04/10/23ADR Services, Inc.

04/10/23

Series of mediations Patent portfolios In-house settlement teams Case management order? Court compulsion

04/10/23

70% executives believe IP should be treated as strategic, not legal, issue

60% executives believe accounting practices understate IP value.

60% executives believe significantly more value could be obtained from existing IP and IP formation

Results from a national survey of Fortune 500 Companies

04/10/23

Finesse Impasse by using the Litigation as an Opportunity to Make a

Business Deal

Goals of IP Litigation

◦ Exchange Technical Information re: Product and/or Patent Portfolio

◦ Exchange Market Information Geography Distribution channels

◦ Exchange manufacturing/design advantages held by one but not the other

◦ Identify Common Enemies

◦ Exchange long-term business plans

◦ Exchange short-term commercial goals

◦ Identify of bargaining chips with different values to each player

◦ Explore underlying motivations for suit

◦ Explore cross-license opportunities

◦ Settle

04/10/23

Prepare Deceive? Explore Bridge Close

04/10/23

04/10/23

Technical education Markman Hearing? Trial Date? Gather same data as would if

intending to purchase competitor or sell client’s business

Personalities, interests and emotional tone

Identify & strategize re presence/absence of stakeholders

04/10/23

04/10/23

• securities filings for past 5-10 years•“google” major decision makers•review management/shake-ups•review opinions of the media, if any, for problems the company has or may have in the future•review market position for all publically traded companies•obtain litigation profile – all public filings here and abroad• WayBackMachine for prior art

Isolate, compartmentalize, explain or withdraw any person on your side who is a source of embarrassment, distrust or friction.

Find and deploy the “peace-makers” Find and deploy the deal-makers

04/10/23

• designate a leader -- mediation no place to act out internal power struggles.

• lead trial lawyer may not make the best lead negotiator

• split leadership role by designating a lead “settlement counsel”

• assemble team • assign roles• Control own people

04/10/23

If your only job is to settle the case, you can address settlement at any time without showing weakness.

This sets up a line of communication with the other side that is entirely different than that between litigators and/or trial counsel.

Using settlement counsel can open a back door to the other side’s castle.

04/10/23

mock mediations help your team members develop a conditioned response that corresponds with their assigned roles.

mediator hired for the mock exercise gives a neutral evaluation of the merits.

forces decision-makers to appreciate the other side of the case (particularly if they are assigned to role-play the other side)

permits both joint session and caucus presentations to be fine-tuned.

04/10/23

business objective or goal potential business deals and

licensing arrangements Identify and diffuse emotional

content: remembering that IP is someone’s “baby”

“Reality Session” to manage expectations

Assign the client a role Explain the role of each

participant Cover logistics Agree on an “exit strategy” but

remain flexible

04/10/23

Everybody lies to the mediator

04/10/23

-Sun Tzu, The Art of War

04/10/23

ABA Formal Opinion 06-ABA Formal Opinion 06-439 – Truthfulness In 439 – Truthfulness In Negotiations: It’s O.K. to:Negotiations: It’s O.K. to:

(1)(1) Understate willingness to Understate willingness to make concessionsmake concessions

(2)(2) Misstate bottom lineMisstate bottom line

(3)(3) Deceive as to ultimate goals and Deceive as to ultimate goals and objectivesobjectives

(4)(4) Exaggerate strengths, minimize Exaggerate strengths, minimize weaknesses of factual or legal weaknesses of factual or legal positionposition

(5)(5) Overstate confidence in alternate Overstate confidence in alternate sources of productsources of product

04/10/23

Realize that the parties are not just “playing” each other, they are also “playing” the mediator

New Mediators (especially former judges) can get pretty touchy about being deceived, but it is all part of the process

Expect deception, and you will be deceived less often

04/10/23

The tactical use of puffing, selecting, emphasizing, spinning, omitting, exaggerating, obscuring, ignoring, lying and misrepresentation is tolerated—to some extent—in mediation.

04/10/23

-Niccolo Machiavelli

04/10/23

04/10/23

We are always “too far apart” We are always “wasting time” The other side is always “not dealing

in good faith” “Bottom Lines” are laughable Storming out is stupid (unless

choreographed with the mediator for maximum effect—and it can only be done once)

Repetitive use of whiny tactics will make you seem silly to an experienced mediator.

Keeping your ducks in order as you get from point “A” to point

“B”

04/10/23

Relegate isolated issues to arbitration

Gap-bridging games

Licensing arrangements & business deals

“Hard Stop” with follow-up

Bracketed proposals and offers

The “timed” smoking gun disclosure

Tax treatment

Mediator’s proposal

Baseball Arbitration

Hi/Lo Agreements

04/10/23

There is nothing like a done deal

04/10/23

MOU Written Settlement Agreement Czar or Arbitration Clause License terms Client sign-off Scope of Release Dismissal with prejudice Confidentiality and Publicity Payment terms Fee shifting Etc.

04/10/23

technical & prolonged

useful if the mediator stays “in the loop” by asking the parties to copy him or her as the documentation is exchanged

mediator is ready to jump in and resolve any “snags” in the documentation

04/10/23

IP and ownership issues -- prior research; future/related inventions

Termination/renewal/revocation◦ time frame for licensee to patent

and/or commercialize the invention? ◦ If licensee fails to do so within

allowed time -- license revert to the licensor? May the licensee extend the license? 

Use of copyrights, trademarks   quality control provisions if you are

licensing. right to pursue infringement cases

against third parties? Minimum royalties -- may be required

both to continue license and to satisfy past transgressions).

04/10/23

MEDIATOR’S PLAYBOOK

•Facilitate •Retaliate•Conclude the Deal

04/10/23

04/10/23

Thank you!!