SMART GRID PATENTS AND STANDARDS
INTRODUCTION TO THE PANEL
Jeff Young, Moderator
Alston & Bird LLP
• OUR GOAL:
• That you leave with insights into:
– the important role patents will play in stimulating
new technology and in the SGIP patent process;
– the status of the SGIP's "IPR policy" and the actions
of its IPR working group;
– how lessons learned in past standards initiatives
might be applied by SDOs in the Smart Grid initiative
when patents are essential to best practices.
Who is Obtaining Smart Grid Patents?
Sample Smart Grid Patents and Application Chosen Merely to Show Variety
Number
Title
Owner
2010/0100253
Systems and Methods for
Controlling Energy Consumption
Demi Energy, Inc.
7,679,247
Lift magnet mechanism for
flywheel power storage systems
Beacon Power Corporation
7,337,153
Resolving Energy Imbalance
Requirements in Real-Time
Siemens Power Transmission
& Distribution, Inc.
7,305,281
Management of a Bulk Electric
Power Market
ISO New England Inc.
7,333,880
Aggregation of Distributed Energy
Resources
EnerNOC, Inc.
7,376,491
Detection of Islanding in Power
Grids
General Electric Company
2010/0114387
Electric power grid control using a
market-based resource allocation
system
Battelle Memorial Institute
112
Trend{
64
Examples of Litigation Affecting the Grid
IPCo. v. Oncor, Reliant, Sensus, Trilliant, Tendrill, et al.
 No. 2:09-cv-00037-DF (filed 1.29.2009 E.D. Tex.)
 – US Pat Nos 7,054,271; 6,249,516
 – Wireless mesh network system for optimizing communication
pathways.
EON Corp. v. Sensus Metering Systems,
 No. 2009cv00116 (E.D. Tex. filed March 13, 2009)
 – US Pat Nos. 5,388,101 5,481,546
 -- Two-way interactive communication video network.
IPCO Mesh
Networks
7,054,271
(a) Software
(b) Not likely
filed with Smart
Grid in mind
Avoiding Patent Infringement
• Be careful – making, selling or just using a product can be
infringement
• Before a major investment:
– Have your patent attorney do a patent infringement search
– Stick to technology not covered by the patents found
– Research patent disputes to see who is actively enforcing
their patents
– Purchase from vendors who indemnify their customers
Leveling the Playing Field
• Obtain your own patents
– Products, systems, processes, software, business methods
are patentable
• Must be new and non-obvious
– Act promptly to avoid filing deadlines
– Encourage employees to share their ideas for
improvements
• Require employment contracts with invention
assignment provisions
• Some reasons why a patent owner would:
– Accept RAND licensing:
• Collect a smaller royalty from an entire industry;
• Assure that its technology is covered by the standard.
– Hold patent out of the standards process:
• Prevent others from using its own implementation of the
standard;
• Seek a higher royalty rate from licensees.
TRACKING RAND LICENSES
IEEE Std 802.11 and amendments
Std
No.
Patent
Owner
Motorola Inc.
802.11
1303 East Algonquin
Road, Schaumburg,
Illinois 60196
Hugh C. Dunlop - European
Patent Attorney, TEL: 1-708576-0379, FAX: 1-708-576-3750
Patent
Serial No. (if Letter
indicated)
Date
Assurance
Received
Date record
entered or
revised (if
known)
yes
not indicated
1-Mar-1994
Intermec
802.11
Contact for License
http://standards.ieee.org/db/patents/
Corporation 6001
36th Avenue West,
PO Box 4280,
Everett, WA 983029280
L. David Rish - Intellectual
Property Law Counsel,
yes
not indicated
26-Oct-1995
Motorola: In the event the proposed standard is adopted and cannot be
practiced without the use of patents now or hereafter owned by Motorola,
Motorola agrees to license those patents on a non-discriminatory basis offering
fair and commercially reasonable terms.
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PANELISTS:
Dr. George Arnold
John Caskey
Yann Dietrich
Richard Schomberg
Q&A
SAFE AND EFFECTIVE STANDARDS
PARTICIPATION
• ADOPT CLEAR INTERNAL POLICIES
– Company will comply with SDO patent policies.
– Company will not knowingly withhold IP rights in an SDO
process.
– Company will make considered decisions for compliance
with SDO policies regarding disclosure of proprietary
information
• Outside of Working Group sessions
• In consultation with the Legal Department
– That required disclosures and licensing commitments will
be made in writing by management.
Q&A
INTERNAL STANDARDS - EXAMPLES
– Adopt a fact sheet template for internal approval to join an
SDO process.
• Require a description of trade secrets and patent rights likely to be involved in
the standard.
• What will Company gain and lose if its technology is adopted in the standard?
• What competitor tactics are expected?
– Prior to each Working Group session, have an internal
meeting:
• Remind participants the SDO meeting is not under NDA.
• Cover Company information that should not be disclosed.
• Remind participants not to make any licensing commitment on the spot.
– Adopt a report template to be completed after Working Group meetings,
copying the Legal Department
Q&A
“PATENT HOLD-UP” SAGAS
• RAMBUS (DRAM and DDR SDRAM)
– Participated in JEDEC, disclosed initial patent, did not disclose
subsequent applications. Sued competitors practicing standards.
– Vilified as a “patent hold-up.”
– Weathered an FTC antitrust violation and verdict of fraud
• QUALCOMM (MPEG)
– Intentionally hid IP from the SSO (JVT), knowing it might reasonably be
necessary to practice the standard, and that SSO participants treated
the policy as imposing a duty to disclose.
– Then misled the trial court by falsely asserting that Qualcomm did not
participate in the SSO.
– Patents ruled unenforceable against standard-compliant products
SGIP BYLAWS May 2010
Q&A
2.6 Intellectual Property
Upon ratification of the Bylaws, SGIP will develop an Intellectual Property policy
consistent with the following principles:
a. The SGIP, the SGIPGB, all committees and all working groups and subgroups
function in an open working environment. The SGIP and its Members will not accept any
documentary or oral disclosure of proprietary information from any Member as a part of
the SGIP's conduct of business. In addition, no information of a secret or proprietary
nature will be made available to the SGIP as official documents, and no such documents
(or documents marked as such) will be made SGIP official documents or forwarded to
the membership.
b. All proprietary information which may nonetheless be publicly disclosed by any
participant during any meeting of the SGIP, the SGIPGB or its committees or working
groups will be deemed to have been disclosed on a non-confidential basis, without any
restrictions on use by anyone, except that no valid copyright or invention right will be
deemed to have been waived by such disclosure.
SGIPGB and SGIP Charter March 29, 2010 1.1 25
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2.6.1 SGIP patent policy - Inclusion of Patents in SGIP-Identified Products
Some SGIP-identified product may include the use of an essential patent claim (one
whose use would be required for compliance with that standard) if technical reasons
justify this approach. If SGIP receives a notice that a proposed or an approved SGIP
product may require the use of such a patent claim, the procedures in the following
sections will be followed.
2.6.2 Statement from patent holder
The SGIP will request from the patent holder or a party authorized to make
assurances on its behalf, in written or electronic form an assurance that a license to
such essential patent claim(s) will be made available to applicants desiring to utilize
the license for the purpose of implementing the SGIP product either:
a. On a non discriminatory basis and under reasonable terms and conditions; or
b. Without compensation and under reasonable terms and conditions that are
demonstrably free of any unfair discrimination.
If the patent holder or party authorized to make assurances on its behalf does not
agree to these terms, then this decision will be documented clearly. As it may pose
risks to the implementation of the Smart Grid, this decision will be seriously
considered by the SGIP in any related activity or vote.
2.6.2.1 Record of statement
A record of the patent holder’s statement will be retained in the SGIP files and posted
on-line.
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2.6.2.2 Notice
When the SGIP receives from a patent holder the assurance set forth in 2.6.1 above,
the expected result will include a note substantially as follows:
NOTE – The user’s attention is called to the possibility that compliance with this
expected result may require use of an invention covered by patent rights.
By publication of SGIP expected results, no position is taken with respect to the
validity of any such claim(s) or of any patent rights in connection therewith. If a patent
holder has filed a statement of willingness to grant a license under section 2.6.1,
details may be obtained from the patent holder.
2.6.2.3 Responsibility for identifying patents
Neither the SGIPGB nor SGIP is responsible for identifying patents for which a license
may be required for use of an SGIP expected result or for conducting inquiries into the
legal validity or scope of those patents that are brought to their attention.SGIPGB and
SGIP Charter March 29, 2010 1.1 26
2.6.3 Copyrights
Copyright in materials produced prior to Membership in the SGIP remains the
property of the copyright owner. However, copyrighted materials offered for
incorporation into SGIP outputs must be made available on a royalty-free basis.
Members who contribute to SIGP outputs are requested to assign copyright to NIST so
that NIST may place them in the public domain.
Standards developers whose standards are referenced in SGIP outputs retain
copyright ownership and control of the standards themselves.
• THANK YOU!