Patent Baristas

See how biotech innovations help heal, fuel, and feed the world.  The 2009 BIO International Convention will take place this month over May 18-21, 2009, Monday-Thursday, at the Georgia World Congress Center in Atlanta, Georgia.

Not a small, intimate affair, the BIO International Convention draws approximately 20,000 industry leaders from 60 countries. This year, the Convention program will feature more than 150 sessions in 22 breakout session tracks. Sessions will address the most pressing issues facing biotech today, including healthcare pricing and access, capital formation and partnering strategies in a tight credit environment, and climate change and biofuels.  This year’s BIO Exhibition will cover will cover an estimated 200,000 net sq. ft. and host more than 2,200 exhibitors.

Sir Elton John will be a keynote speaker at the Convention with Sir John scheduled to speak at noon on Tuesday, May 19, 2009.  That means if you’re not in line right now, you’re probably too late.  He will focus on the HIV/AIDS epidemic, how biotechnology has influenced prevention and treatment of the disease and an outlook of the challenges and solutions that lie ahead.

In addition, presentations and educational sessions at the 2009 BIO International Convention will focus on research and development, partnership opportunities, and new business models required to meet global health challenges.

The 2009 BIO International Convention will feature leading industry experts and government officials from around the world debating key issues that dramatically influence the biotechnology industry including follow-on biologics/biosimilars, biomarker research, genomics and the ever-changing global biotechnology business landscape.

I’ll be in attendance as well as participating in BIO’s blogger network throughout the week.  If you’d like to meet up during the conference, drop me a note and we’ll schedule some time to have coffee together.

It looks like PatentlyBIOtech and Patent Docs will be there — maybe there can be an IP blawger get-together at the local coffee bar?  Send me your suggestions.

The question now:  Should we continue with the iBarista iPod giveaway?

While not invited to the party in person, the Biotechnology Industry Organization (BIO) provided its written testimony on patent reform to the U.S. House of Representatives’ Committee on the Judiciary hearing on H.R. 1260, the “Patent Reform Act of 2009.”

The breakdown for the biotechnology industry looks like this: more than 7.5 million people employed; more than 300 biotechnology drugs and diagnostics created; another 400 or so biotechnology products in the pipeline.

All of this innovation is possible because of the strength and predictability provided by the U.S. patent system. Therefore, when considering changes to this system, we urge the Committee to consider carefully the cautionary language embraced by the Hippocratic Oath – first, do no harm.

BIO’s Views on Patent Reform

• BIO supports full funding for the agency responsible for granting patents – the United States Patent and Trademark Office (PTO).
• BIO supports expanded opportunities for members of the public to submit prior art during patent examination, and repeal of the judicially-created inequitable conduct doctrine.
• BIO supports a transition to a first inventor-to-file system that incorporates an appropriate “grace period.”
• BIO supports willful infringement reforms that would specify that the litigants must first resolve the validity and infringement of the patent before turning to willfulness.
• BIO supports, in principle, venue reforms that would discourage forum-shopping.
• BIO supports repeal of the Best Mode description requirement, which has no counterpart in foreign patent laws.
• BIO supports restoring a rebuttable presumption of irreparable harm and inadequacy of remedies at law when evaluating a request for a permanent injunction.

BIO’s Position on the Patent Reform Act of 2009

Expanded Post-Grant Reexamination: BIO opposes provisions in the bill that would broaden the grounds upon which a patent can be administratively challenged at any time during the life of the patent. If a patent can be easily challenged at any time under a low standard of proof – even years after the patentee and the public have come to rely on it, and years after biotech companies have invested hundreds of millions of dollars to bring a patented invention through clinical trials and regulatory approval – patents will have much less value, and investment predicated upon them will inevitably be diminished.

(The Senate Committee on the Judiciary recently amended S. 515, the Senate counterpart to the Patent Reform Act of 2009, to no longer include provisions allowing for ex parte or inter partes reexamination on the basis of “on sale” or “public use” prior art.

Apportionment of Damages: BIO also opposes the provision in the bill that would dramatically expand the situations in which a court would be forced into an “apportionment” process to determine what damages a patent owner should be awarded once a patent is found to be valid and infringed. Under current law, a guilty infringer of a patent has to pay the patentee damages adequate to compensate for the infringement, which may be the patentee’s “lost profits,” but are often limited to a “reasonable royalty.” In determining a reasonable royalty, courts follow a flexible set of factors, including the 15 outlined in the landmark Georgia Pacific case.

The Patent Reform Act of 2009 would introduce a new default rule for determining and applying reasonable royalty damages, forcing the courts to use an entirely new and uncertain standard that would directs courts to “ensure that a reasonable royalty is applied only to that economic value properly attributable to the patent’s specific contribution over the prior art.” Such an approach ignores the fundamental fact that virtually all inventions are, to some degree, premised on prior art, and that many patented components are essential to the intended functionality of the overall infringing product – two facts that are particularly applicable to biotech patents.

See the entire written testimony here.

The U.S. House of Representatives’ Committee on the Judiciary is holding hearings on H.R. 1260, the “Patent Reform Act of 2009” today and, so far, the testimony is pretty much about what you’d expect.

Phillip Johnson Chief IP Counsel for J&J, and Bernard Cassidy, Senior VP and GC at Tessera, laid out that strong patent protection is critical to protecting U.S. businesses.  It was no surprise that the bulk of the discussion was on calculation of damage awards and how the current system works (or is broken) depending upon who was speaking at the time.

David Simon, Chief Patent Counsel at Intel, and Mark Chandler, Senior VP at Cisco, held close to the talking points about the need to limit damages over patent lawsuits brought against high-tech companies by patent-holding companies that make no products and offer no services but exist solely to extract royalty payments by threatening litigation.

Dean Kamen, DEKA Research and Development, spoke about being an inventor (with patents on more than 150 devices, including the Segway) and that he was — in essence — a patent troll for asserting patents and not actually making a product. I thought it was disrespectful of him to show up in a casual, short-sleeved shirt like he was going to a backyard barbecue (is that a swizzle stick in his pocket?) but he added some good discussion from the perspective of the inventor.

Representative Jackson Lee (D-TX) remarked that she approved of his casual attire since he “looked like an inventor” and we “need more of that.”  But, he’s not Steve Jobs and I think he can afford a jacket and tie.

Phillip Johnson, Chief IP Counsel for J&J, made a good point that, while difficult to define, frivolous lawsuits are brought by plaintiffs who bring a $50 million dollar lawsuit and then sit down and say “Hey, it will cost you $5 million to defend the suit, we’ll settle for $2 million.”  Rep. Brad Shaw (D-CA) got a good laugh about how legislation could ever be drafted to provide for lower damages for those with impure intentions.

In the end, the discussion devolved into “Let’s beat up on software patents.” John Thomas, Professor at Georgetown Law School, expressed that he thought the Bilski case does not go far enough since (not even clever) patent drafters can get around its restrictions.  When it was finally suggested that this be left to the courts and not legislation, Rep. Linda Sánchez (D-CA) asked if that meant they trusted the courts more than Congress.

We’ll keep you posted on developments.

The U.S. House of Representatives Committee on the Judiciary is holding a hearing this morning on the Patent Reform Act:

10:00 a.m. Thursday, April 30, 2009

2141 Rayburn House Office Building

Hearing on H.R. 1260, the “Patent Reform Act of 2009”

Today’s testimony will most likely focus on the more contentious issues of H.R. 1260, including:

Post-Grant Opposition: H.R. 1260 provisions for expanded post-grant review and inter partes reexamination of U.S. patents. These broaden the grounds upon which a patent can be administratively challenged at any time during the life of the patent. This expansion of reexamination, on top of a new, time-limited post-grant opposition system, would cast a cloud of uncertainty over issued patents for decades.

Damages for Infringement: The apportionment of damages provisions in the House bill would be changed to introduce a new default rule for determining and applying reasonable royalty damages, using a new standard that directs courts to “ensure that a reasonable royalty is applied only to that economic value properly attributable to the patent’s specific contribution over the prior art.” The Senate Judiciary Committee approved a modified version of the reform bill that added a “gatekeeper” provision, which gives judgesmore authority to determine how to assess damages and to determine which of the many factors available under the law are appropriate for a jury to consider in calculating damages.

Witness List

David Simon
Chief Patent Counsel
Intel, Inc.

Phillip S. Johnson
Chief Intellectual Property Counsel
Johnson & Johnson

John R. Thomas
Professor
Georgetown University Law School

Jack W. Lasersohn
Partner
Vertical Group

Dean Kamen
Inventor
DEKA Research and Development Inc.

Mark Chandler
Senior Vice President
Cisco

Bernard Cassidy
Senior Vice President and General Counsel
Tessera Inc.

The 2009 survey of equity and cash compensation for top management at private companies is now underway by CompStudy.  The survey covers more than 25,000 executives at 5,000 private companies (including venture, angel or private equity-backed) in the technology and life sciences industries.

This year’s survey covers a variety of industry segments including software, communications, computer hardware/semiconductors/electronics, it services/consulting/systems integration, content/information provider, cleantech, biopharmaceuticals/pharmaceuticals, platform technology/tools, bioinformatics, device and diagnostic, and specialty pharmaceutical.

One interesting point from last year’s survey is that for the equivalent role in a life science company, compensation is higher than found in a technology company.  This “Kelly Bluebook” of start-up executive compensation is in its 10th year and has been expanded to include surveys in China, India, Israel and the UK as well as the US.

To complete the survey you will need to have access to the following information:

• Basic company information including address, industry, revenue, headcount, etc.,
• Compensation including base salary, cash bonus and equity for each executive on the management team,
• Basic executive background including founder status, join dates and professional/academic background,
• Details of financing rounds including investors, amount invested, valuations, etc.,
• The complete capitalization table including amount held by each executive, including board members.

If you are C-level executive of a start-up company in these industries then you should participate in the survey.  It should only take 30-60 minutes to complete the survey and there is no cost to participate. But, the only way to access the full results of the survey is through participation.  Archived copies of past editions are available for download here.

CompStudy is produced by J. Robert Scott, Ernst & Young, and WilmerHale in collaboration with Dr. Noam Wasserman, Professor at the Harvard Business School.

The saga of the PTO’s rulemaking authority continued on March 20, 2009 when the Federal Circuit issued its 55 page decision in Tafas v. Doll holding that aside from the rule limiting continuations, the other rule changes were procedural in nature and the PTO does have the rule-making authority to implement the rules limiting the number of claims in each application, providing for Requests for Continued Examination (RCEs) and requiring Examination Support Documents (ESDs).

What happens next is unclear, but the impact of these changes to the rules could be staggering – especially to the life sciences community and its ability to obtain patents to protect innovation in a potentially new patent regime.

American Conference Webinar Series is now set to present a webinar entitled “Tafas v. Doll – Dissecting the Decision and Preparing for Resurgence of USPTO Rules Limiting Patent Claims.”

This 90 minute webinar, presented Wednesday, May 20, 2009, at 1:00 p.m. to 2:30 p.m. Eastern, is set to provide  an in-depth analysis of the recent decision, expert discussion of the next steps of the case, and what you can and should be doing now to prepare for these potential groundbreaking changes to patent protection.

Points of discussion will include:

• Background of the case and brief analysis of the proposed final rules: 78, 114, 75 & 265
• Analyzing the details, reasoning and nuances of the decision, including:

1. Distinguishing between substantive versus procedural rules
2. Explaining the conflict between Section 120 of the Patent Act and Final Rule 78 limiting continuations
3. Contrasting the court’s reasoning for holding Rule 78 invalid while upholding the rules regarding claims, ESDs, and RCEs
4. Examining the criteria discussed for the lower court to consider upon remand

• Evaluating possible statutory reasons for why Rule 75 could also be under attack
• What happens next and where do we go from here?

1. Impact of the rules for patent claim drafting, filing applications, and potential litigation consequences
2. Practical tips for practitioners on what you should be doing now with your patent applications and portfolio

Download the conference brochure here (pdf).

Today is World Intellectual Property Day and this year WIPO’s focus is on promoting green innovation as the key to a secure future.

According to WIPO, most people are aware of intellectual property (IP) but many still view patents, copyrights and trademarks as business or legal concepts with little to no relevance to their own lives. To address this gap, WIPO’s Member States decided in 2000 to designate an annual World Intellectual Property Day. They chose April 26, the date on which the Convention establishing WIPO originally entered into force in 1970.

Each year, WIPO and its Member States celebrate World Intellectual Property Day with activities, events and campaigns.  These are an attempt to increase public understanding of what IP really means, and to demonstrate how the IP system fosters not only music, arts and entertainments, but also all the products and technological innovations that help to shape our world.

WIPO issues a message from the Director General each year, broadcasts a short publicity spot on international television channels, and dispatches posters and other promotional materials to IP offices and organizations.   Reports of activities organized by Member States are published on this site.

The aims of World IP Day are:

• to raise awareness of how patents, copyright, trademarks and designs impact on daily life;
• to increase understanding of how protecting IP rights helps promote creativity and innovation;
• to celebrate creativity, and the contribution made by creators and innovators to the development of societies across the globe;
• to encourage respect for the IP rights of others.

WIPO’s World IP Day Web Gallery displays some good examples (despite some overuse of the tired light bulb) of posters and publicity materials from around the world.  The April 2009 issue of WIPO Magazine is available for download in PDF format.

Recently, we’ve had a rash of clients receiving misleading demands for fees relating to patents and trademarks. These demands typically take the form of official-looking letters that falsely suggest a connection with the International Bureau of WIPO or European Patent Office, and that solicit fees for some supposed service such as “registration” of a patent or patent application.

One recently received letter contained specific details about a published PCT patent application, and asked that EUR 1675.00 be sent by check or wire transfer to an organization named IPTR (International Patent and Trademark Registry) at an address listed as a post office box in Nürnberg, Germany. The described service to be provided was registration of the patent application:

We refer to the publication of your patent application, application number: PCT/US2008/xxxxxx, publication number: WO 2009/xxxxx, publication date: 23.04.2009, in the public patent bulletin. We offer the registration of your patent application on the basis of our own data records in our private database which appears which appears on the World Wide Web. The entry includes all the data concerning your patent application listed to the right of this text and basic-data concerning your company. The publishing serves the constantly increasing demand for information, particularly with regard to your competitors and business partners.

OK, so they agree to take your patent application information  — information already freely available on the patent office website — and then re-post it on their own website?! On the WORLD WIDE WEB!  WOOHOO! Whatever registration services might be offered in such invitations, they have no connection to WIPO or to any of its official publications and have no bearing on your intellectual property rights.

Admittedly, it does warn you that “This offer for registration is not an invoice. You are under no obligation to pay the amount unless you accept this offer.”  I guess, technically, they warned you that you can through the mailing in the trash but they’re counting on you not reading too carefully.

I know we’ve discussed this before but it’s worth repeating:  please carefully review all such requests.  If possible, confirm with your attorney whether or not a solicitation is valid.  These invitations to pay fees do not come from the International Bureau of WIPO and are unrelated to the processing of international applications under the PCT.

Only the International Bureau of WIPO publishes all PCT applications (after the expiration of 18 months from the priority date) and there is no separate fee for international publication.

An example of such invitations can be viewed below.  See other registry payment request letters here.

Example of a Patent Registry Scam (PDF File)