defend our clients’ interests at every level of the US judicial system.”

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Trade War · Latest News G20 Argentina, Buenos Aires, Argentina

US-China trade war in ceasefire after ‘highly successful’ G20 meeting China will “reduce and remove” tariffs on cars coming into China from the US following a “highly successful meeting” between the two nations leaders at the G20 summit.

US president Donald Trump took to Twitter to make the announcement, suggesting that the current tariff is at 40 percent.

Following a meeting between president Trump and Chinese president Xi Jinping, the White House revealed that tariffs will remain on $200 billion worth of product at the 10 percent rate and will not increase to 25 percent “at this time”.

In turn, China will agree to purchase a “not yet agreed upon, but very substantial” amount of agricultural, energy, and industrial products from the US to reduce the trade imbalance between the two nations.

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The two presidents also agreed to begin negotiations on changes to forced technology transfer, intellectual property protection, and non-tariff barriers.

According to a statement from the White House, both nations will attempt to come to a conclusion within the next 90 days, however, if no agreement is reached, then the 10 percent tariffs will be raised to 25 percent.

President Trump added: “This was an amazing and productive meeting with unlimited possibilities for both the US and China.

It is my great honour to be working with president Xi.” President Trump announced $50 billion worth of tariffs against China and ordered investment restrictions to protect “the intellectual property of Americans” and end “the illegal theft and transfer of IP to foreign nations” in March and increased those tariffs in July. www.ippromagazine.com

USMCA · Latest News G20 Argentina, Buenos Aires, Argentina

US, Canada, and Mexico sign USMCA, includes new IP protections The leaders of Canada, Mexico and the US have all signed the reorganised North American Free Trade Agreement (NAFTA) that includes stronger intellectual property rights protections.

The US Mexico Canada Agreement (USMCA) was announced in early October and promised stronger IP rights protections.

One such protection considered was the extension of patent protection for pharmaceutical companies in Mexico and Canada to 10 years for biologics, bringing the term closer to the US’s 12-year protection.

The agreement includes increased measures for copyright protection, 10 years of data protection for biologic drugs and new protections against the theft of trade secrets. A White House statement called these protections “vital to promoting innovation and economic growth”.

Some generic manufacturers had previously raised concerns that the deal could delay generic products reaching the

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market and other concerns have been raised over the potential cost increase for drugs in Canada. Failure to improve on IP protection would have been a “missed opportunity and a failure to deliver on a key campaign promise”, according to the Institute for Policy Innovation’s president Tom Giovanetti.

US vice president Mike Pence took to Twitter to praise USMCA, saying that, among others, IP was a “big winner” from the agreement.

USMCA was signed by US president Donald Trump, Canadian prime minister Justin Trudeau, and Mexican resident Enrique Peña Nieto at the G20 summit in Buenos Aires, Argentina.

President Trump called USMCA “one of the most important, and largest trade deals in US and world history”.

He added: “The US, Mexico and Canada worked so well together in crafting this great document. The terrible NAFTA will soon be gone. The USMCA will be fantastic for all!” www.ippromagazine.com

Brexit · Latest News UK intellectual property minister quits over Brexit deal UK minister of state for universities, science, research and innovation, Sam Gyimah, has tendered his resignation over UK prime minister Theresa May’s Brexit deal.

Gyimah, who also held responsibilities as minister for intellectual property, explained that he could not “support the government’s deal”.

In a Facebook post announcing his resignation, Gyimah took aim at the UK’s recent decision to pull out of the EU’s strategic satellite navigation system, Galileo.

Gyimah said the prime minister was “right to call time” on Galileo negotiations, but said that this was “only a foretaste of what’s to come under the government’s Brexit deal”.

He explained: “Having surrendered our voice, our vote and our veto, we will have to rely on the ‘best endeavours’ of the EU to strike a final agreement that works in our national interest.”

Gyimah remarked that the Brexit deal had been “hard won”, but all the big decisions that will shape the UK’s future in Europe “are yet to be agreed”.

“Where we set the balance between an independent trade policy and frictionless trade, high market access and freedom of movement, fisheries, agriculture, and the all-important Northern Ireland question are just some of the big issues still in play”, he said.

Gyimah added that the protracted negotiations would result in the UK’s interests being “repeatedly and permanently hammered by the EU27 for many years to come” and said the UK would end up “worse off, transformed from rule markers into rule takers”.

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He added: “Britain will not be standing side-by-side with our European partners as equals. Even in programmes where we have agreement, we will be outside the room when key decisions affecting our future and prosperity are made. It is a democratic deficit and a loss of sovereignty the public will rightly never accept.”

The tortured role of intellectual property minister has changed hands several times under Theresa May’s government and can’t seem to find its footing following the departure of Baroness Lucy Neville-Rolfe who held the role for two and a half years.

Gyimah replaced Jo Johnson, who has also resigned from the government over Brexit, in January 2018. At the time, Johnson had been moved into the role of minister of state for the department of transport and minister for London.

Johnson took on the responsibilities in January 2017 following the departure of Neville-Rolfe in December 2016.

Neville-Rolfe was praised for her enthusiasm and interest in the role, as well as the length of her time in the role, which encouraged continuity and better joined-up policymaking, according to some spectators.

UK member of parliament Chris Skidmore has been appointed minister of state for universities, science, research and innovation, following the resignation of Gyimah.

In a post on Twitter, Skidmore said he was “delighted and honoured” with the appointment.

Skidmore is a descendant of Sir James Scudamore, a courtier in the court of Queen Elizabeth I.

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Patents · Latest News Germany might dodge UPC as Brexit uncertainty persists Germany will not ratify the Unified Patent Court (UPC) Agreement if major uncertainty about the UK’s participation remains, according to Kevin Mooney, chairperson of the rules and procedure committee of the UPC. Mooney warned that creating the court will require a lot of capital, which each member will have to bring in themselves.

He said that Germany may not want to part with money if what it believes to be a key member is not part of the court. To that end, Mooney warns that if UK MPs reject the controversial Brexit withdrawal agreement, then the UK, which has already ratified the UPC Agreement, may not be allowed to participate.

Despite no mention in the draft withdrawal agreement of the UPC, the UK will be allowed to be part of the court when the transition period ends. Mooney questioned what might happen if this agreement fails and, answering his own question, said that nobody knows.

He added that the possibility of a general election or second referendum in the UK could cause a “further considerable delay”.

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Patent licence agreements should be partnerships, not transactions Companies should look at licensing agreements with start-ups as partnerships, not as transactions, according to Jamie Kemler, vice president of intellectual property business strategy at Stryker.

Kemler suggested that thinking of licensing agreements differently allows companies to “think about managing [assets] downstream”.

While highlighting that many start-ups in life science industries do have to balance short-term considerations with long-term, Kemler suggested that the majority of issues focused on by start-ups can be helped through licensing.

Stryker, which licenses to a Massachusetts-based start-up called LaunchPad Medical and Kemler, suggested that by making the licence right exclusive, it will justify an investment a company is making.

In order to maximise monetisation from licensing agreements, Kemler suggested milestone payments could be used to aid commercialisation events, such as product launches, and that the start-up should spend money on the development process, which should hopefully shift value derived for the future.

He also said that in order to mitigate risks, companies shouldn’t sell start-ups IP, but license and make sure that rights of reversion are part of any deal.

An emerging market that Kemler revealed seeing in the future, is licensing touniversity/hospital start-ups. He pointed to data from the Association of university Technology Managers, which said that more start-ups are originating from universities.

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Industry Appointments · Latest News BT patent attorney joins EIP Former senior patent attorney at BT, Pete Wilson, has joined law firm EIP as a partner.

Wilson, who had been in his role at BT for 12 years, coordinated the company’s defence against claims of patent infringement in the UK and the US.

Glaser Weil adds new IP department chair Glaser Weil has hired Lawrence Hadley as a partner and chair of its intellectual property department.

Hadley, who has over 25 years experience in IP, focuses his practice on litigation of patents, copyright, and trademarks.He also has extensive experience before both federal and state courts and the US International Trade Commission.

Commenting on the move, Patricia Glaser, chair of the firm’s litigation department, said: “Lawrence Hadley is a welcome addition to lead the firm’s intellectual property litigation department. His experience working on unique and broad IP litigation in the technology and material science industries adds tremendous value and enables the firm to offer supplementary resources to better serve our clients.”

A former associate of Dummett Copp, Wilson brings with him extensive experience in various technology sectors, including broadband, autonomous networks, and wireless technologies.

Wilson said he was “excited” to be joining EIP. He added: “I have been following their work for many years and have always been impressed by their handling of complex issues across a wide array of industries.”

“I look forward to being a part of their team and helping the firm’s patent department to continue to grow and flourish.”

Jerome Spaargaren, partner at EIP, commented: “I am thrilled to welcome Pete Wilson to EIP to further enhance our awardwinning telecoms practice.”

“He has a tremendous amount of in-house experience and will be an asset to the team.”

“Wilson brings with him a unique set of skills, which coupled with his intimate knowledge of the space will help drive our telecoms practice forward.”

UCB has reduced its patent portfolio to focus on a patient-centric approach Scientific research company UCB has reduced its patent portfolio by 25 percent to “focus on core innovation” and its “patient-centric approach”.

According to UCB associate patent counsel, Manisha Desai and director of intellectual property policy, Aaron Smethurst, UCB opted to reduce its portfolio by one quarter in order to refocus on these goals.

Both Desai and Smethurst said this was conducted across the board, even on patents that relate to a product that is currently on the market.

Smethurst said that when patenting products in the life sciences industry, certain needs of patients that

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need to be met should be considered so that “the right treatment goes to the right patient”.

He added that in the future, big data will “improve our ability to give the right treatment to the right patient at the right time”.

Smethurst said: “There is a need to press forward with medical advances and incentivise those who take on the immense technical challenges and financial risk that those advances require.”

The speakers showed that of UCB’s €4.53 billion revenue in 2017, the company invested €1.05 billion in its research and development programme.

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Life Sciences · Latest News Patent writing software could cause issues in the pharma industry The growing use of software for patents in the pharma industry could kill off jobs, warns University of Copenhagen professor Sven Bostyn.

In terms of whether blockchain is safe to use, she points out that you can choose whether to open your data or not, making it safe.

Speaking at the Life Science IP conference in London, Bostyn who is an associate professor of biomedical innovation law, warned that despite being good for efficiency, software could kill off jobs, and may cause confusion amongst examiners if a system was entirely run by artificial intelligence (AI) such as a black box system.

In terms of the problems related to the patenting of antibodies, he turned to the inventive step and inefficiency as problem areas for this particular innovation.

Despite Bostyn’s warning, Mei-Hsin Wang from the Chinese Biomedical and Technology Application Association disagreed, stating that emerging technologies like AI, blockchain and big data won’t take jobs away, but rather “help us do more”.

According to Wang, AI and blockchain can help identify the quality and function of patents, and can even aid in the search for potential licensees.

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He added that the European Patent Office makes antibody related patent filing difficult as “it is very difficult to prove prior art”.

Another “slightly concerning issue” arising from antibody patents covered by Bostyn was how broadranging they can be, stating that more broad-ranging ones are “encouraged”.

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Jin Ooi · Interview

Southwark Bridge, London, UK

Actavis v Eli Lilly: outcomes Kirkland & Ellis associate Jin Ooi discusses the English patent doctrine following Actavis v Eli Lilly Ben Wodecki reports

How does the Icescape v Ice-World case relate to Actavis v Eli Lilly?

Icescape v Ice-world is a case concerning a system for cooling mobile ice rinks. It is the first occasion in which the English Court of Appeal has had the chance to consider in any depth the effect of the Supreme Court decision in Actavis v Eli Lilly. The Court of Appeal applied the Supreme Court’s decision to consider whether there was infringement: (i) as a matter of normal interpretation (which it confirmed involves purposive interpretation), and (ii) as a matter of equivalents (by asking what it termed the “Actavis questions”).

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What could this English patent doctrine mean for rights holders and for patent law as a whole?

The emergence of a principle of equivalents in English law following on from Actavis v Eli Lilly is generally good news for patentees, almost all of whom have enthusiastically embraced the Supreme Court decision. This is because the principle of equivalents extends a patentee’s scope of protection to cover an infringing variant which may not necessarily have been caught by just construing the claims as a matter of normal, purposive interpretation. This is a significant shift in the state of English patent law as it was previously thought that purposive construction was the be all and end all when considering infringement. www.ippromagazine.com

Jin Ooi · Interview Following this case, what process should be taken to access the scope of a patent?

The Supreme Court explained that a problem of infringement is best approached by addressing two issues, each of which is to be considered through the eyes of the notional addressee of the patent in suit, for example, the person skilled in the relevant art. If the answer to either issue is “yes”, there is an infringement; otherwise, there is not.

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Does the variant infringe any of the claims as a matter of normal, purposive interpretation; and, if not

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Does the variant nonetheless infringe because it varies from the invention in a way or ways which is or are immaterial (for example as a matter of equivalents)?

In considering what makes a variation immaterial, it is helpful to consider the following three questions (which are guidelines, not strict rules): i. Notwithstanding that it is not within the literal meaning of the relevant claim(s) of the patent, does the variant achieve substantially the same result in substantially the same way as the invention, for example the inventive concept revealed by the patent? ii. Would it be obvious to the person skilled in the art, reading the patent at the priority date, but knowing that the variant achieves substantially the same result as the invention, that it does so in substantially the same way as the invention? iii. Would such a reader of the patent have concluded that the patentee nonetheless intended that strict compliance with the literal meaning of the relevant

claim(s) of the patent was an essential requirement of the invention?

In order to establish infringement under the principle of equivalents, a patentee would have to establish that the answer to the first two questions was “yes” and that the answer to the third question was “no”.

What could US patent law take from this important UK case?

Two things: 1. As a result of the introduction of a principle of equivalents, English courts are now much more open to finding infringement where the infringing product/process varies in an immaterial way. Expert evidence continues to be key in assisting the court to answer the “Actavis questions”.

2. English courts continue to adopt a sceptical, but not absolutist, attitude to a suggestion that the contents of the prosecution file of a patent should be referred to when considering a question of interpretation or infringement. It remains a high hurdle. The circumstances in which it will be appropriate to do refer to the prosecution file are where (i) the point at issue is truly unclear if one confines oneself to the specification and claims of the patent, and the contents of the file unambiguously resolve the point, or (ii) it would be contrary to the public interest for the contents of the file to be ignored (for example, where the patentee had made it clear to the EPO that he was not seeking to contend that his patent, if granted, would extend its scope to the sort of variant which he now claims infringes). IPPro

As a result of the introduction of a principle of equivalents, English courts are now much more open to finding infringement where the infringing product/process varies in an immaterial way Jin Ooi, associate Kirkland & Ellis

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Keith Bergelt · Interview

The Open Invention Network: Microsoft’s accession The addition of Microsoft to the Open Invention Network says a lot about the initiative and open source technology Barney Dixon reports

What does Microsoft’s accession to the Open Invention Network mean for the group?

Symbolically and functionally it’s extremely significant. The Open Invention Network (OIN) was formed in the wake of the SCO litigation against IBM, Red Hat and SUSE/Novell. SCO sued claiming to have Unix related functionality that was relevant to Linux.

This litigation was quietly funded by Microsoft, lasted several years and went nowhere. In the end, there was no liability and no culpability for the alleged infringements.

There were a number of components to the litigation, but the bottom line is that Microsoft funded IP litigation. This was a wake-up call for IBM, Red Hat and the other founding members of OIN that patents, and IP in general, could be used to slow or stall the progress of Linux in general and that Microsoft had gone beyond rhetoric and was actually mobilising resources to create fear, uncertainty and doubt.

Back then, Linux was primarily geared towards the enterprise.

It was open-source and was moving forward in a positive direction but didn’t have the energy that it has now, where the operating system is present in automobiles, power grids, banking, internet of things, finance and more. There are very few sectors that have not been impacted by Linux in very significant ways.

Coders are relatively sophisticated when it comes to IP issues because open source is a social movement in which one becomes invested of both time and passion. It’s not about technology per se, the technology, code and innovation are all part of it, but the power of it is the modality—the fact that one plus one plus one does not equal three, it can equal six, 10 or 20. This collaborative model of inventorship in open source innovation, where you bring smart people from around the world together to solve technical issues through the creation of elegant code, is where the power really resides.

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Linux is now having such a significant impact that it is very

difficult to find a single electronic touch in a G10 country that is not enabled by Linux. Whether we’re using an iOS phone and we think we’re utilising Apple’s proprietary code, the reality is that even if a platform doesn’t run on the Linux kernel, there are ample amounts of Linux code that have been co-opted and used to be able to create the iOS platform. The most proprietary of platforms are influenced by open source.

The world has changed so much. Microsoft has gone from being vilified by the community, with OIN forming to deal with not just Microsoft, but what it represented in terms of threat, to Microsoft joining the OIN. Microsoft joining was a statement to say ‘we recognise where we come from, and we recognise where we are going, and our fortunes are tied to open source innovation pure and simple’.

It shows that, wherever we can source innovation, whether it is an internal ecosystem or exchange or through tapping open source resources, we are going to be an innovative company and innovation requires access to open source. This is pretty much what Microsoft is saying and it’s indicating that it is willing to collaborate on the IP front to ensure a richer healthier ecosystem of code development.

How are patent-non aggression groups like OIN a response to big litigation issues in recent years?

OIN was not at all a response to the mobile patent wars and the rise of litigation in the early part of this decade. Formed originally in 2005, it is the oldest of the patent non-aggression communities and it is complementary to many later appearing patent risk mitigation initiatives like AST, RPX and LOTnet because it reduces risk and helps IP directors.

There is no analogue in the history of technology to OIN’s existence: companies getting together to ensure that litigation does not occur in core Linux and, in so doing, safeguarding this open source modality and its creative outputs. You’re www.ippromagazine.com

Keith Bergelt ¡ Interview hard pressed to find companies doing this in the past. Other cross-licensing pools are practical solutions designed to allow technology to proliferate by controlling the absolute costs of licensing in a technology so that you know what the max costs are going to be. OIN was and is designed to promote freedom of action and freedom to operate.

Along the way, there has been a rise in litigation and now a rationalisation through the effects of many who have fought for seven years to get patent reform instituted and have that patent reform interpreted by the courts, in turn reducing litigation risk. In addition to reframing what is patentable subject matter, through pre-issuance submission and the inter parties review programmes the negative impact of poor quality patents has been markedly reduced.

Will Microsoft’s accession to the OIN promote any further inclusion?

I think the answer is clearly yes. In its public statements, Microsoft is already, and will continue to be a strong advocate, for others to join OIN. It has gone from being a patent antagonist by its own admission and design to now being a proponent of open source and patent non-aggression in the way that the OIN encourages.

Microsoft is a very strong supporter and we have already had approximately 200 licensees sign up since the October announcement. It is very significant to have Microsoft encouraging licensees to come to our website and sign up at levels that are, as yet, unprecedented because of the significance of the Microsoft signing.

What other significant developments have happened at OIN in 2018?

We are looking to bring in more Chinese companies. This year the total number of Chinese OIN licensees has eclipsed the total number of Japanese licensees as a whole range of Chinese companies joined this year.

Many companies have participated in the initiative this year to allow us to increase our coverage in China.

China has recently become a very active and patent-rich environment and is becoming a global leader in annual patent filings after limited history of patenting. We would like to sign up as many companies as possible from China to reduce the risk for global companies that participate in China and for Chinese companies to reduce risk in environments like Europe and in the US. In Asia, Japan has been the most experienced and the most extensively committed to open source. For China, it is relatively new. It is only in the last five years that we have seen very active participation from Chinese companies in open source. Led by Huawei, the wave of Chinese participation in open source has more recently been joined by Tencent, Alibaba and many other leading Chinese companies.

We have been purposeful about building our relationships in China and have now reached an inflexion point where the relevance of open source to Chinese companies is driving participation in the OIN community. IPPro

We have been purposeful about building our relationships in China and have now reached an inflexion point where the relevance of open source to Chinese companies is driving participation in the OIN community Keith Bergelt, CEO Open Invention Network

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Stan Lee & Marvel IP · Feature

A look at Marvel IP Stan Lee’s passing shook the comic book industry and superhero film industry he inspired, leaving the question: what is the future of Marvel IP? Ben Wodecki reports Superheroes are more than a cultural phenomenon and nowadays they are present in almost every aspect of our lives. One of the men responsible for bringing them to the forefront of society was Stanley Martin Lieber, better known as Stan Lee.

Stan Lee’s estate may be relatively new, but it has a long and complex history, filled with various disputes over the ownership of certain intellectual property. Now that Disney owns most of Marvel’s—and subsequently Lee’s—IP, the future of Lee’s estate may seem clear. However there is fragmentation to all that created by Lee and aspects of its future remain to be seen.

Born on 28 December in 1922, Lee died in November this year shaking the comic book industry and the superhero film industry he inspired.

Alan Behr, partner at Phillips Nizer, is intimately acquainted with Marvel disputes over the years and explains that not only are characters like the Hulk, Iron Man and Spiderman

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Stan Lee & Marvel IP · Feature protectable by copyright, but original stories and illustrations related to those characters as well.

Behr says he first heard about Marvel from other children when he was in camp during his childhood—they had only just come out. Behr adds that they caught on fast.

Behr remarks on some of the ownership disputes Lee had with Jack Kirby, the American comic book artist who drew some of Marvel’s most iconic superheroes, who claimed partial ownership of some characters and contributions.

Behr highlights that there were numerous lawsuits and that litigation only ended a few years ago, as the US Federal Courts “getting tired of hearing about it”. He adds that the US Supreme Court declined to hear the last of those cases in March of 2015.

Behr, who has been involved in business relations with Marvel, says the company is known for being “very protective of its IP”. He explains: “It did sometimes feel like whenever you called Marvel on a legal matter, the second sentence back to you (after salutations) would be, ‘and we will sue’”.

He says that Marvel is and was very clear about what it claimed to own and he believes that Disney was very thorough in its due diligence following its $4 billion purchase of Marvel in 2009. Behr believes that Disney was confident upon purchase that when it bought Marvel, it bought total control of its IP. While ownership now goes to Disney, which Behr calls “the big guys”, attribution will always go to Stan Lee and Jack Kirby.

In terms of issues arising for Marvel IP following Lee’s death, Behr admitted that he didn’t see anything arising unless someone steps forward and says they’re going to try and make a meal out of it. Would this happen? Behr didn’t outright say no but did say it is hard to believe anyone would claim ownership of Marvel IP that either Lee or Kirby had not already.

Behr notes other cases of writers and illustrators making claims against publishers and studios over well-established content that have gotten bigger time have not gone well.

He says: “When something consequential of a property this big has been purchased, the lawyers from the purchasing company tend to be pretty good at their due diligence and they tend to be very accurate in assessing ownership.”

He adds that it’s not surprising that these kinds of lawsuits of unfairness “tend to look petulant”, and often stem from a product gaining more worth and

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writers claiming they deserve a bigger cut. He explains that acceptance of that argument is more a matter of morality, ethics, and gentlemanliness, but tends not to be a legal obligation.

Behr says that he doesn’t see any reason for a break up of Marvel’s IP following Lee’s passing.

He remarks: “Close your eyes and think of Spiderman. Is there anything missing? The character is full, complete, complex, developed—even though he is a high school kid who gets bitten by a radioactive spider and he turns into a superhero—the same for his other characters.”

“Lee was a success because his characters had fully formed biographies (flaws and all) and inhabited unique worlds.”

“What’s to break up”, Behr asks, “the characters are whole, and they play well together in the same pop-culture sandbox.”

But Behr does warn of problems when these characters become public domain. Characters like Spiderman will one day be available to all.

Behr adds that any alterations to the character that were made over time would become available in a similar way, as would each of the stories as their respective copyright terms expire.

In similar circumstances, Behr notes that Disney is preparing for the loss of copyright in Mickey Mouse. He adds that Disney is adding clips of Steamboat Willie, the first appearance of Mickey from 1928, to the beginning of nonMickey movies in order to show that they are now trademarks and therefore perpetually owned by Disney.

He adds that Disney’s Marvel will likely try to do the same thing and thereby hold onto those rights.

Behr reminds me that genius can arise from nearly anywhere, and that nobody knows who is currently creating something that everyone will want.

He says that it is often the case that, when you are a young person, and you create the next Mickey Mouse or Spiderman, you might not yet be sophisticated enough to understand what your contribution will mean for pop culture and what it will ultimately be worth.

If you knew you were a genius when you created it and if you could have predicted the sales figures, you would probably have asked for a better deal—but art of any character rarely reaches the world based on such certainty. IPPro www.ippromagazine.com

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Phil Swain ¡ Interview Boston Financial District, Massachusetts, USA

Taming the trolls Phil Swain of Foley Hoag explains a recent legislative measure in Massachusetts aimed at hindering patent trolls 21 IPPro

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Phil Swain · Interview Have there been any developments on the measure aimed at banning patent trolling in Massachusetts?

The measure was designed to create a cause of action against people who were the target of bad faith patent troll demands or letters.

including universities and others, and they convinced the governor that this was not narrow enough. One of the groups is called the Associated Industries of Massachusetts (AIM) they were against this and convinced the governor to veto it.

In the US patent trolls often start by sending their targets a letter, accusing them of infringement, including some details about their assertions, which are very vague, and threatening a lawsuit unless the victim pays them a sum of money. The amount the troll demands has nothing to do with the merits of the claim.

For example, I had a recent case with a pretty well-known patent troll called Shipping & Transit. They sent a letter to my client then sued them over patents they claimed covered the concept of sending a confirmation notice for something online, such as a retail transaction.

The vague concept of just sending a confirmation message, like when you order something from Amazon and they send back an email or a confirmation number—Shipping & Transit claimed to have a patent on that. In reality, the patents that they had were nothing like that. The patents involved keeping track of fleets of trucks and buses, which has nothing to do with order confirmation.

This new statute would allow someone who is the target of a letter like that to make a civil claim for bad faith assertion against these patents.

If they succeed, they would be entitled to damages

This new statute would allow someone who is the target of a letter like that to make a civil claim for bad faith assertion against these patents. If they succeed, they would be entitled to damages.

Massachusetts is late to the party—34 out of the 50 states have already enacted this kind of anti-patent troll legislation.

The Massachusetts bill was passed by the state legislature this past summer, but the governor vetoed it.

Why is this problem being dealt with now, and has it increased over the past few years?

What was the reason behind that veto?

The governor wrote a letter to the legislature on 10 August—it was pretty brief. He said that the legislation is “not narrowly tailored and is likely to have unintended consequences for Massachusetts residents, companies and educational institutions”.

I would say the problem has increased over the past few years.

Patent trolls have become a bigger problem as technology, computer and software industries have grown. There are many patents out there that can be asserted against these very complex systems, but a lot of the patents are either not valid or don’t cover what these patent trolls say they cover.

He went on to say that the legislature will go on to discuss this topic in a future session and will draft a more focused solution. Beyond that, there wasn’t really an explanation as to why the governor was vetoing it. I would say this—I think that there were different groups who were pushing for this, like a technology company that was an especially frequent target of trolls. But, there was another group that lobbied the governor,

The patent troll business became successful, I’d say, starting in the late 90’s and it has been continuing to increase up until recently. Around that time a lot of questionable and vague patents were granted because the prior art history searches being done by the US Patent and Trademark Office (USPTO) are not that effective in the high technology industry. There just isn’t that much of a way for the patent office to examine those

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Phil Swain · Interview and compare them to prior art. The USPTO was issuing a lot of patents that were questionable in terms of their validity.

As it increased between the late 90’s and the early 2010s, more and more bad patents were being issued. Then, there was one troll that became very well known, called MPHJ Technology Investments—it was an entity based in Texas— which claimed to have a patent on the basic fundamental technique for scanning documents and inputting them onto a computer.

The patent didn’t cover anything like that basic concept, and it was obviously invalid. MPHJ was sending letters to thousands of targets, often small companies, demanding relatively small amounts, but enough to cause alarm.

MPHJ was probably the worst offender of this bad faith patent assertion. It was just targeting any sort of business it could find, as practically anyone would be involved in scanning of documents onto a computer. A couple of states, Vermont being one of them, got involved and went after this troll and argued that those who received these vague letters should be protected.

The Vermont attorney general sued MPHJ and the state began working on legislature to combat patent trolling. Vermont was the first one to actually pass it.

The battle between the Vermont attorney general and MPHJ eventually settled and resulted in MPHJ ceasing its actions.

Other states began to follow what Vermont did, but each individual state changed their statute somewhat. Currently, eight states have pending diverse legislation on this.

The basic point in all of this legislation is that if you can show that the demand was made in bad faith, and it doesn’t specifically explain how the patent covers the targeted company or its activities, if it just has a vague explanation of what the infringement is, along with the threat to sue, then the victim is covered, [and can bring a claim for bad faith enforcement].

In Massachusetts there are other statutes that could be used to push back against these vague letters too. I’ve had a client successfully use other state statutes, such as the Massachusetts consumer protection statute, to fight back against these sort of bad faith assertions.

Is this something that should be dealt with at a national level?

There have been many attempts to reform the patent system to address patent trolls, and some of those have already been enacted by the federal government, but nothing yet on a national level on these types of letters.

The introduction of the America Invents Act in 2011 has made it easier to combat patent trolls, as it introduced a procedure for challenging patents at the USPTO. That has done more to slow the trolls down than these state statutes.

We saw the peak of troll litigation three or four years ago, and it has begun to tail off over the last few years. Partly because some of the patents have been invalidated, part of it is because trolls are seeing that these types of tactics are not as successful, and people are seeing ways to use the existing tools they have to send them off. IPPro

The introduction of the America Invents Act in 2011 has made it easier to combat patent trolls, as it introduced a procedure for challenging patents at the USPTO. That has done more to slow the trolls down than these state statutes Philip Swain, partner Foley Hoag

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The changing IP landscape Brandstock’s Volker Spitz discusses how IP portfolio management has changed and will continue to change in the coming years 24 IPPro

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Volker Spitz · Interview Ben Wodecki reports

What have been the five biggest changes in IP portfolio management in the past 10 years?

1. Trademark searches: the focus shifted. The interest of corporations changed from getting information related to possible oppositions or objections to obtaining confirmation on freedom to operate and an assessment of risks for the business in case of use despite critical trademarks found.

Corporates also expect different databases to be used in addition to mere trademark databases, such as databases providing financial information related to the owners of conflicting trademarks, as well as case law linked to conflicting trademarks. Also, corporates expect results delivered within very short periods of time on super flexible interactive online platforms. Finally the use of artificial intelligence (AI) has become part of clearing trademarks.

2. Patent annuities and trademark renewals: Corporates expect today strategic guidance as to whether to pay annuity or renewal fees, or let a patent, trademark, domain or other IP right lapse. Corporates’ objective is to invest only in maintaining IP rights which can either be monetised or are needed to safeguard freedom to operate and blocking competitors. Corporates are willing to pay for strategic advice but no longer for commodity services such as annuity and renewal payments.

3. Comprehensive IP management: Corporates rely more and more on external partners who offer full IP management services based on flat fee arrangements.

Corporations are seeking budget security and have to free internal resources for added value tasks such as giving business strategic advice. Less lawyer more manager.

4. Business intelligence and analytics: Corporates demand full transparency regarding agent fees and official fees as well as analytics related to budgets, portfolio strength, benchmarks and competitor mapping. Today also IP departments must contribute to a corporation’s competitive advantage. Executive summaries have to be provided via dashboards which can easily be customised.

5. Workroom technology: More than 95 percent of today’s IP management systems are outdated. Future systems rely on workroom technology and AI. Local agents become part of a corporation’s in-house workforce, email communication and docketing are eliminated and information is updated real-time. Creation and checking of agent invoices are fully automated.

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Has there been an increase in analytical and data-based service providers?

Yes, absolutely. Today corporates need reports and analytics at their fingertips as a basis for business decisions. Correct data related to a corporate’s IP and data related to competitors and other owners of IP rights, paired with modern business intelligence tools, have become the number one priority in the IP industry.

Changes will not come from within the industry but from the outside, most likely driven by small entities acting super-fast and agile

Can you tell me a little bit about how Brandstock fits into this space?

The scenario described fits Brandstock’s genetics perfectly!

Since 1994 we have been pairing IP with innovative IT solutions. Some of them such as the IP CostCalculator and our IP valuation software are still unmatched and unique. Today we are focusing on workroom technology, business intelligence and machine learning. One of our recent developments will disrupt the IP management system space and save up to 80 percent manpower needed today for communicating with local agents and docketing. We position ourselves as a business solution partner, not just as an IP consultant.

How is IP portfolio management likely to change in the future? Are there any upcoming improvements/ inventions that will again change the landscape?

The IP industry will be facing massive disruption. Changes will not come from within the industry but from the outside, most likely driven by small entities acting super-fast and agile. The three main pillars of disruption will be blockchain, machine learning and data. Not a single task which we have completed for our clients for decades will be performed in the “old” way.

These changes will be mainly driven by private equity firms who have been pushing billions into the IP market during the last few years and who have to win back two to three times their invested capital within the next five years. www.ippromagazine.com

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