Clean and Green: A Sensible Approach to IP Protection for

New Energy Innovation

December 8, 2009

Ernest W. Grumbles IIIRobert A. Kalinsky

ITEMS

• A STUDY IN CONTRASTS• WORST-CASE SCENARIOS• IP IN 4 SLIDES• PATENT SEARCHING FOR

BUSINESS INTELLIGENCE• FILING EARLY AND OFTEN• REAL WORLD, CLEAN AND

GREEN IP• STRANGE POLICY TWISTS

Tesla

Nikola Tesla – solar pioneer

A STUDY IN CONTRASTS

THE ECO-PATENT COMMONS

• Pool of Eco-Patents for Public Use – royalty-free

• Est’d by IBM, Nokia, Pitney Bowes and Sony w/ World Bus. Council for Sust. Dev.

• Over 100 patents so far

GE v. Mitsubishi (S.D. Tex.)

Variable Speed Turbine Patents

WORST CASE SCENARIOS Pt. 1

• No ownership or control of your inventions

• Loss of information secrecy

• Loss of patent rights

• Ambiguous or weak patent rights

• No real IP plan

WORST CASE SCENARIOS Pt. 2

• Use of someone else’s trade secrets

• Use of someone else’s patent rights

• Involuntary patent or trade secret litigation

• Injunction and damages from use of third party rights

Patent Litigation: Sport of Kings

• 3,500

• $2.5M

• 2-3 years

• injunction; lost profits; royalties; attorney’s fees

Akeena Solar v. Zep Solar (N.D. Cal.)

Solar Cell Mounting Bracket Patent

Maxwell Technologies v. NessCap, Inc. (S.D. Cal.)

Ultracapacitors

CLEAN AND GREEN IP IS:

• LIKE THE REST OF THE IP WORLD

• IT’S ABOUT – INNOVATION

– IMPROVING THE WORLD

– AND MAKING $

IP in 4 Slides: Patents

• Statutory protection for inventions

• Protects: devices, systems, methods of use/mfg

• Up to 20 years of protection• $15K-30K to get one• 1 year from sale or disclosure

to file – or no US patent

IP in 4 Slides: Trade Secrets

• Statutory protection for confidential competitive info

• No registration• No cost – aside from security• Perpetual (in theory) • Quick death – if you let them

out

IP in 4 Slides: Trademarks

• Common law and statutory protection for brands/trade dress

• State and Federal• Registration best • $1-4K to get registered• Perpetual – but use them or

lose them

IP in 4 Slides: Copyright

• Statutory protection for creative works

• Federal only• Register so you can sue• $35 to register• Time of protection

Look Before You Leap: the Virtues of a Patent Search

• What

• What You Get

• Why / Why Not

• Innovation Reality

• Process

• Timing

Patent Filing Strategies

• New Tech = uncertainty

• Don’t sweat – just file

• Early

• Often

• Cheap

• Time-manage expense

$110

The Destruction of Novelty

• Sales

• Offers

• Public Displays

• Public Use

• Time Limits

My PatentRights

2009

REAL WORLD, CLEAN AND GREEN IP - Filing Strategies

• Traditional Approach

• Linear Approach

• “Bull's-eye” Approach

Filing Strategies – Traditional Approach

Innovation

Time

Filing Strategies – Linear Approach

Time

Filing Strategies – Bull's-eye Approach

Example Patent Filing*

12. A system, comprising:a server operable to communicate

with a power grid operator and with each of multiple electric resources connected to a power grid; and

a charging manager connected to the server and operable to receive an energy generation signal from the power grid operator and to control a number of the electric resources being charged by the power grid as a function of the energy generation signal.

* U.S. Patent Published Application No. 2009/0200988.

Typical Timeline and Costs

2010 2030

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029

01/01/2010

Application filed

06/01/2012

Examination Begins

01/01/2014

Patent Grants 01/01/2030

Patent Expires

$15k - $30k

Types of Technology

• No “Green” indices at U.S. Patent Office

• ICTSD / EPO creating index– general use of patents, access to

technologies, licensing, and technology transfer

Filing Numbers

• Actual filings can be difficult to track

• Clean Energy Patent Growth Index - http://www.cleanenergypatentgrowthindex.com/

• General trend upwards in almost every category

Filing Numbers

U.S. Patent Filings - Green Technologies

0

200

400

600

800

1000

1200

2002 2003 2004 2005 2006 2007 2008

Year

To

tal

U.S

. P

aten

t A

pp

lica

tio

n F

ilin

gs

Filing Numbers

U.S. Patent Filings - Certain Green Technologies

0

100

200

300

400

500

600

700

2002 2003 2004 2005 2006 2007 2008

Year

To

tal

U.S

. P

aten

t A

pp

lica

tio

n F

ilin

gs

Wind

Solar

Geothermal

Biofuels

Filing Numbers

U.S. Patent Grants - Green Technologies

0

50

100

150

200

250

300

350

400

450

2002 2003 2004 2005 2006 2007 2008

Year

To

tal

U.S

. P

aten

ts

Filing Numbers*

Clean Energy Patent Growth Index by Year2002 - 2008

600

650

700

750

800

850

900

950

1000

2002 2003 2004 2005 2006 2007 2008

* This chart is used with permission from the “CLEAN ENERGY PATENT GROWTH INDEX 3rd Quarter 2009” published by the Cleantech Group of Heslin Rothenberg Farley & Mesiti P.C. (www.cleantechintellectualproperty.com).

Filing Numbers*

* This chart is used with permission from the “CLEAN ENERGY PATENT GROWTH INDEX 3rd Quarter 2009” published by the Cleantech Group of Heslin Rothenberg Farley & Mesiti P.C. (www.cleantechintellectualproperty.com).

Players

Large and Small Company Patent Portfolios

0

10

20

30

40

50

60

70

80

90

100

Alliant

Energ

y Corp

Amer

en

Amer

ican

Elec P

ower

Center

point E

nerg

y

Consolid

ated

Ediso

n

Duke P

ower

Pinnac

le W

est

PG&E Cor

p

Progre

ss E

nergy

South

ern

CoXce

l

V2 Gre

en

Company

Nu

mb

er o

f P

aten

ts /

Ap

pli

cati

on

s

Large

Small

STRANGE POLICY TWISTS - UTILITIES, MONOPOLIES AND

PATENTS

• Who owns the IP?

• How to pay for the IP?

• Why does a monopoly want a patent?

Why does a monopoly want a patent?

• Exclude others in certain geographic area

• Freedom to operate

• Image / marketing

• Cross-licensing

• Incentivize innovation

Joint Development / Standard-setting organizations

• Upfront IP disclosure

• RAND licensing terms

• Pooling agreements

Ernest W. Grumbles III – egrumbles@merchantgould.com

Robert A. Kalinsky – rkalinsky@merchantgould.com