The goal of this presentation is to help you to see IP in a new light and, probably, to make change your mind regarding the IP problematic in general and IP problematic in your company.
On march 20 1883, in Paris was signed The Paris Convention for the Porteciton of Industrial Property. Modern usage of term intellectual property goes bact at least as far as 1888 with the founding in Berne of Swiss Federal Office for Intellectual Property. There has been serious change in the commercial ecosystem. Concept of scarcity has changed to the abundancy of information.
Intellectual property ( IP ) is a term referring to a number of distinct types of legal monopolies over creations of the mind, both artistic and commercial, and the corresponding fields of law.  Under intellectual property law, owners are granted certain exclusive rights to a variety of intangible assets, such as musical, literary, and artistic works; discoveries and inventions; and words, phrases, symbols, and designs. Common types of intellectual property include copyrights , trademarks , patents , industrial design rights and trade secrets in some jurisdictions. Now I’ll refer to specific types of the Intellectual property.
A trademark or trade mark  is a distinctive sign or indicator used by an individual, business organization , or other legal entity to identify that the products or services to consumers with which the trademark appears originate from a unique source, and to distinguish its products or services from those of other entities. KODAK, Google, BDO shape of the COCA COLA bottle Nokia ring tone Smell of fresh cut gras for tennis balls
A patent is a set of exclusive rights granted by a state (national government) to an inventor or their assignee for a limited period of time in exchange for a public disclosure of an invention . What is a Patent? :What is a Patent? The right to exclude, not right to use. You Do not Have the Rights to Use your own patented invention. As Elements of your invention may infringe other patents. Priority of rights protects the proprietor of an earlier trademark right. The principle of priority prescribes the preservation of novelty, originality and creativity upon the filling of an application for the grant of protection in one country of the Paris Union- for a limited period of time of twelve months (patents) and six month (trademarks and industrial designs). During that limited period, a more recent invention, creation or disclosure cannot legally destroy novelty, and the creator may file in other countries of the Paris Union based upon the priority date. It is important to file a patent application before publicly disclosing the details of the invention. Patent protection means that the invention cannot be commerially made, used, distributed or sold without the patent owner’s consent. These patent rights are usually enforced in a court. Conversely, a court can also declare a patent invalid upon a successful challange by a third party. All patent owners are obliged, in return for patent protection, to publicly disclose information on their invention in order to enrich the total body of technical knowledge in the world. Such an ever-increasing body of public knowledge promotes further creativity and innovation in others. Registration – At present no world patents or international patents exist. In general, an application for a patent must bi filed and a patent shall be granted and enforced in each country in which you seek patent protection for your invention in accordance with the law of theat country. European Patent Office accepts regional patent applications, or grants patents which ahve the same effect as applications filed, or patents granted, in the EU Member States. Any resident or national of a Contracting State of the Patent Cooperation Treaty may file an international application under the treaty. A single international patent application has the same effect as national application filed in each designated contracting state. However, in order to obtain patent protection in designated states, a patent shall be granted by each designated state.
Industrial designs are applied to a wide variety of products of industry and handicraft: from technical and medical instruments to watches, jewelry, and other luxury items; from housewares and electrical appliances to vehicles and architectural structures; from textile designs to leisure goods.
There are two sets of agreements associated with the transfer of know-how agreement:(a) the disclosure and (b) the non-disclosure agreements which are not separately parts of the principal know-how agreement.[ citation needed ]
Why important for enterpreneurs? Software copyright ; Employee claims; Open source licenses .
Patent Trolls- (companies who do not manufacture or use the patented inventions, however on the basis of their own patent poll the companies file aggressive patent lawsuits against operating companies which might be infringing the patents) Open-source software (OSS) is computer software that is available in source code form for which the source code and certain other rights normally reserved for copyright holders are provided under a software license that permits users to study, change, and improve the software. Free merely means- no license fee, does not mean “free source”, almost always comes with the license agreement..
25 % of enterprises are checked by economic police on the subject of illegal use of the computer programms and other copyright protected items (music, video). The computers can be taken away as the evidence in the criminal proceedings.
- Destroy counterfeit products
Why Monetization is Not Easy : Why Monetization is Not Easy Establishing channels to sell products is expensive & takes years. Selling licenses requires a sales team & effort. Infringement is often difficult to detect. Infringers are often difficult to find. Enforcing patents requires armies of lawyers & legal fees.
Monetization: Selling Products :Monetization: Selling Products &quot;Our products are unique as they are backed by our patents&quot;. Advantages Product differentiation. Disadvantages Restricted by your sales channels. What’s Involved Establish complete product sales operation. Good Candidates Large corp. with sales channels AD Relatively quick & high returns. DIS- Give up future potential. Sale of Patents : Sale of Patents &quot;We'll buy your patents outright&quot;. Advantages Relatively quick & high returns. Disadvantages Give up future potential. What’s Involved Listing & marketing. Good Candidates Patent holders lacking products or sales channels. Value of the patent depends also on previous history of the patent (actions against sucessful) 3. Patent Sale with License Back : Patent Sale with License Back &quot;We'll buy your patents and give you a license to continue selling your products that use them&quot;. Advantages Cash now without giving up product line. Disadvantages May enable competitors. What’s Involved Listing & marketing patent. Good Candidates Product companies without army of lawyers. 4. Selling Enforcement Rights Only : Selling Enforcement Rights Only &quot;We'll enforce the patents for you. We pay the costs and split the proceeds with you&quot;. Advantages Revenue without “selling”. Disadvantages May be joined in infringement suits. What’s Involved Exclusive license with right to enforce, right to join & indemnification. Good Candidates Research labs & universities.
5. Selling Patent with Revenue Share : Selling Patent with Revenue Share &quot;We'll buy your patents and share any subsequent licensing revenue with you&quot;. Advantages Cash today & cash tomorrow. Disadvantages Lower up-front payment. Can be complicated. What’s Involved Sale with revenue sharing agreement. Good Candidates Operating companies divesting of infringed patents. 6. Important to draft proper license agreement. 7.Action by owner, action by assignee 8. IP Backed Loans :IP Backed Loans &quot;We can use your patents as collateral for a loan/credit line&quot;. Advantages Source of debt-capital. Disadvantages Encumbers patents. What’s Involved Find lender. Valuation. Loan with security. Good Candidates Corporations with good credit rating. Not for small companies.
Intellectual property - today's challenges and opportunities [Kaspars Ratkevičs] on Baltic Spark]
Intellectual property - t oday's challenges and opportunities Kaspars Ratkevičs 16 April 2010
Intellectual Property <ul><li>Why important today? </li></ul><ul><li>Emphasis shifts from tangible to intangible assets: </li></ul><ul><li>1970: 80% to 20 % </li></ul><ul><li>2010: 20% to 80% </li></ul><ul><li>Moving from labor-driven economy to knowledge-based economy (efficient production relies on information and know-how; over 70% of workers in developed economies are information workers; factory workers use their heads more than their hands) </li></ul><ul><li>Globalization (markets and products are more global) </li></ul><ul><li>Information technology (Internet has brought the “global village” ever nearer) </li></ul><ul><li>As a result the importance of the Intellectual Property protection has increased dramatically. </li></ul>
Intellectual Property protfolio <ul><li>What’s inside? </li></ul><ul><li>Trade Marks </li></ul><ul><li>Patents </li></ul><ul><li>Industrial Designs </li></ul><ul><li>Know-how </li></ul><ul><li>Copyrights </li></ul><ul><li>Under intellectual property law, owners are granted certain exclusive rights to a variety of intangible assets. </li></ul>
Trade Marks <ul><li>Trade mark - a distinctive sign which identifies certain goods or services as those produced or provided by a specific person or enterprise. </li></ul><ul><li>Trademarks may be: </li></ul><ul><li>one or a combination of words, letters, and numerals; </li></ul><ul><li>may consist of drawings, symbols, three- dimensional signs such as the shape and packaging of goods; </li></ul><ul><li>audible signs such as music or vocal sounds; </li></ul><ul><li>fragrances, or colors used as distinguishing features. </li></ul>
Patents <ul><li>Exclusive right granted for an invention , which is a product or a process that provides a new way of doing something , or offers a new technical solution to a problem . </li></ul><ul><li>The following conditions shall be met in order qualify as a patent: </li></ul><ul><li>Invention must be of practical use; </li></ul><ul><li>Invention must show an element of novelty (some new characteristic which is not known in the body of existing knowledge in its technical field). </li></ul><ul><li>Invention must show an inventive step which could not be deduced by a person with average knowledge of the technical field. </li></ul><ul><li>Subject of the invention must be accepted as "patentable" under law. </li></ul><ul><li>Usually the following are not patentable : scientific theories, mathematical methods, plant or animal varieties, discoveries of natural substances, commercial methods, or methods for medical treatment . </li></ul>
Industrial Design <ul><li>Industrial design - ornamental or aesthetic aspect of an article. </li></ul><ul><li>Industrial design rights make exclusive the visual design of objects that are not purely utilitarian . </li></ul><ul><li>The design may consist of : </li></ul><ul><li>three-dimensional features, such as the shape or surface of an article, or </li></ul><ul><li>of two-dimensional features, such as patterns, lines or color. </li></ul><ul><li>Industrial designs are what make an article attractive and appealing; hence, they add to the commercial value of a product and increase its marketability . </li></ul>
Know- how <ul><li>Know-how – “closely-held” information in the form of : </li></ul><ul><li>unpatented inventions, </li></ul><ul><li>formulae, </li></ul><ul><li>designs, </li></ul><ul><li>drawings, </li></ul><ul><li>procedures and methods, </li></ul><ul><li>together with accumulated skills and experience in the hands of a company’s professional personnel which could assist a company and bring to it a competitive advantage . </li></ul>
Copyright Copyright- the set of exclusive rights granted to the author or creator of an original work, including the right to copy, distribute and adapt the work. These rights can be licensed, transferred and/ or assigned. In 19th century: maps, charts, prints, musical compositions, dramatic works, photographs, paintings, drawings, sculptures. In 20th century expanded to: motion pictures , architectural works, sound recordings, dance and computer programs.
Intellectual Property/Risks <ul><li>Potential infringement of Intellectual property rights of other subjects </li></ul><ul><li>- other entrepreneurs, </li></ul><ul><li>- patent trolls, </li></ul><ul><li>- employees, </li></ul><ul><li>- copyright holders; </li></ul><ul><li>… .as a consequence the company may face claims for breach of somebody’s IP rights accompanied by claims to cover all the damages </li></ul>
Intellectual Property/Risks 2. Infringement of copyrights by the employees of the company … . potential administrative or even criminal penalties to the company 3. Failure to properly register the IP rights object … . may deny the company the opportunity to protect its IP rights and extract all the benefits the company is entitled to.
Intellectual Property Opportunities 1. “ Traditional ” use of IP rights 2. Modern trends
Intellectual Property/Oportunities <ul><li>“ Traditional” use of IP rights : </li></ul><ul><li>Exclusive use of the IP rights; </li></ul><ul><li>Protection against infringements; </li></ul><ul><li>Claiming damages from infringers; </li></ul><ul><li>Selling or granting the IP rights to third parties by license </li></ul>
Intellectual Property/Opportunities <ul><li>Modern trends/ Monetization of IP rights </li></ul><ul><li>Monetization: </li></ul><ul><li>techniques for turning IP rights into Profits </li></ul><ul><li>a way for generating income from IP portfolio </li></ul><ul><li>a “business model” for obtaining unrealized value in the IP portfolio </li></ul>
Intellectual Property/ Opportunities Monetization strategies 1. Sale of products with protected IP rights. 2. Sale of the IP. 3. Sale with license - back. 4. Sale of Enforcement rights.
Intellectual Property/Opportunities 5. Sale of IP rights with revenue share. 6. Licen s ing (exclusive, non-exclusive). 7. Litigation. 8. IP collateralization (use of IP portfolio as a collateral for a loan/credit line)
Intellectual Property/Opportunities Monetization strategies III 9. IP licen s ing and enforcement companies/ Patent Trolls (companies who do not manufacture or use the patented inventions, however on the basis of their own patent poll the companies file aggressive patent lawsuits against operating companies which might be infringing the patents) 10. Patent Aggregators (also non-operating companies, anti –troll, buy out free- market patents in an effort to safeguard operating companies from expensive patent lawsuits)
<ul><li>Please be aware that the present analysis contains general information and doesn’t respond to particular circumstances that are unknown to us. Consequently this presentation is to be used only as a guideline and is applicable only as a general consultation. </li></ul><ul><li>If you believe that the commentary and conclusions are not complete, precise or true, please inform us as soon as possible. We hope that this presentation comes up with your inquiry. </li></ul><ul><li>In case you have additional questions or you need an assistance, please don’t hesitate to contact us and we will be happy to help you. </li></ul>Our responsibility