My fiancé and I are currently planning our wedding. As we’ve surfed from one web site to the next we’ve inevitably found ourselves confronted by wedding horror stories.
There are the usual: Drunk guest goes too far, an ex shows up to stop the ceremony, or someone gets cold feet. But then there are the more interesting ones: The bride drops The Crying Game bomb on the big day, the groom is hauled away in handcuffs during the ceremony or someone leaves at the altar to live with rabid wolverines in the forest. (Ok that last one isn’t real.)
While it’s entertaining to read about people making such an enormous commitment and investment with so little knowledge of one another, it appears to be human nature – and one that is observed in the way many businesses manage their IP.
Just like the bride-to-be surprised that her fiancé is wanted by Interpol, many organizations acquire or build their IP portfolio without asking the right questions and doing their research. Making assumptions without adequate due diligence can result in embarrassment and financial heartbreak.
For example, I recently came across a company that had just purchased a patent portfolio. It turned out that the inventors never actually assigned the patent to the original company, and there were no employment agreements or clauses in place to force the inventors to sign over their rights. The inventors were long gone (the selling company went under), and the acquiring company was now left standing at the altar with worthless IP.
Like a marriage, intellectual property (IP) is a long term commitment that should be carefully planned. Consider these words of IP wedding planning advice.
It’s neither romantic nor optimistic but that’s not what prenups are about. It’s essential to know what you have going in and that both parties are aligned! Document your growth and exit strategy. Do you plan to license your IP or sell it? Do you want to grow your portfolio organically or through acquisition? Having a clear shared view of your end-game will help you build an effective IP portfolio strategy.
It’s time to get your ducks in a row. Who will be the core supporting team for your IP growth? Start with an IP Manager, then build a committee of key leads (e.g. department heads) and IP stakeholders. In an innovation-minded company, an effective Patent Committee should include the CTO, IP Manager, Head of R&D/Engineering, and the COO or VP Ops.
This committee should meet regularly to discuss IP matters such as budgets, targets, and strategy. Any invention disclosures should be adjudicated for patent or trade-secret protection through this team too. Not everyone has the time or interest to manage IP (or plan a wedding). Consider whether you would be best served by hiring an outside “wedding planner” to help. Many companies create an entirely virtual IP department using trusted vendors.
Pack an iPod in case the DJ doesn’t show. Bring a 2nd outfit. Have a back-up seating plan to accommodate surprise guests and no-shows. Contingency planning applies to your patents too!
Patent applications get rejected on average 2-4 times per application, so prepare your defenses. Inventors may be reticent to assign rights to their employer so update your employment contracts to prevent surprises. And manage your costs! Like weddings, IP can have unexpected expenses. Make sure you reserve a budget to cover any surprises.
Before you commit to buying any IP, do your homework and get to know the portfolio intimately. Is there pending litigation for infringement? Is the chain of ownership clear? Are the claims too narrow? Are the key families still open? Make sure that a pretty portfolio is not veiled in secrecy before you put a ring on it. Vigilant diligence will go a long way to ensuring a long term healthy IP portfolio.
Well managed companies review their strategy, mission statement, and key operating metrics on at least an annual basis. This keeps everyone focused on the health of the firm. IP should follow the same rhythm.
Perform regular maintenance checks on your IP operations and data. Make sure no signatures are missing and no deadlines were missed. Review the portfolio in detail each year and note any deficiencies or shortfalls to expectations. If you have trouble keeping up or have doubts about the state of your portfolio it may be time to seek the help of an IP “counsellor” to get things back on track.
Listen to the voice of experience. Start acting like the “big day” is approaching fast. Follow my advice, and you will be on your way to a long and happy marriage of innovation and protection for your intellectual property!