Utilizing IP to Access Funding
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![Page 1: Utilizing IP to Access Funding](https://reader033.fdocuments.in/reader033/viewer/2022052222/5455938eaf79590b088b4991/html5/thumbnails/1.jpg)
Nutter McClennen & Fish LLP Seaport West 155 Seaport Boulevard Boston, Massachusetts 02210 Telephone 617.439.2000
www.nutter.com
TCN Expert Lunch: Maximizing Value Through IP
June18, 2013
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Nutter McClennen & Fish LLP • www.nutter.com 2
IP Is A Potential Asset
• Knowledge & Understanding Needed to Realize Its True Potential
• IP Has Many Uses – Build Value, Attract Investment, Protect Revenue Stream, Build Revenue Stream
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Nutter McClennen & Fish LLP • www.nutter.com 3
PATENTS: WHAT THEY ARE AND WHAT THEY ARE NOT
• Right to exclude others • NOT a right to use your own patented
invention • A’s patented invention may be an
improvement that is dominated by B’s earlier patent • A’s use/sale of its own patented
invention may result in suit by B
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Case Study #1
• Start-Up With No IP Strategy
• Single Patent Application for a Gen 1 Product
• Narrow Claims
• Failed to Keep Patent Family Alive
Nutter McClennen & Fish LLP • www.nutter.com 4
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Case Study #1 (Continued)
• Unprepared for Investor Due Diligence • Couldn’t articulate patent strategy
• Freedom-to-Operate Issues Uncovered • Reactive (Not Proactive) vis-à-vis Third Party Patents
• Result: No Funding Nutter McClennen & Fish LLP • www.nutter.com 5
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Case Study #2
• Second Patent Application for Gen 2 • Broader Disclosure
• Goal: Raise money to Develop and Market Product
• Relying on IP to Build Value – attract investment, achieve exclusivity
• Learned that IP Needs Focus Nutter McClennen & Fish LLP • www.nutter.com 6
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Case Study #2 (Continued)
• Intense Due Diligence • Gained Understanding of Marketplace • Increased Knowledge of Patent Process, Prior Art, and Use of Claim Strategies • Able to Articulate Expected Patent Coverage
• FTO Looked Clean • Aware of Relevant 3d party Patents and able to Explain Path to Market
• Result: Successful Fundraising Nutter McClennen & Fish LLP • www.nutter.com 7
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Surprise!
• Product Fails
• Original Strategy of Successful Product Marketing is Untenable
• All Investment at Risk
Nutter McClennen & Fish LLP • www.nutter.com 8
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New Strategy
• Monetize the IP Portfolio
• IP Portfolio Comprises Multiple Patents • Claims Specific to Intended Product • Broader Claims • Applications Still Pending
Nutter McClennen & Fish LLP • www.nutter.com 9
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Executing The New Strategy
• Aware of Competitor’s Proposed Product Launch • Market Knowledge Pays Off!
• Build Case for Patent Infringement
• File Continuation With Claims Targeting Competitor's Product • Adds Another Picket to the Fence
Nutter McClennen & Fish LLP • www.nutter.com 10
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Success!
• Aggressively Approach Competitor
• Explain and Demonstrate Infringement
• Result: Sale of Company Assets for Good ROI, without Litigation
Nutter McClennen & Fish LLP • www.nutter.com 11
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Takeaways
• Initial Lack of (or Poor) Strategy Created Risk, Facilitated Failure • Don’t Rely on a Single Application
• Increased Sophistication Enabled Aggressive IP Portfolio Development
• Knowledge of Competition Created Opportunity
• Flexibility & Focus Enabled Success Nutter McClennen & Fish LLP • www.nutter.com 12
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Nutter McClennen & Fish LLP • www.nutter.com 13
What Is An IP Strategy?
An IP Strategy is the playbook that describes how intellectual property will support the business
The IP Strategy Should Identify: • Offensive uses of IP – How will you create barriers to
entry that keep competitors behind you • Defensive uses of IP – How will you keep control of
the important aspects of your business • IP liabilities – How will you avoid the potholes
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Nutter McClennen & Fish LLP • www.nutter.com 14
Why Do You Need An IP Strategy?
• Align IP with Business Goals • Competitive Advantage • Attract Funding • Revenue Source
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Nutter McClennen & Fish LLP • www.nutter.com 15
How Do You Develop an IP Strategy?
Identify Business and Technology Goals
Evaluate Your Existing IP Portfolio
Know the Competition
Strengthen Your IP Portfolio
Track Your IP Portfolio
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Nutter McClennen & Fish LLP • www.nutter.com 16
Identify Goals
• Identify both business and technology goals for company
• Identify key players (competitors, partners, customers)
• Identify technology direction (within company and industry)
• Determine offensive goals (asserting IP against others; revenue generation), defensive goals (using IP as a shield), and market purpose (e.g., to demonstrate company innovation, gain funding, etc.)
• Align the goals, industry and technology information, and portfolio use goals.
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Nutter McClennen & Fish LLP • www.nutter.com 17
Evaluate Your IP Portfolio
Review patent portfolio (asset/liability approach)
Inventory IP Assets
• Identify them – What are they?
• What do they cover? Do they support the story?
• Does the company have clear title to them? – If not, they can go from Assets to Liabilities.
Inventors IP Liabilities
• Third party rights that you might not be aware of
• Third party rights you might be aware of
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Nutter McClennen & Fish LLP • www.nutter.com 18
Evaluate Your IP Portfolio (cont.)
Assess Freedom to Operate:
Conduct regular searches
Review all Prior Art
Identify potential problems
Review and assess validity
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Nutter McClennen & Fish LLP • www.nutter.com 19
Strengthen Your IP Portfolio
Multiple Patents: don’t rely on a single patent
Multiple Claim Types: cover paper, bench top, and commercial embodiments, as well as methods of manufacturing and methods of using
Keep patent families alive
Cover competitor products/systems
Cover Any Design Arounds
Consider foreign protection
Consider other forms of IP (trademarks, trade secrets, copyright, agreements)
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Nutter McClennen & Fish LLP • www.nutter.com 20
Track Your IP Portfolio Over Time
Regularly Update and Check Your Progress Against Your IP Plan
One good way is an IP Review Committee • Meet regularly, once a month to once a quarter
• Review business model – any changes? New products?
• Push contributors for Invention Disclosures for key new technologies/product differentiators
• Select which invention disclosures warrant, from IP and budget perspectives, patent application filings and which should remain secret
• Track competitors – any new products? Patents?
• Identify Licensing or Partner/Consultant issues
• Include Marking/Sales as well as CTO/Engineering Committee
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IP Strategy: Track Your Portfolio
Regularly Update and Check Your Progress Against Your IP Plan • Make sure your plan stays up to date
• Is your business model changing?
• Does your product roadmap have a new turn?
• Are you achieving your goals?
• Are you generating the data you need to create the right IP assets?
• Are your patent applications progressing?
• Has the PTO put a crimp in your plans?
Nutter McClennen & Fish LLP • www.nutter.com 21
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Nutter McClennen & Fish LLP • www.nutter.com 22
THANK YOU