IP-Data.biz [Scam Alert]

Just a quick note about IP scams. Recently, a client sent me a document which claimed to be from a patent database provider. They were offering to publish the client's PCT application in their publicly accessible database. All they wanted in return was 2600.00 USD.

IP-Data.biz and companies like them make money based on the lack of information surrounding patents, publications and international filings. The World Intellectual Property Organization (WIPO) already publishes the applications. It is part of the outrageous fee you paid them about 18 months prior.

Safe to say, the only international authority you should pay (assuming you have filed a PCT application and done so pro-se is the national receiving office of the PCT.  This will be a reputable organization, like the USPTO located in Washington or the EPO located in Brussels. It will not be a nondescript drop box in Bratislava. 

Hopefully, if on one falls for their scams, they will move on to other, less low hanging fruit.

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.

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...

Scammers Part 2

A while back I talked about watching out for scams in the form of "official" seaming documents coming from overseas and asking for "international patent" fees.

Well, short time ago, we started receiving inquires from our clients regarding the same issue but this time from a "official" international Trademark Office in Latvia. Note: There is no International Trademark Office. Second Note: If there were...It would not be in Latvia.

Just as in the first instance,Leason Ellis is taking the fight to the scammers.

See here: http://www.law360.com/articles/437509/ip-firm-leason-ellis-sues-to-shut-down-trademark-scammer

Check back for updates.

Success Against Scammers

In a previous post , I discussed how to not get taken in by Trademark scammers. Well, I am happy to announce that Leason Ellis has taken the fight to the con-men and put at least one of them out of business.  In the consent decree, USA Trademark Enterprises ( a notorious scammer that preyed upon unsuspecting trademark applicants) agreed that:

Defendants warrant and represent that they made substantial sales and shipments of the Catalogue in the United States, including New York State, and have made good faith disclosure to Leason Ellis of financial records concerning such sales;

Defendants warrant and represent that, within fourteen (14) days of the Settlement Agreement separately entered into between Plaintiff and Defendants (the “Settlement Agreement”), they shall permanently discontinue marketing, selling, offering for sale, and distributing the Catalogue in the United States per the terms of the Settlement Agreement;

Defendants warrant and represent that, within fourteen (14) days of the Settlement Agreement, they shall never again conduct business in the United States in the field of trademarks or, more generally, in the field of intellectual property; and

USA Trademarks and its owners, officers, stockholders, employees, agents, servants, affiliates, subsidiaries, attorneys, and all other persons in active concert and participation with it, including Timea Csikos and Andras Nemeth, shall abide by the terms of this Consent Judgment.

I am quite proud of the work my firm has done in putting these scam artists out of business. Congratulations are in order.  You can read more about it here.

Trademark Scams

The internet is full of scams, scammers, hackers and Nigerian Princes who are only inches away from giving you 10% of billions in unclaimed Federal Government cash and Russian Women who won't care if you are an unemployed baby-boomer living in your son's basement with an infectious skin condition. They love you, and all they want is for you to send them a bit of money.

IP is not immune to these fishing lures deployed by various shadowy groups bent on bilking you out of your hard earned money.  Recently, a client of mine received a letter, and invoice, purporting to be the "Register of International Patents and Trademarks (I am loath to link to them, but be forewarned- www.patent-online.org). I am not sure what tipped my client off to the scammy nature of the communication. Was it the fact that the "Office" was located in Slovakia? Or that the Bank transfer was to a P.O. Box in Austria? Or is it the fine print that states that "this is not a registration by a government organization." Why would the "International Patent Office" be a governmental organization, that is just crazy talk.  Maybe it is the fact that the invoice changes on every page?

This is nothing new. The publishing of Trademarks by the USPTO is done so that legitimate concerns by other users of similar marks can be addressed.  Unfortunately this means that sometimes unscrupulous people can try to take advantage by using a bit of public information and an official sounding name.

Well, if you haven't figured it out by now, these guys are a scam.  While you can get an internationally recognized Trademark, you must go through the Madrid Protocol Process provided by the World Intellectual Property Organization (which, surprise, surprise, is a international governmental origination). As I have stated previously, Trademark Rights are the first thing that most Start-ups and small business should focus on. Your branding is your identity, and you should take seriously the protection of that identity. Let the Twitter situations be a learning experience. While it might sound self-serving, you should always conduct your Trademark Matters through a qualified IP attorney (i.e. someone who has done this before and knows what they are doing).  Definitely what you shouldn't do is pay money to Eastern European scammers in the hopes that you will secure your rights on the cheap.

For you own research, I have produced the redacted letter that my client received. The prices and invoices are so wildly inflated, relative to what a trademark filing normally costs, as to be laughable.  If you have recently filed for a Trademark, please do not fall for this. If you have questions about internationally filing Trademarks, then consult your IP attorney. If they are too busy on the golf course, contact me. What ever you do, don't wire 2800.00USD to Bratislava, you won't even get a photo of a nice Russian Girl who loves you in return.


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