Lighting Fixture Design 2014
”Patent battles: fight or pay ?”
by Henrik Villumsen
How to obtain the optimum outcome
if faced with an approach over patent
infringement (or ”licensing
opportunity…”)
The usual disclaimer…
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Half an hour available
Only flavour of topic possible
Only in general, non-exhaustive etc.:
Basically two avenues: ”pay” or ”fight”
Focus on how to ”fight”
How to ”pay” (or ”stop”) is simple
Power point not a core competence
Is ”Pay” the best outcome ?
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Why pay (or stop):
put it behind you and focus on your business
minimum ressources required
budget security
patent infringement IS illegal
fighting may be (very) costly (too)
”Fight”
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Why fight:
you don’t infringe
you can’t (easily) afford to pay (what’s asked)
you don’t WANT to pay (what’s asked)
”what patents ? They were wearing diapers
when we first did this”
- ” – and they know it, too”
If (some extent of) fight
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Not without risk:
you may loose (anyway), and bigger
it may end up being more expensive
it may tie up ressources in vain
it may deflect your focus
it may create uncertainty for your business
How to fight ? Leverage !
• Buy time, investigate, maybe counter-attack
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Why and how buying time ?
probably discount for this period
the patent holder may get tired
you can investigate (other) defences
do nothing (for a while), then ask for time
Investigate defences
• Analyse nature of communication: how far up
the escalation ladder is it (now) ?
• Are my products infringing ?
• Are the patents alive, valid and enforceable ?
• Are the license terms reasonable/legal ?
• How strong is the patent holder ?
• Does he infringe any of YOUR patents ?
Defences
• Infringement: compare the claims with your
products – if no claim charts from patent
holder, ask for them (make him work)
• Duration of patents yet: are they running out
in the foreseeable future ?
• Are the patents valid/enforceable ? Look for
invalidity, inequitable conduct, competition
law-issues
Invalidity: non-novelty/obviousness
• Basically the invention made public - prior to
the filing date of the patent - in a way
enabling a ”person, skilled in the art”, to
identify it out or to whom it would have been
obvious
• Prior art oftentimes your own – or other’s –
products
• Obviousness-standard reset in the US in 2007
Inequitable conduct/competition law
• Excessive number of, inconsistent or improper
patents, priority claims, claims, continuations,
divisionals, provisionals, prior art-citation
• Claims, previously opposed, but now asserted
• Claims, previously rejected, but now filed
again with no fact disclosure
• Claims, known from a due dilligence or from
the source of prior art to be invalid
Un-reasonable/illegal license terms
• Is the royalty rate/structure reasonable/legal ?
Similar to competitor’s ?
• Does the royalty reflect the contribution of
the patented technology to the product ?
• Is back-license mandatory ?
• Does an attack on the patents mean risk of
termination of agreement ?
• Requirement to disclose future product
portfolio ? Customers ? Suppliers ?
Nature of patent holder
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Wherewithal
What outcome would be acceptable to him ?
History of approaches/litigation
Where on his radar are you ?
How well is he organised for this ?
Own/other’s patents infringed ?
• Any patents, (potentially) owned or licensed,
that are infringed by the patent holder ?
Counter-attack
• Re-examination
• Litigation - declaratory judgement
• Competition-/anti-trust authorities (abuse of
market domination ? Equal treatment of
licensees, incl. any owned by patent holder ?)
• Round up support
• Public
”Optimum outcome” ?
• Pay and get over with ?
• Investigate/counter-attack to leverage and
(maybe/probably) pay less/nothing ?
• Wipe out patents and destroy patent holder’s
revenue stream ?
• Load the patent holder with cost ?
• Expose the patent holder to scrutiny/public ?
It all depends on everything !
My time is up !
• Thank you for attending !
• Feel free to contact me
• Presentation uploaded at:
www.henrik-villumsen-consult.com/intelligentlighting.html