Upgrading Your Patenting Process

OVERVIEW: A benchmarking study involving 21 companies in chemicals- and high-tech-related industries reveals that much greater attention is now being paid to intellectual property assets. Teeth have been given to the US. patent process, and this has led to more consistent handling of patents and more severe punishment for infringement. Consequently, companies are now including intellectual property issues into their strategy, even as part of their stage-gate product development processes. Patent intermediaries, who patrol the interface between the triangle of researchers, business and attorneys, are important contributors to the overall process. Using outside counsel for patent preparation is common but diminishing. A favored practice is to hire back retired former employees to help in busy times. As patenting becomes more widely accepted as a process, it is more effective when patent attorneys charge back for their time and track where their time is spent. This leads to better management of the process. It also meets the requirement that businesses pay only for services they use. Some people give credit to Microsoft founder Bill Gates for sounding the wake-up call for intellectual property protection in 1976 (1). Others believe that the formation of the Court of Appeals for the Federal Circuit (CAFC) in 1983 was the key factor. Undoubtedly, the income either gained or paid in licensing, and the huge penalties stemming from litigation, have convinced business that intellectual property issues are a major concern (2,3). A corollary is that patent assets and their proper management have similarly grown in importance. Appeals of District Court patent case decisions are heard only by the CAFC and are reviewed only by the U.S. Supreme Court, and then only with rarely-given prior permission of the Court. Thus, CAFC decisions become powerful precedents in the field of patents, and these decisions, coming from a single court, have advanced the understanding of patents and given them renewed vitality. The CAFC has upheld lower-court decisions on patent validity a much greater percentage of the time than the previous system, which involved all the Courts of Appeal. Probably getting the most attention are the substantial penalties assessed, which can be tripled if the infringement is deemed willful. Consequently, patent enforcement in the U.S. has been considerably strengthened (1,3). Many U.S. companies were slow to respond to these changes in the importance of intellectual property. This led to the appearance of many Japanese companies at the top of the list of most prolific patenters in the United States (4,5). Chevron Chemical Company sponsored a benchmarking study in order to improve its patenting process. The 21 companies that participated fell into two broad categories: the "chemicals" group, which included petroleum, chemicals, pharmaceuticals, and metals processing companies; and the "high-tech" group, which included electronics and communications companies. The study was conducted with face-to-face, video conference or telephone interviews. Participants received a standard question set prior to the interviews. The Patenting Process 1. The Patenting Triangle. -Most participants could relate to a triangular patenting model with business, patent attorneys/liaisons and R&D at the corners. We proposed a process that is initiated by a business unit articulating a strategy, which includes a technology strategy. In pursuing this strategy, R&D makes unique discoveries which the patent staff secures through patenting. We explored issues and interactions between all three stakeholders in this process. There were enough differences among the patenting processes our participants used that the "best practices" were difficult to find. Consequently, we coined the term "value-adders," which we defined as those practices that at least one of our participants felt added significant benefit to their overall patenting process (see "Adding Value to the Patenting Process," above). …