How to Build IP Management Best Practices to Suit Your Company

Q&A from the 2015 Intellectual Property Owners Association Annual Meeting

Over 1,120 professionals convened at the Hyatt Regency Hotel in Chicago, Illinois on September 27 – 29, 2015 for the 2015 Intellectual Property Owners Association (IPO) Annual Meeting. Focused on patents, trademarks, copyrights, and trade secrets, the meeting hosted esteemed speakers such as the Honorable Sharon Prost, Chief Judge, U.S. Court of Appeals for the Federal Circuit, and Herbert Wamsley, Executive Director, Intellectual Property Owners Association.

Representing IP.com at the conference were Bobby McMullen, Account Executive, and Caitlyn Tuzzolino, Marketing Director who had the pleasure of meeting with many intellectual property professionals and attended informative sessions.

IPO: Corporate IP Management Best Practices

Of particular interest was the session, Corporate IP Management Best Practices, moderated by Scott Weingust of Stout Risius Ross. Panelists included Alyssa Harvey Dawson, Vice President of Global Intellectual Property and Licensing at Harman International Industries, Inc.; Sam Pace, Chief IP Counsel at Praxair, Inc.; Daniel Staudt, Vice President and Chief Intellectual Property Counsel at Siemens Corp.; and Mike Young, Vice President and Chief Intellectual Property Counsel at Roche, Inc.

The panel discussion focused on one of the IPO’s Corporate IP Management Committee’s current projects. The Committee had interviewed senior IP executives at 25 corporations of different sizes and industries to identify the best practices in IP management. They noted that a best practice for one company might not be a best practice for another. Best practices are contingent upon various unique aspects of the company, such as the industry, the relative size of the company within that industry, the corporate culture, and more. IP practitioners will find the insights pertaining to IP strategy, metrics, patent prosecution, and organizational structure to be most helpful. Among the more interesting observations were:

IP Strategy

Q: Why do you obtain IP assets?

A: Most companies obtain intellectual property for freedom-to-operate and defensive purposes (i.e., avoid litigation/cross licensing).

Q: How do you ensure IP strategy is aligned with business strategy? Who in the organization is involved in assisting with this effort?

A: Development of IP strategy and alignment to business strategy is successful when multiple stakeholders are involved (e.g., legal, business unit leadership, R&D, IP managers, etc.). All of the companies in the study, except one, have a formal process for aligning IP and business strategy.

Metrics

Q: What are the primary metrics you use to measure IP management success?

A: Companies measure IP management success by:

  • Number of invention disclosures submitted
  • Time to filing
  • Applications filed
  • Number of office actions
  • Time in prosecution
  • Patents granted
  • Budgeted vs. actual costs
  • Trademarks registered
  • Educational sessions given
  • Invention brainstorming sessions facilitated
  • Competitor benchmarking

Some of the unique metrics identified include:

  • Return on investment in patents applied for and granted
  • Return on investment in patents acquired
  • Quantitative assessment of whether cross-licenses mitigate risk through litigation avoidance
  • Rates of success of outside patent prosecutors with particular examiners
  • Assessment of outside patent prosecutor performance based on timeliness, quality, responsiveness to in-house counsel, and inventor interaction

Patent Prosecution

Q: What criteria are used for evaluating invention disclosures and who implements the criteria?

A: Most companies have all or most patents prosecuted by outside counsel; only two companies did most in-house.

Q: How do you determine your new patent filing and maintenance fee budgets? Are they combined into one budget or considered separately?

A: Several companies have tried to maintain steady patenting budgets, which has resulted in higher rates of pruning. Many companies charge all patenting to legal departments, while others charge to business units or a combination of the two.

Organizational Structure

 IPO found that most of the interviewed companies utilize legal, technical, and business expertise in IP management efforts, but some are primarily led by legal. Many of the companies that were interviewed have diverse structures. Operations run from fully centralized functions, which assist all businesses, to fully decentralized functions, with which each business/group of businesses or each geography/group of geographies has a dedicated group of IP management personnel. Alternatively, in hybrid structures, legal is centralized and assigned to IP management teams in the businesses; this allows centralized coordination with decentralized decision-making.

A one-size-fits-all approach does not apply to Corporate IP management. Strategies are malleable, and practices are only made “best” when they suit the company and lead to measurable success. Many organizations look at current practices, understand its goals, and then establish organizational structures, define functionalities, and set metrics to develop, implement, and quantify the results of its own IP management best practices.

The final IPO report will be published at the end of 2015.

For questions or more information, contact Caitlyn Tuzzolino at ctuzzolino@ip.com.