Moving Away from Billable Hours in Patent Litigation

William Lee, patent litigator and co-managing partner at Wilmer Hale, will be discussing fixed fees and the state of patent litigation for clients and law firms on a webinar at November 12, 2009 at 2:00PM.

Intellectual Property Owners Association’s weekly one-hour webinar on current topics in IP, hosted by Pamela Sherrid, former editor of IP Law & Business magazine.

REGISTRATION FEE
$100 per user per webinar
To register, click: www.ipo.org/IPChatChannel

MOVING AWAY FROM THE BILLABLE HOUR
IN PATENT LITIGATION

Thursday, November 12, 2:00pm – 3:00pm ET

The demise of the billable hour has been predicted for years, but today’s economic woes are finally pushing alternative fee arrangements into the mainstream. Fixed fees seem an odd fit for high-stakes patent litigation, but that doesn’t mean they haven’t been tried. Hear how the experiment works out for clients and top law firms.

Speakers:

Kevin Rhodes is the President and Chief Intellectual Property Counsel of 3M Innovative Properties Company in St. Paul, Minnesota, where he is responsible for managing the intellectual property assets of 3M Company and its worldwide affiliates.

John Adkisson is a patent litigation partner in the Twin Cities office of Fish & Richardson. He has represented 3M in several cases, including 3M Innovative Properties Co. v. Avery Dennison Corp. which ended with a permanent injunction.

William Lee is a patent litigator and co-managing partner of WilmerHale. He has tried more than 50 patent cases to judgment and argued more than 30 appeals before the Court of Appeals for the Federal Circuit.

Raymond Van Dyke: Merchant & Gould partner in DC

Raymond Van Dyke is a partner at Merchant & Gould’s Washington, D.C. office and focuses his practice in technology and intellectual property counseling, procurement, licensing, and litigation.

Ray has nearly 20 years experience representing technology companies in the intellectual property area, including strategic counseling, patent and trademark litigation, expert witnessing, and IP licensing portfolio management. He represents domestic and international companies in addition to universities in the biotechnology, pharmaceutical, medical, chemical, software, financial services, telecommunications, Internet, voice over IP (VoIP), and digital industries.

Ray’s extensive technical background in both information-based and life sciences-focused technologies enables him to effectively counsel clients in emerging and converging disciplines, such as bioinformatics, cheminformatics, genomics, pharmacogenomics and personalized medicine, nanotechnology, proteomics, and computational analysis.

He represents clients in federal, state, and international intellectual property litigation, mediation, and dispute resolution in patent, trademark, unfair competition, copyright, antitrust, and trade secret cases. He also enforces and litigates intellectual property rights before the U.S. International Trade Commission and U.S. Customs, prepares clients for hearings before the Federal Trade Commission, and advocates intellectual property and regulatory positions before Senators and Representatives, domestic and foreign trade associations, and ambassadors.

Ray counsels clients in a variety of matters, including infringement, validity, freedom to operate, right to use, reissue, reexamination, appeals, artists’ rights counseling, and other patent and trademark opinion work.

His non-legal work in the software industry and during his graduate studies focused on a variety of cross-disciplinary software applications and techniques, including protein and molecular visualization, animation and modeling, computational optimization, graphics, stimulators, and virtual reality for pharmacological, biophysical, and biochemical research with real-time haptic interface with a robotic force-feedback arm (a nanomanipulator); modeling and analysis of steric forces in protein deformations; designing relational databases for complex proteins from X-ray crystallography data; designing enhancements to UNIX C-Shell; signal and image processing and pattern recognition; 3-D texturing; and SPICE modeling semiconductor chip architecture and performance.

Education

University of North Carolina

• J.D., 1990
• President, American Indian Law Student Association
• M.S., Computer Science, 1989
• B.S., Mathematics, summa cum laude, honors
• Minor in Classical Greek, 1985

Wilbur Wright College, Chicago, IL

• AA, with honors

Bar Admissions

District of Columbia
New York
New Jersey
Texas
Virginia (pending)
U.S. Patent and Trademark Office
U.S. Supreme Court
USCA – Federal Circuit
USCA – 2d Circuit
USCA – 3rd Circuit
USCA – 4th Circuit
USCA – 5th Circuit
Southern District of New York
Eastern District of New York
District of New Jersey
Northern District of Texas
Eastern District of Texas
District of Columbia
U.S. Court of International Trade
U.S. Court of Federal Claims

Professional Affiliations

Ray is active in a variety of legal and technical organizations, and also teaches at two universities. Chair, Greater Washington, D.C. Chapter of the Licensing Executive Society Chair, Emerging Technology Committee, American Intellectual Property Law Association

Speeches and Publications

Ray is a regular speaker to legal, university, and professional audiences on various technology, intellectual property protection, and litigation issues, both nationally and internationally. His recent presentations analyze Supreme Court cases affecting intellectual property rights, proposed changes and reforms to the U.S. patent system, nanotechnology, software patenting, ethics, International Trade Commission litigation and procedures.

Senator to Shield Banks From Patent Lawsuit

Senator Jon Kyl, a member of the Senate Judiciary Committee, is pushing for legislation that would protect banks from a patent infringement lawsuit.  As reported by CNNMoney.com, the suit is related to electronic imaging and the processing of checks.  While the Judiciary panel is scheduled to look at a patent reform bill today, it’s been hinted that if Kyl has his way, banks would be shielded from having to shell out money for damages in any possible cases.

The plaintiff, DataTreasury Corp., owns a patent for digital check processing, and is currently suing Bank of America and Wells Fargo & Co.  Some banks, such as JPMorgan Chase & Co., have already settled with DataTreasury.

Banks moved toward the digital processing and imaging of checks in 2003, after Congress passed a law that encouraged them to do so.  Furthermore, a recent report by the Congressional Budget Office found that DataTreasury could be entitled to $1 billion or more in patent royalties if it succeeded in its litigation efforts.

This isn’t the first proposal of this type to be suggested, as Sen. Jeff Sessions offered a similar proposal last year.  However, Sessions’ proposal came under fire because it targeted ongoing litigation, and Sessions also owned stock in two banks that could have gained from the provision.

Senator Kyl’s bill differs from Sessions’ because it does not completely protect the banks.  Instead, Kyl’s plan contains a clause that would void the provision if a federal court finds that the legislation amounts to a government taking of DataTreasury’s patent rights.

For the much troubled banking-system, this provision could potentially save a lot of trouble and capital.  But would passing this legislation set a dangerous precedent?

‘Pick Up Artist’ Granted Patent

Sometimes the USPTO publishes applications that make you sit back and say, “Really?”

One strong example is a patent I stumbled upon earlier today that is titled “Interpersonal Pursuit Method.”  Although it was published on February 14, 2008, the author is Erik von Markovik, better known as ”The Pick Up Artist.”  The abstract of the patent describes his method of “instructing males regarding three main steps of establishing attraction, building comfort, and seduction.”  Furthermore, von Markovik states that these steps should be executed in sequence, and the male should allot “between four and ten hours, within about seven hours being considered optimal…from the beginning of the process until its conclusion.”

The patent was originally filed in August 2006, and von Markovik has since gained tremendous fame.  In addition to writing a book about his “pick up” tactics, he has been given his own reality TV show on VH1 called “The Pick Up Artist,” where von Markovik goes by the name “Mystery.”

The patent describes von Markovik’s theory in great detail, by first identifying the differences in attraction between men and women.  He then outlines steps for men to build comfort and attraction with a woman by using a combination of negative complements, compliance testing, and statements of interest.

It is unknown why von Markovik decided to patent his technique.  Perhaps now he can sue someone when they use his method to attract women?  Yet one thing is for sure, if the USPTO grants these types of patents, it will give the USPTO a negative public opinion.

U.S. Senator: Patent Bill Will Pass

While Congress has recently been receiving  flack for their bailouts of financial institutions, one subject that has been lost in the news is the progress of U.S. patent reform.  In fact, Senator Orrin Hatch predicted that the bill, currently being written, would pass the Senate.  “I think we’re close to it,” he told Reuters.

The bill looks to address the main issues that are currently plaguing the patent system.  First, the new bill will reduce damages paid for infringement, while also making it tougher for plaintiffs to find an infringement-friendly court. 

The bill will also contain language making it tougher to show misconduct in applying for patents.  This portion of the bill would force plaintiffs to find evidence of misconduct to win invalidation of a patent, rather than a simple error in the patent process.  However, the bill does not currently include these clauses.  “They left it out, with the understanding that they are going to work it out,” Hatch said.

When Orrin was asked if the bill would pass this year, the Republican from Utah said, “I think so.  This is the closest we’ve come to really doing this job.  I’d be very shocked (if it didn’t).”

USPTO Budget Problems Confirmed by Doll

Due to the current economic recession, many have speculated that the U.S. Patent and Trademark Office will face significant budget problems for the remainder of this year. Yesterday, the acting director of the USPTO, John Doll, confirmed that the Office is currently facing budget problems as they are currently projecting a 2% drop in applications, reported Reuters.

Doll stated that the projected 2% drop stems from the early trends of 2009.  But some have told the USPTO that the decrease in applications could actually reach 10% for the year, as well as a similar drop in fees for other services that the USPTO provides.

The budget problems are particularly troubling for the USPTO, since the government agency has had to announce a hiring freeze and stop recruiting examiners.  These budgest problems complicate the USPTO’s current effort to clear a tremendous backlog of patent applications.

“We’ve stopped hiring at this time.  If we closed our doors today, it would take us almost two years to clear out our backlog,” said Doll.

USPTO Opens National Inventors Hall of Fame

The United States Patent and Trademark Office has announced the opening of the National Inventors Hall of Fame.  The Hall of Fame, now located Alexandria, Va., honors individuals that are responsible for great technological advances that make human, social, and economic progress possible.

The Hall of Fame was founded in 1973, with Thomas Edison being the first inductee.  Inductees are selected each year, and there are currently 390 inventors that have been inducted in to the Hall.  The Hall originally resided at the USPTO, but moved to Akron, Ohio in 1995.  That building closed last year for the construction of the National Inventors Hall of Fame School, bringing the Hall of Fame back to the USPTO.

Acting Under Secretary of Commerce for Intellectual Property and Director of the USPTO John Doll said:

We are delighted that the National Inventors Hall of Fame has returned to its roots at the United States Patent and Trademark Office.  The journey to induction begins here with a patent, so it is only appropriate that those innovators who have truly transformed our lives should be honored at our headquarters.

The opening of the Hall of Fame is coinciding with the opening of a new exhibit named “Inventive Links.”  This exhibit illustrates the unexpected way in which modern technology and a variety of inventors are interlinked.

Research Team: Patent System Needs Reform

The pros and cons of the current patent system have often made people wonder if the system is in need of some type of overhaul.  According to an international research team, not only does the system need overhaul, it should be reformed to reflect more of a free market system.

As reported on swissinfo.ch, a team of researchers found that a market economy, where inventors buy and sell shares of the key elements of their discoveries, beats the winner-take-all patent system.  The market economy system increased the number of beneficiaries, as well as driving up new levels of collaboration and development.

The researchers fault the current patent system, because it only rewards the prize to the winner, or whoever submits the idea first.  Anyone who submits the idea second or third walks away empty handed.  Therefore, many are discouraged from filing for patents because they simply believe that someone else has already beaten them to the punch.

The researchers drew these conclusions from a series of “rucksack” experiments, where participants were given a large number of items as well as a bag that could not possibly hold all of the items.  The participants were supposed to figure out how to maximize the number of items that could fit into the bag.  One set of participants  was to figure out the problem by using a system similar to patents, where the reward was only awarded to the first individual that could work out the solution. 

The other group was to solve the problem by using a free-market system, where participants were encouraged to buy and sell securities attributed to each item.  The researchers found that even in the free-market group the initial inventor held an advantage, but it also gave “the second and third person a chance to profit from their work as well.”  Furthermore, the free-market group also led to numerous people trying different ideas each time the game was played.

While the patent system does need reform, this research is hardly the information that would be needed to change the current patent system.  The results are interesting but it should be taken with a grain of salt.  Although the current system has its faults, it does discourage the stealing of ideas while also turning an intangible invention into a tangible asset.  The patent system is far from perfect, but would radically changing the system really solve all the problems?

University to Evaluate Patents

While most universities are looking to cut costs in these economic times, one university lab is taking a unique approach – evaluating patent portfolios to bring in extra cash.

According to The Tech Transfer Blog, National Wind Solutions recently acquired a fuel cell patent portfolio.  After acquiring the patents, the company announced a deal with a “well known California university research laboratory” to evaluate and research the patents.  Although this university remains unidentified, National Wind Solutions claims that the lab has “extensive experience in fuel cell development.”

This seems like a pretty good idea, given that certain university labs have a wealth of expertise and knowledge in certain technology areas.  If this trend catches on it could signal a new symbiotic agreement as it will be a new source of income for many universities, as well as an efficient way for a company to check the strength of its patents.

USPTO Extends Window for Public Comments

The United States Patent and Trademark Office has decided to extend the period for public comment on deferred examination.  The public now has until May 29, 2009, which should give those who wish to comment plenty of time.  The USPTO had planned on closing the public discussion on February 26, but announced it was extending the deadline in the Federal Register.

The USPTO has already held a roundtable discussion on the topic of deferred examination, which would put off examining applications to reduce their workload.  If you would like to comment on the matter, you can submit your own comments and opinions to AC6comments@uspto.gov.

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