IP Best Practices: Tips for mHealth Companies, Investors and Acquirers. Presentation by Yoheved Novogroder-Shoshan, Partner at the law firm of Yigal Arnon, June 29th at the mHealth Israel Investors Summit. Includes checklist of five things Founders / Inventors can do to protect their Intellectual Property and increase value.
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mHealth Israel_Yoheved Novogroder-Shoshan_IP Best Practices: Tips for mHealth Companies, Investors and Acquirers
1. IP Best Practices:
Tips for mHealth Companies,
Investors and Acquirers
Yoheved Novogroder-Shoshan
June 29, 2015
2. Creating a mHealth Platform
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Third Party
Technology
(in-license)
Existing IP –
Founder’s
Invention
Employees
Consultants
3. IP Ownership- Debunking the Myths
Myth #1: If I pay someone (employee, consultant) to create an
invention, I own it.
General Rule: The one who creates the IP owns it, unless an exception
applies
Exception: Employee “Service Inventions”: absent agreement to the
contrary, inventions developed by an employee during the term of
employment and as a consequence of employment are owned by the
employer (Patent Law 132).
Key issues:
◦ You will not own consultant-developed IP unless there is a written
agreement assigning rights to you
◦ Potential employee claims
Solution: Sign clear IP assignments with Employees and Consultants.
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4. IP Ownership- Debunking the Myths (2)
Myth #2: If a consultant assigns an invention to my
company in a written agreement, of course I own it.
Key issue: if a developer develops IP for you and the
developer is employed by someone else, the invention may
be a service invention owned by the consultant’s employer.
Solution: Waiver
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5. Special Cases: Academics
Employment Agreement
Institutional IP policy
o Applies to unrelated work
o Tail period
o Applies to PhD students.
o Applies during sabbatical
Solution: Written Agreement with
Institution’s Technology Transfer Office (TTO)
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6. Solutions:
•Stipulate No IP creation permitted
•Cost/Benefit Analysis; Consider
Alternatives
•Explore License Option
Special Cases – Hospitals,
Government Institutions
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Private Hospital- like academic
Government Affiliated Hospital
Real World Examples:
7. Service Inventions- Inventors’ rights
Myth #3: If my employee assigned an invention to my
company, I don’t have to pay him/her a share of my
revenues from commercializing the invention
Employee’s right to royalties for service inventions:
Patent Law 134: Absent an agreement to the contrary, Patent
Compensation Committee authorized to determine
employee’s entitlement to royalties for service inventions
Solution: Express royalty waiver
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8. 5 Things You Can Do
1. Diligence on employee and consultant third-party relationships,
especially academic institutions, hospitals and government bodies
2. Engage local counsel familiar with the law, local practice
3. Obtain written IP assignments from employees/consultants -before
work begins
4. Get third party approvals - before work begins
5. Address title issues immediately upon discovery
Real world consequences
• Title questions can delay an exit
• A cloud over IP that can be cleared for a few hundred thousand dollars
when a company is in a Series A round can cost the company millions of
dollars on the eve of an acquisition
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