In 1421, Filippo Brunelleschi received the world's first patent for an invention. He created a method of transporting marble more cheaply via a paddleboat. We have a long way to go… His patent gave him the right to burn any ship borrowing his design for three years.
The largest recipients of patent filings are the patent offices of Japan, the United States of America (USA), China, the ROK and the European Patent Office (EPO). These five offices account for 77% of all patents filed in 2005, (a 2% increase over 2004), representing 74% of all patents granted. With an increase of almost 33% over 2004, the patent office of China became the third recipient of patent filings in 2005. IPR in international news WIPO Report Reveals Changing Geography of Innovation with Highest Patenting Growth Rates in North East Asia WIPO, 20 August, 2007
The MD Speak Mahindra Innovation at low cost: Scorpio: $30M – engg design, $50 Production specific expenses, $40 facilities Integrated Production Management System: $140k v. $2.6m import Bolero: Seat installation system: $30k Italian, $1500 inhouse. So, where’s the IP?
IPR and M/A JVs in the News Tata Motors: “The management will expect a return from the R&D just like any other investment. They will get more aggressive about guarding the output of their research ” “ As foreign companies set up their own operations, the local firms are having to spend their own money on R&D” TVS: 12 crores to50 crores in 7 years Bajaj: From under 3Cr to 68 crores within a decade Tata Motors: This is just a start. As more Indian companies build their own products, the litigation will only be on the rise.
IPR in Worldwide Research Organisations National Science Foundation, USA – Policy On Patents CERN, Europe – Policy On Technology Transfer OECD – Turning Science Into Business – Patenting And Licensing At Public Research Organisations Oxford University – Intellectual Property Policy Cornell University – Patent Policy
IPR in Worldwide Research Organisations NASA – 641 (1941) Oxford University – 21 (191) TIFR – 3 (20) CERN – 8 (74) Cornell University – 52 (258) MIT – 3020 (8572) IIT – 82 (267) Mahindra and Mahindra – 1 (25) L&T – 1 (56)
Japanese Industrial Development and IPR From about 1600 for about 250 years the door was closed to the outside world In 1854, when Japan reopened the doors, the science and technology of the West, had surpassed Japan. Japan did not have the power to compete against the advanced Western countries.
Japanese Industrial Development and IPR As the early stage of industrialization, it was necessary to import leading technology from abroad. Japan had to import technology from abroad, for which it was vital to establish an IPR system. 1884, the Trademark Ordinance; 1885 the Patent Ordinance. However, there was the problem that patent rights of foreigners were not recognized.
Sakichi Toyoda – Founder, Toyoya In his lifetime, Toyoda himself acquired 84 patents and 35 utility models. Total No. of patents 99,999+ Japanese Industrial Development and IPR
Soichiro Honda, Founder the Honda Group. Honda himself acquired 115 patents and 359 utility models. Japanese Industrial Development and IPR Total No. of patents 97,000+
Sony, Masaru Ibuka, Co-Founder Sony. Ibuka himself acquired 50 patents and 53 utility models. Japanese Industrial Development and IPR Total No. of patents 20,000+ worldwide
A large number of venture industrialists in Japan used the patent system and, along with developing the companies they established, also caused the Japanese economy to develop. IPR to Economic Development Takahiko KONDO Commissioner Japanese Patent Office November 16, 1999 Tokyo
www.peertechnical.net Electronics P.Wasted Intel and AMD 1990s $200,000,000 Mechanical P.Lawsuit Hughes Tool <-- Smith International 1986 $205,000,000 Mechanical P.Lawsuit Haworth <-- Steelcase 1996 $211,000,000 Electronics P.Settlement Intergraph <-- Intel 2002 $300,000,000 Medical P.Lawsuit Cordis/Johnson & Johnson <-- Boston Scientific 2000 ($324,000,000) Software P.Settlement Pitney Bowes <-- HP 2001 $400,000,000 Electronics P.Settlement Litton Industries <-- Honeywell 2001 $420,000,000 Software P.Buyout InterTrust <-- Sony, Philips 2002 $453,000,000 Mechanical P.Buyout SpinBrush Inc. <-- Procter & Gamble 2002 $475,000,000 Electronics P.Settlement Texas Instruments <-- Toshiba 1990 $500,000,000+ Computer P.Lawsuit Digital <-- Intel 1997 $700,000,000 Chemical P.Lawsuit Polaroid <-- Eastman Kodak 1991 $873,000,000 Sports C.License Major League Baseball <-- Fox Television 2002 $2,500,000,000 Technology Legal Action Parties Year Amount
Xerox Corp v. University of Texas. Feb 2002 HP v. Cornell University, 2001 MIT (Boston)/Electronics for Imaging v. A lot of companies - 2002 Institutions in IPR lawsuits Steal this idea: university patent-infringement suits flourish - Update University Business , March, 2002 by Tim Goral
Types of Infringement Valid Steal Direct Infringement Contributory or induced Infringement Vicarious Infringement
Direct Contributory Vicarious It is wholesale reproduction and distribution of ‘protected’ works It occurs when someone knowingly encourages infringing activity When for financial benefit the operator in spite of his ability to control and check infringements deliberately restrains from checking the users from committing such acts Ignorance no excuse!
What is the value of an IP? Single IP may or may not carry much/any value, a carefully constructed portfolio will normally carry high value Value?
IP competitive strategies B M&M M&M M&M M&M M&M M&M M&M M&M M&M M&M Design Around M&M M&M M&M M&M M&M M&M M&M M&M M&M M&M M&M Build A Fortress Wiggle your way out
Live and let live Forming Strategic Alliances The cross-licensing signaling a new trend, allows the electronics giants to tap each other's vast patent portfolios of basic technologies. Sony, Samsung to share patents