Patent Reform - Impact on New Product Development

1 Copyright © 2012 Newlogic

Are you prepared for the effect the patent reform laws will have on packaging R&D strategy, organization and management?

PRESENTED TO: Structural Packaging, St. Augustine, Fl.

March 1, 2012

PRESENTED BY:

Tom Hambleton Food & Beverage Practice Leader, Newlogic

Wil Jacques Patent Portfolio Management Practice Leader, Newlogic


“What Me Worry” •  A massive shift is going to occur… •  Most are unprepared… •  Will change R&D and NPD processes… •  Be afraid, very afraid…


“…the biggest set of changes to happen to US patent laws since 1836.”

•  First inventor to file •  Supplemental Examination •  Post Grant Review •  Prior User Rights •  More and Different Costs


First Inventor to File: The Change •  First inventor to file at USPTO wins;

can’t invalidate prior art based on earlier invention date

•  First patent stands unless a subsequent patent owner proves you derived the invention from them

•  Can’t take something publicly used from a foreign market and patent in the US

Legal Reference: 35 USC 100 & 102 / Mar 16, 2012/13


First Inventor to File: So What? •  You will have to file earlier and faster •  Potential large influx of worldwide inventors •  Open market testing is risky; however, secret ideas

can lose as well •  Paranoia sets in…everyone is a leak •  Patenting strategy has to be an integral part of NPD


Supplemental Examination: The Change •  Patent Owner can correct inadvertent

omissions (i.e., prior art) in filed patent applica8ons –  You can go back and provide a new

reference a@er patent issues; USPTO will reexamine if SNQ of patentability is raised.


Supplemental Examination: So What? •  New ability to modify your issued patent after it’s

issued –  In speeding R&D pipeline to patent, greater potential for

mistakes/omissions not caught until after patent issues.

•  Protects you (patent owner) from charges of inequitable conduct (i.e., litigation by a competitor)

•  Once effective (Sep 16, 2012), patent owner can submit “any” issued patent (rid potential skeletons in the closet).


Post-Grant Review: The Change •  Easier, cheaper ways to

challenge patents •  Anyone is enabled with ability

to challenge validity of your patent - on virtually any ground

•  (e.g. sale or public use etc.)

Legal Reference: 35 USC 321-329 / Sep 16, 2012


Post-Grant Review: So What? •  Low cost & quicker way to challenge the validity of

competitors IP, but there are risks to petitioner if decision goes against you, –  Can be stopped from bringing further action (i.e., PTO,

ITC, District Court) •  Patentee can still make changes to patent while

undergoing review •  Once review is granted, decision in 1 year

(appealable to CAFC)



Prior User Rights: The Change •  Prior user rights a defense to patent

infringement suit –  however NOT a defense

against Univ/TTOs



Prior User Rights: So What?


•  Secret activities, reversed engineered product, or EUREKA! can concede market expansion and create estoppels to on-going R&D efforts

•  Do you know the technical/patent taxonomy of all products and internal processes and division transfers?

•  Sponsored research projects with Universities and other research institutions heighten need for tighter agreements (e.g., CDAs and NDAs)


New and Different Costs: The Change •  Immediate 15% surcharge on PTO fees •  Optional speedy examination cost of ≈ $4800 •  More and higher patent filing costs •  Additional cost to clean mistakes •  New challenge/defensive costs •  More and different market/IP search costs •  Up to 75% fee reduction to small entities and

micro entities


New and Different Costs: So What? •  More early stage reviews; •  Opportunity Cost - the risk of

not filing a patent; •  Fee reductions invite new

players into the market


“We patent everything or nothing” “Our costs are out of control”

“Should we spend more on R&D?–or less?”

“Are we patenting the right thing?” “We should develop new products faster.”

“We can file the paperwork later” “We just file what we need now”

“Should we include our supplier’s contribution?”

“Creativity is being killed by bureaucracy “We can’t afford to back every opportunity.” “Another painful new product launch” “We should be able to do more, with less.”

“Most of our patents aren’t used”

What We Hear:




“Are we patenting the right thing?” “We should develop new products faster.”

“We can file the paperwork later” “We just file what we need now”


“Creativity is being killed by bureaucracy “We can’t afford to back every opportunity.” “Another painful new product launch” “We should be able to do more, with less.”

“Most of our patents aren’t used” FIRST INVENTOR TO FILE

SUPPLEMENTAL

POST GRANT REVIEW PRIOR USER RIGHTS

MORE & DIFFERENT COSTS





“Most of our patents aren’t used” “Are we patenting the right thing?” “We should develop new products faster.”

“We can file the paperwork later” “We just file what we need now” “Creativity is being killed by bureaucracy “We can’t afford to back every opportunity.” “Another painful new product launch” “We should be able to do more, with less.”

FIRST INVENTOR TO FILE

SUPPLEMENTAL










SUPPLEMENTAL










SUPPLEMENTAL




“We can file the paperwork later” “We just file what we need now” “Creativity is being killed by bureaucracy “We can’t afford to back every opportunity.”





“Another painful new product launch” “We should be able to do more, with less.”


SUPPLEMENTAL




By Using Planning, Communications & New Tools You Can Address the Changes Required by Patent Reform Laws

CHANGE SO WHAT WHAT TO DO

First inventor to file Early & Fast

Supplemental

Post Grant Review

Prior User Rights

More and Different Costs

Market Testing

Resources

Speed to Market

Competitive Review

Platform Fit

Partnering Opportunity

We don’t know the value

Technology Strategy

Technology Platforms

Portfolio Management

Innovation Process

Technology Intelligence


An Innovation Process that Accounts for Patent Reform Addresses IP at Multiple Stages

5. B

uild

Cas

e to

su

ppor

t IP

cos

ts

6. F

ile P

rovi

sion

al

Pate

nt –

at

leas

t

8. F

ile U

tilit

y Pa

tent

Ope

n In

nova

tion

Com

peti

tive

Te

chno

logy

in

telli

genc

e

3. R

esea

rch

com

peti

tive

IP

Posi

tion

s

11.

Def

end

agai

nst

post

-gra

nt

revi

ew

File a Patent, or not 7


Without A Comprehensive Technology Strategy You Won’t Know What IP Is Important

Product/market Where to compete ? How to compete ?

Technology Which technologies ? How to deploy them ?

Manufacturing What to produce where ?

How to manufacture ?

Marketing/distribution Where to sell ?

How to sell/promote ?


Technology Platforms Enable Breakthroughs on Multiple Product Platform Features & Elements (Product Attributes)


Changes Your Supplier Relationships Affects Open Innovation Initiatives


IP Portfolio Decisions Should Be Integrated With Your Project Portfolio Decisions:

UPSTREAM DOWNSTREAM Doing the “right” things Doing things “right” Making choices Implementing choices

OBJECTIVE ACTIVITY

Project and Program Management

CONTINUOUS FEEDBACK

INNOVATION LOOPS

Successful Commercial

Market Entry

Project Selection

Portfolio Optimization

Product Strategy

Product Planning

Technology Strategy

Technology Planning

Ideation and

Validation

Inno

vati

on F

unne

l


An Aggressive Project Portfolio With Integrated IP Goals Will Support the Business Strategy & Deliver Greater Benefits


New Tools to Communicate & Support Dynamic Decisions to Support Your New Product, Technology & IP Investments


Planning, Communication and New Tools Are Needed to Address the Changes Required by Patent Reform

Clearer vision of long-term trends in market/ customers, competitors & technology

Better process to select the most promising innovation opportunities

Better process to determine which resources to build where

Better focus in product portfolio strategy priorities

Better focus in technology & manufacturing strategy priorities

Better focus in product planning and faster product development

Clearer & better process to optimize product & portfolio plans

Clearer & better process to plan and allocate development capacity


What to do next? •  Start talking about it and asking questions

–  Ask how does this effect our NPD process? –  Ask how does this affect our decision making? –  Ask, how does this impact our technology investments? –  Ask, how are we going to manage?

Are Your Prepared?


www.newlogicusa.com 617-433-8449

Documents

Patent Reform - Impact on New Product Development