Let it snow! Burton Patents

To say that the winter of 2014 as been harsh would be an understatement. In the North-East and West, snow totals are approaching historic levels. Even as I type, another monster storm is gathering to dump feet of snow on an area stretching from upstate NY to Maine.

If there are any winners in intense snowy winter, it is ski resorts. Resorts, it is obvious to state, can't function without skiers and snowboarders.  One of the premier outfits in snowboarding Burton is, aside from a trendsetter in slope apparel and design, a prolific patentee.

According to the patent databases, Burton has more than 100 issued patents and pending application in the US.  An appreciable number of these patents are directed to function features, such as the spring leaf modified glide board design seen above.  Other patents address the continuous problem of lacing your boots. For example patent 8418381, describes a lacing system for boots.

One of the features that drives sales in the apparel / sporting goods space is the relentless need to innovate and produce new and improved models. In that respect, the Tech space and the sports retail space are not significantly different.   The ability to patent these advancements, however incremental, mean increased sales and wide recognition as an innovator.

Not every patenable idea is a commercial success, nor should it. A large purpose behind the patent system is to allow companies and individuals to iterate over known ideas to get new ideas. Sometime, the iteration is not worth the added expense. Sometimes the iteration was the last piece of some overall systems puzzle that advances the art, and becomes the basis of new paradigm in the industry.

Burton made a large push for the integrated boot binding combination. Had it taken off, it would have changed the technological direction of the industry. At the end of the day, in 2014 at least, that technology is a side show to the more simplistic boot binding system employed by Burton and other board manufacturers.

The point is that you never know which ideas might strike and catch fire, and which ideas whither on the vine. If you wait until you are successful to patent those ideas, it is already too late.


Jordan Garner

Steampunk, Patents & IBM

Steampunk as a genera was set to explode in 2013.  For those who don't know the difference between steampunk, cyberpunk and retro-future, let me provide this definition. A common definition could be provided as a sci-fi / fantasy sub-genre based around Gothic machinery and the industrialized civilization of the 19th Century. However, it should be noted that the definition of Steampunk differs from adherent to adherent. The common elements are a heavy influence by the works of Jules Verne, the inventions of Nikola Tesla and Victorian fashion. The genera adheres a retro-futuristic style that puts critical emphasis on ascetics, at times to the detriment of function.

According to IBM (a retro-futuristic enterprise if there were one) Steampunk was set to evolve into a cultural meme, jumping cultural domains like some sort of mechanical fish. IBM came to that conclusion through the use of its sentiment analysis system which scans social media for "chatter". In this case, the chatter said that Steampunk is set to explode. This "steam explosion" will see the transition from "high-cost" low volume Steampunk inspired devices to mass market production. See there analysis here. 

Naturally giddy at the prospect of this explosion in felt hats and brass goggles, I fired up my ISPDR Terminal (More on this another time) and went looking for Steampunk patents. 

Unfortunately, the only issued patent that felt "Steampunk-y" is the above illustrated "gear-heart" pendant. U.S.P. 666116.  Some additional patent applications were directed to video games having a Steampunk feel, but no additional physical device. No giant steam powered spider-automaton diagrams, no difference engines powered by AEther. Just some odd electrode wielding walking sticks and some flogs. 

Of course, it is possible that all of the really fancy jewelry is being copyrighted and not design patented.  However, if you thought your designs were going to go mass market, and you were working in a genera as unique and ascetically diverse as Steampunk, why wouldn't you seek design patent protection.  

The general take away should be about focusing your development efforts to conform to some 10,000 foot analysis, as opposed to developing and IP portfolio which serves current business needs. Clearly, those high-cost low volume manufacturers are not having a problem with rampant infringement. Otherwise they would have masses of patents and pending applications. 

Chatter about trends, technologies, or concepts are just that, chatter. Even with powerful computer analysis it is difficult to determine the direction of technology and style. Therefore, you never know what ideas and technology might take off tomorrow. This makes it difficult to justify the costs associated with IP protection. However, the opposite is true too. One well placed patent might control the market, or a genera. A balanced IP portfolio strategy, based on real world feedback, is always the right style. 

Jordan Garner

Girls be illin?: Don't waste your start-up capital on non-essential legal fights

Story: Goldieblox, a toy company marketing engineering toys to girls, used the Beastie Boys famous / infamous song "Girls" in a parody music video to promote their start-up project. The music video went viral on youtube, spawning mostly ardent praise and affection.

The Cerberus Legal dogs of Universal Music sent Goldieblox a pleasant letter (by Cerberus legal dog standards) asking them to take down the video. The letter claimed that the parody video was outside the scope of the fair use exception to copyright use, and constituted an impermissible use of the underlying work.

The legal counsel for GoldieBlox filed a declaratory judgment action seeking a finding on non-infringement under the parody provision of fair use.  This could be a educational case about how a "letter" is never really a letter, but an invitation to bring a DJ action.

A lot of digital ink has been split regarding the merits of the parties positions. If you are in favor of the permissible parody argument, then the Electronic Frontier Foundation (eff) has a great rundown of the law and their interpretation.

The point being missed here is one of resource allocation. It is argued that any press is good press. If that is true, then this entire episode is a net benefit to Goldieblox and their start-up ambitions.

However, from a business point of view, getting into a law suit with a major entertainment company is a huge hassle. Aside from your own legal costs, which could have been better spent on non-legal blog based marketing, you run the potential risk that you might lose and owe someone, or some mega corporation, lots of money. That outcome is unlikely here (even if GoldieBlox loses, they will likely have minimal damages), but that is besides the point.

A cursory level of diligence would have shown that not only do the Beastie Boys not like "Girls" (they refuse to play it anymore), they are actually quite litigious. As such, perhaps their IP, regardless of your use, was not the best media to use.

For the legal costs involved in filing and arguing a Declaratory judgement action, you could have hired a band or a composer to generate a all new song. The point here isn't that the Beastie Boys are right to argue about fair use, it is that a start up generally should avoid potentially bruising legal fights.  IP counsel should always be mindful of not only the legal arguments, but the overall business position.

Start-up resources should never we wasted on non-essential legal fights. If you need access to a particular piece of technology or code in order for your idea to function, then roll the dice, take the risk. If you want to make a music video parody of a famous song, think about the necessity to the bottom line.

Jordan Garner

No Patents on Perpetual Motion Machines

In this house we obey the laws of thermodynamics!!!

It is always good to revisit the basic, core concepts to reconfirm that you have a firm grasp of the complex. This is true across endeavors. Great cooks sometimes need to remember how to boil an egg. Likewise, software designers sometimes create simple apps using the bare bones code base.

The same is true for patent law.  Recently on the internet, there was a discussion about a supposed "perpetual motion" machine developed by a German tinkerer. A brief article concerning the inventor is here.  One of the points being bandied about in the discussion of a supposedly limitless energy system was that "because it is not a perpetual motion machine, it can be patented".  This is a misinterpretation of U.S. Patent Law.

U.S. Patent law allows for the patenting of "everything under the sun, made by man".  This restriction means that naturally occurring items, as well as purely theoretical constructs are not patenable. For example E=MC2 is not a patentable formula, since it describes a fundamental property of physics. A practicable application of this equation, say a nuclear reactor, would be patentable.  However, recent US case law has held that any preemption of a natural law  that is, a patent that claims all the applications of E=MC2, is also not patentable.

The point here is that natural laws are not defined by Congress, or the Courts. Furthermore, natural laws and laws of nature are only rough approximations of how we believe the world to work.  These laws might be subject to boundary conditions and localized modifications given the right arrangement of energy inputs and conditions. As such, it is possible that the "laws of nature" that you can't patent today, will be different from the laws of nature you can't patent 100 years from now.

This is all to say that you could get a patent on a perpetual motion machine. Merely calling it a perpetual motion machine is not the problem in getting a patent. There is no rule that says per se perpetual-motion, Faster Than Light and teleportation devices are not patentable.

The difficulty is in demonstrating to the patent office that it works. This is called the enablement requirement. If you show up to the patent office with a patent application that describes the mechanism of action as a perpetual motion machine, then you are going to need some extraordinary evidence to back that claim up. If you show the world a device that apparently accepts no input but continued to do work, then you will get a patent, so long as others can reproduce your results. What you can't do, is claim on paper to have a device that goes against our current understanding of science and expect to be granted a patent.

 In fact that Patent Office does not even require you to advance a theory as to why the device works in the first place in order to get a patent. A patent is simply a contract between an inventor and some territorial organization (e.g. The United States of America or France). This agreement states, explicitly, that as the inventor of  a improvement in a technical field, you are granted a limited monopoly to make, use and sell that improvement. In exchange for this monopoly, granted and enforced by the government, you must disclose the invention to the public (i.e. the world) in sufficient detail such that any one skilled in that technology can make and use the invention without resorting to undue experimentation.

 If you have a perpetual motion machine, and you can satisfy this requirement, then you will get a patent on it. The underling laws of physics that you are bending breaking or modifying are of no consequence.

Swiss-style Basic Income and IP

To the ill-informed, "Basic Income" is a social security system in which the government regularly gives each citizen a sum of money — with no conditions. No questions asked, no obligations. 

There is a referendum in Switzerland, which if passed would give each adult resident the equivalent of 2750.00 dollars a month. You can read the proponents thoughts here.  In short, the theory is, without the necessity to obtain income necessary to live, people could make more resumed choices about their careers. They could made different choices about how they spend their time. As a result, you might have a more efficient economy. 

Obviously, there are people, including economists, who think this is a terrible idea. The argument against Basic Income is that the whole system will collapse in a morass of lack of motivation to actually work. People will move their expenses down to the level of the Basic Income and then forego employment. Opting instead, it is argued, to just sit around all day. 

I take no position on which one of these outcomes is likely (or the likeliness of this idea gaining traction in the US). Wikipedia has a good run-down on the pros and cons.  However, I do take a position on the economic outcome of people sitting around. I tend to lean on the side of "that's great". 

Why? Because people freed from the restraints of taking ANY job to make ends meet, will naturally gravitate towards their hobbies. When people focus a lot on their hobbies, they tend to turn those hobbies into occupations. We see that with the craft "everything" movement. A zest for baking becomes a bake shop, a thirst for brewing your own beer becomes a craft brewery. A love of reading has become self-published media empires (Ed. a bit close to home....).

Freeing everyone from the constraints of occupation would lead to some people just sitting around. It would also lead to an explosion of new businesses financed by the Basic Income. 

Some of these new businesses would create new works of intellectual property. New artistic, musical, literary works; new software platforms; new devices and new methods could all spring from Basic Income. These works could be licensed world-wide; generating taxable revenue to feed back into the Basic Income system. 

Many Venture Capital organizations have an "Entrepreneur in Chief" position - a person paid to basically think stuff up. We are constantly being told that America needs more "innovation" and "entrepreneurship" and that IP is a step in the wrong direction. Basic Income matched with IP might allow the America to realize the dream of being a "Start-up" Nation where everyone is paid to "think stuff up."

Why you had a hard time getting an IP job 2009

Not my children, but they raise an interesting point

There was [is] a misconception that "IP" people and especially "Patent" people land on their feet after a traumatic work event.

In most cases these traumatic work events are solitary affairs to be met with stoicism when they arrive, and laughed off once gainful employment is once again obtained.   Job loss, it should be noted,  is not uncommon. It is definitely not uncommon in late 20th / early 21st century America. In general this theory holds true, with a strong caveat concerning Bio-background patent prosecutors (a situation which I have addressed before). Engineering background IP practitioners have generally found it easy to obtain new employment.

However, at the tail end of 2008 and well into 2009 and beyond, there was a uncommon tightness in the IP employment market for all background. This tightness didn't comport with the conventional wisdom about IP.

Conventional wisdom held that IP slightly a-cyclical or even lightly counter-cyclical to the overall business market. If IP was influenced by the broader economy, it was the result of companies exploiting their IP to the full extent possible in a difficult market. This theory held that lots of new applications, litigation and diligence work would be generated in a mild downturn as people companies and organizations attempted to maximize license fees, infringement judgements and acquisitions.  Litigation and diligence can be the topic of a different post.

Here we take a look at the wisdom as applied to applications, and find it lacking.


source: http://www.theatlanticcities.com/jobs-and-economy/2013/10/where-americas-inventors-ara/7069/

As evidenced by the chart title, the above graphs the number of application filings by US inventors per year.  Instead of seeing a steady churn in work, we see an inflection point, then a steep and accelerating drop off until 2010.

What this chart shows is that "peak-application" (like peak-oil) hit sometime before anyone was actually aware a problem was brewing. As 2007 transitioned into 2008, the trend accelerated such that applications were approaching free-fall in by the end of 2008.

However, if people remember correctly, the Lehman Brothers Bankruptcy did not hit the news until September of 2008.  So this drop off was not the result of the economic collapse that erupted in the wake of Lehman, but was part of the systemic breakdown which caused it. While everyone was keeping their eyes glued to the "market", IP watchers should have been analyzing the IP "market".

The second chart below breaks this data out to the highest regional markets for patent applications.


As far back as 2005, there was a leveling off in the application filings. This would have been the point to consolidate and solidify staffing levels. Instead, 2007 saw some of the largest summer associate class sizes. New York suffered severely. From a pre-2007 height of  over 1,000,000 applications to a current number of just over 600,000; New York had seen a 50% reduction in filings. By 2011 the IP filing market was only 10-20 % off the lows.

A 50% reduction in patent work in New York means a lot less law firms getting paid, and a lots less associates on the firm's rosters.

What these two charts show is that triggering event for the Great Recession (Lehman Bankruptcy ) was not the triggering event for the decline in patent filings. The gears were already in motion back in 2006.  The reasons for the run up and crash are likely as varied as reasons for the crash in the broader market; over-supply, irrational belief that history always points upward, empire building at the cost of sustainability. Any, and likely all, of these factors played into the massive disruptions that gripped law firms in 2009-2010. (see Towsand, Morgan, Darby et al.)

Firms are not quick to innovate in the best of times. Facing a 50% drop in work load, billings, and profits is not the best of time. All of this conspired to make it difficult to get a job in the IP field in 2009. Thankfully, the broader market is slowly improving.

As the line representing new filings continues on its upward march, we would do well to keep a close eye on the movements and metrics of our own "market" s well as the broader market.

Flat Design and the Decline of the GUI Design Patent

 With the advent of IOS7, Apple has joined Microsoft (Metro) and Google (Now) in putting to rest (for the time being) digital skeuomorphic designs. While a good thing for designers who like clean lines, it might complicate future GUI Design Patent Strategies.

A quick primer, digital skeuomorphic design elements are when the interface or the icon is designed such that it looks like the physical world object that it is designed to digitally replicate. For example, the bookshelf in Ibook, is digital skeuomorphic design. There is no reason that a digital container of book files needs to look like a bookshelf; other than to relate to you, the user, what is the purpose of the digital program. Additionally, buttons with dropped shadows, or clever isometric representations of objects within the icon space, are all examples of digital skeuomorphic design.

However, with the advent of flat design across the three major mobile development platforms, things like icons designed to look like bookcases is going to be a thing of the past. Flat design, like its "Modernism" architectural equivalent is premised of reducing the ostentation ornamentation. In the same way that neo-Gothic architecture like this gave way to boxy simplicity of like this, so too does flat design trend to simple geometric forms and a studied lack of ostentation and ornamentation.

Part of this change has been led by a difference in attitudes regarding the purpose of the GUI in the first place.  Digital skeuomorphic designs were originally used to help people with no inherent knowledge of the inner workings of computers to easily map real world actions to digital ones. A digital file was made to look like a physical office file. A digital delete function was made to look like a trash can, etc. Now, with at least two generations of American consumers raised on digital entertainment, there is less of a need to visually explain the functions of each icon. It is simply enough, in most instances, to state its function and designate an area for the user to interact with that function.

lots of rectangles, no shadows 

GUIs, flat or not, can be protected by design patents. In 1996, the USPTO created guidelines for the protection of GUIs based on its decision in Ex Parte Strijland.  GUI design or surface ornamentation is protectable as long as it is shown to be novel, not obvious, and not functional. The claimed design may be presented as a line drawing or a digital image. Color and grayscale are allowed to be presented in the same GUI application, but line drawings and digital images are not. Animated designs are also patentable in the United States, and must show a minimum of two views of the animation. 

This is all a long winded intro into the point. Of the recent victories that Apple has achieved against Samsung, Apple succeeded in proving that Samsung had copied a design patented GUI (seen at left). As you will note,  this Apple design is chock full of skeuomorphic elements. This includes not only the icons themselves, but their placement, the shape of the icons, their slightly beveled appearance etc.

However, by moving to a flat design paradigm, Apple and its competitors are moving into a field whose sole purpose is to simplify the display elements, not add ornamentation. As noted above, design patents mush have a non-functional use, and must be directly related to the ornamentation. If flat design takes hold, it will be increasingly difficult for designers to obtain protection for flat designs as they  essentially become functional identifiers for computer tasks. As a result, we are going to see a lot of convergent design elements that people will accuse other people of stealing, but no one will be able to obtain a patent on.

As a result, it is preferable to augment your GUI design patent strategy with a screen shot copyright strategy. This way, if it is an instance of blatant copying, you are still protected by an enforceable IP right.

Jordan Garner

Scammers Part 3 "Astro Boy" edition

Reporting on scams has become something of a tradition around here. In order to pull off a good con, the scam artist needs to know something about the psychology of its mark.

 It does the con-artist no good to offer to split a giant pile of bacon with a vegan (however delicious that concepts sounds). 
So to, do IP scammers know their audience. 

While not a new scam, the following letter was recently received in our offices: 

From: Osamu Tezuka Makoto [mailto:osatemakoto@gmail.com]

Sent: July 30, 2013 1:11 PM

To: Firm

Subject: Legal Rep

Dear Attorney,

We are a media publishing company in Japan. We have a breach of intellectual property agreement matter in your jurisdiction, we can forward you the agreement and 5195842743_2305>

Yours Sincerely,

Osamu Tezuka Makoto

Tezuka Production Company

4-32-11, Takadanobaba

Shinjuku-ku, Tokyo 169-075

Japan

Tel: +81333716411

Email: osatemakoto@gmail.com

http://tezukaosamu.net/jp

After some further digging the "client" told us that :

"We are  the owner of rights in a collection of animated characters including Astro Boy.  Springer Publishing of New York City failed to make a required payment upon termination of an intellectual property agreement between the us ."  

On its face, it seams like a golden opportunity  You, sitting in your office, business development book out to the "how to attract clients" chapter, gets this e-mail. You think, "sweet!" all that networking is paying off. Not only with new clients, but internationally famous IP clients. You do some due diligence, both the company, the IP and the opposing party seem legit.  Or do they. Why would a production company trading in a famous brand like Astro Boy communicate with a gmail address. Why would they contact you out of the blue, with no preface or introduction. Why call you "attorney"? 

The details of how this scam plays out differ from mark to mark, but the concept is pretty simple. Tezuka and Sterling (even though these are real valid companies) are setups, honey pots. You are supposed to Google them, see they are real, and rub your hands together in expectation of easy and significant billings. 

In reality, the contact info above, and the contact info they give you for the point of contact at "Sterling" are to the same entity. Once you negotiate a settlement, with a hefty retainer for your trouble, the money gets transferred to your firms' bank-account by a very slow validating banking institution. 

Because the client and the opposing counsel are the same entity, they know when the "money" was transferred  You, the successful hard litigating, hard negotiating lawyer, soon gets a call from the grateful client asking you to forward the money, minus your fees, of course. 

Now, some attorneys will wait until the check has fully cleared before sending on the money. Some will resist, until the client mentions that there are other people who owe them money, and they would like to retain you for future matters.  Either way, some lawyers will send a check, secure in the knowledge that the money in is the bank. 

The problem is, that the money isn't in the bank.  That slow moving bank transfer suddenly shows up as a cancelled check. Now the firm is out some hundreds of thousands of dollars. When you call Sterling and Tezuka, neither of them have ever heard of you. They have their own lawyers, who are you? You have to go to the Executive Committee and explain why you gave away the farm for some magic beans.  

You, my friend, have been scammed. Something for nothing is usually that...

Tax Policy for NPE ('Patent Trolls") [Wonky]

'In this world nothing can be said to be certain, except death and taxes." - Benjamin Franklin (noted scientist, inventor, philanderer  founding father, and fit model for currency).

The current debate around NPE (non-practicing entities, i.e. Patent Trolls) had me thinking about the law of unintended consequences and taxes. (Yes, I know, boring).  

I think everyone can agree that the ultimate goal of the AIA changes to the patent law were driven, in no small measure, by companies wishing to eliminate the threat of Patent Troll suits. For a general counsel with the ear of the legislature, this sounds like a perfectly reasonable use of power and influence. For the solo inventor who honestly believes that MegaCorp has ripped him off, it looks like corruption of the highest order. 

Resolving these two conflicting visions is nearly impossible. For MegaCorp, it honestly believes that Solo inventor is just a crook who is hassling their highly successful venture. For Solo inventor, he has invested time, but more importantly, money in acquiring a patent and MegaCorp is reaping all the benefit.  Furthermore, to Solo, it looks like the law has been changed to favor one party over the other. 

While the AIA might cut down on NPE suits, it will likely have inadvertent effects that we are barely aware. As such, I tend to not agree with wholesale legal changes as a way to eliminate 'bad' actors. When profit is the motive, very bright people will expend effort to find the loophole.  The problem with the AIA is that it targets the result of NPE actions (suits directed against major tech companies) instead of the goal of NPEs (Profit!). 

I would have advocated using tax policy to target the goal, not the result. 

On MegaCorp's side, Tax policy could be changed to make a new taxable income category for reasonable royalties as assessed by a court for infringement of a non-practiced patent.   Currently the tax rate for recovery in settlement and and reasonable royalty recovery by judgement are the same (~35% and taxed as income).  However, a change is the way that the IRS treats recovery from settlement vs recovery from litigation would lead NPE's to maximize their profit through the most efficient way possible.  If the tax rate for reasonable royalty (of a Non-practiced patent were sufficiently high, it would alter the calculus of going after MegaCorp, especially given that attorney fees are not tax deductible. Likewise, tax policy could be used to reduce the windfall that a true NPE could recover based on a past damages.

While this might drive NPE's into settlements instead of broadside litigations (which is what most GC's are really worried about), it would still leave Solo inventor holding the bag on his out of pocket patent fees.  

One way to lesson the impact to Solo is to use tax policy to unburden him of some of the cost in acquiring the patent.  This system would work as thus: The IRS would allow, given the size, income and subject matter, a tax credit for money spent acquiring a patent. This could be as simple as acquiring a tax credit for application fees, or it could be as complex as some formula for a tax credit that takes into account the amount of money that was spent in prosecution. 

These are obviously rough sketches of a goal oriented solution to the NPE problem, while trying to make sure that honest small inventors are not thrown out with the NPE bathwater. 


Jordan Garner 

Last days of First to Invent System

This is a short post, and probably should have been done before now, however Life! Today is the last day to file a U.S. Patent Application under the 1st Inventor system that we have used for 200 Years. Starting Monday, the U.S. (in harmonization with the rest of the developed world) will move to a First to File system. 

What does this mean. Well, probably nothing. However, if you are in a development race with another company, you should really think about filing today.  Now, in the U.S., it will be possible to be beaten to the patent office by a later inventor. 

So, if you have a provisional, or even a technical document, you should think about filing it before midnight. I could help you with that. It is easy to file a provisional and under the new rules (AIA) the cost is pretty modest for small companies. 

Next week starts a brave new world, or in Greek, an Apocalypse. 

Contact Jordan at: jgarner@leasonellis.com

Design Convergence and Design Patents

The other night, I read my son his favorite Train Book. This book contains a global panoply of  Train designs ranging from the old school "Tank" engine of Thomas to the ultra-sleek trolley trains of modern Germany. *See left.

Unfortunately for my 2 year old son, the modern trains have a more than a passing resemblance to buses.  My son insisted that the vehicle to the left was a "bus" and not a "train."

I was crushed, I had failed in my helicopter parenting. I failed to teach my son about the sordid world of design convergence.  He looked at me with puzzled eyes as I explained that, as the life cycle of a product category grows, the lion's share of new development efforts are directed to squeezing  maximum utility from the product.

In this case, buses and trains, no mater their underlying mechanisms of action, are both means of conveying people form location A to location B as quickly as possible (assuming you're not talking about the Manhattan X-Town).  Because they are mature technologies directed toward the same goals, designers will achieve  convergent design. This is true even when taking into account the unique technological platforms.

 The bus to the left is slightly higher due to engine and drive train. The trolley is longer and has less ground clearance.  However, overall, the design of the bus and the train are pretty similar. The windows on the side, the larger driver windshield,  the double doors, all of them speak to an optimization of certain design element that we look for in public transit.

Now, what does this have to do with intellectual property?

When an inventor or designer is contemplating obtaining protection for a concept, it is essential to understand the underlying function. However, it is also important to look to optimal form for achieving that function.

 In our bus/train example, if a designer had a design for a new bus, a Design Patent that covered some of the elements relating to usability, would run afoul of "no functional elements" prohibition of design patents.

 However, if you simply drafted utility claims directed to big windshields and double doors  you are unlikely to get very far with the patent office. The solution then is to break your concept down into two parts, the function of the device, and how the user interacts with it. Double doors become passenger clearance enhancers, not simply design elements.

Most inventors are quick to seek protection on the function of the device. A far smaller number actually obtain protection on commercially viable product form factors. One company that has aggressively exploited this gap is Apple. Since the internal components of Iphones are generally known technology, Apple relies heavily on Design Patents to protect the unique look of its products. The function of a Samsung phone and an Apple phone are technically identical. However, the appearance are worlds apart.

In order for an inventor to cover both avenues, it is essential to have a working knowledge of how users will interact with the technology and what forces will drive convergence.  Inventors have done themselves a great disservice by not pushing some quantitative analysis of user interface designs, as they relate to their specific technology. Once they find the optimal design, they could file for a Design patent along with their utility applications.

By the time I finished explaining all this, my son had decided it was just easier to go to sleep, hopefully dreaming of converged automotive design.

By: Jordan Garner
Contact me at: jgarner@leasonellis.com

Off hiatus, and the End Of IP

I have been on hiatus from Claimed Elements for a little while (which is official-ese for "I had other more pressing things to do").  However, much like the leaves change, so does my desire to blog.

A lot of this change in desire has come from some recent developments in the "End all IP" Troika of economists, open source software mavens, and Pacific Rim Software Pirates.

Recently, a study produced by the St. Louis Fed ( Paper can be found here) makes a strenuous call for the abolition of patents.  In brief, the authors conclude that there is no benefit to innovation by adopting a patent system. Let me state 1) that the St. Louis Fed has better things to do than opine on Patent Law. 2) They really should have better things to do than opine on Patent Law (Like calling for an increase in marginal lending practices so as to allow people easier debt servicing (oh, you don't like it when Patent Lawyers go all "economist speak", well turnabout is fair play.")

Obviously, I disagree, and not just because I like getting a paycheck.  There is a major fallacy lurking at the heart of the study.

Comparison.

Now, I grant you that Patent law has gotten a bit out of hand (something I call the Locust Syndrome, but more on that another time), but there is absolutely no way to determine if a system with or without patents produces more innovation.

Why. Because we don't have a second, alternative reality Earth to use as a control.  The authors focus (as most anti-IP people do) on Software Patents.  The problem is that they can not point to another first world, industrialized nation with the infrastructure and educational system necessary to produce sophisticated software code. We can't say that in 1520, the rate of innovation was better or worse than the rate of innovation today. The circumstances of innovation and progress are the end result of  historical accidents, low hanging fruit, and economic factors.

To paraphrase Neal Stephenson "in the early 21st century, America only did three things well, make movies, make music and write the best code."

The author's have not provided an example of a country that is producing superior, or more innovative software compared to what is developed by companies taking advantage of the U.S. Patent system.  The reason is obvious, in an fully integrated world, it is impossible to tell what effect the Patent system has on developments country A vs country B. Without a control group, we are merely grabbing at strawmen to explain why our version of reality is the right one.

So lets all take off our sandwich boards and calm down.

Jordan Garner (Jgarner@leasonellis.com)
www.leasonellis.com

Patenting Deliciousness

This is not a picture of patented deliciousness. Original photographer found here. 

The Internet is reporting that Oklahoma State University (Go Cowboys!) is attempting to patent a "cut" of steak.  While general reporting has focused on the fact that this new improvement in the Steak-y Arts will be called "The Vegas Strip" ( which does sound delicious) no one is focusing on the fact that the Inventors pretty much opened themselves up to a Sec. 103 Rejection based on the interview.  

For those who don't know (and why you would be reading a patent blog without knowing about patents...) merely filing a patent on something is no guarantee that you will actually get a patent on that thing. A lot of  digital ink has been used to decry the patent system as innovation restricting.  However, these garment rending positions are usually taken by people who have less than a common familiarity with the workings of the patent system. Once you apply for a patent, that application (helpfully called a "Patent Application") is examined by a Patent Examiner, and is not automatically turned into a patent.  

It is that Patent Examiner's job to determine if your patent application meets certain legal and procedural hurdles.  In this case, hopefully the patent application for Vegas Strip is given to a Patent Examiner who is an expert in Tastiness (I have a PhD in Tastiness from Finger-licking University, but I don't like to brag). According to OSU, the patent is not for the steak itself, but for the series of cuts used to make the steak.  For those of you aware, OSU just gave away that the patent is to a "Method" and not a "thing".  So the Tasty Expert Patent Examiner would look at this method of steak cutting a see if it has been done before, or if it is obvious (Sec. 103) in light of previous steak cuttings methods.  

The spokesperson for OSU's Steak Patenting Initiative (I just make up the initiative part), when asked how the method works said: 

"If i told you, it would be a hint to where this muscle is," he said. "A knowledgeable person would say, 'Aha!'"

Well, if that doesn't sound like "it would have been obvious to one skilled in the art" I don't know what is.   So, what's the point.  Well, one point is to not give interviews about your specious patent applications. 

A second, better point, is to not freak out every time someone says that they filed for a patent on the color blue, or a user interface, or some stupid Facebook integration program.  Merely filing the patent does not get you from A to B.  The patent office has plenty of mechanisms for weeding out bad, and obvious ideas, and does a pretty good job at it.  I think we can all sleep safely knowing that Oklahoma will not corner the market on deliciousness. 

Jordan Garner, Leason Ellis, Patents

Getting Hired in the IP Field

 Regardless of how you find yourself less than gainfully employed (or about to be less than gainfully employed), it is helpful to know that all IP associates are not equal in terms of their supply / demand curves. 

It is generally assumed that all IP associates (and partners) tend to land on their feet after a major event like Dewey. This, I can say from personal experience, is not always the case. Depending on your technical background (you have a technical background, right?) the market tends to set the going rate of demand differently for different kinds of associates.

So, how does one increase their desirability in terms of greater chance of employment? Well, going to a really good law school is really helpful, but not an indication of success.  Going to a decent (not terrible) school and doing really well is probably not better than going to an excellent law school and not doing so hot, but it is a decent consolation prize. Obviously the preferred option would be to go to a good school and do really well (and date supermodels). So, taking a clutch of associates, all of whom did well in undergrad and went to an excellent law school, who gets hired first? Who is in demand?

Well, if you have been on any recruiter websites (or get the e-mails) you can quickly create a ranking based on demand. While the list moves around a bit depending on Litigation or Prosecution emphasis, the top spots of the list remain largely intact. So who is on top: 

Electrical Engineering

Computer Science

Mechanical engineering

Chemical Engineering 

Civil Engineering

Pharmaceutical / Biotech (PhD. level) 

Biology (Non- Phd.)

Trademark

The best way to get a job in the current IP landscape is to have an electrical engineering degree or a computer science degree.  The hardest way is to not have a technical degree at all. This doesn't mean that Trademark Associates do not get hired (we have hired a few recently), it just means that the supply greatly outstrips demand, and will for the foreseeable future.  

Jordan Garner, Leason Ellis, White Plains NY.

Market Forces

No, this post is not about the excellent Tech-futuristic thriller by Richard K. Morgan (although it is awesome and can be found here)

In light of the continuing mess at Dewey ( if you are unaware, see here, here and here) it is probably helpful to think about price discovery schemes for associate compensation in the current job market.

If you weren't aware, the job market for associates (new and old alike) is going through what economists call a "Market Clearing".  This is just fancy way of saying that the supply is currently outstripping demand, and either the supply will need to contract, or the price for the supply will have to come down.

If you have spent anytime talking to the management of larger law firms, you know that there is no such thing as a permanent decline in salary for associates. The reputation deficit that comes from such a move is considered to be far more damaging than the price savings. Now, this does not mean that it doesn't happen.  In the dark days of '08-'10, many a law firm took the "lowered tier" option of differential associate payments and tried to spin them as some sort of revolution in Associate salary / price discovery.

 However, most associates are not in a position where they are given the option of voluntary wage cuts in exchange for continued employment. The end result is that the price discovery is impossible in the legal market, and the only way to get the market clearing effect is to reduce the supply of associates, often through forced attrition.

However, there is an alternative:

The alternative would be to allow the associates who are performing at an acceptable level to continue to work at the firm, but at a greatly reduced salary.

It would be possible to retain two associates for the price of 1. Basically, offering two similarly situated associates the ability to "share" their salary and maintain employment.  For high-year associates, it is possible to still obtain a 6-figure income on that 1/2 share. This allows the human capital developed by the firm to still be utilized, and the associate to avoid the stigma of a growing employment gap on their resume.  Unfortunately, the current practice of picking one associate and dismissing the other does nothing to help discover the true price of the associate and results in a wasted investment for the firm.

Either way, the lack of utilization of human capital (in the form of associates) is something that the legal profession is going to have to come to grips with.

Jordan

You got a job, now what?

Even with last week's job report steady employment is still difficult to find for a lot of people. One of the demographics having a slightly easier time achieving the employment dream are those young people with hard science and engineering degrees. regardless of if you are going to work for Microsoft or some garage stat-up, you should keep in mind what is being slipped into your employment contract.

A good illustration of the pitfalls of not properly reading your employment contract can be found in Picture Patents, LLC v. Aeropostale, Inc.  (Google Scholar is a god send for cheap Attorneys who hate to use the Westlaw accounts).  While this case is not new (April 2011) it does provide 2 key point I want to make about employment contracts and keeping your rights.  


A bit of back story. Ms. Baker, a student at Columbia, got an job working for IBM. Excellent right! Well, IBM being a huge, 100-year old multinational corporation who builds Jeopardy winning supercomputers in its spare time, is not an entity to let something like an employment contract be a Staples brand boiler plate. The employment contract has all the obvious provisions about not showing up drunk and sexually-embarrassing your co-workers in the breakroom.  In addition it has this doozy of a IP assignment section. The relevant part states: 

4. I hereby assign (emphasis mine) to IBM my entire right, title and interest in any idea, invention, design of a useful article (whether the design is ornamental or otherwise), computer program and related documentation, and other work of authorship (all hereinafter called "Developments"), hereafter made or conceived solely or jointly by me, or created wholly or in part by me, whether or not such Developments are patentable, copyrightable or susceptible to other forms of protection, and [sic] the Developments: (a) relate to the actual or anticipated business or research or development of IBM or its subsidiaries, or (b) are suggested by or result from any task assigned to me or work performed by me for or on behalf of IBM or its subsidiaries....

The above provisions concerning assignment of Developments apply only while I am employed by IBM in an executive, managerial, product or technical planning, technical, research, programming or engineering capacity....

Humm... restrictive. You invent a newer, better algorithm. It belongs to IBM.  You invent a better toaster, IBM is making your toast. You invent a slightly tastier pancake (impossible you say!, pancakes are already at maximum tastiness! Bah!), IBM is slathering Aunt Jemima all over it. An important note here is "hereby assign" this means today, not some point in the future. So when you develop something in the future, it is already assigned (in a temporal paradox no doubt) to IBM.  You are binding future you to assign things, i.e. you don't get to renege later.

I am pretty sure you know what happens next. Ms. Baker comes up with an idea (not important what) that she developed with the resources of IBM, while at IBM. IBM declined to advance the project further. Ms. Baker decided to take the technology on the road, do some more developing and file some patents.  Later, she decides that a whole bunch of people are infringing said patents, and brings suit....and looses.  Why?

Cause those patents belong to IBM.  Yea, she paid all the maintenance fees, all the filing fees and all the attorney time, but BIG BLUE takes the prize. Ms. Baker failed (or Ms. Baker's attorney failed) on two accounts. One, when the IBM's employment agreement asked her to list all currently developed(ing) projects that were outside the scope of the the IP agreement she wrote "None".  While it was possible that at the time of her signing, she had zero conception of the project, it is not likely. More likely, she didn't think the idea was worth putting down on paper at the time.

What's the lesson?  Always divulge (in confidence, so as not to be considered a disclosure under sec 102 et seq. ) all of you concepts. Sure some of them might sound stupid, or half baked, but you never know when you will develop them into the next killer app, only to have Megacorp take all the cash.  This is easily done with something like a spread sheet that gives a basic description that lists the things you are working on and thinking about. The downside to this is that if you are too descriptive, you run the risk of narrowing your room to claim broader inventions.

Two, do not use your corporate resources to pursue personal inventions or discoveries. They hate that. More importantly, using their equipment lends credence to the fact that you were doing it for them, and it belongs to them (while else would a company let you do stuff, if not for their benefit).

The back-up lesson you kids who skipped to the end is to make sure you read your employment contract thoroughly. If you don't understand something, ask a lawyer. If you are working for a place that has this kind of contact, and you develop something on your off time, as your lawyer how to make sure it does not instantly get grabbed by the boss.

IP Insurance in China

Recently, I had the good fortune to participate in a series of IP and Patent Law lectures in Shenzhen, PRC.  The main topics of discussion were related to the practical application of prosecution strategies and the new changes going into effect because of the AIA. While the audience was very receptive to the practical and philosophical changes coming to American Patent law, a strain of thought kept appearing in the questions presented to the speakers. (Pictures to Follow)  

The Chinese audience seamed, relative to the usual American audience, to place a high premium on risk mitigation.  The questions related to risk were varied, but they all had a component that sought to forestall danger by unloading risk to someone else.  This usually took the form of a question about IP Insurance in the U.S.  For those unaware, IP underwriters (for a fee, natch) will supposedly cover the cost of your outrageously expensive Patent infringement litigation. The Chinese audience wanted to know the extent of IP Insurance policies and how they were implemented.  Beyond the specifics of insurance, additional questions were directed to other forms of risk mitigation and risk allocation as it applies to drafting patents and filing disclosures.  While the mechanisms of action were different, the essential question always boiled down to "How can I eliminate risk to myself, while engaging in a profitable venture?"

The answer is, you can't.  We told them as much.  My colleague explained that those firms that would foresee being sued relentlessly are already capable of handling their litigation costs.  Those who could not, likely can not afford the premium on the policy for an event that may never happen in the life of the company.  Patent litigation, as related to risk mitigation, is too statistically random to allow a proper allocation of risk premiums. Either the insurance company will go out of business due to massive 'bet the company' litigation payouts, or a number of start-ups are going to bleed capital paying premiums to insure an event that never occurs. Either way, your money is better spent elsewhere. (Like getting an opinion on infringement from a competent Patent Attorney) 

What's the takeaway for the Start-Up community.  Patent Law is complex.  Risk management is complex. Anything worth doing, that you can make money at, carries a risk component.  Worrying about the potential of being sued by a competitor is something that is a necessary part of the innovation experience.  Efficient offsetting of the risk would not result in better products and services, it would merely enable people to take financially rewarding risks without consequence to the danger (See: Wall Street, 2008-present ).  Fear of a competitor's patent should never deter your from seeking your own.  The more time and money you spend focusing on risk mitigation, the less time you have to perfect your own idea. If your investors want more assurances, you can always get an opinion from counsel.